U.S. Agency for International Development: Status of Achieving
Key Outcomes and Addressing Major Management Challenges
(17-AUG-01, GAO-01-721).
This report reviews the U.S. Agency for International
Development's (USAID) fiscal year 2000 performance report and
fiscal year 2002 performance plan, which is required by the
Government Performance and Results Act of 1993 to assess an
agency's progress in achieving selected key outcomes that are
important mission areas for that agency. GAO found that although
USAID reported progress toward achieving the selected outcomes,
the extent of the progress is unclear because the agency based
its support on disaggregated and, in some cases, out-of-date and
selective data. Unlike past years when USAID issued separate
performance reports and performance plans, the agency issued a
performance overview supplemented by more detailed data in the
fiscal year 2000 budget justification to the Congress, both of
which incorporated elements of performance reporting and
planning. In the fiscal year 2000 Performance Overview, USAID
based its statements of progress on self-reported fiscal year
1999 performance data provided by individual USAID missions. In
addition, USAID reported progress toward achieving agency goals
and objectives by relying on selected information about an
individual country's missions' performance. Although USAID
reported detailed fiscal year 2000 performance data at the
operating unit level in its budget justification, those data were
not aggregated to summarize progress toward agency objectives.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-01-721
ACCNO: A01448
TITLE: U.S. Agency for International Development: Status of
Achieving Key Outcomes and Addressing Major Management Challenges
DATE: 08/17/2001
SUBJECT: Performance measures
Program evaluation
Reporting requirements
Strategic planning
Government Performance and Results Act
GPRA
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GAO-01-721
Report to the Ranking Minority Member, Committee on Governmental Affairs, U.
S. Senate
United States General Accounting Office
GAO
August 2001 U. S. AGENCY FOR INTERNATIONAL DEVELOPMENT
Status of Achieving Key Outcomes and Addressing Major Management Challenges
GAO- 01- 721
Page 1 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
August 17, 2001 The Honorable Fred Thompson Ranking Minority Member
Committee on Governmental Affairs United States Senate
Dear Senator Thompson: As you requested, we reviewed the U. S. Agency for
International Development?s (USAID) fiscal year 2000 performance report and
fiscal year 2002 performance plan required by the Government Performance and
Results Act of 1993 (GPRA) (P. L. 103- 62, 107 Stat. 285) to assess the
agency?s progress in achieving selected key outcomes that you identified as
important mission areas for the agency. 1 These are the same outcomes we
addressed in our June 2000 review of the agency?s fiscal year 1999
performance report and fiscal year 2001 performance plan to provide a
baseline by which to measure the agency?s performance from year to year. 2
These selected key outcomes are
economic growth and development, the spread of Human Immunodeficiency
Virus/ Acquired
Immunodeficiency Syndrome (HIV/ AIDS), and natural and man- made
disasters.
As agreed, using the selected key outcomes for USAID as a framework, we (1)
assessed the progress USAID has made in achieving these outcomes and the
strategies the agency has in place to achieve them and (2) compared USAID?s
fiscal year 2000 performance report and fiscal year 2002 performance plan
with the agency?s prior year performance report and plan for these outcomes.
Additionally, we agreed to analyze how USAID addressed its major management
challenges, including the governmentwide high- risk areas of strategic human
capital management and information security, that we and USAID?s Inspector
General
1 This report is one of a series of reports on the 24 Chief Financial
Officers (CFO) Act agencies? fiscal year 2000 performance reports and fiscal
year 2002 performance plans. 2 Observations on the U. S. Agency for
International Development?s Fiscal Year 1999 Performance Report and Fiscal
Years 2000 and 2001 Performance Plans
(GAO/ NSAID- 00- 195R, June 30, 2000).
United States General Accounting Office Washington, DC 20548
Page 2 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
identified. Appendix I provides detailed information on how USAID addressed
these challenges.
Although USAID reported it made progress toward achieving the selected
outcomes, the extent of the progress is unclear because the agency based its
support on disaggregated and, in some cases, out- of- date and selective
data. Unlike past years when USAID issued separate performance reports and
performance plans, the agency issued a performance overview supplemented by
more detailed data in the FY 2000 Budget Justification to the Congress, both
of which incorporated elements of performance reporting and planning. In the
FY 2000 Performance Overview, USAID based its statements of progress on
self- reported fiscal year 1999 performance data provided by individual
USAID missions. In addition, USAID reported progress toward achieving agency
goals and objectives by relying on selected information of individual
country missions? performance. Although USAID reported detailed fiscal year
2000 performance data at the operating unit level (i. e., country mission)
in the Budget Justification, those data were not aggregated to summarize
progress toward achieving agency objectives. Specific results under the
selected key outcomes are as follows.
Planned Outcome: Increasing Economic Growth and Development USAID reported
it made progress toward achieving this key outcome; however, the extent of
its progress toward meeting its goals in this area is unclear. The agency
reported an agencywide summary of self- assessment scores for the overall
strategic goal of increasing economic growth and agricultural development,
but the summary data were for 1999 and were not broken out by program
objective. Operating unit data for 2000 were presented but not aggregated to
summarize progress toward this key outcome.
Planned Outcome: The Spread of HIV/ AIDS - USAID reported that it made
progress toward achieving this key outcome; however, it is difficult to
assess actual progress. USAID did not systematically report on the sole
indicator- condom usage- outlined in the Annual Performance Plan for 2000,
or on progress toward the reduction of HIV/ AIDS prevalence rates. The
agency reported on many generally accepted proxy indicators for prevalence,
but 2000 data were limited to progress at the country mission level. The
lack of agencywide or regional level summary data- either for proxy
indicators or prevalence rates- limits the utility of the reported data for
assessing progress toward the desired outcome. Results in Brief
Page 3 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Planned Outcome: Natural and Man- Made Disasters - USAID reported it made
progress toward achieving this outcome; however, the extent of USAID?s
progress toward meeting its goals in this area is unclear. The agency
reported an agencywide summary of self- assessment scores for the overall
strategic goal of promoting humanitarian assistance, but the summary data
were for 1999 and were not broken out by program objective. Operating unit
data for 2000 were presented, but not aggregated to summarize progress
toward this key outcome.
USAID made significant changes in the manner of reporting progress and
future plans. USAID changed the focus of planning and reporting from the
agencywide level to the level of the country missions? and regional offices?
(operating units) strategic objectives or programs. This approach sought to
tie agency programs more closely to agency outcomes. In addition,
information to meet requirements for performance planning and reporting was
presented in two documents. The FY 2000 Performance Overview provided a
broad summary of agency performance for 1999 and a brief description of
plans for 2002. This overview primarily relied on selected examples of
progress rather than a systematic analysis. More detailed information on
performance in 2000, and planned performance targets for 2002, was presented
in the FY 2000 Budget Justification to the Congress, but the information is
limited to individual operating units and is not aggregated to summarize
performance at regional or agency levels.
The performance overview includes a discussion of specific goals, actions,
and measures for addressing governmentwide management challenges- strategic
human capital and information security- as well as three others we
identified: (1) developing reliable performance measures and accurately
reporting results of programs, (2) implementing an integrated financial
management system, and (3) developing accurate and reliable financial
management information. The discussion summarized efforts conducted in 2000
and plans for 2002.
In this report, we recommend that in future years the Administrator of USAID
provide clearer evidence of progress toward achieving agency outcomes,
including, where possible, aggregating performance results across agency
objectives and the activities under them.
In providing oral comments on a draft of this report, USAID officials said
they agreed with our recommendation but noted that not all measures were
conducive to aggregation due to differences in program operations and
country needs. We modified our recommendation to reflect the agency?s
concerns.
