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U.S. AID TO PAKISTAN (PART II): PLANNING AND

ACCOUNTABILITY

HEARING

BEFORE THE

SUBCOMMITTEE ON NATIONAL SECURITY

AND FOREIGN AFFAIRS

OF THE

COMMITTEE ON OVERSIGHT

AND GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

SECOND SESSION

MARCH 16, 2010

Serial No. 111–162

Printed for the use of the Committee on Oversight and Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.house.gov/reform

(II)

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

EDOLPHUS TOWNS, New York, Chairman

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

JOHN F. TIERNEY, Massachusetts

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

JIM COOPER, Tennessee

GERALD E. CONNOLLY, Virginia

MIKE QUIGLEY, Illinois

MARCY KAPTUR, Ohio

ELEANOR HOLMES NORTON, District of

Columbia

PATRICK J. KENNEDY, Rhode Island

DANNY K. DAVIS, Illinois

CHRIS VAN HOLLEN, Maryland

HENRY CUELLAR, Texas

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

PETER WELCH, Vermont

BILL FOSTER, Illinois

JACKIE SPEIER, California

STEVE DRIEHAUS, Ohio

JUDY CHU, California

DARRELL E. ISSA, California

DAN BURTON, Indiana

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

BRIAN P. BILBRAY, California

JIM JORDAN, Ohio

JEFF FLAKE, Arizona

JEFF FORTENBERRY, Nebraska

JASON CHAFFETZ, Utah

AARON SCHOCK, Illinois

BLAINE LUETKEMEYER, Missouri

ANH ‘‘JOSEPH’’ CAO, Louisiana

RON STROMAN, Staff Director

MICHAEL MCCARTHY, Deputy Staff Director

CARLA HULTBERG, Chief Clerk

LARRY BRADY, Minority Staff Director

SUBCOMMITTEE ON NATIONAL SECURITY AND FOREIGN AFFAIRS

JOHN F. TIERNEY, Massachusetts, Chairman

CAROLYN B. MALONEY, New York

PATRICK J. KENNEDY, Rhode Island

CHRIS VAN HOLLEN, Maryland

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

PETER WELCH, Vermont

BILL FOSTER, Illinois

STEVE DRIEHAUS, Ohio

STEPHEN F. LYNCH, Massachusetts

MIKE QUIGLEY, Illinois

JUDY CHU, California

JEFF FLAKE, Arizona

DAN BURTON, Indiana

JOHN L. MICA, Florida

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

JIM JORDAN, Ohio

JEFF FORTENBERRY, Nebraska

BLAINE LUETKEMEYER, Missouri

ANDREW WRIGHT, Staff Director

(III)

C O N T E N T S

Page

Hearing held on March 16, 2010 ............................................................................ 1

Statement of:

Feldman, Daniel, Deputy to the Special Representative for Afghanistan

and Pakistan, U.S. Department of State; and James A. Bever, Director,

Afghanistan-Pakistan Task Force, and Deputy Assistant Administrator,

Asia and Near East Bureau, U.S. Aid ......................................................... 8

Bever, James A. ......................................................................................... 18

Feldman, Daniel ........................................................................................ 8

Letters, statements, etc., submitted for the record by:

Bever, James A., Director, Afghanistan-Pakistan Task Force, and Deputy

Assistant Administrator, Asia and Near East Bureau, U.S. Aid, prepared statement of ........................................................................................ 21

Feldman, Daniel, Deputy to the Special Representative for Afghanistan

and Pakistan, U.S. Department of State, prepared statement of ............. 11

Tierney, Hon. John F., a Representative in Congress from the State

of Massachusetts, prepared statement of ................................................... 4

(1)

U.S. AID TO PAKISTAN (PART II): PLANNING

AND ACCOUNTABILITY

TUESDAY, MARCH 16, 2010

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON NATIONAL SECURITY AND FOREIGN

AFFAIRS, COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, Washington, DC.

The subcommittee met, pursuant to notice, at 10:05 a.m. in room

2154, Rayburn House Office Building, Hon. John F. Tierney (chairman of the subcommittee) presiding.

Present: Representatives Tierney, Kennedy, Van Hollen, Murphy,

Welch, Driehaus, Quigley, Chu, Flake, Luetkemeyer, and Lynch.

Staff present: Andy Wright, Staff Director; Elliot Gillerman,

Clerk; Talia Dubovi, Counsel; Scott Lindsay, Counsel; Steven Gale,

Fellow; LaToya King, Fellow; Aaron Blacksberg, Intern; Bronwen

DeSena, Intern; Adam Fromm, minority Chief Clerk and Member

Liaison; Stephanie Genco, minority Press Secretary and Communications Liaison; Christopher Bright, minority Senior Professional

Staff Member; and Renee Hayes, minority Fellow.

Mr. TIERNEY. A quorum being present, the Subcommittee on National Security and Foreign Affairs, the hearing entitled, ‘‘U.S. Aid

to Pakistan, Part II: Planning and Accountability,’’ will come to

order.

I ask unanimous consent that only the chairman and ranking

member of the subcommittee be allowed to make opening statements, and without objection it is so ordered.

I ask unanimous consent that the hearing record be kept open

for 5 business days so that all members of the subcommittee will

be allowed to submit a written statement for the record. Without

objection, so ordered.

Good morning.

I want to thank you both for coming here today. We are going

to continue our ongoing oversight of the planning, accountability,

and effectiveness of U.S. aid to Pakistan.

On October 15, 2009, President Obama signed the Enhanced

Partnership with Pakistan Act. It is informally known as the

Kerry-Lugar-Berman Bill, tripling U.S. civilian economic and development assistance to Pakistan to $1.5 billion annually until 2014.

While Kerry-Lugar-Berman was a largely bipartisan demonstration

of U.S.’ commitment to long-term assistance to Pakistan, serious

concerns remain regarding the ability of USAID and the State Department to effectively and efficiently manage and account for such

a massive increase of assistance.

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In November 2009, I led a congressional delegation to Pakistan

in order to investigate, among other things, the status of the U.S.

assistance programs and the State Department’s and the USAID’s

capacity to manage and oversee Kerry-Lugar-Berman funding.

After four trips, it is apparent that the security environment in

Pakistan has grown markedly worse in recent years.

During the congressional delegation, we met with Pakistan civilian leadership, its political opposition, and a wide variety of civil

society members, NGO’s, and international contractors. We also

traveled to Peshawar to deliver aid supplies directly to the principal hospital that had been receiving wounded from the many

bombings during the past year.

Following that trip, in December 2009 the administration announced its new regional stabilization strategy for Afghanistan and

Pakistan. That plan will ‘‘increase direct assistance through Pakistani institutions,’’ mainly the ministries and local NGO’s, and

focus more money on high-impact projects such as major energy

and water infrastructure.

The plan also promises to reduce USAID’s over-reliance on large

international contractors as implementing partners.

I want to state at the outset that I am supportive of exploring

a new AID approach and appreciative of the time and energy that

our witnesses and the administration have put into crafting the administration’s new strategy. That said, given the importance of

U.S. national security interests in Pakistan and the magnitude of

the U.S. taxpayer dollars authorized for development and economic

assistance there, it is critically important that we carefully scrutinize plans for implementation of the new strategy, and particularly

its accountability mechanisms. In short, we must make certain that

the administration’s new strategy will not send more money

through weaker systems—systems that lack the internal controls

developed with time and experience.

This presents several challenges. First, how will the State Department and USAID gain visibility into the operations of ministries that have historically resisted robust oversight? In light of

Pakistan’s sensitivities regarding impingements on its sovereignty,

this challenge will be particularly acute.

Second, I am concerned about USAID’s internal capacity to oversee and account for funds directed through Pakistan’s ministries

and local NGO’s. For years USAID has been marginalized and

stripped of personnel, while at the same time U.S. foreign policy

has increasingly emphasized aid delivery in high-risk conflict and

post-conflict countries like Iraq, Afghanistan, and Pakistan.

This challenge is only made more difficult by the current security

environment that makes it very difficult for either USAID personnel or western ex pats to see let alone actively manage or oversee many projects, particularly those in the federally administered

tribal areas [FATA], in the Northwest Frontier Province.

I plan to continue to work with Congress and the administration

to bolster USAID’s internal staffing and capability. We must reverse USAID’s decline in the last decade if it is to serve as a central tool of U.S. foreign policy in South Asia or the Middle East,

a task it has been assigned but not given the tools to fulfill.

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I also want to highlight the recent challenges that the U.S. Embassy in Islamabad has had in obtaining visas from Pakistan for

critical U.S. Government personnel from State, USAID, and the

Department of Defense. Many of the visa applications have been

denied or delayed, including visas for auditors, accountants, and inspectors—the very people that both the agencies and the Congress

rely on to make sure that civilian assistance is spent as it is intended.

