Experts worry about SPREP’s ability to manage donor funds, SPC’s ‘mega-bureaucracy’

Samisoni Pareti



Heads of three regional organisations turned down a last minute plea to save the technical and scientific capabilities of the Fiji-based scientific organisation, the Pacific Islands Applied Geoscience Commission (SOPAC).
The dramatic appeal was made by three leading scientists who are members of an independent committee of experts to SOPAC, who went to some lengths questioning the capabilities of SPREP (Secretariat of the Pacific Regional Environment Programme) based in Samoa to manage donor funds.
“Caution needs to be taken to ensure the increased funding provided through the SOPAC work programme is managed properly,” the three-member panel of scientists said in their report, a copy of which was obtained by ISLANDS BUSINESS.
“On page 14 of the SPREP [audit document], it was noted that ‘an inadequate core budget has been a perennial problem of SPREP’.
“This situation evidently still exists. However, it will be necessary to develop a proper business plan that will ensure funds obtained to support the new agency’s work programme are managed properly.
“The issue of SPREP being in financial distress presents a pitfall in taking the money and operating without improved services.
“The SPREP budget is approximately 44% of SOPAC’s, a considerable differential and prone to mismanagement especially since SPREP has had funding problems in the past.”
The three scientists are leading members of SOPAC’s voluntary but independent committees of TAG (Technical Advisory Group), STAR  (Science, Technology & Resources Network) and PMEG (Programme Monitoring and Evaluation Group).
In their 26-page report dated July 4, 2009, the three scientists of Dr John Collen (currently chair of STAR), Dr H Gary Greene (chair of PMEG) and Dr Andrew Matthews (a member of PMEG) put up a strong bid for SOPAC.
But as our lead story shows, this high-powered representation came a bit too late as the joint councils of SOPAC, Secretariat of the Pacific Community and SPREP pushed to dismantle the Suva-based organisation.
This, they argued, is in line with the Forum Leaders’ decision following their 2007 summit in Tonga and reiterated at the Niue Forum last year.
Core of SOPAC’s work will be turned into a new geoscience division of SPC, whilst a few of its programmes especially those relating to marine environment including climate change and meteorology will be absorbed by SPREP.
For this story, ISLANDS BUSINESS managed to obtain four out of the six reports that were commissioned to look at the structure and method of implementing the Forum Leaders’ decision on SOPAC.
The two reports that were not made available to us were the CEOs’ reports of the three affected regional bodies (namely SOPAC, SPREP and SPC), and the ‘independent consultants’ report that ‘analysed, assessed and validated’ the options provided by the CEOs.
That independent consultants’ report came in two parts; Part 1 was ready on April 6, 2009 and Part 2 on May 12, 2009.
Part 1 of that report offered three possible options about SOPAC.
Option One was for the ICT-Outreach programme of SOPAC to be absorbed by SPC.
The second option was to split SOPAC in half with its Pacific energy sector and petroleum advisory services to be transferred to SPC and the rest to be ‘integrated’ into a new organisation.
The final option offered by the independent consultants was for the re-branding of both SOPAC and SPREP into a new regional environment and resource management organisation to be named the Pacific Environment Resources Commission.
Yet when the independent consultants presented Part 2 of their report, they offered a fourth option; that the core programmes of SOPAC be established as a division of SPC.
Plethora of reports: These options provided to the CEOs of SOPAC, SPREP, SPC and the Forum Secretariat (PIFS) triggered a series of reports by consultants.
The magazine’s expert on regional diplomacy termed it as a “plethora of reports.”
ISLANDS BUSINESS could count four more reports, all of which we were able to obtain copies of.
In mid-May 2009, legal consultant Brenda Heather-Latu of Latu Ey & Clarke Lawyers was commissioned to study the legal implications of certain options relating to the rationalisation of SOPAC’s work programmes. Latu’s 23-page report was ready on June 2009.
The accountancy firm of KPMG was also hired to assess the financial implications of the rationalisation of SOPAC’s core work programmes into SPC and SPREP.
Its 32-page plus report was completed on June 9, 2009.
Then to look at the technical and scientific implications of SOPAC’s dissolution, the three-member team of Greene, Collen and Matthews was hired.
To back up their case, the three scientists solicited “independent legal advisors” of Matthew Segal and Kari L Vander Stoep of the global law firm of K & L Gates.
Justifying the involvement of the two lawyers, the three scientists said on page 4 of their report that they “strongly believed that an independent legal review on behalf of SOPAC was needed and because the legalities of disbanding SOPAC did not appear to be fully analysed in regards to suspension of the dissolution of SOPAC as a treaty organisation”.
Their report was ready on July 4, 2009 just three days before the joint meeting in Suva of the three governing councils of SOPAC, SPREP and SPC.
“Extensive efforts have been made to analyse the rationalisation process by all entities involved,” the scientists noted in the executive summary of their report.