Page 4 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Purposes of the Government Performance and Results Act - GPRA is intended to
shift the focus of government decisionmaking, management, and accountability
from activities and processes to the results and outcomes achieved by
federal programs. New and valuable information on the plans, goals, and
strategies of federal agencies has been provided since federal agencies
began implementing GPRA. Under GPRA, annual performance plans are intended
to clearly inform the Congress and the public of (1) the annual performance
goals for agencies? major programs and activities, (2) the measures that
will be used to gauge performance, (3) the strategies and resources required
to achieve the performance goals, and (4) the procedures that will be used
to verify and validate performance information. These annual plans, issued
soon after transmittal of the President?s budget, provide a direct linkage
between an agency?s longer- term goals and mission and day- to- day
activities. 3 Annual performance reports are to subsequently report on the
degree to which performance goals were met. The issuance of the agencies?
performance reports, due by March 31, represents a new and potentially more
substantive phase in the implementation of GPRA -the opportunity to assess
federal agencies? actual performance for the prior fiscal year and to
consider what steps are needed to improve performance and reduce costs in
the future. 4
USAID Mission, Operating Environment, and Strategic Plan - USAID, an
independent federal government agency, is responsible for implementing U. S.
foreign assistance programs. USAID?s Administrator receives overall foreign
policy guidance from the Secretary of State on implementing U. S. foreign
assistance. 5 USAID operates programs in about 125 countries, with resident
staff in 75 countries in 4 regions of the world: sub- Saharan Africa, Asia
and the Near East, Latin America and the Caribbean, and Europe and Eurasia.
USAID promotes a wide range of assistance objectives related to economic and
agricultural growth; population, health, and nutrition; the environment;
democracy, governance, and the rule of law; education and training; and
humanitarian assistance. USAID staff frequently work in difficult
environments and under evolving demands, and programs often require years of
effort to achieve desired outcomes.
3 The fiscal year 2002 performance plan is the fourth of these annual plans
under GPRA. 4 The fiscal year 2000 performance report is the second of these
annual reports under GPRA. 5 USAID?s activities also contribute to the
Department of State?s strategic plan for international affairs. Background
Page 5 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
At USAID, decisions about programs and operating resources are based on the
settings in which the agency pursues its goals. These settings can vary
significantly across countries and regions, as well as over time. Therefore,
USAID relies on local participation in planning and implementing programs
since mission personnel are more familiar with the needs of a specific
locale. According to USAID, the agency develops a new strategic plan and
objectives for operating units to accomplish, or modifies existing ones, as
appropriate. As part of this effort, operating units develop plans for
performance monitoring that include baseline data and performance targets.
Operating units annually report progress against performance targets and,
based on the results, request resources for the following fiscal year. USAID
headquarters uses these results both to allocate funding and to make
?sector- wide assessments of the effectiveness of various objectives and
approaches? for use in its annual performance report. 6
In 1997, USAID defined a limited set of performance goals and indicators for
each of the agency?s strategic goals. According to the agency, the goals,
indicators, and targets are broad and at a country level. They share common
attributes, such as ?they are commonly available across countries; they are
for the most part independently collected and available from published
sources; and they permit performance reporting using a fairly compact set of
tables that can be readily summarized and aggregated.? 7 However, despite
these attributes, USAID acknowledges that one cannot attribute overall
country progress toward specific outcome areas solely to USAID programs.
According to the USAID strategic plan, despite supporting and contributing
to the achievement of performance goals, actual achievement is at best only
weakly linked to USAID programs and resources. With this in mind, USAID
revised its strategic plan in October 2000, and beginning this year, the
agency will use the strategic objectives and indicators of operating units,
which include country missions, regional offices, and bureaus, as the
agency?s performance goals for its annual performance plan and annual
performance report. USAID felt that at this level, it could more clearly
demonstrate its contributions.
Further, the agency changed the manner in which it will present performance
plans and results by issuing two annual documents replacing previous years?
Annual Performance Plan and Annual Performance Report, starting with results
reporting for fiscal year 2000 and planning for 2002.
6 USAID Strategic Plan 1997 (Revised 2000). 7 Ibid, p. 5.
Page 6 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Both new documents will incorporate elements of past year results and future
year plans, with a general description of both provided in a Performance
Overview and more detailed performance data and targets provided in the
annual Budget Justification to the Congress.
This section discusses our analysis of USAID?s performance in achieving its
selected key outcomes and the strategies the agency has in place. 8 Although
USAID reported it made progress toward achieving the selected outcomes, the
extent of the progress is unclear because the agency based its support on
disaggregated and, in some cases, out- of- date and selective data. Actual
progress toward achieving outcomes, detailed in the FY 2000 Performance
Overview, is not clear because USAID did not base its assessment of progress
on fiscal year 2000 performance data. Instead, the agency relied on
selective performance data the operating units submitted for fiscal year
1999. 9 Data presented in the Fiscal Year 2002 Budget Justification to the
Congress represent 2000 performance; however, USAID provided no discussion
of the data?s validity and reliability. In addition, limiting performance
data to the disaggregated level of the operating units? strategic objectives
makes determining progress toward achieving agency goals difficult. Finally,
the agency provided a discussion of strategic human capital management 10
issues and strategies related to its
8 USAID generally has a three- tiered hierarchy for describing its strategic
and performance plans. At the top of the framework are the strategic
development goals, which are statements of USAID?s broad activities, such as
encouraging economic growth and agricultural development. Next are the USAID
objectives, which are more focused statements of areas of activity, such as
expanding and strengthening critical private markets, but are still applied
to agencywide efforts. Lowest in the framework are the operating unit
strategic objectives, which are in essence the actual programs operated by
the country missions and regional offices and bureaus. To be consistent with
our requestor?s mandate, we refer to the strategic goals and USAID
objectives we examined as ?selected key outcomes.? However, we do maintain
USAID?s vernacular when discussing performance at the operating unit level.
9 USAID relied on performance data derived from a preexisting internal
reporting process. The reporting deadline for this process, however, was
past the point in which fiscal year 2000 data could be collected and
analyzed to meet its performance reporting deadline under GPRA. Assuming
USAID continues to use this internal reporting process for GPRA reports, the
time frame for that process must be made compatible with GPRA time frame. If
not, USAID will be forced either to report out- of- date information in its
annual GPRA report or to issue its performance report with the correct data
after GPRA deadline.
10 Key elements of modern human capital management include strategic human
capital planning and organization alignment; leadership continuity and
succession planning; acquiring and developing staffs whose size, skills, and
development meet agency needs; and creating results- oriented organizational
cultures. Assessment of
USAID?s Progress and Strategies in Achieving Selected Key Outcomes
Page 7 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
efforts for addressing natural and man- made disasters, but it did not
discuss human capital issues and strategies in the context of its economic
development and HIV/ AIDS activities. The agency also did not discuss
information technology issues and strategies in the context of accomplishing
the three key outcomes.
USAID reported it made progress toward achieving its outcome of increasing
economic growth during 2000. However, the Performance Overview does not
clearly articulate the agency?s actual progress and relies on 1999
performance results and mission self- assessments. Moreover, fiscal year
2000 data reported in the Budget Justification were not aggregated to
summarize regional or agency level performance.
To achieve this outcome 11 USAID undertakes programs under three broad
objectives:
expanding and strengthening critical private markets, enhancing
agricultural development and encouraging food security, and expanding and
creating more equitable access to economic opportunity
for the rural and urban poor. Seventy- five missions, regional offices, and
bureaus (operating units) carry out 152 programs, also referred to as
strategic objectives, under one or more of the three objectives. For
example, more than two- thirds of the operating units supporting the
economic growth outcome have programs with a focus on strengthening markets.