From the position as chairman of the National Security and Foreign Affairs Subcommittee, I want to make clear to the government

of Pakistan that the U.S. civilian assistance comes as a package:

funding, programming, and oversight. Pakistan cannot accept the

funding but deny U.S. agency the personnel or the access for critical oversight.

I asked both witnesses here today to keep the subcommittee informed regarding developments with the visa applications for their

agencies’ respective personnel and to only fund programs and

projects for which they have the personnel in place to perform the

proper oversight.

The third issue of concern to me is to ensure that U.S. funds directed to Pakistan’s ministries are supplementing Pakistan’s funding of those ministries, not simply displacing it. At the end of the

day, the government of Pakistan must own and take responsibility

for each of the projects we embark on together. Instilling a sense

of such ownership will be a critical and delicate challenge going forward.

I am a strong believer that the U.S.’ civilian assistance to Pakistan is critical to the stabilization and the health of Pakistan, and

to long-term U.S. national security interests. The Kerry-Lugar-Berman is a major down payment on our shared future. In the best

circumstances, however, it is an extraordinary endeavor to create,

manage, and oversee billions of dollars in development assistance

programs, and Pakistan is not in the best of circumstances. That

is why this subcommittee has made a great effort to exercise

proactive oversight in order to ensure that critical accountability

mechanisms are in place from day one.

With that said, I would like to defer to my colleague, Mr. Flake,

for his opening remarks.

[The prepared statement of Hon. John F. Tierney follows:]

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Mr. FLAKE. I thank the chairman for holding this hearing and

also undertaking the Co-Del a while ago. I wish I could have gone.

It would have been helpful, and I look forward to the testimony

today.

It was interesting, when this package was announced, certainly

in Pakistan, I don’t think any aid package has been met with such

derision from the recipients. It certainly piqued our interest here

to see how it was played there. Obviously , we know it was for domestic politics, but I think it is safe to say that it is difficult to see

or to assume that any country could receive this amount of aid and

be able to transition that quickly, as well as our aid agencies to

ramp up this substantially in this short period of time, as the

chairman said, in the best of circumstances, and these are not the

best. So I look forward to the testimony and all you have to say.

Mr. TIERNEY. Thank you.

Just a quick aside to that. After the Kerry-Lugar-Berman bill

passed—and this committee had quite a bit to do with that, as Jeff

knows—we had an occasion to speak both in Pakistan and back

here at home, but what is indicative, I think, is one occasion up

in Cambridge, Massachusetts, where I spoke before a few hundred

Pakistanis, when I got through one half of the room was mad that

we had put these sanctions on, not the sanctions but the conditions, and the other half of the room was mad because they weren’t

strong enough. They were all Pakistani, so it depends on how you

break down on that.

With that, we’d love to hear from our witnesses. We have 5-

minute remarks, as you know.

We swear our witnesses in on this committee, so I ask the witnesses to please stand and raise your right hands.

[Witnesses sworn.]

Mr. TIERNEY. Let the record please reflect that both witnesses

answered in the affirmative.

I would like to give a brief introduction of our witnesses.

Mr. Daniel Feldman serves as a Deputy to the Special representative for Afghanistan and Pakistan at the U.S. Department of

State. He previously served as Director of Multi-Lateral and Humanitarian Affairs for the National Security Council, where he was

responsible for global human rights issues. A former congressional

staff member, Mr. Feldman has also served as counsel and communications advisor to the Senate Homeland Security and the Government Affairs Committee. Mr. Feldman holds a B.A. from Tufts University in Massachusetts and from Princeton University’s Woodrow

Wilson School and a J.D. from Columbia University Law School.

Mr. James Beaver currently serves as Director of the Afghanistan-Pakistan Task Force of the U.S. Agency for International Development, where he oversees more than $4 billion in U.S. assistance to Afghanistan and Pakistan. A member of the Senior Foreign

Service, Mr. Beaver previously served as Senior Deputy Assistant

Administrator for the Middle East, providing leadership for $2.5

billion in U.S. assistance to the Middle East and North Africa. Mr.

Beaver holds a B.A. from Cornell University and an M.S. from

Georgetown University.

Again, thank you both for making yourselves available today and

for sharing your considerable expertise. You both are experienced

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witnesses before Congress, so I know you know the drill. Five minutes if you can keep it reasonably close to that. We have all read

or will read your remarks, and then we’d like to get to the question

and answer period if we could.

Mr. Feldman, let’s start with you, please.

STATEMENTS OF DANIEL FELDMAN, DEPUTY TO THE SPECIAL

REPRESENTATIVE FOR AFGHANISTAN AND PAKISTAN, U.S.

DEPARTMENT OF STATE; AND JAMES A. BEVER, DIRECTOR,

AFGHANISTAN-PAKISTAN TASK FORCE, AND DEPUTY ASSISTANT ADMINISTRATOR, ASIA AND NEAR EAST BUREAU,

U.S. AID

STATEMENT OF DANIEL FELDMAN

Mr. FELDMAN. Thank you very much, Chairman Tierney and

Ranking Member Flake, for the opportunity to be here and to discuss our efforts to enhance planning and accountability of U.S. development assistance to Pakistan.

I will give a more pared-down and focused version of the written

testimony, just so we have a kind of baseline for our conversation

afterwards, and then I will also welcome the opportunity to speak

afterwards once we start Q and A. I am happy to address the visa

situation or some of the other specific issues you raised in your

opening statement.

As you know, Pakistan faces threats of many forms. The security

situation weighs heavily on all Pakistanis. Too many of the country’s citizens do not have access to functioning health or education

systems. Pakistan’s energy crisis leaves businesses and homes in

the dark many hours in the day, and the looming water crisis poses

an existential threat to Pakistan and its neighbors. All these factors increase the stakes on the effectiveness of our assistance programs. Your committee rightly identifies the crucial role of proper

planning and oversight in the success of our efforts.

Since 2002 when the U.S. reengaged with Pakistan, a large percentage of our civilian assistance has been tied up in large contracts and grants with U.S. organizations that have produced uneven results, have lacked flexibility, have not provided optimum

value, and have not built sufficient Pakistani capacity. Much of our

past programming did not address the issues most important to

Pakistanis, such as energy and water.

Pakistanis believe that a high percentage of U.S. resources do

not reach them, given our work and our people have been mostly

invisible to the average citizens of the country. The average Pakistani has perceived our assistance as being too strongly tied to

their country’s military and intelligence cooperation with the

United States rather than being aimed for the long-term well-being

of the country’s citizens.

All this pointed to a very large and expensive missed opportunity

which we have tried to rectify over the course of the past 14

months. U.S.G. assistance in Pakistan now aims to expand our relationship beyond predominantly security issues, providing instead

a more balanced approach that will help the Pakistani people overcome the political, social, and economic challenges that threaten

the country’s stability.

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As you referenced, in the regional stabilization strategy that we

circulated earlier to the Hill, we hope to address first of all the immediate energy, water, and related economic crises; second, support

broader economic and political reforms that are necessary for political growth, sustainable growth; three, improve health care and

education; four, help Pakistan respond to the humanitarian challenges caused by extremist violence and natural disasters, and;

five, combat extremism.

We have a remarkable opportunity before us to deliver this more

effective and balanced environment for delivering civilian assistance. This is formed, in large part, as you noted, by the passage

of the Enhanced Partnership with Pakistan Act, the Kerry-LugarBerman legislation, as well as the initiatives that have been undertaken thus far by President Obama, Secretary Clinton, Ambassador

Holbrook, and others in the executive branch.

How we are responding to these opportunities is through several

broad categories of reformulated vision toward assistance. First of

all is the emphasis on smaller and more flexible contracts. To provide more flexibility and improve monitoring and oversight, we are

shifting away from large U.S.-based contracts to smaller, predominantly Pakistani ones, with fewer sub-grants and subcontracts.

These will be managed by our increased number of staff in the

field.

Second is decentralization. Within the next few months, USAID

teams will be placed in Lahore and Karachi, in addition to the current offices in Islamabad and Peshawar. A decentralized programming platform will enable more location-appropriate development

activities at the provincial and district level, make it easier for U.S.

officials in the field to oversee and monitor programs and prevent

fraud, and allow more regular engagement between our personnel

and the populations we aim to benefit.

Third is the meaningful assistance. Relevant and effective assistance must materially address the issues that count most to the average Pakistani. The overwhelming message conveyed to the Secretary and Ambassador Holbrook during their visits to Pakistan

was the need for assistance with the country’s chronic power and

water shortages. In response, we have begun projects to reduce the

hours of power blackouts, make more potable water available to

poor communities, and improve the availability and management of

irrigation water for farms.

