BAGHDAD BUDGET EXECUTION PROBLEMS START AT THE

C O N F I D E N T I A L SECTION 01 OF 03 BAGHDAD 003447

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E.O. 12958: DECL: 10/26/2018
TAGS: EFIN PGOV IZ
SUBJECT: BAGHDAD BUDGET EXECUTION PROBLEMS START AT THE
VERY BOTTOM

Classified By: BAGHDAD EPRT-2 Team Leader Conrad Tribble for reasons 1.
4(b) and (d)

This is a Baghdad EPRT-2 reporting cable.


1. (C) Summary: Baghdad's municipal authorities, at the
lowest level, suffer from a host of weaknesses that sharply
constrain their ability to deliver essential services
effectively. The list is long: insufficient budgets and
resources, poor management skills, human resource
deficiencies, limited ability to monitor contracts and
projects, outdated and broken equipment, and poor
communication with key central offices. These problems, when
combined with almost non-existent public communication
skills, are a recipe for public frustration with the level of
services in the capital. It will require significant
training and upgrades for the municipality to be in a
position to deliver the essential services that Baghdad's
citizens are increasingly demanding. U.S. support in the
form of continued training, education and mentoring -- not
project delivery -- will be crucial, but far greater Iraqi
leadership is needed. End summary.


2. (SBU) Baghdad's "Amanat" is the public works department,
responsible for the full range of municipal services in the
urban districts of Baghdad (but not the rural "qadas" of
Baghdad Province). The Amanat divides the city into 14
service districts that we label "Beladiyas," each headed by a
director general (DG). The Beladiyas, the lowest level
municipal authority in the capital, have primary
responsibility for picking up trash, maintaining sewage and
water systems, maintaining city roads, landscaping parks and
public areas. They do small repair and refurbishment
projects as well as maintenance, but they are not responsible
for developing or executing larger-scale infrastructure
projects, e.g. building a new sewer system in a neighborhood
that has not had one. (Note: These activities are the
responsibility of the Amanat's central offices, though once
completed, their maintenance becomes the Beladiya's
responsibility. End note.)


3. (C) Baghdad EPRT-2's area includes four of these Beladiyas
- Karada, Rusafa, Al-Ghadier (western 9 Nissan),and New
Baghdad (eastern 9 Nissan) -- covering the entire east side
of urban Baghdad except for Sadr City and Adhamiya. Over the
past two months, EPRT-2 Team Leader, governance advisors, and
4-10 Brigade Deputy Commander have held a series of
discussions with our four DG's and their staffs to get a
detailed picture of their responsibilities, resources, and
constraints. What we have learned is just how far the
authorities have to go to be able to deliver essential
services effectively. They lack the resources, technical and
management capacity, and institutional support from above to
do their jobs effectively. This shortfall is not likely to
change any time soon.


4. (SBU) The list of problems is long, the problems are all
related, and they all exacerbate each other. Key challenges
include the areas outlined below.

Budget and Resources
--------------


5. (SBU) Despite wide differences in their size and problems,
each of the four Beladiyas receives a cookie-cutter budget of
IQG 12 billion (USD 10 million) annually for operational
expenses, allocated in monthly installments of IQD 1 billion
(USD 833,000). Salaries are paid directly from Ministry of
Finance accounts. Each DG uses their allotment differently
from month to month, allocating varying amounts to the main
operational areas as circumstances demand. All four DG's
tell us this level of funding is inadequate for their needs,
and two of them said that in practice, they often receive
less than the anticipated IQD 1 billion at beginning of the
month. All submitted budget request increases for the FY

2009.


6. (SBU) Other resources essential to management of a modern
city are missing. Only one of the four Beladiyas has
internet access in its main office, and there is very limited
internet access at branch offices or facilities such as water
treatment plants, sewage pump stations, and garages.
Computer-based planning, budgeting, and personnel management
are rudimentary, suffering from both lack of equipment and
lack of skilled personnel.

Management
--------------


7. (C) The Amanat civil service, below the top leadership
level, is dominated by engineers and the four Beladiya DG's
and their senior staffs are no exception -- they are all

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engineers with little management training or background.
Despite the presence of small Beladiya planning and
administrative offices, the lack of real planning capacity is
painfully obvious. Only one of the four DG's has even a
passing familiarity with the five-year Provincial Development
Strategy launched earlier this year. Asked to break out how
they spend their budgets every month, each of the four said
they allocate funds based on essentially seat-of-the-pants
estimates, adjusting as they go. They described in similar
terms the "planning" process that went into creating their FY
2009 budget requests. None had a detailed budget they could
show us identifying regularly recurring expenses such as
vehicle maintenance, spare tires and parts for equipment, or
facilities upkeep. "We fix vehicles when they break" is how
one DG described his maintenance program, while outside a
tractor with a broken wheel sat unrepaired for over a year
for lack of replacement parts. The kind of tracking and
planning tools typically used in any American municipality --
for accountability of facilities, personnel, and equipment,
or for estimating resource needs -- are either non-existent
or very rudimentary.

