Ireland’s Development Aid Programme in Mozambique: Discussion.

I welcome His Excellency Mr. Frank Sheridan, the Irish ambassador to Mozambique, and Mr. Seamus Collins, programme manager for Mozambique, Trócaire. Ambassador Sheridan is accompanied by Mr. Patrick Empey, head of development, Embassy of Ireland in Maputo, Mr. Damien Cole, director of programme countries in Irish Aid, Ms Marcella Smyth, deputy director of programme countries in Irish Aid and Ms Iseult Fitzgerald, deputy director of the Africa section of the Department of Foreign Affairs.

Members of the sub-committee agree that this meeting marks the beginning of a slightly different approach, which will heighten the sub-committee's oversight and watchdog role with regard to the budgets spent in the various Irish Aid programme countries. This is being done because for obvious reasons public finances in general are being subjected to closer scrutiny. It has been suggested that the Irish Aid programme should be reduced even further. While I disagree with this proposal, given the budgetary constraints in place, it is important to examine in a more forensic manner the significant sums expended by Irish Aid in the different programme countries.

Rather than learning about the broad picture today, I ask the delegation to discuss the minutiae of Irish aid expenditure in Mozambique in the past five years and the results achieved for people on the ground both through Irish Aid and non-government agencies which receive funding through the multi-annual programme scheme, MAPS. It is important to explain and describe the positive benefits and outcomes achieved through Irish aid. The sub-committee has received a briefing on the various areas of aid expenditure. I ask the ambassador to go through the broad headings and explain the benefits and outcomes achieved in Mozambique with the money expended. I ask Mr. Collins to detail the experience of Trócaire in Mozambique and outline the effects recent reductions in expenditure on aid will have on people on the ground. Following the presentations, we will take questions to the delegation from members. This is a broad outline for how the meeting will proceed.

H.E. Mr. Frank Sheridan

I thank the Chairman and members of the sub-committee for the invitation to appear before them today to bring them up to date on the elements of our development programme in Mozambique. As I understand members have been given a brief on the programme, I will not spend much time providing detail. I will, however, outline the main components of the programme and the role we play among donors and with the Government of Mozambique.

We have a good, well balanced four-year programme focused on helping Mozambique in its efforts to eradicate absolute poverty and attain the millennium development goals. In the past two years, we have spent €87 million in Mozambique and we have a budget of €40 million for this year, the largest budget among our programme countries.

Before outlining in brief some of the key elements of our approach, it is important to state that Mozambique is a country where it is possible to point to significant results arising from Ireland's engagement and that of other donor countries. Following almost two decades of civil war ending in 1992, Mozambique has moved from being a fragile state to being a haven of peace and stability. In the 1990s, following the civil war, Mozambique was the poorest country in the world and 80% of its people lived in absolute poverty, that is, on less than a dollar per day. Following more than a decade of sustained growth, the number in absolute poverty has fallen from 80% to 50% of the population and Ireland has been centrally engaged in contributing to this development.

Three sets of general elections have been held in Mozambique since 1994. While none of them was perfect, each election has been better than the preceding election. If municipal elections in November last were anything to go by, the general elections in October next should be the best in the country's history.

Mozambique, as some members will be aware, is prone to natural disasters. The country lies in the path of cyclones from the Indian Ocean and because most of the central African plateau drains into the country, it is prone to floods and, ironically, droughts. In every instance in recent years, the Government and in particular the national agency responsible for dealing with these emergencies have shown themselves to be responsive and responsible. To summarise, the key message is that Mozambique is a good development partner for Ireland and other donor countries. That all major western donors and multilateral agencies have missions and programmes in the country is further testimony to this fact.

I will now address the key elements of our engagement in Mozambique. Ireland has programmes in two provinces, Inhambane in the south, which is six hours drive from Maputo, and Niassa in the north, which is four hours flying time from Maputo. We have a large programme aimed at helping the health sector in which, through our partnership with the Clinton Foundation, we provide additional funds for the sector to help ensure it can afford a programme of anti-retroviral treatment for AIDS sufferers. We have similar sectoral programmes in education and agriculture. As regards HIV-AIDS, we work with the National AIDS Council on a broad agenda of prevention and mitigation. In Mozambique we are also making a concerted effort, uniquely among programme countries, to transfer some of the experience of Ireland in job creation to revitalise moribund factories in the cashew and coconut industries. After more than a decade of assisting with de-mining and significant success in contributing to the clearance of the four northern provinces of Mozambique, we have a final programme in Inhambane in the south which will end in 18 months. We support civil society with a special focus on promoting good governance through a challenge fund that we operate with another donor.

I wish to speak about budget support which occasionally can be controversial. It is the assistance we provide for Mozambique's central exchequer. Ireland currently chairs the group of donors in the country, the group of 19 donors providing support for Mozambique's exchequer. Between us, we provide US$450 million in budget support annually and a similar amount in support through the sectoral programmes. Apart from the fact that we are focused on reducing poverty through a national strategy, the central advantage to us is that budget support gives us access to all government budgets. We have access to the budgets for health, education, military expenditure, police expenditure, the President's household and the cost of parliament. We have a big influence in controlling budgets and accounting for them. We can ensure more than 50% is spent on health and education.

With me as chair of the heads of mission and my colleague, Mr. Patrick Empey, as chair of the heads of co-operation, we co-ordinate the provision of funds, including the directing of an annual full measurement of performance in all sectors, the setting of targets for that performance and the management of interaction with the government that arises on the problems within that performance. It includes leading a number of meetings at ministerial level in the past year. During our chairmanship we agreed the basis for the provision of budget support through the negotiation of a new memorandum of understanding for the next five years. We included as a condition for providing financial support an obligation for compliance with key democratic and accountability principles such as safeguarding peace and promoting free, credible and democratic political processes, the independence of the judiciary, the rule of law, respect for human rights, good governance and probity in public life, including the fight against corruption; prioritising fighting poverty through its policies and plans and in its patterns of public expenditure; and pursuing sound macroeconomic policies and public financial management systems. The measurement of performance year-on-year has shown consistent improvement. The provision of budget and sectoral support is conditional on more than half of all expenditure being directed to the key human capital sectors such as health and education.

That is a brief summary of our programme. I know the sub-committee was anxious to focus on the achievements within the programme. Perhaps we can do that in response to specific questions.

Mr. Seamus Collins

I thank the Chairman for giving me the opportunity to speak to the sub-committee. It is always good to have an opportunity to speak about positive experiences and bring positive stories back from Africa. I wish to speak about Trócaire's work in Mozambique and work which has been supported by Irish Aid.

Trócaire supported its first project in Mozambique in 1975, just after independence was gained, and established a field office in the country in 1994. Therefore, we have a breath and depth of experience in the country that is significant to inform our presence there. I will not read through the document circulated to members but they can see we are supporting four programmes outlined in the submission targeting approximately 250,000 people in a country that is, despite the progress to which the ambassador, Mr. Sheridan, referred, still ranked 172nd out of 177 countries in the latest human development report.

I lived in Mozambique for four years between 1992 and 1996. I arrived there just as peace was declared, although I do not claim credit for this. At the time there was a tremendous sense of hope within the country that violence had ceased. It ceased immediately on the declaration of a peace protocol and did not reignite until 1999. There was a willingness to leave violence behind and progress. The country, at the end of a 15-year war, having been a centrally planned economy and a one-party state for so long, entered into a period of rapid transition. During the one-party state period there was a conflation of state, government and party. Ordinary people in Mozambique who I knew when I was living there found it difficult to engage with the new dispensation because any level of opposition to the government was seen as unpatriotic and traitorous. There was a sense of confusion, even though there was hope.