The agency reported in the Performance Overview that overall it met or
exceeded performance expectations for encouraging economic growth and
agricultural development for 88 percent of the 152 strategic objectives.
USAID based this determination on operating unit self- assessments but does
not explain how these self- assessments were conducted.
In addition, USAID did not assess agency progress against the performance
goals contained in the Annual Performance Plan for Fiscal Year 2000. For
example, the agency did not report 2000 performance for the percentage of
countries with annual growth of Gross Domestic Product per capita of at
least 1 percent. Instead, the performance overview includes a discussion of
economic growth trends in USAID recipient countries by region drawing on
these broad country- level indicators.
11 USAID refers to this outcome as a strategic goal. Economic Growth and
Development
Page 8 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
USAID?s fiscal year 2002 Budget Justification, which USAID completed after
it submitted the Performance Overview, does contain fiscal year 2000
performance data. These data described the progress missions and other units
made relative to agreed upon targets. However, the data are presented for
individual operating units and are not aggregated to summarize regional or
agencywide performance in either this document or the Performance Overview.
USAID reported that 13 percent of the operating units? economic growth and
agricultural development strategic objectives did not meet expectations. For
example, the overview states that several USAID programs under the
strengthening markets objective failed to meet their goals. The Performance
Overview listed operating units in the Europe and Eurasia region, including
Albania, Armenia, Croatia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan,
and Uzbekistan, as having difficulties. USAID further reported that programs
in other regions, including Angola, Colombia, and Haiti, also fell short of
expectations. USAID attributed these difficulties to external factors,
especially to the lack of host government commitment to reforms and, in some
cases, to political instability stemming from government transition. For
example, USAID reported that in Croatia the agency suspended assistance
under its financial program in 1998 because the government showed no
willingness to engage in any meaningful economic reform.
USAID?s explanation for not meeting some of its performance goals is
consistent with its reporting of the prior year?s performance. USAID
acknowledged that external factors, such as international financial
conditions, might seriously affect desired program outcomes. Although, the
Performance Overview provides examples of some programs that did not meet
expectations in 1999, it does not provide details on all programs that did
not meet expectations. Nor does it discuss strategies for addressing unmet
goals in either 2000 or 2001. Although the Budget Justification contains
detailed fiscal year 2000 performance information for individual operating
units, explanations for why missions failed to meet performance targets for
specific strategic objectives are not always provided. For example, one
target of USAID?s program for reconstruction and expanded economic
opportunity in Lebanon was ?7,800 informal sector loans delivered.? The
actual number of loans provided in 2000 was 5,880. The Budget Justification
did not discuss the significance of, or provide a reason for, this
shortfall.
The Performance Overview does not assess the impact of its fiscal year 2000
performance on the likelihood of achieving its fiscal year 2001 goals
Page 9 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
for economic growth and agricultural development. The overview contains a
general statement concluding that prospects for further progress are good,
but it does not state what data this assertion is based on. It adds,
however, that actual progress will continue to depend mainly on the selfhelp
efforts of governments and countries.
The Budget Justification discusses fiscal year 2000 performance and fiscal
year 2001 prospects for each strategic objective described for the
individual countries and regions. For example, one strategic objective
presented in the Budget Justification for the Philippines is to ?accelerate
the economic transformation of Mindanao.? USAID cited progress in some of
its efforts in fiscal year 2000, such as the number of marginal farm and
fishing families initiating commercial- level production of more high- value
products. The agency reported that performance in 2001 will be affected by
the general poor performance of the national economy and the degree to which
progress is achieved in managing the continued conflict in parts of
Mindanao.
The Performance Overview includes a general discussion of planned activities
at a few operating units for achieving unmet performance goals (based on
fiscal year 1999 data), but it does not include specific strategies or time
frames. For example, in commenting on efforts in Haiti, where programs did
not meet expectations, USAID reported that it would continue to work in
collaboration with other donors to consolidate gains and continue a reform
process. USAID?s overall strategies for achieving its performance goals,
such as expanding trade through policy, legal, and regulatory reform;
increasing production of agricultural commodities; and providing small loans
and business training for the rural poor, are reasonable. The overview
provides a general discussion of USAID?s plans for 2002, stating that the
basic framework that guides operating choices will remain the same. The
Budget Justification contains more detailed information by country and
region.
USAID recognized the contribution of other multilateral and bilateral donor
organizations, host- country governments, and U. S. government agencies. The
Performance Overview included a general statement acknowledging that its
economic growth and agricultural development programs do not operate in a
vacuum. The overview also lists major multilateral and bilateral donors. The
Fiscal Year 2002 Budget Justification provided more details on USAID?s
specific contributions and the contributions of other donor programs by
country and strategic objective. In addition, the overview discussed using
studies and evaluations to confirm its broad- based economic approach to
development, but it did not
Page 10 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
state whether these tools were employed when developing plans for 2002. In
addition, the overview did not discuss issues related to strategic human
capital management and information security as strategies to achieve
increased economic growth and agricultural development. The overview
includes a separate section that discusses USAID?s agencywide strategic goal
to achieve USAID goals efficiently and effectively. This goal includes
objectives that address strategic human capital management and information
technology issues.
It is difficult to assess the progress USAID made in 2000 toward achieving
this outcome. The agency did not systematically report on its sole
indicator- condom usage- detailed in the Annual Performance Plan for 2000.
Moreover, the Performance Overview relies on 1999 performance data of
selected missions, and fiscal year 2000 data reported in the Budget
Justification were not aggregated to summarize regional or agency level
performance.
Strategies for addressing this selected outcome of reducing the transmission
and impact of HIV/ AIDS 12 are diverse and include efforts to change
sexually risky behavior and cultural norms; develop, test, and promote
prevention and provide care; treat and prevent sexually transmitted
infections; enhance nongovernmental, public- and privatesector
organizations? capacities to prevent the spread of HIV/ AIDS and support
persons affected by the disease; and improve the availability, quality, and
use of evaluations and surveillance information. USAID works closely with
the international community on HIV/ AIDS efforts, including host
governments, other national and multilateral assistance agencies,
nongovernmental organizations, and the private sector. In addition, USAID
partners with the U. S. Bureau of the Census to maintain and update the HIV/
AIDS International Surveillance Database and provides funding for HIV/ AIDS
research to the Centers for Disease Control.
The performance goal for USAID?s HIV/ AIDS activities is to reduce HIV
infections by 10 percent among 15- to 24- year- olds between 1998 and 2007.
13 Although this goal is objective and quantifiable, progress toward
12 This selected outcome is one of five agency objectives under USAID?s
strategic goal of stabilizing the world?s population and protecting human
health. 13 The prevalence rate is the percentage of the adult population
currently infected with HIV. USAID uses as its baseline country- level and
regional- level prevalence rates for 1997 developed by the Joint United
Nations Programme on HIV/ AIDS. The Spread of HIV/ AIDS
Page 11 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
achieving it cannot be assessed since USAID did not systematically report
prevalence data for 2000 either at the regional or country level. 14 In
addition, USAID also did not systematically report on its sole proxy
indicator for reducing HIV/ AIDS prevalence- condom usage- identified in the
Annual Performance Plan for 2000 but did not cite a reason. However, the
agency reported on other generally accepted proxy indicators for reducing
HIV/ AIDS transmissions not prescribed in the plan for 2000, such as condom
sales, but data reported in the Performance Overview were mostly from 1999,
while 2000 data reported in the Budget Justification were not sufficiently
aggregated to summarize agency performance.
In a March 2001 report, we concluded, in part, that USAID?s ability to
measure the impact of its activities on reducing the transmission of HIV/
AIDS is limited by a ?lack of routine reporting of results to headquarters.?