As these projects move quickly from feasibility to implementation, we will begin the same process for projects that address other

priority Pakistani needs, including medical and educational facilities.

Fourth is the increased assistance, as you have mentioned, provided through and to Pakistani institutions. In order to maximize

the amount of our resources that will remain in Pakistan, we are

transitioning our assistance modalities. We will do so by decreasing

our reliance on large international contractors and aim instead to

build institutional capacity and sustainability by increasing direct

assistance to Pakistani implementing partners. While these arrangements involve transfers to Pakistani institutions, this is not

blank check budget support; instead, they are the results of negotiations with USAID regarding how the funds will be spent, how

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progress will be monitored, and how the financial arrangements

will be implemented.

In the case of budget support transfers, there will be targeted institutions and uses rather than general budget support, as was previously provided in the past.

All this goes to the issue of improved accountability and oversight. Our stated policy goal of working more through Pakistani institutions does have the potential to contribute to corruption, as we

recognize. To mitigate this risk, we are increasing the number of

direct hire contracting staff and Inspector General personnel that

will reside in Pakistan.

We are also expanding the use of Pakistani public accounting

firms to conduct financial audit of funds, provide to Pakistani

NGO’s, train Pakistani public accounting firms and Pakistan’s

Auditor General on how to conduct audits to U.S. standards, help

the Pakistan Auditor General conduct financial audits of funds provided to Pakistan government entities, and build the capacity of

the Pakistan government to carry out or assist with investigations

and coordinate audits and investigations among the U.S. Inspectors

General and the GAO.

In the past 2 months, over $26 million in contracts to buttress

audit and monitoring capabilities in Pakistan have been awarded

using ESF.

The Secretary, Ambassador Holbrook, our entire team at the

Special Representative’s office who work on Pakistan believe we

have a duty to ensure that USG resources are used for the purposes intended by Congress, and the reforms I have outlined will,

over time, decrease cost for assistance programs, increase the

amount of U.S. assistance directly benefiting the Pakistani people

and Pakistani institutions, and ensure much better development effects.

I am happy to talk about any of the details during the question

and answer.

[The prepared statement of Mr. Feldman follows:]

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Mr. TIERNEY. Thank you, Mr. Feldman.

Mr. Bever.

STATEMENT OF JAMES A. BEVER

Mr. BEVER. Thank you very much, Chairman Tierney, Ranking

Member Flake, other distinguished members of the committee.

Thanks for your invitation to USAID to speak with you this morning.

Chairman, I particularly appreciate your longstanding support

for rebuilding America’s Foreign Assistance Agency, especially the

staffing. Thank you, sir.

When USAID reopened its mission in Pakistan in 2002, I had

just come back from serving 4 years in India as the Deputy Mission

Director. I was then serving as the Director for South Asian Affairs

and, of course, Pakistan and Afghanistan had become our biggest

responsibilities at that time. As you know, we started out with a

very large cash transfer at that point to the government of Pakistan, and then gradually grew that into primary health care and

education attention, in coordination with other donors.

Following President Obama’s strategy review, we now have a

focus on forging new partnerships with Pakistan and with Pakistani entities, as well as rebuilding the capacity of Pakistan public

institutions, as well as its private institutions, in affecting lives of

individual Pakistanis.

I am going to talk just briefly about the civilian assistance strategy, about local implementation through Pakistani institutions,

some of the safeguard mechanisms, FATA development, and a little

bit on democracy governance, as you know, under the Enhanced

Partnership with Pakistan Act, which authorizes tripling of U.S. civilian assistance, bringing our funding up to $1.5 billion annually

as a target.

Our three foci, if you will, for our assistance is on infrastructure

and constraints to infrastructure for development in Pakistan; second is on building the capacity of the government of Pakistan to

deliver key and appreciated services to its people and to improve

the connectivity between the people, the governed, and the governing; and, finally, to improve the capacity of the Pakistan institutions to be able to implement on their own.

Terms of our presence in the country. As you know, at the time

actually that I served in Pakistan, which was as a Division Chief

for energy assistance about 25, 26 years ago in the War against the

Soviets next door, we had many, many American AID officers in

Islamabad and elsewhere around the country. And as a matter of

fact, we were the second-largest staffed operation in the world next

to Egypt at that time. Today, although of course we had a large hiatus in the 1990’s, we have about 30, 35 U.S. Foreign Service officers at our AID operation, plus another couple dozen what we call

U.S. personal service contractors, and over 100 Foreign Service nationals. This is much smaller than we had back in the years during

the 1980’s.

But thanks to the Enhanced Partnership Act, we do plan to increase these levels, in consultation with the Embassy colleagues

and Ambassador Patterson and our colleagues here in Washington.

We will be increasing our American staff significantly, as well as

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our Pakistani staff, which is extremely important. Our Pakistani

staff are world class, are our eyes, our ears, and our brains, and

our continuity from one American rotation, if you will, to another.

So we will be building up our project management capability, our

financial oversight capability, and our procurement capability, and

our legal capability. I can go into more of that if you would like.

We will also be focusing more on the provinces, not just the Federal Government in Islamabad, which is extremely important, but

also the legitimate provincial government authorities who, for example, have responsibility for education in the country of Pakistan.

In terms of local implementation, we will be moving to find

ways—and we are already aggressively pursuing this—to diversify

our mechanisms and our partners. I think this is sound U.S. foreign policy. I think it is sound U.S. foreign assistance technique.

It is not to the exclusion of our existing partners. There will be a

role for them, too. But we are trying to broaden and diversify the

players who can deliver the American assistance program and also

strengthen their capabilities, whether it is in the government, private sector, or civil society in Pakistan.

In terms of oversight and monitoring, my colleague, Dan Feldman, has already addressed those. I can go into some of those in

more detail later. I just want to stress that we believe in AID and

that the IG and the GAO are our best friends. They are like our

family physician that travel with us. We may not always like the

techniques they use to identify what is needed in our health, but

it is good to know what the diagnostics are so we can deal with

them. We coordinate closely with them, accordingly.

In FATA, I will just say that we are very proud, despite very

dangerous situations in the FATA—the Federal Administered Tribal Areas. We have been able to implement over $140 million of social and economic support projects, mostly at the community level,

in all seven of the FATA agencies and in all six of the Frontier regions.

I have to stress, Mr. Chairman and other Members, in my own

view, having spent 9 years living in South Asia and in other dangerous parts of the world additional years, this is the bravest, most

courageous, riskiest, but most overdue action that I can think of in

the U.S. foreign assistance program.

In democracy governance, one thing I would like to just state

specifically is that we will continue to support the government of

Pakistan in its development of its own parliament, and we are providing assistance to the government of Pakistan to construct a capability so that there are staff support for the members of its [foreign word], of its parliament, and to help them with rule of law,

however, complicated and challenging that is, because it is those

values that connect most deeply among the Pakistani people when

you think of democracy and governance.

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In closing, I just want to say thank you again for inviting us, and

I want to just dedicate our testimony today to those very brave

American third country national and Pakistani staff at our embassy, including our AID mission, who risk their lives every day to

carry out U.S. foreign policy and to make Pakistan a better, more

representative government.

Thank you, sir.

[The prepared statement of Mr. Bever follows:]

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Mr. TIERNEY. I want to thank both of the witnesses. Mr. Bever,

I appreciate your latter remarks. I am sure Mr. Flake and the

other Members here do, as well.

We don’t mention often enough the serious sacrifices being made

by those families, the important role they play, even though we do

have Admiral Mullen and most of our generals over there talking

about the fact that this cannot be won solely militarily and that we

have to have people willing to do those jobs, so I appreciate your

bringing that up.

We are going to start the 5-minute rounds of questioning, and I

would like to start just by reading to you both a quote from an economic officer at USAID who filed this dissenting cable on October

2, 2009. In it, it says: the USAID mission in Pakistan is receiving

contradictory objectives from Ambassador Holbrook.

On the one hand, it is expected to achieve high impact counterinsurgency and broad-based economic development objectives as

quickly as possible, especially in those areas more susceptible to

radical Taliban recruitment. On the other hand, it is asked to do

this by working through national and local government channels

and host country contractors and NGO’s and not through U.S. contractors and NGO’s, to avoid the overhead charges of the latter and

to improve the institutional capacity and legitimacy of government

agencies and local institutions. These are all worthy goals and

USAID can achieve them all; however, they are contradictory objectives without a reasonable transition period for the latter.

Can you give me your reaction to that statement, and what we

are doing to address those concerns?