Being a partnership organisation, we do not have a direct relationship with the Government of Mozambique, apart from registering as an NGO in the country. Our national partners work with their local government counterparts. We have found this has improved in recent years in terms of the quality and level of the relationship. When government agencies are working with national NGOs known to be in receipt of funding from international NGOs such as Trócaire, there is a tendency to assume they have access to resources and the government resources are then removed in any intervention on which they co-operate. For that reason it is important that the Irish Aid programme continue in Mozambique and that funding flow through the government channels in order that there is a real possibility of collaboration at local level. We see our presence in Mozambique as being strongly complementary to the presence of Irish Aid in that we are supporting the development of a strong, confident, vibrant and resourced civil society which can engage with its government counterparts in the creation of a society that is good for all.

We work closely with other Irish NGOs in the country. A question always arises about the level of co-ordination between Irish NGOs on the ground. As recipients of MAPS funding, we participate in co-ordination meetings on a regular basis chaired by Irish Aid. We share information and analysis with our Irish counterparts, especially during emergencies. We always co-operate in responding to emergencies wherever they arise. We do everything possible to avoid duplication of effort in such circumstances. I will leave it at that rather than go into detail. I will respond to questions from the committee.

An independent report was commissioned in early 2008 on Irish Aid's activities in Mozambique. It found that corruption was endemic in the country and made a clear recommendation that Irish Aid should strengthen its monitoring evaluation and lesson learning capacity. Has this occurred in the past year? What steps have been taken to implement the findings of the report?

H.E. Mr. Frank Sheridan

Corruption is the bedfellow of poverty and we have to deal with it everywhere we go. One of the issues with which we are dealing which is at the heart of the matter and something we need to appreciate in order to be able to tackle it is that in virtually all of Africa, with a few exceptions, we are dealing with the imposition of statehood before nationhood which has robbed it of the citizens' pride that makes probity so easy to sustain and promote in countries such as Ireland. We have to factor in measures that will help to deal with this, as we deal with the challenges of protecting our funding and ensuring none of it is diverted.

Petty corruption is common within the system, as is fee taking at every point of entry. For example, a fee is paid to the teacher or principal by parents who want to get their children into what should be free schools. The same is true of the health board and in seeking a driving licence, passport or any official document that might be needed. In large measure, the fee taking is driven by poverty. The key measure we have undertaken through our leadership of the G19, the group of donors who provide budget support, involves complete salary reform in order to try to provide a living wage in order that one takes away the need to engage in such corruption.

The other element is to have rigour in challenging and bringing to account those who are taking fees. Within recent years, under pressure from the group we are leading, there have been significant moves in terms of eradicating, reducing and tackling petty corruption. An annual publication gives the figures of civil servants who have been disciplined and dismissed. The word is getting out and even two weeks ago the government published in the newspapers confidential telephone numbers for people to report to. Within our system we have been upping the level of oversight and audit in terms of ensuring that our funding is properly accounted for. Within the government system, we have been dealing with the equivalent of the Comptroller and Auditor General to build his capacity to ensure that every area of government expenditure is properly investigated and accounted for. In particular — and this, perhaps, is one of the strongest points — we have helped to roll out something called "systaff", which is a financial accounting system that goes right down to the lowest level of government activity, to the local districts, and shows where expenditure is going and how it is being used. That system, as recently as two months ago, threw up a diversion within the province of Cabo Delgado in the north of the country, leading to the imprisonment of two senior officials. It was clear evidence that the system we are helping to develop is beginning to show results.

It is generally accepted as a result of this alliance of donors and the approach they are taking, that grand corruption has, in significant measure, been pushed out of the public sector. Now we still have issues in the private sector and in tendering and procurement where we need greater transparency. The challenges are being identified and we are going at them one after another. In the main, however, there is significant progress to report as a result of the collective approach we are taking and in terms of our individual funding, particularly in the provincial programmes. We have increased significantly the rigour of our approach and we also can report success in getting the Comptroller and Auditor General-equivalent to set up branch offices in the provinces and do audits of not merely ours but all public sector funding.

We have achieved the transparency we asked for, while not always getting results that are encouraging. An audit we carried out two years ago in one of the northern provinces showed that one third of all transactions were not being properly accounted for. However, as we probed into that, the key factor to emerge was that people simply did not know how to do double-entry accounting or how to set up paper trails. The greater part of the 30% improperly accounted for indicated that there was a lack of capacity — and capacity is at the heart of a significant number of issues that we are dealing with, and we are endeavouring to address that.

Coming back to the recommendation in the evaluation that was done of our programme, of increasing oversight accountability and monitoring, we have done that very significantly, both at the centre and on the ground.

I thank Ambassador Sheridan and Mr. Collins for their contributions. I have a few brief questions, a couple of which are for the ambassador. Could he outline the impact on the population of Mozambique of refugees and people fleeing Zimbabwe?

Also, can he please say something about the role of China? How long as Ambassador Sheridan been posted to Mozambique?

H.E. Mr. Frank Sheridan

Almost four years.

Has he seen a change in the way the Mozambique Government and authorities treat the 19 donor countries? I assume China is not one of the 19. Is there conflict between the 19 donor countries and the role of China? What impact has China in how it provides aid, in terms of infrastructure, perhaps, as opposed to monetary contributions?

How many staff are employed at the embassy? It is, perhaps, easy for us to talk about the ambassador monitoring the money and dealing with government, but I should like to know how many staff he has to do this job. He got €48 million last year and €87 million over two years. He is down to €40 million for 2009, so could he indicate how much of that is spent on fee-taking, for want of a better word? Is it possible to quantify how much of the €40 million might go astray in buying access or whatever? Perhaps it is a fact of life that these things have to be done, unpalatable and all as they may seem. Do we have any idea what proportion of that money is spent in this way?

The ambassador mentioned the universal financial management system, but did not elaborate. Who got the contract to put that system in place? He also mentioned, either in the briefing document or in his contribution, something about the expertise and job creation that was transposed to Mozambique. What physical form did that initiative take? Were people brought out or did he have the expertise on the ground? If there was one thing the ambassador could change with respect to the allocation and administration of the aid budget he has, what would it be? From this remove it is very difficult for us to ascertain the situation. We can only take matters at face value and much good work, it seems, is being done. The Irish Aid programme seems to be one of the best developed in the world, but can the ambassador really reassure us that we are getting value for money? It will come under closer scrutiny, with the general populace, perhaps, arguing that the money should be spent at home. There will be an increasing battle on sustaining the move to 0.7% of GNP over the next few years.

I have a couple of questions, too, for Trócaire. The co-ordination of NGOs was mentioned. What other Irish NGOs are out there? For example, is Concern or Goal there? Is there merit in the individual NGO, perhaps, concentrating its resources on one country, as opposed to several operating together? For example, let Goal deal with Zambia, Trócaire with Mozambique and so on, to cut down on administration, or is that a very simplistic view?

Equally, who on the ground in Trócaire controls the funding it allocates in Mozambique? Is there a certain percentage of Trócaire's funding that goes to Mozambique, and if the NGO's funding reduces, does it reduce, accordingly, there — or is money allocated on a crisis by crisis basis? Who controls funding on the ground?

Again, the ambassador might not be free to give his opinion as regards the NGOs, but if there was one issue that he could change as regards their operations, perhaps he might outline what that would be.

H.E. Mr. Frank Sheridan

I propose to answer one or two of the points raised by Deputy Timmins and I shall ask my colleague, Mr. Patrick Empey, to talk about Zimbabwe and its impact on Mozambique.

There is an issue with China across all sub-Saharan Africa. It is becoming very active and the most significant difference, perhaps, between its approach and ours is that governance is not an issue for China. Probity and higher behaviour in the government service is not something it is particularly bothered about. Also, it is quite open in saying that it is there to further its own interests. There has been a growing Chinese involvement in Mozambique over several years, but it is mainly at the moment in the area of construction, and to a lesser degree in the mining industry. That has not really happened all that much, however.

