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Indonesia: A Local Perspective on Independent Verification

Created Feb 12 2015, 12:00 AM by Unknown

In the development world, independent verification is most often the domain of the private sector and, more often than not, the independent verification agents are international consultants.  What if governments and the local community had the skills to perform their own independent verifications, bringing the benefits of community involvement and sustainability?  That’s what a grant from the Global Partnership on Output-Based Aid (GPOBA) is doing in Indonesia, partnering the World Bank Group urban team to train government auditors to become independent verification agents.

 

During a recent visit to In Bandung, Indonesia, I had an amazing opportunity to participate in a training for technical verification of BPKP (the national government’s audit institution) financed by a technical assistance grant from GPOBA.  We successfully trained 213 BPKP staff members from the central BPKP and 15 representative offices. 

 

Many of my interactions and conversations with the participants centered on the “independent” part of the verification. They noted that the term “independent” seems to be defined as a team or firm outside a public service organization or private sector. They were concerned by the perception that as professional accountants, auditors and public institutions could not be trusted to be independent, effective or ethical.  They also raised questions about what happens after the project closes and the private sector/international IVA leaves and there is no capacity built or knowledge transferred to the local staff.

 

These participants took pride in the fact that their work resulted in good quality and durable infrastructure for Indonesia. Through this training, they added technical quality skills to their accounting profession.   Two of the outputs for the technical assistance are handbooks; one to help BPKP identify quality infrastructure and another to show local governments how to construct good quality infrastructure that can pass the national government’s rigorous inspection.

 

One local government representative expressed concern that higher quality independent verifications by the government would trigger a drop in verified outputs. But there was overwhelming consensus that even if the verified outputs drop initially, they will gradually increase since the contractors hired by the local governments have a strong incentive to pass the verification: unless they pass, they won’t be paid.  This would end up a win-win situation; more rigorous verifications will stimulate better construction leading to more
durable, higher-quality infrastructure. If the thoroughness and seriousness with which the participants conducted the verification simulation during the field visits is anything to go by, or a sign of things to come, then I am confident that BPKP is ready for a higher level of verification when the second phase of the program goes into effect. This is possible with a strong, autonomous and professional cadre of auditors from public institutions. This is further enhanced by national and professional pride, a commitment to poverty reduction, national commitment for excellence, strong institutions and, of course, funding for continuous learning and capacity building.   At the end of three weeks, this team of 213 participants is ready to contribute immediately to the Indonesia Local Government and Development Project.

 

I am reminded of the saying about when you give a man a fish, you feed him for a day; teach a man to fish, and you feed him (and his community) for a lifetime. Having a professional cadre of national independent verification agents ensures project sustainability, commitment to accountability and country ownership. With GPOBA’s support, BPKP is learning how to fish.

 

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    Very interesting article, Juliet. Thank you for sharing your thoughts.

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  • Juliet, many thanks for this interesting blog on the verification of outputs. Indeed, in most of the GPOBA funded projects, the implementing agencies hire independent verification agents to certify the outputs delivered by service providers. This process is aimed at ensuring the independence of the verification but it can be costly. In a few cases when the implementing agency is executing the project, the independent verification agent is hired by the World Bank. This was the case of Ethiopia Electrification where the national power utility, EEPCo was the GPOBA grant recipient and also implemented the access project.

     

    Mainstreaming the monitoring and verification functions within the government has been the practice of the successful renewable energy program
    in Bangladesh. The program is implemented by the Infrastructure Development Company Limited (IDCOL), a government owned infrastructure finance company in partnership with Partner Organizations (POs)/project sponsors. Regular inspections by IDCOL for compliance of the renewable energy technologies installed by the POs with technical standards plus biennial technical audits by independent third parties aim at ensuring the quality and sustainability of the program.

     

     

     

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