Mr. FELDMAN. Chairman Tierney, we certainly value the dissent

channel quite a bit. This was an issue that came up at the very

outset of our move to push toward more local Pakistani. We have

had a variety of meetings in post and briefings with staff and

Members about this. I think that was a concern at the very outset

of this process.

Mr. TIERNEY. It was a concern while we were there at about that

time.

Mr. FELDMAN. Yes. The announcement initially was at the end

of the fiscal year, so right around September 30th, October 1st, at

the time this cable was written, there was a lot of anxiety I think

because of a lack of communication about exactly what would be

done, how quickly we were going to start this initiative. I think

that we have certainly worked our way through virtually all those

concerns at this point.

Primarily, we started a review of every major contract through—

and I think there were a lot of existing contractors, including

NGO’s and others, who were quite concerned that the contract may

end in 90 days and they wouldn’t be able to do it. We have thus

far only terminated one contract in the last 4 or 5 months since

this review has happened. It was only a $2.5 million contract. Everything else has continued through the next year.

Mr. TIERNEY. Nobody has been asked to wind down or——

Mr. FELDMAN. None of them are winding down, and we said that

if they were going to wind down we would give them 45-day notice.

None of that has happened, and we don’t have the intent for anything like that to happen. What we have done is, I think, put the

29

international contracting community on notice that for new contracts, and as we start expending and disbursing most of this new

Kerry-Lugar-Berman money and others, we are looking to first

issues to Pakistani implementers and NGO’s to fill the capacity, as

I discussed.

We have always said that we will reserve the right that if there

is not the ability or capacity there that we will continue using

international contractors. We work actively with the international

NGO community, as well as the local Pakistani NGO’s. In fact, we

have on Ambassador Holbrook’s staff someone dedicated just to

NGO relationships and working with NGO’s on these issues. So we

are in no way trying to terminate that, but we are trying, as I outlined in the opening statement, to really build local capacity and

to do that as quickly and effectively as possible.

So I think that we are well beyond those problems, but I refer

to Jim to see what his sense is.

Mr. TIERNEY. Thanks. Can both of you gentlemen assure the subcommittee that you will keep it informed regarding the visa issue,

developments on that, and regarding your agency’s personnel, and

give us some assurance that you will only fund those programs and

projects for which personnel are in place to perform the adequate

oversight?

Mr. FELDMAN. On the issue of visas, there has been a backlog,

and it was very problematic, but we have made very substantial

progress over the last few months on the visa issue, working very

closely with the government of Pakistan. Ambassador Haqqani is

in our office very frequently giving us updates on that issue. I

think there was a backlog of about 500 visas in January. It is down

to, I believe, less than 200 at this point. So we are actively moving

through those, and we have made it very clear that this is in the

best interest not only of us but of the Pakistanis, since many of

these are auditors, in order to be able to go through——

Mr. TIERNEY. That is exactly the point. We need some assurances

that we are not going to start spending this money without those

auditors and other people in place to monitor it.

Mr. Bever.

Mr. BEVER. If I could just comment, I share Dan’s concerns about

this. Of particular concern to us is when we have visa problems for

Inspectors General from Manilla or of our security people that we

need from our Washington security office who we need to get out

to post to consult with our own internal security people to make

sure that the lives of our employees, be they Pakistani or American, are safeguarded as much as possible.

Without the ability to have an independent Inspector General

function out there at post, or without the ability to keep our people

as safe as is reasonable given the risks, we will not be able to function as productively, and we would have to change the way we do

our business or even think through what business we do.

Mr. TIERNEY. Can I take that as a yes, that we will not be spending this money where there is not the adequate personnel for auditing and oversight in place.

Mr. FELDMAN. Yes, absolutely.

Mr. TIERNEY. Mr. Feldman says yes. Mr. Bever, do you say yes,

as well?

30

Mr. BEVER. Yes, sir.

Mr. TIERNEY. Thank you.

Mr. Flake.

Mr. FLAKE. Thank you.

Thank you for the testimony.

When we are talking about building capacity with the institutions there, you mentioned they are trying to hire firms, Pakistani

CPA firms and others, to audit a lot of this. How is that going so

far? How much capacity needs to be built there before you can

transition a lot of the work from international contractors? Mr.

Feldman.

Mr. BEVER. Maybe I could start, Congressman.

Mr. FLAKE. Go ahead.

Mr. BEVER. Well, AID has a long history of doing pre-award audits, for example, and of seeking to build local capacity, including

through our Inspector General operations. They often will reach

out to local CPA firms affiliated with international CPA firms,

Americans in particular, so in many of the countries we work, including in Pakistan, there is some depth there for us to work with.

We now have in place a number of local Pakistani CPA firms,

and we have asked our IG to give us the—I would say the Good

Housekeeping Seal of Approval on those local Pakistani firms so

that we know that when we use them, they are ones that our own

IG, Inspector General, operation is comfortable with. So we would

often go to those that have also worked, for example, to do the

audit, financial audit work for the World Bank or for the British

or for the Asian Development Bank. So we try a number of different ways to go about this to make sure we get good, high-quality

operations to do that internal audit.

Mr. FELDMAN. If I could just add, although I defer to Jim on the

specific numbers, but we have been actively seeking to increase

those number of pre-vetted Pakistani CPA firms. I think it has

gone from five or six at the end of last year to close to twenty at

this point. I have seen between 16 and 20. I know we are in the

process of vetting quite a number of them. And then, in terms of

the actually pre-award surveys, I believe over 100 Pakistani organizations have been identified for pre-award surveys, and about

roughly 40 are completed or underway, and so the process of vetting on the financial and accounting side is very much underway

at a very robust level.

Mr. FLAKE. We mentioned the reaction to the conditions that was

placed on the money by the Pakistani government. Have they reconciled with that? Are they okay? And is their displeasure manifested in other areas, or areas other than visas? Just tell me how

that process is going.

Mr. FELDMAN. I was actually very involved in the aftermath of

the Kerry-Lugar-Berman legislation and I worked with Chairman

Berman, Chairman Kerry, and Foreign Minister Karachi when he

was here to try to work through some of these issues, including the

ultimate production by the Congress of the joint explanatory statement on Kerry-Lugar-Berman.

It was a backlash which we perhaps should have anticipated but

we didn’t. It had been so long in the making and there had been

so much news about it, that we didn’t expect this. I think it is fair

31

to say that a large part of this was jammed up for domestic political purposes that, once we were able to get the explanatory statement out and once people were actually able to focus on what is

actually in it.

I think there was so much misinformation about this impinging

on the sovereignty of the Pakistani government on what exactly,

how onerous the conditions might be, what sorts of reporting there

may be. Once we were able to get through the initial few weeks

and actually get people to read what the legislation actually did

and what it would require and what the opportunities are, it has

been a much more cooperative, facilitative environment.

I think having Senator Kerry there to explain it was very, very

helpful, including with the Parliament. The Secretary’s trip I think

really was a kind of turning point, and at one point she said quite

bluntly in a town hall, ‘‘Look, if you don’t want it, don’t take it.’’

And I think since that point we have really kind of turned the corner and we have not seen any sort of kind of negative press like

this over the last few months.

Mr. BEVER. If I might just add, there is one important evolution

now over about 8 years ago. Eight years ago, when we did the first

big cash transfers, $600 million, it was very difficult to get the

Pakistan government to cooperate with us in certain ways we needed in order to have rights of audit in the right places we had to

have them, but we now have an agreement with the Supreme

Audit Institute of the Government of Pakistan that will allow us,

in fact, to audit and to have our auditors and our CPA firms and

the Pakistan CPA firms enter into audit wherever we feel we need

to have it. That is an important step forward. And we have learned

some lessons, and so has the government of Pakistan in this regard.

Mr. FLAKE. Very quickly, Mr. Bever, the security situation in the

FATA for our contractors and grantees, is it improving generally or

does it go up and down depending on government action in the

area?

Mr. BEVER. I would say the latter. It goes up and down. It is,

of course, a risky place and a sometimes dangerous place. That has

not stopped us from being able to help the FATA Secretariat and

the FATA Development Authority from being able to do what they

need to do with our help, but it requires a great deal of sensitivity,

and particularly in Waziristan, of course, because of the fighting

that has made it especially complicated. We are very mindful of the

risks at play there, including for the Pakistanis that work with us.

Mr. FLAKE. Thank you.

Mr. TIERNEY. Thank you.

Mr. Quigley, you are recognized for 5 minutes.

Mr. QUIGLEY. Thank you, Mr. Chairman.

Mr. Chairman, I join you and other Members in thanking your

efforts in Pakistan. We recognize how difficult they are, but to get

past the specific points today, how do we overcome what seems to

be overwhelming distrust by the Pakistani people toward our Government and our aid?