The other area where it has indicated a particular interest is in relation to food. China has become a food importing country and it is looking for other countries to grow rice and other products for it. It has indicated an intention to become involved in that area, but there is no evidence that it has done it yet. The only evidence we see of Chinese engagement in Mozambique is in the construction area. It is working out beneficially because they are fulfilling contracts on time, within budget and for less than others — and their tendering is quite keen. Up to now, while there are worries in our minds about what the impact of a growing Chinese engagement might be, its involvement in Mozambique is limited, not that great and less than in other regions. I am also accredited to Angola and there Chinese engagement is enormous. At every level they are carrying out practically all of the infrastructural expansion and have enormous oil interests in the country as well. In Mozambique, however, while it is something we are watching and it gives us some cause for concern, it is relatively minimal in comparison with other countries.

On how much of our €40 million goes astray, our intention is that none of it does. We have very rigorous systems in place and trace our funds to the greatest extent possible. Obviously, when they are put in collectively, they move collectively. I could not put a figure on whether any element of the money that goes in on budget support is being diverted, but there is a general acceptance that the donor engagement has pushed a significant amount of this sort of thing completely out of the system, and that we are getting a degree of probity and absence of malfeasance that represent significant progress.

With regard to the funds we give directly, I do not want to tell any stories that become sensational, but there was a diversion of Irish funds in one of our provinces about 18 months ago. We found it within weeks, and it was the only diversion. The individual who diverted the funds is serving 12 years in jail. The funds have been seized by the court and will be given back to us shortly.

This is the incident mentioned by Mr. Brendan Rogers at the Committee of Public Accounts hearing and it involved about €35,000.

H.E. Mr. Frank Sheridan

It was €25,000. It has been completely retrieved. This was the first attempt by this particular individual to touch any Irish funds. The moment he did, it set off our alarms. We were able to trace it and show that he had been diverting funds from other government sources for a while before that. He was brought to account and, at our insistence, he was prosecuted and is currently serving 12 years in jail. Our funds have been retrieved. They are in the court system but they will be returned to us shortly. We feel that we have a rigorous system. We are not complacent. A system is only as good as the people who operate it, and of the quality of the systems. We place a huge premium on ensuring that we have accountability and oversight.

We have a staff of 30 in the embassy, which includes everybody down to the gardeners. We have a management team of five, eight advisers and an administration team. We also have two "out offices". We have an administration office in the province of Inhambane and one in the province of Niassa, each with five staff. The total payroll for the Irish embassy is 40.

The financial management system is known as Systaff. I cannot recall exactly who provided the system. It might have been a South African company. The first elements of it were put in place about five years ago. It now has become universal throughout the system. It has been there for a while, but the system has been extended.

Mr. Patrick Empey

The financial management system was designed in the late 1990s with the IMF and a number of the Nordic donors, primarily Sweden and Norway. It has been rolled out much more effectively in the past three to four years. It uses primarily Brazilian technical assistance because of the language and the technical matters related to similar systems in Brazil. It is a joint donor funded programme, with some funding coming from the Government itself through the general Exchequer.

Mozambique is Portuguese speaking and although there are some movements along the border, especially in the province of Manica, there has been very little influx into Mozambique from Zimbabwe, primarily due to the linguistic issues. South Africa has far greater difficulties with it, as does Malawi and some of the other English speaking countries. The situation in Zimbabwe has had some impact on Mozambique in another sense. One of its imports route is along the main transport conduit for Zimbabwe and business on that particular corridor has deteriorated over the past ten years as the economic movement in Zimbabwe has been so slow.

H.E. Mr. Frank Sheridan

I will return to some of the points made about value for money and job creation. The job creation approach is something of which we are particularly proud. Within a relatively short period, and for very little funding, there are about 1,500 people gainfully employed and about 3,000 suppliers in the cashew and coconut areas, who are earning enhanced income from their engagement. Our approach is relatively simple. I have been involved in development on and off since 1987. Previous attempts made to engage the private sector were not particularly successful. They tended to end up as consultancy companies coming in looking for Irish Aid funding to do what they wanted to do, which was not essentially sustainable. This time we decided that if we were to engage with the private sector, we would not invest in the enterprises. We would do everything to help them to work, but the money should be put in on a commercial basis and stand or fall on that.

With an American agency, we endeavour to locate entrepreneurs. We ask them to consider investment in particular areas where studies have been done beforehand to indicate that the prospects are good, such as in cashew and coconuts. Once they come in and decide to invest, we help them locate a moribund factory that can be rebuilt, to locate a workforce and train them, to procure appropriate technology and to find markets. On that basis, we took our first tentative steps in 2004 and a factory was opened after three months with about 350 people employed and the raw material was all bought from local suppliers. That has been extended to seven factories and we are now getting into the coconut area. The value of the coconuts is not as a food product, but as a growth mass. If one crushes the coconut shells and mixes them with fibres, they can replace the use of soil and there is a ready market for this in nurseries and so on in South Africa. Our first steps in that area have been very encouraging.

Our overall sense is that if we put money into people's pockets, they will bring about their own development. We have seen tangible evidence of it in the areas where we have stimulated this particular form of enterprise. As we drive through the villages leading up to where these factories are located, we see straw roofs being replaced by steel sheets, we see bicycles outside doors, we see ramshackle schools beginning to burst at the seams, with kids attending because they can now afford the uniforms and the books that allow them to go to school. We can see the direct impact on communities of our job creation efforts. We put all of this to the Department about a year ago, and they agreed to double the amount. It is still relatively small at little over €1 million. We have gone from about €200,000 to €400,000 and now to €1 million. We are using an American agency that is focused on the private sector and brings in the type of expertise necessary to create the facilitating environment for this. It has been working very well and is deeply encouraging.

Value for money is a key issue for us. I feel we are getting exceptional value for money in the health sector. A key statistic in the health sector is that even now, after engagement in the health sector by donors since 1992, less than 50% of the people of the country are reached by the health service. It is a very fragile service. We have entered into a partnership with the Clinton Foundation in which they lower the price of anti-retroviral treatment and we put in enough funding to ensure that the government there can roll out a service to provide treatment to people who have AIDS. Since we have engaged in that in 2005, the figures have gone from zero to 130,000 people receiving anti-retroviral treatment.

There are two particular dimensions to that. First, this fragile health service is maintaining these people on anti-retroviral care for the rest of their natural lives. Second, this means that the children of these people will be brought to adulthood and will not become street children, orphans or vulnerable children. It is having a very significant effect in mitigation of the impact of HIV and AIDS. We are trying to break the link whereby children become vulnerable to catching AIDS. This is one area from our point of view where there is very significant value for money.

I was asked what I might do to improve the situation if I was given a wish list. I would like to encourage a greater engagement from Ireland in development. I am encouraged in Mozambique by two particular developments. One is Habitat for Humanity, a group that has established links here and in Northern Ireland. Teams are coming out from Ireland and helping to build houses for poor people, especially people who are living with AIDS. The real benefit of something like that is that it is an engagement outside our programme and it broadens out the knowledge of development challenges. The other area of engagement is at the top end. When I go back to Maputo next Monday, 40 Irish academics will be there at a conference that is working to build up the capacity of the universities in Mozambique. As it is in the public service, only 5% of the people there have tertiary qualifications. It must be addressed and we are getting this independent engagement on the basis of small seed money that has been given by Irish Aid, but essentially they are bankrolling it themselves. We would like to see that type of engagement because we know there is huge capacity in Ireland which could complement what we are doing.

Mr. Seamus Collins

Deputy Timmins asked about the merit of NGOs concentrating resources in one country. There is merit in focusing on particular countries or particular areas. In 2004, Trócaire supported individual projects in 53 countries. Since then, we decided to concentrate on 25 priority countries because we realised the need to focus our assistance in a limited number of places to maximise the impact of what we do. We have also developed six organisation programmes. We work within those programmes and within specific subsectors under those programmes, with a view to maximising impact by concentrating our resources.