Politics, religion, and corruption - a noxious brew
-------------- --------------


8. (C) The Beladiyas suffer from a stifling Amanat culture
that limits effective communication up and down the chain and
across different divisions of the Amanat. The DGs tell us
they fear retaliation for raising problematic issues with the
Mayor (Amin) or their direct superior, the Deputy Mayor for
Municipalities. (Note: For several months this year, the
acting Deputy Mayor was the brother of the al-Ghadier DG, so
his situation was different. Now that his brother has moved
back to another position, he faces the same situation as his
peers. End note.) They meet with senior Amanat officials
irregularly and have limited authority to make decisions
without getting central approval. Amanat central offices
(e.g. the Baghdad Sewer Authority or Baghdad Water Authority)
do not systematically share information with the Beladiyas on
planned or initiated infrastructure projects, even though the
Beladiyas will be responsible for operations and maintenance
of new facilities once completed. Personnel decisions, one
DG complained, are routinely overturned by higher authority
on blatantly political grounds; this same DG said he was
powerless to fire many of his employees because of the fear
of retaliation.


9. (C) We see several factors at play in this. There is the
legacy of totalitarian government in which keeping one's head
low was a key survival mechanism; all of our DG's came up in
the Saddam-era Amanat and it shows. There are
political/sectarian tensions. The Karada and Rusafa DGs are
both Sunnis in a Shi'a-dominated institution, and tell us
they must tread carefully as a result. Karada DG Tharwa
Ibrahim's husband was murdered in 2007 in a sectarian
killing, she was falsely accused of corruption earlier this
year and suspended for several weeks while under
investigation, and her son was kidnapped in August in what
may have been an act of intimidation (evidence is
inconclusive). Since early September she has stayed away
from the office after receiving death threats that her deputy
(also a Sunni) believes come from within the Amanat. That
same deputy DG told us that only four of the 30-plus DG
positions throughout the Amanat were filled by Sunnis, and he
had been told he could not be promoted into a DG position
earlier this year because, essentially, the quota was filled.
Finally, we see signs that the Beladiyas' willingness to
cooperate with the U.S. military is running into resentment
at higher levels of the Amanat fearful of seeing CF activity
highlight their overall ineffectiveness, and fearful of
losing control of contracts that provide easy graft
opportunities.

Communication
--------------


10. (C) Finally, a glaring weakness of all four Beladiyas
(and of frankly most GOI institutions at the local level) is
their lack of capacity for and even interest in communicating
effectively with the public. Despite all of their
constraints, the four Beladiyas do provide a minimal level of
services and have shown improvement in some areas over the
6-8 months. They are working to pave additional roads, clean
blocked sewers, improve potable water delivery, beautify the
city, and pick up the trash. They communicate none of this
to the citizens in any systematic fashion, nor do they share
information on their constraints with the
district/neighborhood councils (who are in a position to
agitate for more funding through the Provincial Council). In
the context of an improved security environment, legitimate
public demands by citizens for improved services, and an
increasing chorus of criticism from the press, this is a

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completely unnecessary self-inflicted wound.

Comment: Long road ahead
--------------


11. (C) The Beladiyas, the first line of attack on the
essential services front, are years away from being the
modern, efficient organizations the capital city requires.
They need a wide range of management and technical training,
a significant expansion of funding and equipment (from the
GOI, not the USG),and perhaps most importantly, a change of
mindset that may only come after several years of learning
and testing new approaches. This is equally true, we
believe, for the rest of the Amanat, of which they are a
part. Since 2003, the Beladiyas have received far less
attention from U.S. assistance efforts - whether military or
civilian-funded - then the district and local councils
established by the U.S. in the immediate aftermath of the
war. Given the Beladiyas' direct role in providing essential
services (as opposed to the councils' role as community
advisory and advocacy bodies),that needs to change. We are
looking actively at ways we can address these problems
through training and other programs by the EPRT, Baghdad
PRT-B, and USAID. Ultimately, however, senior leaders at the
Amanat and above need to address the more fundamental
institutional weaknesses using Iraqi funding and Iraqi
solutions.
CROCKER