15 While the agency has begun implementing a new monitoring and evaluation
system, planning for the system did not specify to whom data would be
reported or how it would be used. We also noted in the report that in 1998
USAID established a data repository for collecting and tracking performance
data from HIV/ AIDS programs. However, the agency did not require that
missions actually report information to that data facility. The lack of a
reporting requirement to a centralized unit- whether at the regional or
headquarters level- affected the agency?s ability to generalize about
progress toward the selected outcome and to make management and resource
decisions based upon the data. It also inhibited sharing best practices
because the agency cannot compare activities across countries. We concluded
that failure to address these issues not only inhibits USAID?s ability to
measure performance, but also hinders the agency?s decisionmaking regarding
allocation of resources among missions and regional offices and limits its
efforts to identify best practices.
USAID?s reporting of 2000 results and its planning for 2002 performance
underscore our conclusion. USAID did not provide information on indicators
that summarized worldwide or regional levels. Further, in addition to a
reliance on fiscal year 1999 data, information provided in the Performance
Overview to support overall statements of accomplishments
14 USAID is supporting improvement in national sentinel surveillance systems
to allow for annual measurement of this indicator. 15 Global Health: U. S.
Agency for International Development Fights AIDS in Africa, but Better Data
Needed to Measure Impact (GAO- 01- 449, Mar. 2001).
Page 12 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
is selective and at a country level, and may or may not be representative of
all countries where similar data are collected. For example, in the
Performance Overview USAID addressed progress toward the reduction of HIV/
AIDS prevalence by discussing only three countries, saying its assistance
resulted in a 50- percent decline in prevalence rates among young urban
women in Uganda, a reported reduction in rates for 15- to 19year- olds in
Zambia, and the maintenance of low prevalence rates in Senegal. Despite
citing no data for the latter two countries, USAID officials said Uganda,
Senegal, and Zambia represent significant accomplishments and show the donor
community can have impact on stemming the spread of HIV/ AIDS. Although it
is important to show where USAID and its partners in the international
community have made strides against the pandemic, these three countries
represent just 7 percent of the countries where USAID operates HIV/ AIDS
programs. 16 Moreover, the citation of three interventions generally
considered successes does not provide enough information to assess overall
progress toward achieving the desired outcome.
USAID?s 2002 Budget Justification provided data on various HIV/ AIDS
indicators for each unit operating HIV programs. As with the Performance
Overview, the indicators were generally accepted proxies for HIV/ AIDS
prevalence. These indicators were diverse- almost 60 distinct measures used
by 24 missions and regional offices in the Africa region alone (see table 1
for examples from Zambia and South Africa). In addition, many missions used
output- rather than outcome- oriented performance measures, reflecting their
primary use as management tools for specific program activities. A few
operating units, such as the missions in Uganda and Ghana, reported
prevalence- based indicators, while other country missions, such as in
Rwanda, Ethiopia, and Mozambique, reported on condom usage. Although the
data contained in the Budget Justification may be useful for program
management within a specific mission, or for individuals interested in
assessing effects of activities in a specific country, the lack of
consistent indicators limits the usefulness of this document for determining
agencywide progress toward achieving the key outcome.
16 The agency reported that as of spring 2000 it operated HIV/ AIDS programs
in 46 countries.
Page 13 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Table 1: Fiscal Year 2000 Performance and Future Year Planned Performance on
HIV/ AIDS Indicators for Zambia and South Africa
FY 2000 FY 2000 Target FY 2001 FY 2002 HIV/ AIDS Indicators (actual)
(planned) achieved (planned) (planned) Zambia
Condoms sold (millions) 8.6 7. 5 Yes 9. 5 10.5 Family planning, new
acceptors 98,000 175,000 No 105,000 110,000 Vitamin A, 6 to 72- month- olds
receiving supplements (%) 86 74 Yes 85 85
South Africa
Sexually transmitted infections treated, males (%) 82 75 Yes 86 90 Prenatal
consultation, females (%) 74 80 No 78 82 HIV counseling access (%) NR 85
Unknown 90 95 Antenatal care access, females (%) NR 80 Unknown 85 90
Legend NR = Not Reported Source: GAO analysis of USAID data.
In 2001, USAID began expanding its response to the HIV/ AIDS pandemic by
developing new strategies and activities designed to prevent new
transmissions of HIV and identify and treat those with the disease. In the
Performance Overview, USAID stated it would support both highprevalence
countries and low- prevalence, high- risk countries by building capacity to
provide care and support for affected individuals and families; reduce the
social and economic impact of key vulnerable groups, such as health,
education, and government professionals; and develop and introduce new
prevention and care approaches and technologies, such as microbicides,
lower- cost testing with quicker results, and behavior change activities.
The Performance Overview provided no specific set of overall performance
targets for its efforts in 2002, but it discussed the accomplishments USAID
expects to make by 2007 in unspecified ?selected countries,? which include
reducing HIV prevalence rates among 15- to 24- year- olds by 50 percent in
high- prevalence countries and maintaining prevalence rates below 1 percent
among 15- to 49- year- olds in low- prevalence, high- risk countries;
providing access to interventions aimed at reducing mother- to- child
transmissions of HIV to 25 to 50 percent of infected mothers in
highprevalence countries;
Page 14 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
building host- country capacity to provide basic care and psychosocial
services to at least 25 to 50 percent of children affected by AIDS,
including those who have lost parents to the disease; and lessening the
impact of HIV/ AIDS on the key labor sectors, such as
education, health, and government professionals. The above measures are
objective and measurable, and USAID stated that the targets would be
regularly reviewed and revised in light of the evolving pandemic and ongoing
analyses of the cost- effectiveness of the programs. To do so, USAID, in
collaboration with the Centers for Disease Control, the World Health
Organization, and the Joint United Nations Programme on HIV/ AIDS, will
improve HIV sentinel surveillance systems in selected countries to report
annually on HIV prevalence among 15- to 24- year- olds. However, USAID did
not state the degree by which information will be aggregated so that
decisionmakers in USAID?s regions and headquarters, as well as the Congress,
can deliberate on resource allocations based on progress toward reducing the
spread of the HIV/ AIDS pandemic.
As with the performance data for 2000, USAID?s 2002 Budget Justification
provided more detailed indicators of planned future performance than the
Performance Overview. However, the indicators are again disaggregated to the
mission level. The lack of meaningful data aggregation- whether to the
regional or agency level- of HIV/ AIDS performance indicators reported in
the Performance Overview and Budget Justification limits their value for
determining progress toward this selected outcome. We understand that
missions must operate HIV/ AIDS programs as they fit with the needs of the
host nation and that some USAID activities are not conducive to quantitative
measurement. However, there are methods of data aggregation, such as showing
the number of country missions that achieved planned targets for any
particular indicator common among missions, that provide more meaningful
assessments of whether progress is being made toward the agency?s goals and
objectives.
USAID reported it made progress toward achieving its outcome of saving lives
and reducing suffering associated with natural or man- made disasters during
2000. However, the Performance Overview does not clearly articulate the
agency?s actual progress and relies on 1999 performance results and mission
self- assessments. Moreover, fiscal year 2000 data reported in the Budget
Justification were not aggregated to summarize regional or agency level
performance. Natural and Man- Made
Disaster
Page 15 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
USAID supports this outcome around the world through a total of 31 strategic
objectives in 24 operating units. USAID stated performance expectations were
met or exceeded for 87 percent of operating units? strategic objectives.
However, the agency based this determination on 1999 operating unit self-
assessments, without explaining how these selfassessments were conducted.