One disadvantage of concentrating in too small a number of regions or countries would be to lose the richness that can come from exchange and experience across different countries, within Africa, between Africa and Latin America — which happens quite often within Trócaire's programme — and within Asia. For example, we learned a tremendous amount from responding to the disaster that was the 2004 tsunami. That knowledge is permeating throughout the organisation in other disaster responses on other continents.

In terms of the control of our funding within the Mozambique programme, we have a country office in Mozambique, a country representative and three programme officers, each of whom is responsible for one of the programmes we support in Mozambique. As I said earlier, we work through local partner organisations and concentrate strongly on the development of the capacity of those organisations. It is not simply a matter of passing over money and waiting for a financial and narrative report 12 months later. We employ local consultants to work on these partners' governance set-up and financial reporting systems to ensure the capacity gaps to which Ambassador Sheridan referred are addressed at the appropriate level. We have developed a country strategic plan for Mozambique that sees our efforts concentrating on three provinces — Sofala, Nampula and around Maputo — again focusing on where we can have most effect as well as supporting national-level initiatives aimed at the development of a stronger civil society.

Deputy Timmins asked what one change I would request in regard to our efforts in Mozambique. The immediate answer would be to seek an assurance that there will be no further aid cuts. I suppose it is too much to ask that the most recent reduction be reversed. Echoing what Ambassador Sheridan said, the greatest frustration I have found — and I have been working in Africa since 1987 — is that when I come back to Ireland and speak to people about Africa, I can see the expectation in their eyes and in their response that there is only bad news from the continent. There is this predisposition to assume the continent is at war, that it is corrupt and that nothing good is happening there. There are so many good stories, which we highlight through our Lenten resources, our development education activities and our campaigning work. If I could only take one action, it would be to change the mind set of the public to be more open to positive stories from developing countries.

I compliment Irish Aid, its staff, the ambassador and the various NGOs on the work they do on behalf of the Irish people in Mozambique. On the question of good governance, has the ambassador experienced any difficulties with Government agencies in Mozambique as a consequence of the stringent conditions insisted upon by Irish Aid? In terms of co-ordination between the various agencies, I understand there are 19 donor countries and various NGOs working there. For example, in regard to the prevention and management of AIDS, is there a co-ordinated approach by all the different agencies or are there gaps and duplication that must be addressed?

What type of progress has been made in agriculture and how is that impacted upon by the types of natural disasters to which the ambassador referred, particularly cyclones and floods? How many Irish missionaries are working in Mozambique and what type of work do they do? I note from the briefing document that these missionaries received €42,700 in 2008. Was this sufficient for their purposes or is greater funding required? I assume they have requested more. It seems a very small sum.

H.E. Mr. Frank Sheridan

Our relationship with the Mozambique Government has its moments. Mr. Collins referred to civil society. In Mozambique, civil society comes from a base where until 1992, there was no non-governmental sector. The Government was everything. We are coming from a base where that is much more recent in terms of its development and, therefore, weaker in comparison with other countries. There is a lesser holding to account of the Government by the people than one might find in other countries. As a result, the donors end up stepping into the gap and holding the Government to account.

As an aside, as I mentioned, I am also the accredited head of mission to Angola. In 2004, I led a team from Irish Aid to that country to look at the possibility of engaging there following the peace between the MPLA and UNITA. Our overall sense was that it was a country with huge problems of governance which would make it very difficult for us to operate. I returned there last year to find significant improvements in terms of growing transparency. However, it remains a long way behind Mozambique in terms of its accountability. The difference in Mozambique is the donor combination, the pressure those donors put on the Government and the degree to which they hold it to account.

The relationship with the Mozambique Government can be fractious. In the past year, as leader of the group, I met the relevant Ministers six times. The Government has occasionally been testy because of the pressure we are putting on it. However, when one measures the performance one year to the next, one sees that the issues which have been identified are being addressed. It is something of a love-hate relationship but it is one that works.

In regard to co-ordination among donors, I will offer a simple statistic. The Danish Government sent out a team which left the country last week and which visited several of Denmark's donor countries to compare donor co-ordination and see what lessons could be learned. This delegation concluded that Mozambique has the best donor co-ordination in the region. Our links between donor countries, NGOs, UN agencies and other agencies involved in various areas is generally seen as good in most areas. There are special problems in regard to the prevention and management of AIDS, in particular, difficulties within Governments in terms of the quality of the national AIDS council. Several major changes have had to be made recently to make the programme more effective. It is an area of particular concern to us but our measurement of performance has identified the difficulties and we are significantly engaged in seeking to address them.

I have learned since I came here some days ago that the number of Irish missionaries in Mozambique has doubled from two to four. Heretofore, I was only aware of the existence of two. I am pleased to inform Deputy O'Hanlon that there has been an increase in the figure of €42,700. The four missionaries have managed to squeeze €250,000 out of Irish Aid funds.

Are the four missionaries members of a religious order?

H.E. Mr. Frank Sheridan

They are members of the Missionaries of the Sacred Heart, the Redemptorist Fathers and the Spiritan Fathers. I am also aware of an evangelical Elam church family from Northern Ireland which is involved in the Tet province near Zimbabwe. It is a small complement. When I was in Zambia some years ago, there were 499 Catholic missionaries. The Irish engagement in Mozambique is much smaller, with a total Irish population of less than 60

I ask Mr. Empey to respond to the Deputy's question on agriculture, which is a very important area.

Mr. Patrick Empey

Agriculture and forestry account for approximately 25% of Mozambique's GDP. Unfortunately, however, there are constraints within the sector and on occasion, certainly in some of the very dry areas, the country does receive food aid. Nevertheless, the potential is enormous, particularly in the north of the country. The constraints being faced pertain to infrastructure and human resource capacity. There are 133 districts in Mozambique, only 34 of which have extension staff to work with small farmers. Together with a number of other donors, we have been working on a sectoral programme to try to address this issue. However, it is also worth noting that following the increase in food and fuel prices last year, the government reacted quickly and constructively and has developed a new food production action plan. Last year alone we saw a significant reallocation of resources within the agriculture sector to further extension staff and the recruitment targets were exceeded.

The other important development within the food and agriculture plan is that it is the first time in ten years that Mozambique has started to put together a co-ordinated response to agriculture. This is an inter-ministry response that includes road transport, industry and commerce, agriculture and health. A major part of the plan is to address the severe marketing difficulties that small farmers face. While the plan requires further elaboration and we are working with the government in this regard, it provides for the first time a holistic vision addressing the various constraints on the sector.

I thank the delegates for their attendance and agree with Mr. Collins on the importance of sending a positive message about Mozambique and Africa. One figure that jumped from the briefing document members received was the tenfold increase in the number of school children since the early 1990s, with the increase in the number of schools from 2,000 to 9,500, which bodes well for the future.

Many of the questions I wished to ask have been covered, particularly those relating to corruption. However, I refer to the anti-corruption authority abolished or shut down in 2007. Has it been eliminated completely as an organisation or is its reformation awaited? How has this affected the fight against corruption? The ambassador spoke of capacity building in respect of the equivalent of the Comptroller and Auditor General's office. Last year members met the Ugandan and Malawian Comptroller and Auditors General. Is there much cross-fertilisation of ideas between our missions in Mozambique and other African countries to ensure best practice across the board in fighting corruption?

I seek the delegates' comments on the current status of the signing by Mozambique of European trade agreements. I also refer to the forthcoming cuts in aid. The ambassador has noted that Ireland has a leading role among donors in the region. What are the other donor countries doing in respect of a cut in aid? Are we alone in making cuts in aid in Mozambique? What impact does the ambassador predict the forthcoming cuts will have on work on the ground?

H.E. Mr. Frank Sheridan

I will take the Senator's last point first and then return to the issue of the anti-corruption authority and cross-pollination of ideas between our missions.