My numbers may be old, but they are from last year that 64 percent of the public see the United States as an enemy, and 9 percent

of them see us as a partner. Obviously, this comes from many reaVerDate 17-JUN-2003 14:20 Jan 24, 2012 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\71614.TXT KATIE PsN: KATIE
32

sons. You would know better than myself, but obviously the drone

attacks contribute to this significantly, and whether or not you can

argue that those are a good idea, they seem to be having a very

negative impact on how people react to us.

And if, at least in large part, these efforts are to win the hearts

and minds of the Pakistani people, gentlemen, doesn’t it seem like

they just blow away all your efforts and no matter what you do and

how much money we spend and how efficiently we spend it, the

drone attacks seem to be literally destroying our efforts to win the

hearts and minds?

Mr. FELDMAN. Congressman, I can’t comment on the drone attacks, but I would say that the effort to rebuild our reputation and

nation relationship with the Pakistani people is the chief underlying framework of how we are proceeding with our relationship

there. And it goes back, again, to the question, I think, that Congressman Flake asked on Kerry-Lugar-Berman. There is a great

degree of skepticism in Pakistan about America, but it is——

Mr. QUIGLEY. Do you think these numbers are in the ball park?

Mr. FELDMAN. I think they are in the ball park, yes. I think that

we are working on moving them up. I think we have seen some increases. When Secretary Clinton was there, they certainly rose. I

am not sure where they currently stand right now. But yes, the

perception of Americans is not a positive one, and it is formed by

a history where they have seen our interest wax and wane based

primarily on our security and military interest. They see it as a

very self-interested relationship.

They don’t believe that we are interested in a longer-term relationship, and that is why so much of our work has been to emphasize that this is a long-term relationship, that it is based on a civilian relationship as well as a security one, that it is a people-to-people relationship. This was the entire theme of the Secretary’s trip

last fall, where she talked about turning the page and building this

civilian relationship.

I think that it will take time to do, but I think that we are going

in the right direction and it has already showed some successes. I

think it is, in part, given our many high-level principal visits. Ambassador Holbrook has been there, I think, eight times in the past

year, is headed there again at the end of the month. Admiral

Mullen has been there a number of times, the Secretary, obviously,

President Obama referencing it.

Obviously, the interest of Congress in Kerry-Lugar-Berman, but

as well as the ongoing strategic dialog, which Secretary Clinton is

hosting here next week with Foreign Minister Karachi leading the

Pakistani delegation, and trying to demonstrate the breadth and

depth of the issues that we have to discuss, rather than seeing it

through the very narrow military security prism.

In terms of how we are seeking to use the Kerry-Lugar-Berman

money, it is to do exactly what you have said in some part. It is

to have impact, use the money, obviously, efficiently and to build

sustainability. But as we have laid out in our regional stabilization

strategy and others, we have also highlighted these high-visibility,

high-impact projects in five or six different key areas, which is

meant to demonstrate what America’s commitment is over the long

term in energy, as the Secretary announced on her visit, with $125

33

million toward efficiency mechanisms that put many more watts on

the grid, but also in water and agriculture and health and education and governance. And we are in the process of developing

those right now, as we are also continuing the work that we have

done in development in that country over the years.

So we are very cognizant of that relationship, of the perception

of the Pakistani people, and of trying to change that, and we are

there for the long term, and we think that over time, as that becomes evident, that those perceptions will change.

Mr. BEVER. If I might just add to that briefly, Chairman, I would

just say what will be important to the Pakistani people, in my own

experience, is that long-term commitment, and that is why I think

the enhancing partnership with Pakistan is so important.

Mr. QUIGLEY. Excuse me. You don’t want to react to my question

as to how much of an impact the drone attacks have, either?

Mr. BEVER. I cannot comment on that, sir. I just know that what

we are talking about here do not lend themselves to dronable solutions.

Mr. QUIGLEY. And, Mr. Chairman, I know my time is up.

Mr. TIERNEY. For some time now, yes.

Mr. QUIGLEY. I appreciate it. I think mine might have been 30

seconds, but the point being a perusal of Pakistani newspapers, despite all your best efforts, seem to show that the drone attacks and,

again, whether or not we think it is rational, the trial of a female

doctor just blowing away all your efforts as it gets to the hearts

and minds of the Pakistani people.

Mr. TIERNEY. I would just comment on one thing on that. If you

read the Pakistani papers about the Kerry-Lugar-Berman thing

you have an entirely different impression from what reality was on

the ground, too, so I think there is——

Mr. QUIGLEY. Which is frustrating.

Mr. TIERNEY. It is frustrating. It is hard to tell really what is

going on, whether it is manipulation or accurate reporting on that.

Mr. Luetkemeyer, you are recognized for 5 minutes.

Mr. LUETKEMEYER. Thank you, Mr. Chairman.

In some of the information we have here, there is a quote from

June 29th to the New York Review, something to the effect that

says, rather, we can expect a slow, insidious, long-turning fuse of

fear, terror, and paralysis that the Taliban had lit and the state

is unstable and partly unwilling to douse. With the recent arrests

that have come about in Pakistan and their seemingly different approach to dealing with the Taliban, do you see an improvement in

the government’s ability to control its own destiny here, or is it still

as unstable or more unstable than what the original comment was

made almost a year ago?

Mr. FELDMAN. We are certainly happy to offer any sort of briefings to you or others about the arrests and include the intel component which I can’t really speak to. I think that there are a number

of indicators that our relationship with the government of Pakistan

is on increasingly stable and more constructive grounds, due to actions on both sides. It is one that both we and the Pakistani government have invested a lot of time and effort into over the past

14 months. I think that is beginning to show dividends.

Mr. LUETKEMEYER. Mr. Bever, what is your thought?

34

Mr. BEVER. I would just add that I think what we have seen over

the last year and a half is a more conscious effort by the government of Pakistan, when it does have to take certain military actions in populated areas, that they have learned some lessons from

the approach they took in the Mulakan and Swat and Mongora

areas.

As they have moved into Waziristan with better joint civilian

planning for better pre-staging of supplies for populations that escape from those areas because of the fighting, and for better preplanning to go back in to try to re-establish stability in those areas.

To me that is a signal of better consciousness, both within the military of the Pakistan government and the civilian sides, of the importance of doing these kinds of stabilization efforts for their security and a more humane way and for more rapid recovery.

Mr. LUETKEMEYER. Well, it seemed that the more stable a government, the more effective our aid would be to the people of Pakistan. I would assume that we would be supporting them in those

endeavors and hope that they will be able to do a better job of controlling their country and the various factions in there; otherwise,

the aid is going to fall in the wrong hands, I would assume.

Do you have any way to measure how our aid is being effective,

how effective it is, the number of schools or water projects or more

kids being educated or more people having less disease? I mean, do

you have some measurable way of seeing what we have been doing,

what the outcomes are?

Mr. BEVER. Yes, in those areas where we operate, we do baseline

surveys, we do monitoring, we do interim assessments, as well, to

see how many more children are able in a certain catchment basin,

let’s say of population, able to get some minimal primary education,

for example, how many more girls are coming back in to school because we have combined a feeding program, like our Head Start,

for example, so that, in fact, they are, in fact, more motivated to

come in to school.

We do monitor the maternal child health statistics and maternal

morbidity and infant mortality. So those are the kinds of measures

we try to take as we operate how many—what kind of community

development activities, how much community participation we are

getting, including female participation in the communities, especially difficult in areas of FATA, for example. We do have ways to

do that, and if you would like more information we can make that

available to the committee.

Mr. FELDMAN. I would also add that the White House has undertaken their metrics process, which has been ongoing over the past

6 or 8 months. I know that the first report due to Congress I believe will come at the end of this month.

Regarding FATA, in particular, just to amplify what Jim said, I

think there is a sense that, because of the security issues, because

of other ongoing concerns, that there is not necessarily much that

we have been able to do there, and that is very much not the case.

Just since September 2009 USAID and OTI have completed 32

activities totaling over $1.6 million. These have included repaving

seven roads, fifteen water supply and sanitation activities, four

flood protection walls, three electricity system rehabilitations.

35

Mr. LUETKEMEYER. Okay. Very good. That was my question. Before my time runs out I have one more question. Thank you. I

didn’t want to interrupt you here, but I do have one more question

I want to get to real quickly.

I know in Afghanistan we are using the National Guard operation where we have National Guard individuals who have a background in agriculture to come in and help train and work with the

Afghanis to try and teach them some different farming methods, as

well as help establish new markets for their farming products. Is

there something like that that is being thought of as a way to implement in Pakistan, as a way to gain the trust of the Pakistani

people, the various factions there?