“However, management schemes and the mechanics of rationalisation have been the major focus of the work to date, with little attention given to the specifics of the technical or scientific aspects.
“The strengths of SPREP and SOPAC should be their scientific and technical expertise, yet the reports say little on how synergies would be developed between these components of the two organisations.”
The rationale: A key theme of the scientists’ report had been their attempts to understand the rationale behind the decision to dissolve SOPAC in favour of SPREP.
Page 14 of their report said: “The SPREP [document] outlines significant weaknesses in SPREP that are not present in SOPAC.
“Taking over a stronger, larger and better-funded organisation in the hope of addressing corporate, scientific and technical weaknesses lacks rationality to us.
“As pointed out in the consultants and CEOs’ reports as well as the independent legal analyses, the highest risk option of allocations presented in these reports is the SPREP takeover.”
Figures provided by KPMG on its report about the financial implications of closing SOPAC down show that the Suva-based regional body is almost three times bigger than SPREP in terms of budget.
SPREP’s annual budget is US$7.65 million compared to SOPAC’s US$17.9 million. SOPAC too has 110 staff members while the Apia-based regional body has 65.
Another key issue raised by the panel of scientists, KMPG as well as the Latu report has been the threat of SOPAC losing European Union funding once it is dissolved.
The KMPG report said on page 6: “The European Union is the single largest donor of SOPAC, contributing 63% of its 2009 annual budget.
“In contrast, SPREP currently receives minimum funding from the European Union.
“We understand that SOPAC passed the EU institutional assessment in 2007 whereas SPREP recently underwent a similar assessment which had not been finalised at the date of this report.”
The panel of scientists report went further to assert that SPREP does not have the capacity to absorb SOPAC because of the differences in the budget and staff size of the two organisations.
In addition, the scientists claimed SPREP needs to improve on its weaknesses as highlighted in a recent audit.
The Samoa-based body also needed to ensure it meets the requirements of the European Union first before it could access any EU funding.
“The concerns expressed in the consultants’ report about a larger staffed and greater funded organisation (SOPAC) being taken over by a smaller and less funded organisation (SPREP) in our estimation needs to be considered,” said the scientists.
“In addition, the recent SPREP independent corporate review report outlines considerable problems within SPREP, in contrast to the better operated and managed SOPAC.”
On page 12 of their report, the scientists continued: “Within the consultants’ reports, it was pointed out that SPREP has in the past had difficulties meeting EU funding requirements and deliverables and that, since EU funds contribute a substantial amount (63%) of SOPAC funding, these contributions may be in jeopardy if a SPREP takeover was accomplished.”
Agreeing that making SOPAC a division of SPC will be “administratively more straightforward,” the scientists however still have some reservations about this particular option.
“A significant problem viewed by us is one of rationalising SOPAC into a regional mega-bureaucracy.
“SPC is a magnitude larger than SOPAC with respect to staff and funding. An inherent problem with this is that decentralisation can occur, competition for internal funds can become severe and response to member countries’ problems will most likely be slowed down because of the hierarchical nature of large bureaucracies.”
Because of their deep reservations about the ability of both SPREP and SPC to absorb the work of SOPAC, and fearing that SOPAC’s core work including its EU funding could be jeopardised if this happens, the panel of three scientists instead offered two more options for Pacific Islands Forum Leaders to consider.
One is for SPREP to be absorbed by SOPAC, or second, for SOPAC to remain although of a slightly modified version.
Fundamental change: “Although this was not an option considered at the start of the rationalisation process, it should be seriously considered as fragmentation of SOPAC’s work programme now appears to be a distinct possibility, as could be expected if the CEOs are to ensure the best possible solutions to their organisations.
“SOPAC can easily be directed to develop synergies between SPREP and SPC that would reduce duplication of work and enhance services to member countries without the need for a fundamental change.”
Lawyers Segal and Stoep—hired by the panel of scientists—highlighted several legal liabilities in the two options of SOPAC merging with SPREP or for SOPAC to be made a division of the SPC. They said if the proposed change structure offered by SPREP is followed, it would contravene SOPAC’s constitution.
As well, SOPAC’s existence as a legal entity should only be suspended and not dissolved as suggested by SPREP, the lawyers advised.
“The SPREP acquisition option also presumes that SOPAC should dissolve when in fact there is no reason for it to do so,” Segal and Stoep said in their advice.
“Dissolution is a final and draconian remedy which would terminate all relations under the existing SOPAC constitution.
“Suspension is much less radical and provides greater flexibility.”
It was Segal and Stoep who first proposed a “reverse merger” where SPREP is merged into SOPAC, and the latter becomes the “surviving corporate entity”.
“A legal analysis of the contractual arrangements and asset portfolios of both SOPAC and SPREP may reveal that assets and contractual relationships will be more likely to be sustained if SOPAC is the surviving entity.
“Parties contracting for funding may be more willing to continue their legal arrangements under this scenario.