The overview also discussed USAID?s humanitarian assistance trends by
regions, using indicators such as crude mortality rate; prevalence of acute
malnutrition in children under age 5; number of refugees and internally
displaced persons; and changes in the freedom, civil liberties, and
political rights classification of post- conflict countries. Data for these
indicators also represented 1999 performance results.
USAID used the operating units? strategic objectives and local performance
indicators to report progress in the Budget Justification. The performance
indicators are measurable and provide a reasonable assessment of USAID?s
specific efforts. For example, a strategic goal of USAID?s program in El
Salvador is to reduce the vulnerability of the rural poor to natural
disasters in target areas. One of the performance measures is the number of
community members trained in disaster preparedness. USAID?s target for 2000
was to train 750 community members. The actual number for fiscal year 2000
was 2, 313.
The Performance Overview does not assess the impact of its fiscal year 2000
performance on the likelihood of achieving its fiscal year 2001 goals. It
does include a discussion of future plans that describes a number of
recommended actions that, based on its past experience, the agency intends
to implement to improve its capacity to respond to disasters. In addition,
the Budget Justification provides specific details for individual countries?
strategic objectives. For example, for USAID?s program in the Dominican
Republic, the Budget Justification states that its Hurricane Georges
Reconstruction objective is meeting expectations and should achieve all
objectives by December 31, 2001.
In March 2001, we testified that USAID?s disaster recovery assistance
program in the wake of hurricanes Mitch and Georges has made progress. 17
After some initial start- up problems, most activities are scheduled for
completion on or before December 31, 2001, as USAID and congressional
17 Foreign Assistance: Implementing Disaster Recovery Assistance in Latin
America
(GAO- 01- 541T, Mar. 21, 2001).
Page 16 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
staff had informally agreed. In its most recent quarterly report for the
period ending June 30, 2001, USAID reported that it and the other U. S.
agencies involved in the hurricane assistance had spent about $413 million,
or 67 percent, of the disaster recovery funding. With some variance by
country, USAID and the other U. S. departments and agencies involved have
used the disaster recovery assistance to bring about economic recovery,
improve public health and access to education, provide permanent housing for
displaced families, and improve disaster mitigation and preparedness. To
achieve these broad objectives, USAID funded infrastructure construction and
repair, technical assistance and training, loans for farmers and small
businesses, and some commodities.
The Performance Overview provides a general discussion of USAID?s plans for
2002, stating that the agency?s disaster relief, based on the 1999 self-
assessments of performance from the operating units, are on track and that
no major changes to the strategic framework are expected. USAID further
reports that it anticipates responding to the same levels of crises in the
next year but that it may be called upon to provide increasing levels of
assistance. The Performance Overview includes a general discussion of the
participation of other U. S. and international agencies. It specifically
mentions USAID?s relationship with United Nations agencies, particularly the
World Health Organization and the United Nations Administrative Coordinating
Committee/ Subcommittee on Nutrition. The overview states that the
committee/ subcommittee is a coordinating mechanism for exchanging
information and technical guidance on nutrition and that it assists USAID in
monitoring the performance goals on nutrition status of children under age 5
and crude mortality rate. The Budget Justification also discusses USAID?s
collaboration with other agencies for specific strategic objectives.
USAID reports that during fiscal year 2000, it began an evaluation of
internal responses to emergencies and transitions with a special focus on
complex emergency transitions, but it did not provide specific details.
USAID reported sharing lessons learned across the agency and with
implementing partners. The overview addresses some human capital issues in
its discussion of recommended actions needed to strengthen USAID?s capacity
to respond to complex emergencies. For example, USAID plans to develop a
reserve corps of nondirect- hire workers to supplement direct- hire
humanitarian workers and establish a career ladder for its humanitarian
response professionals.
Page 17 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
USAID?s revised approach to performance planning and reporting, which uses
the Performance Overview for discussing general performance and future
expected results, and the Budget Justification for presenting detailed data
on operating unit performance, have advantages and disadvantages. Reporting
progress against the operating units? strategic objectives gives a clearer
picture of how the agency?s activities contribute to performance goals.
However, USAID acknowledges that the main drawback to the reporting change
is that there are many different objectives and performance indicators and
that the measures and objectives are based on programs that are tailored to
local needs. Another problem is that the Performance Overview for 2000
contains limited and out- of- date performance data, making it difficult to
assess USAID?s progress. Moreover, the overview does not consistently
provide explanations for unmet goals or strategies for achieving them in the
future. The Budget Justification provides more detailed fiscal year 2000
performance information and fiscal year 2002 plans for individual countries
and regional offices and bureaus.
USAID?s decision to use actual operating units? strategic objectives as the
agency?s performance goals responds to past criticisms of its use of broad
development performance indicators. For example, in June 2000, we reported
that indicators of economic growth could not realistically serve as measures
of USAID?s specific efforts. 18 We further stated, and USAID acknowledged,
that although its assistance can contribute to economic growth, many other
factors determine the actual level of growth in a country. However, by
disaggregating performance planning and reporting data to the operating unit
level, USAID has made it more difficult to assess progress toward achieving
agency objectives and goals.
18 Observations on the U. S. Agency for International Development?s Fiscal
Year 1999 Performance Report and Fiscal Years 2000 and 2001 Performance Plan
(GAO/ NISAD- 00- 195R, July 20, 1999). Comparison of
USAID?s Fiscal Year 2000 Performance Report and Fiscal Year 2002 Performance
Plan With the Prior Year Report and Plan for Selected Key Outcomes
Page 18 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
We have identified two governmentwide high- risk areas: human capital and
information security. 19 Regarding human capital, we found that USAID?s
Performance Overview discussed performance results of efforts in 2000 to
resolve strategic human resource issues. The indicators for this area were
objective and measurable. The Performance Overview also discussed two
performance goals for 2002 regarding strategic human capital management-
strengthening human capital resources planning capabilities and addressing
skill shortages. These goals and their associated indicators are objective
and measurable. USAID also reported meeting two key milestones to support
information security challenges management and technology it achieved in
2000, but the agency did not state whether these were all the performance
targets for the year. USAID also listed two performance indicators related
to information security for 2002- the security and integrity of the legacy
core financial management systems enhanced and federal certification of the
general control environment and system security for half of the agency?s
missions obtained. Both indicators are objective and measurable. While the
Performance Overview discussed achievements and planned performance for
strategic human capital and information security on an agency level, it
generally did not discuss them within the selected key outcomes.
In January 2001, we reported on one additional management challenge specific
to the agency. 20 USAID faces challenges in developing reliable performance
measures and accurately reporting the results of its programs. Our past
work, and that of the USAID Inspector General, 21 has identified a number of
problems with the annual results data that USAID?s operating units have been
reporting. For example, in commenting on USAID?s fiscal year 2000
performance plan, we noted that the plan provided limited confidence that
the agency had the capacity to obtain credible, results- oriented program
performance information. In addition, a 1999 Inspector General review of
data prepared by 18 missions for 1996 showed problems with the results
reported for 83 percent, or 252, of the 302 indicators. USAID has
acknowledged that performance measurement is a challenge. In the Performance
Overview, the agency reported the
19 Major Management Challenges and Program Risks: A Governmentwide
Perspective
(GAO- 01- 241, Jan. 2001) 20 Major Management Challenges and Program Risks:
U. S. Agency for International Development (GAO- 01- 256, Jan. 2001). 21
Audit of the Quality of Results Reported in USAID Operating Units? Results
Review and Resources Request Reports Prepared in 1997 (Report No. 9- 000-
99- 006- P, Mar. 5, 1999). USAID?s Efforts to
Address Its Major Management Challenges Identified by GAO
Page 19 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
results of a number of efforts it undertook in 2000 to improve the quality
and availability of performance data, most of which were objective and
measurable. USAID also provided three performance goals and indicators for
2002 to continue addressing this challenge. However, the goals and
indicators were general in scope, not readily measurable, and not well
explained.