I know that seems to be what is working in Afghanistan, and it

is a great way to turn the people to realize that we are there to

help, not to harm. Is there anything like that under consideration,

or is that strictly something that is only used in Afghanistan?

And, Mr. Chairman, I do appreciate your indulgence.

Mr. BEVER. At this time no, although I must say we are extremely grateful to the U.S. National Guard from, I think, nine

States now in Afghanistan that are operating there on agricultural

development teams, together with U.S. Department of Agriculture

and our own AID advisors. At this time, to the best of my knowledge, we are not planning or thinking of that on the Pakistan side.

We have other ways to deliver agriculture-related assistance, together with USDA, by the way.

Mr. LUETKEMEYER. Well, the reason for the question was you

made the comment about building relationships with the people,

we have to earn their trust, and it seems to be working in Afghanistan. I was seeing if that was something you would be thinking

about as trying a way to earn the trust of the people of Pakistan,

as well.

Mr. Chairman, I do appreciate your indulgence. Thank you very

much.

Mr. TIERNEY. Thank you for your comments. Thanks for your

questions.

Mr. Murphy, you are recognized for 5 minutes.

Mr. MURPHY. Thank you, Mr. Chairman.

I appreciate your testimony here today. I want to get back to this

question we have been tossing around about metrics. As compelling

as data is about the number of roads paved and the number of children educated, it strikes me that that is ultimately not why we are

there. If just investments in social infrastructure and in hard infrastructure were our end product here, then we should be in a lot of

places in the world. The metric here ultimately is to Mr. Quigley’s

point, is whether or not we are creating the conditions upon which

people will feel better about the United States and feel less inclined

to move into an extremist movement there that threatens both the

stability of the country and threatens the United States.

So I guess my question is: do you think about how we measure

that? And what are the ways in which we can do it?

I think I agree it is hard to do that on a national basis because

we have a lot of other competing factors that are hard to measure

for, but I wonder if there are ways to do that on a localized basis

in areas of the country that we have heavy investments in and

36

where we are paving roads and putting kids to school and setting

up health clinics. Is there a way to measure what the sentiment

there is to the United States and what the local activity of extremist groups are in those areas? I would be interested to hear a little

bit about how we measure what is our ultimate objective rather

than our intermediary objective of making the investments and

making them stick.

Mr. FELDMAN. On the more macro picture, the combating extremism is obviously a core reason, if not the core reason, for part of

our assistance programs, as laid out, again, in our regional stabilization strategy; in fact, the kind of central focus of the President’s speech on Afghanistan and Pakistan on December 1st. So

clearly how successful we are in ultimately combatting extremism

is critical to this.

The metrics in terms of actually gauging and evaluating that are

obviously a lot more difficult. I mean, it is something that is part

of every conversation. There are more specific aspects that we attempt to use in combatting extremism, the new public diplomacy

and counter-propaganda programs that we have had in trying to

get out more moderate voices more frequently. But in terms of actually how we gauge the moderating impact or even whether we

will have access to that information—and certainly not yet. I think

at this point it is a far longer-term process—is one that we are continuing to evaluate how we best capture that information.

In the relative short-term, the outputs are the easiest gauge, but

clearly they don’t tell the whole story, as well, and we have to say

not only how many schools are built, but how they are then used

and what the sustainability is and ultimately what the literacy

rate in that region is. And so it is a constant process of adjusting

that as we get the information and over the course of time. But

with the ultimate goal, the combatting extremism, is certainly a

core piece of that.

Jim might have more specifics.

Mr. BEVER. That is a very good question. I would just add that

in the end one of the metrics I kind of keep in my mind is the continuity and the strength of the civilian government and the existence of the civilian-lead government in Pakistan. It is an indicator

to me of their satisfaction with a civilian-elected and a civilian-led

government because, as you know, the rotations over time of civilian government versus military government and strengthening

that relationship between the people, as I said earlier, the governed

and the governing, is extremely important.

I think we will see indicators of that in the coming months in

Pakistan, because they are now going through, in each province,

decisions by each provincial assembly as to how they will hold their

own local elections, their equivalent of district or they used to be

called nauseam elections. That I think will be—you asked at the

local level—an indicator of what are the people thinking about the

way that Pakistan government is moving forward in servicing its

people. And it will be a mixed story. I am absolutely sure it will

be a mixed message.

To me, rule of law is extremely important, and how they perceive

rule of law at the local level, how they perceive corruption by local

37

officials or not at the local level, and how they perceive delivery of

services and their demand for those services at the local level.

Mr. MURPHY. I understand how difficult this is, and I understand

even when you are talking about local measurements like election

results it is very difficult to extrapolate that simply to U.S. aid

versus a lot of other factors, but to the extent, Mr. Feldman, you

were talking about the White House’s new effort to try to implement metric strategies, I think to the extent that we can try to get

at our end goal and in some way measure that back to where we

have made investments and where we haven’t, it makes it a lot

more helpful for those of us who right now are operating on faith

and who believe this is the right strategy, to go back and translate

that to our constituents back home that are sometimes skeptical of

us spending this amount of money abroad instead of here at home.

So I would encourage you to continue to think about how to best

measure that.

Mr. TIERNEY. Thank you, Mr. Murphy.

Mr. Lynch, you are recognized for 5 minutes.

Mr. LYNCH. Thank you, Mr. Chairman.

I want to thank both of our witnesses for your help with the committee’s work.

We were in Pakistan several weeks ago meeting with some of the

USAID and some of our NGO’s there, and there was some concern

raised about the—well, the focus is right, I think, in terms of the

federally administered tribal areas and the Northwest Province;

however, there was some concern about the safety of NGO personnel in some of those regions, and there was a sort of a reassessment going on, I guess you could call it, where western employees

were sort of hunkering down in areas closer into Islamabad and

trying to get services out to the population in those areas through

Pakistani nationals, and it was a sort of a—they were changing it

on the fly and there were even sustained concerns about the safety

of those Pakistani nationals doing work on our behalf or on behalf

of the Pakistani people.

I was just trying to get a sense of how much is that affecting the

efficacy of our attempts here to bring capacity to those governments in the tribal areas in the Northwest Frontier Province.

Mr. BEVER. I appreciate your question, Congressman Lynch. It is

one on our minds all the time. It is our preeminent concern, frankly.

We have, both in Afghanistan and Pakistan, we have lost a lot

of people paid under our assistance programs, more, of course, in

Afghanistan than in Pakistan. The local nationals—in this case

Pakistanis—are the ones who are most exposed. We know the head

of CHF was murdered in Peshawar a year ago, along with one of

his Pakistani staff. There have been kidnappings of staff from our

NGO’s, so what we——

Mr. LYNCH. Sir, could I ask you to just speak up a little bit? I

am an old iron worker and I have bad hearing.

Mr. BEVER. Sure. What we have tried to do now and since the

time you were there is whenever any of our partners come to us—

and it is usually at their initiative—to say, Will we provide funding

to them so they can adjust their agreements, their contract or their

grant or their cooperative agreement, as we call it, to allow some

38

expenses to improve their security. We look at that very seriously

and make sure, in consultation with our security office regional

diplomatic security people at the embassy, that we come to a mutually agreeable accommodation so that, in fact, they can try to improve their security.

We also have to count on the Pakistani security services, themselves, to assist us with the right kind of information about areas

where these people work and where they have to go into and come

back and commute back and forth. So we have done that kind of

coordination since the time that you were there and raised some

of these concerns and were responsive to them.

So it has not stopped us from being able to operate and to be

able to support FATA, Secretariat, and others, for example, or even

in the Northwest Frontier, but it is certainly something that constrains us on any given day.

Mr. LYNCH. Okay. All right. I am just about out of time. Mr.

Feldman, would you like to add to that, please?

Mr. FELDMAN. I completely agree with what Jim said. I mean, it

is a constant calibration between, obviously, having to be mindful

of the security situation and wanting to protect lives while also trying to do the critical assistance work that we continue to do in

those areas.

I would give as a recent example the United States has agreed

to provide $55 million for reconstruction projects in South

Wajiristan, focused on roads, dams, rehabilitation, and power grid.

General Zubear has worked very closely with Ambassador Rafo and

our Embassy in Islamabad to ensure that access for U.S.-funded

Pakistani monitors would be one of their top priorities. And so as

we continue to try to put forward—and there is a range of other

oversight mechanisms we have tried to put in place, which I would

be happy to talk about later, fixed reimbursement agreements and

things like this—but we have tried to work with and mitigate, to

the extent we can, the security situation while still being very cautious about risking lives.