Ireland is the first country to announce a reduction in its allocation. However, this is not the only country that will be making reductions. In reaction to the Government's decision which we will implement as effectively as possible there obviously will be a reduction in the amount we had planned to spend in 2009. However, since September last year, we have been aware of forthcoming reductions that will have a much broader impact than anything we are doing. All budgetary figures within Mozambique are nominated in US dollars. We were aware that the currencies of a number of countries such as Sweden, Denmark and the United Kingdom were suffering as a result of devaluation against the dollar and that, therefore, the amounts they had pledged for 2009 were going to be reduced. Other countries such as Switzerland and Canada also are watching closely to discern what will be the impact in this regard. Our overall sense was that the strategies that most of us had for 2009 which posited increases were unlikely to be implemented. Consequently, in conversations among ourselves, our overall approach has been to ascertain whether we can maintain the 2008 levels. The Government is also saying the same thing, namely, that its objective is to be able to maintain it. The prognosis is reasonable that we will be able to do so. While we face a reduction in our programme, in the overall scheme of things $450 million is still being made available in budget support and similar amounts are going into sectors and the provinces. Ireland is still a relatively small player, even though we have grown hugely in recent years. Consequently, our impact will be limited, although there is a reasonable prospect that we will be able to maintain 2008 levels. Within this, our overall focus in our individual areas of interaction which is shared by the other donors is to maintain essential services and protect the vulnerable, as well as perhaps stretching the capital budgets, that is, for construction and involvement in infrastructure, over a longer period. Generally, although Mozambique and all the countries in sub-Saharan Africa will be challenged by the global crisis, the overall sense among the donors is that we should ring-fence funding for essential services, ensure services delivered to the poor are maintained and that otherwise we can consider stretching the period of engagement for projects such as school construction, road construction and so on.

The anti-corruption authority has been abolished because it was discovered that it was unconstitutional, in terms of its set-up against the constitution of the country. The engagement has not changed and the same people are still engaged in anti-corruption strategies. We are focusing heavily on the equivalent of the Director of Public Prosecutions who has a slightly broader role with regard to investigation and taking court cases than would be the case in Ireland. There is a significant improvement to report regarding the number of cases being taken. While Mozambique is not unique, it is special in that there is not a culture of impunity. A former Minister of the Interior is in jail, as is the head of the airport authority, both of whom were caught with their hands in the till. To that extent, there is a willingness to put people at high level in jail. That perhaps leads to the Senator's question on cross-pollination of ideas with our other missions.

May I piggyback on Senator Hannigan's question? In the recent past people involved in NGOs have suggested Irish Aid should not be involved in Mozambique or countries like it because of the prevalence of endemic corruption. What is the ambassador's response to such suggestions? While he has answered to an extent, this is an important point for the public. Deputy Timmins has also alluded to public sentiment.

H.E. Mr. Frank Sheridan

I would be delighted to do so and have a very simple response, namely, there is no development without a government. Unless one engages with a government, it is not possible. I consider the Irish NGOs to be some of the best in the world and do not state that as a form of plámás but as objectively as I can. We work with them in the field and have seen the quality of their work. We see how they are regarded by others. However, even they would admit that, collectively, they are not in a position to run a health or an education service, build schools or develop a curriculum. They are not in a position to come up with systems for economic development or attracting foreign direct investment. This only can be done by a government. Moreover, if one considers Africa, the other issue to which one must point is that African countries face a unique challenge as colonial creations, which is one of statehood before nationhood. It is a situation that has robbed them of the broad-based citizens' pride that made probity so common and easy to promote in our first steps following independence. However, this means we must take special measures to protect taxpayers' funds and that we must be hard-nosed in ensuring there is full accountability for those funds. However, I revert to my starting point, that there is no development without a government. One cannot create the conditions for economic development and removing people from poverty if it is not centrally led by the government.

While I share the ambassador's view, it is important to give him the opportunity to respond to such commentary. That is one reason for holding these hearings.

Mr. Seamus Collins

I agree strongly with what the ambassador said. Irish Aid must engage with the Government of Mozambique and the governments of the other programme countries. There must be engagement with the governments of developing countries or there will be no long-term development. As an NGO, we consider we are working with our natural counterparts in local NGOs and civil society. For example, in the province of Nampula we are supporting the efforts of 4,000 families to improve farm productivity. While that is fine, it will not have any long-term effect, unless work is also done at the policy level to improve the policy environment in order that they can have access to markets and that agricultural policy is influenced in favour of smallholders. There is a strong symbiotic relationship between our work at civil society level and the work that Irish Aid must do with the Mozambican Government.

What of my question?

H.E. Mr. Frank Sheridan

On cross-pollination between missions, we are still a relatively small organisation and there is daily interaction between our missions to exchange experiences and information.

Regarding Uganda, I was in Mr. Cole's role as a programme director before I went to Mozambique and had a heavy engagement with the Auditor General's office in Kampala. I carried this experience and information through to our engagement with Mozambique's equivalent of the Comptroller and Auditor General, the Tribunal Administrativo. For our organisation, it has generally been easy to co-ordinate and share experiences, given the fact that we are a relatively small group of people who are regularly in contact with one another.

Mr. Empey wanted to comment on the question of corruption and anti-corruption strategies.

Mr. Patrick Empey

My contribution will be worth something to the sub-committee. Like Mr. Collins, I worked in Mozambique in the 1990s and returned to my current position one year ago. I have a unique experience, in that I am able to see the implications of decisions made in the 1990s and the changes that have occurred. The area of public financial management has improved significantly since then, as shown by evidence. The World Bank and the OECD's methodology of assessing public expenditure and financial management is known as public expenditure and financial accountability, PEFA. Mozambique is one of the first countries to have undergone two PEFA assessments in which all aspects of public financial management, both on expenditure and auditing, were assessed. The first assessment occurred in 2006 and the second in 2008. There is objective evidence to support the claim that there have been significant changes in the financial management systems in that three-year period, partly supported by the system referred to by the ambassador. Mozambique will have conducted a third assessment by the end of next year. In terms of public financial management, a definite improvement is occurring.

The OECD's development assistance committee undertook an evaluation of general budget support in 2006, a main finding from which was that, in general, budget support contributes to building systems and accountability by making aid transparent and bringing it further into the domain of parliamentary overview and reporting.

I thank the ambassador for his informative presentation and I take note of his comments regarding statehood before nationhood being a major problem throughout Africa, not only in Mozambique. I was interested in his presentation on job creation in terms of coconuts and cashew nuts and how the effect has trickled down into the community. In the long term, the expansion of job creation will have more benefits for Mozambique than throwing money, which has often been perceived to be the solution to the problem.

I met a gentleman who now works for the Clinton Foundation in Mozambique, Dr. Vinay Nair. Despite the pronunciation, he is actually from Limerick. He had concerns regarding micro-financing throughout Africa and the developing world, not just Mozambique. We in the First World or Second World, depending on who is speaking, might have taken out loans that we should not have been given. Is this a problem in Mozambique? Has micro-financing, which should have removed people from debt, not only contributed to keeping people in debt, but put them in dire poverty through loans? Often, the words "micro-financing" and "moneylending" can be interchangeable, since the line blurs. In some cases, the person giving the loan is on commission and will give recklessly. Is there much micro-financing in Mozambique, has it developed, should it be encouraged and is it a solution? Is it a solution for people who are trying to start up small businesses, for example, smaller versions of the cashew nut and coconut factories, which have spread employment across the community? Should Ireland promote or rein in micro-financing? In some senses, it might have gone out of control. Reckless lending in the First World was replicated in the Third World.

H.E. Mr. Frank Sheridan

On job creation in Mozambique, there is a significant issue with the high cost of credit. It is difficult to get and banks are mainly only offering credit to those who do not need it. The rates on repayments could be anything from between 18% and 25%. We have concentrated on helping to negotiate access to credit at reasonable rates on behalf of entrepreneurs and people willing to invest funds. We have met with a fair amount of success. The fact that we as a donor and Technoserve, which works with us, are interceding on behalf of businesses provides banks the assurances they want regarding whether something is a reasonable risk and affords entrepreneurs credit at a reasonable cost. The partnership works both ways.