In June 2000, we reported on two additional challenges related to financial
management: USAID had not implemented an integrated financial management
system, and the agency?s financial information was unreliable. In the
Performance Overview, USAID stated it initiated a comprehensive study of its
financial management operations worldwide, begun transitioning to a new
accounting system, and begun configuring a commercial financial software
package for the agency. In 2002, USAID plans to install a fully operational,
secure, core financial system compliant with federal requirements and that
will integrate worldwide financial operations.
USAID has made an attempt to address past criticisms of its performance
indicators. For example, many indicators in past years were too broad to
demonstrate the agency?s actual contribution toward meeting performance
goals. This year?s approach sought to tie the agency?s efforts more closely
to the agency?s desired outcomes by reporting performance data at the
operating unit level. By using this approach, however, USAID did not
adequately demonstrate progress toward the agency?s selected key outcomes in
its performance reporting documents. Although USAID provided aggregate data
of the number of strategic objectives met under an outcome area, additional
information summarizing results at the unit level and linking it to agency
goals is needed to help assess overall progress. For example, under economic
development activities, it would have been useful for USAID to provide
information on the number of units meeting performance targets related to
the agency objective of expanding and strengthening critical private markets
and associated activities, such as developing private enterprises.
We recommend that the Administrator of USAID take actions to provide clearer
evidence of progress toward achieving agency outcomes. The actions should
include reporting aggregated performance results of agency objectives and
the activities under them. This aggregation should be sufficient to provide
a clear linkage between overall statements of Conclusions
Recommendation
Page 20 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
progress found in the Performance Overview and unit level data presented in
the Budget Justification.
As agreed, our evaluation was generally based on the requirements of GPRA,
the Reports Consolidation Act of 2000, guidance to agencies from the Office
of Management and Budget (OMB) for developing performance plans and reports
(OMB Circular A- 11, part 2), previous reports and evaluations by us and
others, our knowledge of USAID?s operations and programs, our identification
of best practices concerning performance planning and reporting, and our
observations on USAID?s other related GPRA efforts. We also discussed our
review with agency officials at USAID and OMB, and with the USAID Office of
Inspector General. The agency outcomes that were used as the basis for our
review were identified by the Ranking Minority Member of the Senate
Committee on Governmental Affairs as important mission areas for the agency
and do not necessarily reflect the outcomes for all of USAID?s programs or
activities. We did not independently verify the information contained in the
Performance Overview or Budget Justification, although we did draw from our
other work in assessing the validity, reliability, and timeliness of USAID?s
performance data. We conducted our review from April 2001 through July 2001
in accordance with generally accepted government auditing standards.
We received oral comments on a draft of this report from the Director,
Center for Development Information and Evaluation and other USAID officials
who agreed with our general recommendation that the agency take actions to
provide clearer evidence of progress toward achieving outcomes. In addition,
the officials agreed in principle that aggregation of performance data would
allow a better understanding of agency progress. However, the officials
noted that the complexity of the issues USAID addresses, the long- term
sustained efforts needed to affect positive change, and the difficult
environments where the agency works can lead to differences in programs
between countries. As a result, they were concerned that many outcome and
some output measures were not conducive to aggregation. We modified our
recommendation to reflect the agency?s concerns.
In response to our statement that USAID failed to report on HIV/ AIDS
prevalence and condom sales, USAID officials stated that these data have
become available since the issuance of the Performance Overview and Budget
Justification. In addition, they noted that under monitoring and evaluation
activities for USAID?s expanded response to HIV/ AIDS, the Scope and
Methodology Agency Comments
Page 21 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
agency is developing a template for annual HIV/ AIDS performance reports to
help guide the field missions. This template will show not only the topics
and order of discussion in the report, but also the data needs and sources
to inform the discussion. USAID officials said this monitoring and
evaluation activity could become a model for agencywide performance planning
and reporting. USAID officials provided technical comments that we
incorporated as appropriate.
As arranged with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days after
the date of this letter. At that time, we will send copies to appropriate
congressional committees; the Administrator, U. S. Agency for International
Development; and the Director, Office of Management and Budget. Copies will
also be made available to others upon request.
If you or your staff have any questions, please call me at (202) 512- 4128.
Key contributors to this report are listed in appendix II.
Sincerely yours, Jess T. Ford Director, International Affairs and Trade
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 22 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
The following table identifies the major management challenges confronting
the U. S. Agency for International Development (USAID), which include the
governmentwide high- risk areas of strategic human capital management and
information security. The first column lists the challenges identified by
our office, USAID?s Inspector General, and the agency itself. The second
column discusses progress USAID made in resolving its challenges, based on
its FY 2000 Performance Overview. The third column discusses the extent to
which USAID?s fiscal year 2002 performance plan includes performance goals
and measures to address the challenges identified by us and USAID?s
Inspector General. We found that USAID reported progress during 2000 in
resolving most of its challenges except for three: (1) the reconciliation of
financial management information, (2) the agency?s broad and changing
mandate, and (3) strengthening of collaboration with partners and
stakeholders. Of the agency?s 12 major management challenges, its
performance plan had (1) goals and measures directly related to 7 of the
challenges; (2) no goals and measures related to 2 of the challenges but
discussed strategies to address them; and (3) no goals, measures, or
strategies to address 3 of the challenges. Appendix I: Observations on the
U. S. Agency
for International Development?s Efforts to Address Its Major Management
Challenges
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 23 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Table 2: Major Management Challenges Major management challenge
Progress in resolving major management challenge, as discussed in the fiscal
year 2000 performance overview Applicable goals and measures in the fiscal
year
2002 performance plan GAO- designated governmentwide high- risk challenges
Strategic Human Capital Management: GAO has identified shortcomings at
multiple agencies involving key elements of modern human capital management,
including strategic human capital planning and organizational alignment;
leadership continuity and succession planning; acquiring and developing
staff whose size, skills, and deployment meet agency needs; and creating
results- oriented organizational cultures.
(GAO also identified human capital management issues as a major management
challenge for USAID.)
(USAID?s Inspector General also reported strategic human capital management
as a major management challenge.)
USAID stated it took a number of steps to build a stronger and more capable
human resource base. Of primary importance, USAID stated it ?staffed every
critical position through FY 2000 and believes that its human resource
constraints will be sufficiently eased by FY 2002.? The agency initiated a
New Entry Professionals (NEP) program for hiring entry- level staff (FS- 4
salary class), and increased the level of midcareer professionals. In
addition, the agency increased the number of seniorlevel managers trained
through external sources and developed in- house training to enhance the
results- oriented management, financial management, acquisitions and
assistance, and supervisory skills of program managers and staff.
Specific performance results in 2000 included
hiring 51 NEPs and retaining 63 NEPs at the end of the fiscal year;
having 996 Foreign Service Officers on staff at the end of 2000;
providing training to - 101 senior executives through the Federal
Executive Institute, Carley Senior Leadership Training, and Foreign Affairs
Leadership Seminar; - 140 individuals in supervisory classes and seminars; -
435 technical staff on funds management; and - 700 employees on new
acquisition and assistance rules and procedures;
certifying 80 percent of contracting officers; and
outsourcing the automated personnel and payroll functions to the
Department of Agriculture?s
USAID reported it intends to strengthen its human resource planning
capabilities and address skill shortages in 2002 by pursuing and achieving
the following goals and indicators:
Human Resource Planning Capabilities Strengthened: Rapid deployment of staff
in all labor categories through intensified recruitment efforts. USAID plans
to meet all its Foreign Service and Civil Service staffing requirements and
make ?Web- enhanced human resource management tools? available to human
resource management personnel.