Mr. LYNCH. Thank you, Mr. Chairman.

Mr. TIERNEY. Thank you, Mr. Lynch.

Mr. Van Hollen, you are recognized for 5 minutes.

Mr. VAN HOLLEN. Thank you, Mr. Chairman. And thank you

both for your service. I want to commend you and the whole team

on what I think has been significant progress over the last year or

so in Pakistan, and I think we are beginning to see the results, at

least with respect to responsiveness and engagement with the government of Pakistan in fighting the most extreme elements. It

wasn’t long ago that President Musharraf was entering into nonaggression pacts with the Pakistani Taliban in Swat Valley. Largely as a result in the change in government and the engagement of

the new administration, a diplomatic, political, economic offensive,

you have a much greater degree of cooperation and engagement.

Not only has the military gone after the Pakistani Taliban, but

they have also taken very important steps in going after elements

of the Afghan Taliban based in Pakistan. We saw that, obviously,

with the arrest of Mua Omar’s operation head and the arrest of the

shadow Governors and other signs of greater cooperation.

39

That is a result, I believe, of greater confidence and cooperation

between the U.S. Government and the Pakistani government, and

a view on the Pakistani side that they have a big stake, as well,

in defeating extremism, whether it is the Pakistan Taliban or ultimately trying to resolve the situation with the Afghan Taliban.

So I think that is important progress, and I think it is the result,

in part, of engagement at all levels, including economic engagement, and sending the signal that we are there for the longer term.

I commend you on the idea of trying to channel more resources

through Pakistani contractors and indigenous institutions, with the

caveat, of course—and you have raised this—that we have to make

sure there is transparency and accountability. As we put more

funds through local organizations and build capacity, we need to

make sure that those moneys are being well-spent.

So there is building this relationship with the government, but

we are all frustrated with the fact that if you take a poll in Pakistan today among the Pakistani people, the United States is held

in very low regard. And, as the chairman pointed out, the KerryLugar-Berman legislation aid, it was like kicking the gift horse in

the mouth, although we don’t see it as a gift, we see it as part of

our engagement and interest. At the same time, it was something

that was a good thing.

So while I like the idea of channeling more funds and building

capacity, at the same time those American taxpayer dollars are not

necessarily—we don’t get the credit necessarily for those investments in the mind of the Pakistani people, and I think there is a

real feeling what while we pumped millions and millions of dollars

into important things like institution building and democratic

building, that if you were to turn around and ask the average Pakistani citizen, what has the United States done in terms of economic

development, it is hard for them to identify something.

So my question is: in addition to doing these kind of things,

should we not also think of doing some of the things we used to

do in the past? USAID used to do much bigger investments that

were important investments in the country, but at the same time

drew the national attention of the Pakistani people, clearly identified as an investment being made in the United States in the future of Pakistan and the future relationship, because there is a

concern that after spending all of this money, especially as you

channel it more through the government of Pakistan, which builds

capacity, that no one in Pakistan, among the Pakistani population,

can say, yes, the United States helped us in this particular, concrete way.

If you could, respond to that and what ideas you have with respect to some of these other projects.

Mr. BEVER. Congressman, we certainly agree with your comments. It is important that the Pakistani people have some visibility and see the benefits of cooperation with the American people

and the American assistance with our people’s money. So we are

looking and have already initiated the first wave in the last few

months of assistance to the energy center, trying to rehabilitate

and repair some of their existing power systems. They will see that

to the extent they see things quickly in the press. They should also

40

see it in terms of the effects in certain parts of the country on their

load shedding.

Now, again, these are just the first steps.

It is a country of 157 million people, plus or minus. It is more

than half the population of our country. So when you take that,

even with a very generous assistance program we have now, it is

still less than $8 or $9 per capita in the country. So we have to

do this extremely catalytically, and we have to be very thoughtful

on how we approach this.

So we will be working in energy, which all Pakistanis can immediately identify with as a need. We will be working in water, which

is an extremely important feature for the Pakistanis, both in agriculture, in quality of water, potable water in their communities,

but also on water distribution systems and, obviously, because of

base and treaty concerns that are also political concerns in the

country.

So those are just some quick examples, but we want to make

sure, as we do those more-infrastructure programs, that the policy

reforms are there, too, so that our people’s money is put into programs that, in fact, will be sustainable financially.

Those are the two examples I would like to share with you.

Mr. FELDMAN. Thanks, Congressman Van Hollen. I appreciate

your stage setting, as well, because I think it is critical, as we

think about how we continue to move forward, what the metrics

are, recognizing that there is still a sense of great skepticism about

the American relationship among Pakistanis. Just a year ago the

Taliban were 100 miles from Islamabad. We were facing a quite

critical scenario.

And over the course of the past year, through the increased cooperation at every level of Government, we have seen the development of a far more cooperative, constructive, civilian-based relationship, which I think is starting to yield real benefits now, but

it will take, I think, a significant amount of time to continue to see

these benefits, as per their earlier questions about how do you actually engage something like combatting extremism.

Your question on how these benefits help to accrue to the United

States, how people focus on what the United States has contributed

to them in our development projects is obviously one that the development community grapples with all the time. As we came to it

in terms of looking at how we could best use this Kerry-Lugar-Berman money, we also went through the exact same calculus, and we

have really tried to walk the line between continuing to do the institutional capacity building as we have done over time, but also

demonstrate, and this is where this whole term of either signature

projects or high-impact, high visibility projects has come from, but

to do at least one type of those projects in each of the five or six

main sectors we have identified that are most important to Pakistanis, starting with energy, given the Secretary’s trip last fall, and

the second one being water, showing that we are hearing the concerns of the Pakistani people beyond just the border regions, beyond where we are seen to have a more narrow, targeted interest.

I think the process that evolved as we considered what we could

do in the energy field was a very instructive one. I think we started

with the idea of let’s build something big that we can stand on and

41

have a ribbon cutting, and everyone will know that America built

this. And as we looked more and more into it, first of all, the costs

were exorbitant, the sustainability issues were there. It was questionable what the needs were.

As we started looking more at the actual needs, it became far

more clear that working on the efficiency issues, working on getting more watts on the grid, avoiding some of the blackouts in high

consumer and commercial areas, which we could do relatively

quickly and easily through this $125 two-well project, would be far

more constructive, far more efficient, and more sustainable.

And so instead of the kind of signature energy project, a dam or

something like that, we have come up with this signature energy

initiative. I think that the same process is unfolding in many of the

other sectors. In education we could have looked at building an

American university, but again how sustainable is that over the

long term. What is the commitment there? Does that become a target in and of itself?

So I think, although we are still very much in the process of trying to determine which direction we are going in and USAID and

State together are actively looking at a number of these projects in

the remaining sectors, something like a center of excellence at an

existing university or some sort of faculty, which would be seen as

this is a gift of the American people or done in conjunction and cooperation with the American people, helps to build that, but is also

not necessarily the grand bricks and mortar vision that we had of

big development projects.

Mr. TIERNEY. Thank you, Mr. Feldman.

Mr. Welch, you are recognized for 5 minutes.

Mr. WELCH. I thank you very much.

The dilemma I think all of us have is, number one, what is the

basic purpose of the aid, and it has to be tied obviously to national

security, however else we describe it, and, number two, in order to

deliver that aid, how can it be effective, how can we get our money’s worth. The models that we have used, whether it was depending on international contractors or NGO’s, where there is a high

overhead, whether it is dependent on Pakistani ministries where

there is a high level of corruption, and whether it is dependent on

NGO’s, where there are huge oversight problems. The only way we

can be successful—and I will just ask you this—is whether we

have, Mr. Bever, and honest and a competent Pakistani partner. I

mean, would you agree with that?

Mr. BEVER. Absolutely.

Mr. WELCH. So if we don’t, I mean, there are disputes between

the military and the civilian government. There is a weak civilian

government that is up and down. Other than for purposes of domestic consumption and the need that we have to at least appear

that we are attempting to win hearts and minds through development projects, through economic opportunity projects, through education projects, if we are honest with ourselves and ask the hard

question, can we realistically be successful when the implementation and execution really requires an honest partner in Pakistan.

Mr. BEVER. Well, this is one of the purposes of our financial preaward assessments. It is our procurement officers, it is our controlVerDate 17-JUN-2003 14:20 Jan 24, 2012 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\71614.TXT KATIE PsN: KATIE
42

lers, it is our project officers also that check out these organizations

before we——

Mr. WELCH. See, this is my point.

Mr. BEVER [continuing]. Provide assistance to them.

Mr. WELCH. It is a real dilemma. I don’t mean to be challenging,

because I know you are doing your level best. Obviously, it is desirable for us to be doing projects that are going to improve the lives

of Pakistani people.