Micro-credit is not as well developed in Mozambique as it is in other countries. It is further down the continuum than would be the case in a number of other countries in the Anglophone region. As a result, there is not that particular manifestation of a large number of bad debts. Through the G19 group that we are leading and individually, we are trying to push for a greater network of credit and banking facilities, especially for people in the provinces. The banks have been quite receptive to setting up branches in provincial areas so as to enable businesses to operate in the normal way with banking facilities. I am not aware of a serious problem with people getting into significant personal debt. While Trócaire may have other information, it has not manifested as a serious issue at our level.

I will briefly address a question on economic partnership agreements that I did not answer. Mozambique has signed an initial economic partnership agreement, EPA, with the Commission. The region holds complexities because a common customs union, which includes Namibia, Lesotho and Botswana, operates within the southern African region. In addition, a number of Southern Africa Development Co-ordination Conference, SADCC, commitments are coming down the road in respect of a wider common customs union and the reduction and eradication of tariffs. We must take many of these commitments into account. Currently, there is a tentative deal between the Commission and Mozambique, but its dimensions will be determined when the greater problem of an EPA with southern Africa is finally resolved. Angola has either pulled out of the process or is not moving at the same pace as other countries because of its unique situation, that is, it does not need an EPA thanks to its oil wells. I am not 100% sure about Tanzania's position. Mozambique has signed up to engage in an EPA, but it will be slightly on hold until the wider problem has been resolved.

While members should speak if they want, I mentioned at the outset that I wanted to cover the different areas systematically from the standpoint of outcomes, that is, the money spent on each area in recent years and the results observed. We will take Trócaire first. Will Mr. Collins explain the amount of money that Trócaire has spent in Mozambique? He mentioned it to a certain extent in his presentation and answers, but I would like to cover systematically the main areas in which Trócaire is involved, the amounts of money spent in each area and what outcomes have been achieved.

Mr. Seamus Collins

I will respond briefly to the question on micro-credit. We do not have a micro-credit component to our livelihoods programme in Mozambique. Our experience in Latin America showed that people engage at different levels with micro-credit opportunities. Some use micro-credit simply as a subsistence instrument while others manage to move up the ladder, as it were, and get increasing sizes of loans and in that way they develop businesses. Some people simply use the loans to live from one six-month period to the next. In Ireland we have the tremendous example of the credit union movement. Many of the lessons learned from that can be very useful when one looks overseas.

We sent a brief on our work in Mozambique to members. We have four programmes: livelihoods; governance and human rights; HIV and Aids; and responding to emergencies, particularly, as the ambassador mentioned, responding to flooding over the past nine years. This has come in a cyclical way and is increasing in recent times.

To give an example of the kind of impact we are having, one of the organisations we support in Mozambique, Rede da Criança, the Children's Network, works for children's rights. In one initiative we supported in 2008, the organisation secured 143,000 birth certificates for children who were living in poverty or on the streets. The possession of a birth certificate in Mozambique is essential for accessing state services. We can say, therefore, that as a result of our support to the Children's Network, there are 143,000 children who are now able to access state services. This underlines once again the need to work with the state to ensure those services are there when they go looking for them.

If they did not have the birth certificates they would not have been able to do this.

Mr. Seamus Collins

They would not have been able to because the possession of a birth certificate is an essential element. The lack of access to a birth certificate arose from a number of factors — perhaps the children were separated from their families or perhaps their parents did not have the confidence or the literacy skills to be able to access the state's apparatus and secure a birth certificate.

Can Mr. Collins explain to us what difference it makes, in human terms? Is it a matter of life and death or simply different circumstances?

Mr. Seamus Collins

It ensures there can be some hope of a better quality of life. I would not be so dramatic as to say it is a matter of life or death although in certain cases this is probably the case.

Our budget for Mozambique this year is €1.8 million.

That has grown from——

Mr. Seamus Collins

That has grown from approximately €900,000 over about five years. The growth happened on the basis of the agreement we entered into with Irish Aid concerning the receipt of multi-annual programme scheme, MAPS, funding. We believe that predictable aid is a significant cornerstone in being able to plan for the future and for growth. In 2009 we were due to receive €23 million from Irish Aid. This will now be €16 million unless there are to be further cuts later on in the year.

The €1.8 million has obviously been reduced. Can Mr. Collins indicate the area where the reductions will be seen?

Mr. Seamus Collins

I do not wish to pre-empt what is happening, even now. We had a meeting with our six regional managers two weeks ago and, given a deadline of next Friday, they are to come in with proposals for cuts in their activities and budgets in each region. The regional manager with responsibility for southern Africa is looking at this right now across the countries in which we work in that region. It will certainly go as far as cutting programmes and may go as far as cutting countries. There could be a very significant impact on the lives of the 250,000 people we are supporting now.

We can ignore the vote because I shall stay here. In his presentation the ambassador mentioned the reduction of extreme poverty from 80% to 50% and the key role that Ireland has played in that. Mr. Collins also mentioned this in his presentation. Will he give some more detail as to how that manifested itself?

Mr. Seamus Collins

I can speak about my own experience in the early 1990s when I worked within the government apparatus. Having a job at the time within the government meant having access to resources. There was general endemic petty corruption. If a person had access to resources through his or her job those resources were used for the benefit of that person's family. People were using a project vehicle at weekends, for example, and drawing down on resources of that kind to support their families. Within Africa there is a very strong sense of catering for the extended family. If one person in an extended family gets access to any resource, or if their income increases in any way immediately it is expected to be shared out among the extended family. As people move out of poverty the temptation to indulge in petty corruption of that kind is reduced.

Does the ambassador wish to contribute?

H.E. Mr. Frank Sheridan

Mr. Empey has compiled some interesting statistics that might help to address this issue.

Mr. Patrick Empey

I would be glad to supplement this with detail after the meeting because I might give a list now that would be lengthy. We provide support in three broad areas — general budget support, programme sector level engagement and at project level. With regard to general budget support, a number of changes have been attributed to this support. The ambassador mentioned the changes in figures for those below the poverty line. There will be a further survey at the end of this year and we think we will see the number below the poverty line decreasing perhaps to as low as 45%. We will have data on that later this year.

It is worthwhile mentioning that in terms of general budget support we have been in a position to be able to negotiate with the government on its allocations. For example, up to 65% of the annual budget over the past ten years has gone on pro-poor expenditure and 55% of that has gone to health and education, whether in salaries, recurrent costs, medicines. I mentioned that I worked in Mozambique before. During a recent monitoring visit to one of the provinces I visited a health post I would have known well from the mid 1990s which then had very little in terms of stock of medicines and had very poor record keeping. The medicines it had were probably out of date and the staff were without proper clothing or equipment. On my return, that health post had an immaculate and excellent stock system, its shelves were full of medicines and the staff had clothing, stethoscopes, and so on. That is one small example of general statistics being demonstrated at a field level.

With regard to sector level engagement and support over the past three years we have seen almost 12,000 new teaching posts created. We have already mentioned the increase to 1 million in the number of students. The net enrolment rate for primary education in Mozambique is now up to 95%.

Senator Hannigan mentioned this. The numbers involved are extremely high for additional enrolment compared to other programme countries. Perhaps Mr. Cole might contribute. That appears to be a significant step forward in recent years. Is that the case in other programme countries? I ask for a top of the head figure.

Mr. Damien Cole

There are very high levels of enrolment in Uganda also. One would have seen a significant increase in the levels of enrolment there that immediately springs to mind. In the case of Mozambique there has been a very significant increase in recent years. When I was there recently I saw the quality of educational facilities which were being built. It was very interesting to visit a teacher training college and see the difference between the buildings to whose construction Irish Aid is now contributing and the quality of school rooms that was there before. There is not only the issue of increase in enrolment but the quality of the facilities we are assisting in providing. Quality of teacher training is a big issue in the country. The ambassador and Mr. Collins might be able to talk about this. In a place like Mozambique the issue is now as much about the quality of education as much as about getting children enrolled.