Skill Shortages Addressed: USAID will continue to provide in- house training
on critical operational skills, including acquisitions and assistance
training to 450 technical officers and leadership training for 125 managers.
FAIR Act Report: In March 2001, the Office of Management and Budget directed
federal agencies to prepare a plan for 2002 for outsourcing not less than 5
percent of ?commercial activities? positions defined by the Federal
Activities Inventory Reform (FAIR) Act of 1998 (P. L. 105- 270). USAID
stated that it identified a total of 631 positions classified as commercial
functions, which would translate to 32 positions, at a minimum, being
outsourced. USAID stated that given its current skills shortage and the
existing efforts to recruit new employees, it will not be able to achieve
OMB?s requirement. In addition, USAID stated that the majority of commercial
activities staff also perform USAID core functions that cannot be outsourced
or contracted out.
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 24 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Major management challenge Progress in resolving major
management challenge, as discussed in the fiscal year 2000 performance
overview Applicable goals and measures in the fiscal year
2002 performance plan
National Finance Center. USAID planned to have a total of 1,000 Foreign
Service Officers at the end of fiscal year 2000, but fell just short with
996. USAID reported no performance targets for the remaining indicators.
Information Security: Our January 2001 high- risk series update noted that
since our last high- risk report in January 1999, efforts to strengthen
information security have gained momentum and expanded both at individual
agencies and at the governmentwide level. However, recent audits continue to
show that federal computer systems are riddled with weaknesses that make
them highly vulnerable to computer- based attacks and place a broad range of
critical operations and assets at risk for fraud, misuse, and disruption.
(USAID?s Inspector General also reported computer security as a major
management challenge and noted that mission directors are not accountable
for information security.)
USAID?s 2000 performance overview stated that security risk assessments were
completed at a number of missions and a Web- based security course was
developed. However, the report does not list the number or location of the
missions. In addition, the report does not provide any information on the
content of the security training or the numbers and types of personnel who
received the training.
USAID?s plan provided two performance goal indicators. One is for USAID to
enhance the security and integrity of legacy core financial management
systems. The second is for the agency to achieve federal certification of
the general control environment and system security for half of the agency?s
missions.
GAO- and IG- designated major management challenges
Challenges with developing reliable performance measures, and accurately
reporting results of programs: USAID continues to have problems developing
performance measurement systems that meet external and internal reporting
requirements, including the requirements of the Government Performance and
Results Act of 1993.
USAID stated a key step taken to address this challenge was overhauling the
regulations and procedures for delivering development assistance through the
Automated Directive Series 200- Managing for Results. In addition, USAID
developed a performance management workshop, which it piloted in October
2000. (During fiscal year 2001, USAID plans to conduct 14 workshops and
train 350 employees in 4 regions and Washington, D. C.)
USAID also stated it expanded technical assistance on performance
measurement in missions, and
USAID provided three performance goals for 2002 that related to improving
the reliability of performance indicators and the reporting of results.
However, the performance goals and indicators are vaguely written, and USAID
provides no explanation of what they actually entail. The performance goals
and indicators are
program performance assessment systems and capabilities increased.
- Indicator: USAID program performance tracked.
knowledge to plan and implement USAID?s programs acquired and shared
effectively.
- Indicator: Knowledge.
agency operations guided by effective policies and procedures.
- Indicator: Assessments and audits validate implementation of policies and
procedures.
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 25 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Major management challenge Progress in resolving major
management challenge, as discussed in the fiscal year 2000 performance
overview Applicable goals and measures in the fiscal year
2002 performance plan
conducted technical analyses of performance data quality and coverage, but
it did not explain what these activities included or their results.
Implementing an integrated financial management system: USAID acknowledged
the cornerstone
of its financial management improvement program is the implementation of a
core financial system that is fully compliant with federal requirements and
standards. The agency noted that in fiscal year 2000, it successfully
configured a commercial financial software package that is currently being
used at multiple federal agencies. USAID noted that it followed a ?best
practice? approach and reengineered its business process to avoid costly and
risky changes to the commercial software product. It also notes that the
software underwent extensive testing and that the agency implemented a
comprehensive program to train and prepare agency staff to transition to the
new accounting system.
USAID reports substantial completion of the work to transition to the new
accounting system; however, the updated implementation plan required the
agency to close fiscal year 2000 with its current accounting system before
transitioning to the new accounting system in fiscal year 2001.
(According to USAID?s fiscal year 2000 accountability report, the new system
began supporting Washington financial operations on December 15, 2000. Key
financial data including obligation, expenditure, and loan information have
been migrated to the new system.)
(The Inspector General, in the fiscal year 2000 audit report, noted that the
USAID remediation plan said the agency would achieve compliance with Federal
Financial Management Improvement Act in fiscal year 2003 by implementing an
integrated financial management system at
USAID?s performance goal for a core financial management system certified
compliant with federal requirements has two indicators:
integrated, automated financial systems worldwide, with the targets to (a)
link the remaining legacy financial systems to the new core financial
management system in Washington D. C. and (b) obtain federal certification
of the general control environment and system security for the accounting
operations of overseas missions not certified in fiscal year 2001;
a fully operational, secure, and compliant core financial system installed
with interfaces to major feeder systems. USAID noted that its target is to
expand this system to as many overseas field missions as budgetary resources
allow.
The plan does not provide progress milestones or resource allocations and
specific time frames for completion.
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 26 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Major management challenge Progress in resolving major
management challenge, as discussed in the fiscal year 2000 performance
overview Applicable goals and measures in the fiscal year
2002 performance plan
USAID/ Washington and two pilot missions. However, the Inspector General
concluded that USAID might not achieve the goal until the system is
implemented worldwide.) Financial management information unreliable/
Financial statements inaccurate and do not measure program results: The
Inspector General was unable to report on USAID?s financial statements for
fiscal year 2000 because the agency had not implemented adequate accounting
and financial management systems to produce complete, reliable, timely, and
consistent financial statements. Agency systems do not meet the federal
requirements and standards for financial management.
USAID identified financial management as a management challenge, and
recognizes the need to improve the quality and availability of financial and
performance data. However, the report does not directly address agency
progress in obtaining an unqualified opinion on its financial statements.
USAID reports that during fiscal year 2000, it concentrated on correcting
this problem by making substantial progress toward completing the transition
to the new accounting system. USAID noted that it installed, configured,
tested, and readied the new core financial management system to support
Washington?s financial operations, beginning in fiscal year 2001.
To improve its financial management procedures, USAID said it initiated a
comprehensive study of its financial management operations worldwide. USAID
feels this study, undertaken in collaboration with the Chief Financial
Officer?s Council, is a critical first step to enhance the agency?s
financial management operations, introduce best practices into its financial
management procedures, and bring USAID?s financial procedures and operations
into compliance with various federal financial management laws and
regulations. The agency received the study?s findings in 2000 and will begin
implementation of key recommendations during fiscal year 2001.
The plan has no goals or measures. However, it provides general time frames
for establishing an integrated financial management system certified
compliant with federal requirements. Also, USAID indicated that its target
is to install a system capable of allocating costs to strategic objectives
in Washington, D. C. and the field.
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 27 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
IG- designated major management challenges
Reconciliation of financial management information at USAID continues to be
a problem
USAID identified data reconciliation as one of the critical problem in
dealing with financial management issues. However, the report does not
discuss any progress directly related to reconciliation of various financial
data.