“Moreover, unlike the SOPAC constitution, the SPREP constitution does not contain a specific provision governing suspension or dissolution. This is an important legal distinction between the two treaties.”
In the end, all these arguments came a bit too late.
Governing councils of SPREP, SPC and SOPAC decided to recommend to Forum leaders at their meeting in Cairns this month for SOPAC to be made a division of SPC and a few of its other programmes to be transferred to SPREP.
Contacted for his views on the latest development, an authority on Pacific islands politics who spoke to ISLANDS BUSINESS on the condition of anonymity believes “vested interests” contributed to the “plethora of reports” on the dissolution of SOPAC.
“If, for instance, someone or one PIC (Pacific Islands Country) leader doesn’t like the recommendations of one report, the report is sidelined and another is commissioned,” this expert told us.
“PICs’ own interests are very much to the fore here. I believe it goes right back to a misunderstanding of the RIF’s (Regional Integration Framework) initial recommendations and the shenanigans that major regional players were up to, that a technical Pacific Community is to be established from the merging of all the technical CROP (Council of Regional Organisations in the Pacific) agencies and to form Pillar 2, and this leaves the three educational/training CROP agencies on their own to form Pillar 3, and Pacific Islands Forum serviced by PIFS (Pacific Islands Forum Secretariat) to form Pillar 1 and to be the paramount political apex of the reconfigured CROP agencies.
“The recommendation leading to the reconfiguration was not going to lead to any closure of existing CROP agencies or any physical relocation of premises.
Speculations: “In other words, SOPAC will remain in Fiji, SPREP in Samoa, etc.
“There will, of course, be a management restructuring and networking that would be necessary to allow the new structure to work.
“But this was enough to start a series of speculations, fuelled by self-and country-interests, that some CROP CEOs may lose their jobs and, worse, this move was just a tip of the iceberg that it was really meant for the final relocation of premises and institutions.
“Fear and suspicions provided added fodder. From memory, SOPAC was unhappy. SPREP followed suit.  FFA under Feleti Teo was against it, but, of course, he had to change tune when he became deputy Secretary-General at PIFS.”
Asked about the genuineness of the recommendations of these consultants, our expert said most of these—and he named former Governor of the Central Bank of Solomon Islands Tony Hughes, former Fiji’s foreign minister Kaliopate Tavola and ex-SPC Director-General Lourdes Pangelinan of Guam—were sincere to the terms of reference they had to work with.
“The report by Tony Hughes was driven by the need for better coordination; removal of duplication of responsibilities; better positioning of roles, expertise and competence; enhanced efficiency, productivity and cost-effectiveness.
“Tavola supported all these during his short engagement with the project.
“I suppose when vested interests intervened in the debate, many of these good virtues were either put aside or sacrificed.
“I tend to think that consultants who were engaged were true to their respective terms of reference.
“Pangelinan pursued the concept of a Pacific Community (a super SPC as you termed it) since that was the prevailing concept at the time and one which Tony Hughes advocated.”
This expert did not want to be drawn into the debate on whether Fiji should share part of the blame for SOPAC’s demise, for failing to see the real push by Samoa to have SOPAC that is headquartered in Suva closed and moved to Apia to come under SPREP.
When Forum leaders decided at their Tonga summit in 2007 to reverse the Hughes report recommendation by saving the FFA in Honiara and SPREP in Apia but to dissolve SOPAC in Suva, Fiji didn’t offer any noticeable resistance.
It did put in an attempt months later, but by then, critics said the horse had already bolted and Suva was told the Forum leaders had already made their decision about the geoscience body.
Said our expert: “By October 2007, vested interests had become influential in decision-making and the initial concepts and ideas of RIF had become politicised.
“FFA managed a separate decision by the Leaders. SOPAC was on the verge of extinction. That might have been a Samoan coup!
“PIDP (Pacific Islands Development Programme at East West Center, Hawaii) had dropped from Pillar 3.”
How have all these developments affected the staff of SOPAC?
Interestingly, in studying the possible legal and financial implications of the proposed moves, none of the reports focussed on this save the three panel of scientists.
On page seven of their report under the heading “people not machines,” Greene, Collen and Matthews observed: “In our interviews with these specialists and support staff, it is apparent that productivity is in jeopardy and that morale is deteriorating.
“It appears to us that this problem is occurring primarily because of the attitude taken by the other organisations (SPREP and SPC) in regards to how rationalisation is to take place.”
“These people retain the corporate memory of SOPAC and it is not just a simple task of individual replacement that can take place when vacancies occur.
“A critical mass is necessary for SOPAC’s work programme to not be adversely impacted and thus the individuals involved need to feel they are needed and have a role to play in RIF.
“So far, that has not occurred and rightly or wrongly, a “cherry-picking” attitude by the other organisations involved in the rationalisation process appears to be perceived as the operational mode.”