In the areas where we are working in education across the programme countries, where it is a priority for us, we have seen significant progress. It may be a matter of moving towards increasing the quality of education in some of those areas as much as increasing the numbers.

Mr. Patrick Empey

I will supplement those comments and Mr. Cole is correct. As in the case of Uganda, Mozambique now faces the challenge of quality since the issues of enrolment and access have been improved. However, there is still an average pupil to teacher ratio of 73:1 or 74:1. In some cases it is lower and in other cases it is higher, for example, in the more remote districts where it is harder to get teachers in place. Issues of quality are now much higher up the agenda than three to five years ago. Net enrolment was one issue and the completion rate is a different issue. That is falling to almost 60%. The number of girls finishing primary school has doubled in the past five years from approximately 20% to just less than 40%, a significant improvement in a five year period. However, only 40% are completing primary school. There must be a balance and quality is an issue.

There are similar stories in other sectors too. Water coverage has improved. We have touched on health matters.

On health, the ambassador mentioned the increase in the number of people receiving anti-retroviral drugs. A figure of 143,000 was mentioned. Is the HIV infection rate increasing? Is prevention being dealt with in addition to treatment?

H.E. Mr. Frank Sheridan

The prevalence rate of HIV is 16% among adults aged between 16 and 45 years. That is significantly less than the rates in South Africa, Zambia, Botswana and Swaziland, but nonetheless quite worrying and threatening. Ultimately, if not contained, it has the potential to hollow out any of the positive developments we have discussed. There is a concerted effort, especially in the health sector to contain, to break the link and to educate.

Let us break this down a little. As far as our budget is concerned, will the ambassador provide some figures concerning how much we are spending and investing in the area?

H.E. Mr. Frank Sheridan

Just less than €1 million has been given to the national AIDS council. I refer to a matter relevant to the visit made by Mr. Cole two weeks ago. In addition to working with the national AIDS council, we are also examining the challenges of anti-retroviral treatment and trying to ensure people live a normal life span. As a result of our efforts and with help from the global fund there are now 130,000 people receiving anti-retroviral treatment. However, in the main, the majority of these people follow the line of road from north to south. In other words, we are dealing with the people in the urban and peri-urban areas. It is much more difficult to provide assistance in the rural areas. The anti-retroviral regimen is a very harsh regimen of drugs. It has the potential for liver and kidney failure if not properly managed. Another issue, difficult to manage with poor people, is the need for medication to be taken at a certain time. Most of these people do not have watches. The medication should be taken with food but there is a serious challenge for poor people in doing so.

In the province of Inhambane we have tried to develop a model that we could use for home based care for people in rural areas. We have developed a system of community organisations to roll this out. Mr. Cole and I went to see some desperately poor people. There is no equivalent here to the poverty we experienced in rural areas. There was a woman sitting outside what might pass for a grass hut on a mat with nine children and no source of income. However, through the community system we set up, people were reaching out to her. She was getting her medication, which was being monitored. Food was being delivered to her. This was part of a system for which we had reasonable hopes and which, we believed, would be sustainable and could be used as a model. The amount of money involved in this was a pittance. It is not an issue of money. To set up this community organisation that was taking care of approximately 50 people in rural areas, the total cost per month was $1,200. Money is not necessarily the issue. We will not cure the problem by pouring more money into it. It takes significant management investment in terms of trying to develop these models and then integrate them within the Ministry, because if we do not integrate them we cannot sustain them indefinitely. We do not have the management capacity to do so. That was an area in which we had a model that was working reasonably well.

I refer to some headline matters in respect of value for money. These are developments within Mozambique for which we can claim some personal responsibility. Obviously, other donors are involved because we operate in partnership. We mentioned the percentage of people in poverty falling to 50%. Literacy has risen from 49% to 62% and adult literacy from an abysmal low of 33% to 46%. In 1992 there were 2,800 schools in the country, there is now 9,000. In the same period initially there was 400,000 attending school and now the figure is 5 million. Incomeper capita has risen from an abysmal $140 to $210. It is still remarkably low, less than 1 dollar per day, but it is coming up and reflects the fact that — I will not say uniquely but it is not common throughout Africa — poverty reduction is taking place across the board. It is not unequal although signs of inequality are emerging, which is natural enough as a middle class begins to develop and accumulate some wealth. Until now the change has taken place in urban and rural areas and there is a significant element of progress to report.

Previously, I dealt with countries such as Uganda and others in which military expenditure was a significant issue. That is not at all an issue in Mozambique. The army is less than 20,000 for a population of more than 20 million. It is one of the smallest and it acts as an aid to the civil power and has become involved in peacekeeping.

There are many positives to report. Mr. Empey referred to several areas in respect of provincial support. In recent years we have built 21 health units, 15 maternity units, 15 laboratories, two hospitals and four sets of housing. In the area of education we have built 52 school rooms. We have provided almost 5,000 units of furniture. We have built boarding blocks. One of the problems we face in respect of demography and the low density of population is that, often, to create a secondary school it must be a boarding school. We have built boarding blocks for the people also. In respect of public works we have built almost 5,000 kilometres of roads and 36 bridges. It is a long litany and we can provide the committee with the statistics but we have very significant progress to report. We have helped to join up communities which, in some cases, have been separated since the war of independence in the 1970s. This has resulted in significant improvements to their livelihood because they now have access to markets.

Mr. Damien Cole

The Chairman requested another example of the programme countries. I will provide some figures for the purpose of illustration and comparison. In Uganda there has been progress in education also. The introduction of free secondary education in 2007, which we supported, resulted in a 17% increase in enrolments. The number of children in Uganda attending primary school has increased from 2.4 million in 1996 to more than 7.5 million in 2008, a three-fold increase. This is another example of the impact we are having in another programme country in the education area. One could replicate this across many programme countries.

Does Mr. Empey wish to continue?

Mr. Patrick Empey

The ambassador has provided the information I was going to offer.

On the economic pillar, de-mining was mentioned in the brief. Can the delegation provide an idea of how much was expended in that area, with whom the delegation is dealing and the areas which have been de-mined?

Mr. Patrick Empey

We have been supporting de-mining in Mozambique since we started our programme in 1996. In total, almost €3 million has been spent since then. Currently, we provide approximately €375,000 to HALO Trust. Initially, in the mid 1990s, we funded two programmes, through the UN development programme in the south of the country and through HALO Trust in the north of the country, especially Niassa. By the turn of the century Niassa was the first province in Mozambique to be declared mine free and now all five northern provinces have been declared mine free through the work of HALO Trust, which has moved its work down south.

We have plenty of statistics in respect of the number of mine fields cleared, but the bottom line in respect of mine-cleared areas is that the north of the country is officially considered mine free. We believe approximately 80% of the mines have been removed in Mozambique in general. There were two difficulties. Mapping was not a very strong capacity within the two armies fighting at the time and much of the work must be done through community contact and mapping through community knowledge of where it is believed the mines were laid. In 2000 and 2001 there were horrendous floods which dislodged a large number of mines along the river. That delayed progress in finalising or completing Mozambique's de-mining programme. Along with other donors, we believe the capacity is now within Mozambique to finish the work. We may have to extend it until approximately 2014 at an estimated cost of $35 million to complete the programme.

I do not see an end to this in 2014.

Mr. Patrick Empey

A large part of the country is now mine-free. The national institute for de-mining came to a conclusion at the end of last year that with $36 million it would be able to finish by 2014. It would be one of the first countries to be completely cleared and mine free.

The delegation has dealt with the governance section and talked about the financial management reforms it is involved in. Regarding the cuts in its budget, wherever they have been made, can the ambassador deal with that, in terms of the most sensitive and crucial areas that affect people?