(The Inspector General, in its December 1, 2000, letter to the Committee on
Government Affairs? Chairman on USAID management challenges, discussed data
reconciliation and progress made to resolve some of the problems. The
Inspector General noted that USAID contracted with independent public
accounting firms to assist in reconciling USAID?s fund balance with Treasury
and each grant currently recorded in its Letter- of- Credit system; these
reconciliations were performed as of September 30, 2000. In addition, USAID
contracted with the Department of Health and Human Services (DHHS) to
process, disburse, and liquidate advances to grantees. USAID expected
significant improvements in the recording of disbursements and liquidations
of advances awarded to grantees through the contract with DHHS. To date, the
Inspector General has not seen evidence of this expected improvement.)
The plan does not address this challenge. Challenges with accounts
receivable: Despite improvements in its process and procedures for reporting
Credit Receivables Program, significant discrepancies exist between the
contractor bank?s loan information and USAID?s records
USAID recognized weak financial management procedures as another critical
financial management issue. To this end, the agency reported that it adopted
a new standard general ledger posting model for credit programs, eliminated
the backlog of debtrescheduling entries, and began to use commercial banks
to service outstanding loans. However, the report does not provide
information on the status or results of these initiatives.
The plan does not address this challenge. Information resource management:
new management system reporting and resource management capabilities and
information resource management processes
USAID reported it faces several management challenges linked to its ability
to improve its information management and technology systems.
The performance overview stated that USAID developed an Information
Management Strategic Plan for Fiscal
USAID?s plan for 2002 stated that the agency will continue to be challenged
as it attempts to provide more effective information resources management.
The plan provided performance goals for upgrading (1) desktop/ network
operating systems at more than half the agency?s worldwide locations, and
(2) telecommunication network equipment at more than one- third of the
agency?s worldwide locations. The
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 28 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Years 2001- 05 that maps a course for more effectively applying information
management and technology to the goals and objectives of the agency. USAID
also reported that it
established a Capital Investment Portfolio;
developed a Target Information Architecture;
completed Year 2000 transition and operations unimpeded;
completed an analysis of agency connectivity options; and
implemented a pilot electronicgovernment (e- gov) initiative.
plan also stated that USAID expects to link its new core financial
management system in Washington to remaining legacy financial management
systems. In addition, the plan stated that USAID expects to complete the
development phase of the agency?s Government Paperwork Elimination Act
initiative, thereby setting the stage for final implementation and testing
in fiscal year 2003.
USAID?s broad and changing mandate: Studies dating to 1992 reported USAID
was faced with a multiplicity of programs, unclear mandates, and an out- of-
balance ratio of country programs to staff and budget. In addition, the
agency?s mandate continues to evolve from sustainable development in poor
countries to emergency assistance in response to man- made and natural
disasters (war, hurricanes, disease, etc.), and transition to democracy.
The performance overview does not address this issue.
(The Inspector General reported USAID has sought to obtain additional
resources for personal services contractors and direct and technical
advisers in response to increased demands for emergency responses, such as
disaster assistance resulting from hurricanes Mitch and Georges. In
addition, USAID created a working group to address the resource demands of
supplemental appropriations.)
The plan does not address this challenge. Accountability in the
international environment: Corruption and lack of accountability in the
overseas environment are major impediments to economic development, the
growth of democratic institutions, and the ability of developing countries
to attract foreign investments.
Not addressed specifically as a management challenge.
In the performance overview, USAID reported that 30 operating units
throughout the world had programs pursuing transition to democracy and
strengthening government institutions. In addition, 23 units had programs
focused on improving capacities of government institutions, and 16 units
operated rule of law programs.
Not addressed specifically as a management challenge.
USAID stated it will increase efforts to fight corruption, in collaboration
with the Department of State, by creating and refining regional strategies.
The agency also said it expects to increase program activities in connection
with the May 2001 global forum on fighting corruption.
(The Inspector General?s office stated it will focus on efforts to detect
financial losses.)
USAID- identified major management challenges
Agency goals and objectives served by well- planned and managed acquisitions
and assistance: In its Revised Strategic Plan, USAID made efficient and
effective acquisitions and assistance a strategic goal of the agency due to
its heavy reliance on intermediaries, contractors, grantees, and cooperative
USAID developed four performance goals and indicators for the new strategic
objective. The performance goals are
acquisitions and assistance planning and program development integrated;
acquisitions and assistance competencies of technical and contract staff
strengthened;
Fiscal year 2002 activities and performance targets under the performance
goals are
acquisitions and assistance planning and program development integrated
- establish and modify procurement priorities and negotiate 38 percent of
fiscal year 2002 obligations within the first three quarters, 20 percent
during July, 21 percent in August, and 21 percent in September. - twenty
percent of contracts over $25,000 are
Appendix I: Observations on the U. S. Agency for International Development?s
Efforts to Address Its Major Management Challenges
Page 29 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
agreement awardees to deliver the actual assistance programs.
(In March 2001, we reported a potential obstacle to rapid HIV/ AIDS program
expansion in sub- Saharan Africa derived from human capital shortages and
some processes within the USAID acquisition process.)
partnership among USAID technical offices, contract offices, and
contractors and recipients approved; and
consistency in application of acquisitions and assistance policies and
procedures.
USAID also established indicators for three of the goals and baselines for
two goals.
USAID stated that during 2000, it trained 700 employees in new acquisitions
and assistance rules and procedures.
performance- based. - ninety- five percent of contracts valued at over
$25,000 are advertised via the Internet.
acquisitions and assistance competencies of technical and contract staff
strengthened
- ninety percent of contract officers certified by end of 2002. - establish
performance target for training of Cognizant Technical Officers.
partnership among USAID technical offices, contract offices, and
contractors and recipients approved
- increase post- award meetings between all parties to establish
relationships when substantial new awards are made. Target will be set
following establishment of baseline in 2001.
consistency in application of acquisitions and assistance policies and
procedures
- contract Review Board findings, special evaluations, and feedback from
agency acquisitions and assistance ombudsman validate consistent
implementation of policies and procedures. Target will be set following
establishment of baseline in 2001. Collaboration with partners and
stakeholders strengthened The performance overview did not
address this issue. (In May 2001, the USAID Administrator testified before
the Congress that within the agency there has been an increased emphasis on
the roles of religious institutions, nongovernmental organizations, private
foundations, universities, corporations, and individuals in providing
services and accomplishing public objectives.)
Plans for 2002 performance state USAID will work to (1) increase strategic
consensus with other donors on key development issues to ensure
compatibility of efforts in select sectors, countries, and regions; (2)
increase public awareness of USAID programs and achievements to the U. S.
public and the Congress; and (3) enhance the role of country partners in
strategic planning and program implementation by including more country
partners in strategic objective teams, and ensure that country partners
perceive that they are part of the team.
(In addition, the USAID Administrator testified before the Congress that the
agency will become the catalyst for mobilizing ideas, efforts, and resources
of the public sector, corporate America, university community, and
nongovernmental organizations in support of shared objectives. The agency
will act similarly to a venture capital partner by using its resources and
experience to help partners with investment decisions. The agency will also
seek new partners who can bring new investment and ideas into the
development arena. USAID calls this ?new business model? the Global
Development Initiative.)
Appendix II: GAO Contact and Staff Acknowledgments
Page 30 GAO- 01- 721 USAID: Status of Achieving Key Outcomes
Lawrence L. Suda (202) 512- 5380 In addition to Mr. Suda, Shawket Ahmed,
David G. Bernet, Janey Cohen, Kirk Daubenspeck, Patrick Dugan, Audrey Solis,
Laverne Tharpes and Tom Zingale made key contributions to this report.
Appendix II: GAO Contact and Staff
Acknowledgments GAO Contact Acknowledgments
(320038)
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