H.E. Mr. Frank Sheridan

One of the advantages on this occasion, as opposed to when I was a head of mission in 1987, is that we have had a fair degree of predictability and knew this was coming. We could see in September that it was clear we would have a serious challenge to try to maintain 2008 levels. The key issue for me was to transfer that predictability across to Government to make sure all of our partners in the provinces, and the others who might operate in terms of projects and at central level were aware that we were facing serious challenges and it would be very difficult to maintain the current levels of expenditure in 2008.

We have done a great deal of work. I wrote to Ministers in November, including the Minister for Health, the Minister for Education and the Minister for Planning and Development to tell them this was the case and they should presume the most we could aim at would be maintaining 2008 levels. They responded fairly positively to that. I have been in touch with them informally since then. We wrote to the Minister for Planning and Development in January to advise him there was more bad news to come and our overall sense was that it would be very difficult to maintain current levels. We have also been dealing with partners among the other donors, NGOs and UN agencies and letting them know, within our various working groups, that in terms of commitments, we would be looking at something less than the 2008 level, but with the greater part of our programme maintained intact.

The overall approach, in terms of our provincial level, where we have met the two governors and told them what their budget levels will be for the year, and with the Ministers we are dealing with, is that we will ring-fence essential services and ensure the people to whom we have committed to provide services will continue to receive those services. Outside of that, we will stretch out the time period for capital programmes or any additional things we may have decided to do over the next couple of years. We will honour everything we said we would do but the period will have to be longer.

We have a template for this arising from what happened in 1987. There is still enough folk memory within the system of what we had to do then. On that occasion we tried to maintain the skeleton of the programme, where the cuts were very substantial. Here, the core part of the programme is relatively well-established and protected, and we will look at all discretionary areas to be as creative as possible in ensuring we have the wherewithal to maintain essential services. Our negotiations and interaction with the Government so far indicate that, overall, the level of expenditure in 2009 will not be far off the 2008 figure.

Where there is a challenge that is somewhat worrying does not concern donors, but, rather, domestic revenues. As a result of the reduction in economic activity across the board, in South Africa and other countries to which Mozambique would export, there will be a fall off in domestic revenues. One of the largest local industries is an aluminium plant and it is already looking at a fall-off in its output of more than 10%, with consequences for tax revenues going to the Government.

Maintaining essential services will be a challenge but it is bigger than us and our engagement with the Government is one where we are endeavouring to bring in all the expertise and be as creative as possible, and also give it definition. We are currently in a position as leaders of the donors in collecting all the information over the next month and, on 28 May, sitting down with the Government and outlining the commitments which will be made in the next year. It is hoped we can come up with a plan of action at that time, in terms of how we will manage cuts. The Irish perspective is that although we are a donor that has been growing, we are still a fairly small player. The impact of what is happening regarding us is manageable and relatively minor.

Deputy Timmins asked me to mention that the ambassador noted in his presentation that Irish people were coming to Mozambique to work on different projects. There is a theory that because people have become unemployed, including those with different skill sets throughout the different areas of employment here, one place they could be enticed to or their skills made use of is Africa, through our programme countries. Is that an opinion the ambassador shares? Is it set up for that?

The flip side of that, as I have heard from a number of NGOs, is in some cases if a person is not slotted into a job or position, it can cause more hassle down the line and can create an expenditure on resources the NGOs does not need. Sometimes it is nice in theory but does not work in the practical sense.

H.E. Mr. Frank Sheridan

When I make the point about a wider engagement from Ireland, I was looking for people who will come with funding. We are broadening out the engagement and tapping into the resources and capacities in Ireland to get something that goes beyond us and reaches into areas we cannot reach into. For that reason, when the Centre for Cross Border Studies in Northern Ireland engaged the nine universities on the island and brought them out to build up the research capacities of the universities in four countries in Africa, it was something we strongly applauded.

We are looking for people to find their own budget line, not to be dependent on us and, within the institution, build up their own commitment to sustain this and keep it going. We do not want to have sustainability dependent on the Irish aid programme coming up with funding.

Regarding people who are unemployed looking for opportunities in sub-Saharan Africa, obviously there is an opportunity. One side of a coin of challenge has opportunity. We are in the process of recruiting some 20 junior professional interns who will be coming out to work in developing countries. One of them who happens to have Portuguese is coming to Mozambique in the next while. We have also been supporting UN volunteers, a number of whom have arrived in Mozambique to work with UN agencies. I understand two arrived recently.

The nature of volunteering itself has changed. When I was in Africa in the 1980s, one would find volunteer teachers and others dotted around the place. There was openness. That has now changed. Governments now want to have their own people trained and are not looking to have volunteers on the same scale. That said, there are opportunities and it is important to have round pegs in round holes and make sure we have a strategy that encompasses them.

We are supporting a volunteering centre in Dublin that comes up with the information necessary to try and have people find for themselves the appropriate area for engagement in line with their skills, capacity and experience. It is something one would support, but with the slight reserve that it requires a strategic approach and care and caution to make sure we place people in the right places.

The ambassador mentioned he also dealt with Angola, a former Portuguese colony, and that there were only 60 Irish nationals throughout the country. How did it become the largest programme? It strikes me that there are plenty of other places in Africa where we have had far more in-depth tradition or experience.

My uncle was a policeman in Rhodesia or Zimbabwe for 25 years. He policed the border between Rhodesia and Mozambique and became very friendly with some Portuguese army officers. He went to visit them in Lisbon and they told him they were planning a coup. This was in the early 1960s. He returned to Rhodesia, wrote a report to his superiors, submitted it and they ignored it completely. When the coup occurred and was successful, they went back to him and asked how he knew about it. He asked why they did not read his report. He is very fond of that story.

Outside of my own tiny family history, how did it become such a large programme country, considering there is very little past history connecting it to Irish citizens?

H.E. Mr. Frank Sheridan

I can answer the question because I was around at the time. Between 1975 and 1979 we picked three countries that became programme countries — Lesotho, Zambia and Tanzania — mainly because of the difficulties all three were experiencing under the apartheid regime in southern Africa. They were under significant economic and political pressure, and this was our attempt to engage with them and help them deal with those challenges. However, in the mid-1990s, when funding became available and it was clear we would have to increase the number of programme countries, we sent teams to a number of countries in sub-Saharan Africa. They came back with reports and analysis they had done on the basis of need and on the basis of propitious conditions for development, and Uganda, Ethiopia and Mozambique were selected as programme countries. We can point to equivalent progress in all three countries resulting from the fact that the conditions for development were better there than in the three countries that were chosen originally. Mozambique has outpaced the others slightly by virtue of the Clinton Foundation's engagement, which enabled us to put in additional funding to deal with the HIV-AIDS problem and the need for anti-retroviral treatment.

The main reason it is the largest programme is need rather than the fact there has traditionally been Irish engagement.

Does Seamus Collins have anything to add?

Mr. Seamus Collins

I started my career in development as a volunteer, so I have experience of that. As Ambassador Sheridan said, volunteering has changed significantly over the years and host governments now place a much stronger emphasis on developing their own capacity. We support that. Our organisation is considering volunteering carefully. We have had successful intern programmes, but if volunteering re-emerges in another form it will need to be within a carefully controlled environment. It should support national capacity and not replace it.

We are committed to continuing to work in Mozambique. We have supported Mozambique since 1975. When we decided on the number of priority countries we would work on and brought it down to 25, we decided on Mozambique on the basis of delivery of engagement so far and the possibilities for success in our programmes. We want to continue working there, but predictable aid is a significant factor in ensuring that.

Would the ambassador like to say anything else?

H.E. Mr. Frank Sheridan

We have had a very good innings, for which we are most grateful.

Mr. Cole?

Mr. Damian Cole

It has been a comprehensive and interesting discussion.

I agree. I thank the delegation for coming in today. It was a very good session and an informative one. I think we dealt with everything.

The sub-committee adjourned at 1.15 p.m. sine die.