But there is a hard question that we have to ask. We can have

all the auditors in the world. We can have all of the honest NGO’s

in the world. But if there is not a mechanism that is solid in Pakistan, we are going to have Iraq all over again. I mean, that is the

hard question. And what you seem to be acknowledging is that we

really do need an honest partner there.

Mr. Feldman, how about you?

Mr. FELDMAN. Of course I absolutely agree that we need an honest partner. We are doing everything that we can to work with the

honest partners, to identify those, to vet them, and to make

sure——

Mr. WELCH. And politeness requires that we say kind things, but

the mechanisms over there don’t exist. It is our need now, because

we have an urgent national security need, things have changed, apparently somewhat for the better, as Mr. Van Hollen has mentioned.

But I think most of us would probably come to the conclusion

that it had much more to do with the self-interested conclusion

made by the Pakistani military that the Pakistani Taliban were

starting to cause trouble that made their lives difficult. It was not

a result of the Kerry-Lugar-Berman aid. Would you agree with

that?

Mr. FELDMAN. I think it is a combination of factors. I think that

it is an evolving, changing relationship that is dependent on many

things, and I think that the Kerry-Lugar-Berman aid will be quite

critical for that.

Mr. WELCH. When I was there, I just was there with the chairman, and what was really apparent when you are there is how incredibly difficult it is to actually get a water project and education

project, you name it, how hard it is to actually do it. And we can

talk here, and we can talk about metrics, but there is an abstract

quality to it because the people on the ground, the security challenges they face, the lack of infrastructure, administrative infrastructure to make it happen, these are enormous impediments to

the best intention, the best and hardest-working people.

For domestic reasons here, we have to act beyond military, but

on the other hand, with all of the practical problems, I wonder

whether it doesn’t make sense to do a big, visible project, somewhat

like the approach described by Mr. Van Hollen. It is easier to control the money, more confidence that you will get a dollar’s worth

of—well, maybe 70 cents worth of work for a dollar’s worth of income. It is a substantial and visible project.

I know my time is up, but I would ask each of you to briefly comment on that.

43

Mr. BEVER. I would just comment that in my experience with

Pakistan over a quarter of a century and half my career, there are

leaders in Pakistan, there are reformers in Pakistan.

Mr. WELCH. Right. I know that.

Mr. BEVER. There are many Pakistanis of very high integrity,

such high integrity that sometimes in past governments they could

not be trusted and they were sidelined, and some of them are back.

There is a growing, I think, appreciation by the Pakistani business

community and Pakistani civil society that they have to take more

charge at their levels for the future of their country and to hold

their leaders as accountable as we hold our leaders accountable.

I think that is a very important phenomenon that is evolving in

Pakistan today, and obviously the extremist threats to the country’s future help to mobilize that, whether it was a tax on universities or police stations in Lahore, regardless of those things that

were going on in the FATA and NWFP.

I think the real future of that country and our assistance to it

is linked to our ability to support those who have the courage inside their own society to transform their own society, and that is

where we will be most effective and, over the long run, getting to

Congressman Van Hollen’s question also, that is where the Pakistani people will thank the American people the most, but it will

take time.

Mr. TIERNEY. Thank you, Mr. Welch.

Mr. Driehaus, you are recognized for 5 minutes.

Mr. DRIEHAUS. Thank you very much, Mr. Chairman, and thank

you, gentlemen, for being here today.

I just wanted to follow up on Mr. Van Hollen’s comments about

the Pakistani perception of U.S. aid in Pakistan. I am a former

Peace Corps volunteer, and I am curious as to how we are engaging

in soft diplomacy. There are many projects, massive projects, littered around developing countries that were done counter to the

will of the people in certain countries, that, because of one reason

or another, were failures and they stand out as failures of U.S. aid

policy in those countries. Yet, we know that soft diplomacy often

works very effectively in terms of changing opinion toward the

United States of folks that are, you know, obviously living in those

countries.

So I was wondering just if you could start off by telling me what

we are doing to engage in soft diplomacy in Pakistan.

Mr. FELDMAN. I guess, Congressman, first of all I would say it

would depend in part on how we define soft diplomacy. But in

terms of if it also includes democracy and governance related activities, whether it is just person-to-person contacts, which is going

to be one of the key areas for the strategic dialog next week, and

continuing to build those ties with NGO’s, obviously, continuing to

build ties with both Federal and provincial leaders, parliamentarians, and other elected leaders, the democracy in governance program—and Jim can give more details—has a parliamentary

strengthening dimension to it, a local governance dimension to it,

an elections-based dimension to it.

I know that NDI and IRI and other organizations are very interested in continuing to do more. There is a whole range on the softer diplomacy. There is a whole range of kind of communications

44

mechanisms. Our new Under Secretary of Diplomacy, Judith

McHale, has put together a very robust communications strategy

which has already started putting out bids for children’s educational TV programs in local languages, other communications

programming, radio, television, using new social media networks,

cell phones, and other things.

So there are a range of activities that are currently in the works

and starting to be implemented, but I am happy to come back

and——

Mr. DRIEHAUS. Well, I guess I am concerned that those all seem

to be up here, and what are we doing at the ground level and in

the villages, in the cities in terms of touching people, face to face,

in terms of Americans on the ground and engaging in some type

of cultural exchange in addition to development, because, when we

talk about democratization, when we talk about Federal Government intervention with the Pakistani government, that is a bit different than being at the village level and on the ground.

Mr. BEVER. If I could just add, Congressman, one of the evolutions you will see this year in our program, security permitting,

will be deepening our presence in the country. We will be moving

out of just Islamabad—I am talking about AID—and establishing

regional offices in Lahore to service the people of Punjab and Karachi, to service the people of the Sindh and Balujistan, in addition

to a very modest presence in Peshawar, which is constrained right

now for American officers by security.

That will enable American officers—again, I am talking AID, and

sadly we don’t have a Peace Corps presence there—to be able to

get out with the people more, with the business community, with

the local associations, with women’s groups, with communities,

with the Governors and the district officials, the kinds of things we

used to be able to do 25 years ago when I first served there, and

that we have all been wanting to do.

That is why we will be basically tripling over time, over the next

two fiscal years, assuming funds are available, our American officer

presence, but we are also going to be more than doubling our Foreign Service national Pakistani staff to also serve in Lahore and in

Karachi and be able to help us get out more, as well.

Mr. DRIEHAUS. With regard to the AID assistance delivery and

the transference to local NGO’s, what lessons have we learned in

terms of accountability and sustainability in terms of Pakistani

NGO’s and how they are able to engage in development? And do

we have outcomes measurements that we are using to hold them

accountable, similar to what we would be doing with international

NGO’s and American NGO’s operating with USAID contracts?

Mr. BEVER. A number of questions in your larger question there.

Mr. TIERNEY. That is a clever tactic Mr. Driehaus uses to eat up

his 30 seconds remaining. But please go ahead and respond.

Mr. BEVER. First and foremost, we do have to assess the capability of these groups. We have to make sure they are actually registered with their own government, that our financial analysis and

those of our Pakistani firms that we use assure that, in fact, they

are following their own law, first, to make sure they are accountable.

45

We also have learned some lessons about how we do our grants,

because we are talking NGO’s. They are usually grants. So we

don’t necessarily always give it all in one big amount of money up

front; we tend to give an initial amount, see how they do, give an

incremental amount, see how they do, and then give a final

amount, those kinds of things to meter the flow of money, to make

sure we get the performance that they told us they want to do, and

we are assisting them in what they claim they are good at. That

is why we provide grants or cooperative agreements.

In the case of cooperative agreements, we have a clause that is

called substantial involvement. It means the U.S. Government has

a much deeper relationship with the grantee than under a normal

grant arrangement, and we exercise that through our assistance officers that have Federal warrants.

Those are just some examples.

In terms of measurement, every one of our program activities has

to have a measurement and monitoring plan, and we make that

available to the Inspector General to hold us accountable in the

way we do our business, as well.

Those are some of the lessons we have learned over time, Congressman.

Mr. FELDMAN. May I just add one thing to it? I mean, one thing

which I think you are very right to focus on is the impact on the

ground, but in an example like Swat, just since September the combination of the work of the Pakistani government in helping to return IDPs, but also the USAID work has really contributed to a resumption of normalcy there which I think would have been unimaginable 6 months ago.

So helping to rebuild government of Pakistan offices, helping to

rebuild schools and thereby enabling people to return and resume

that degree of stability I think has been very significant, from both

a national security strategic sense as well as what our overall development goals are.

Mr. BEVER. If I can just add, we also vet our partners. We are

required to check to make sure that the partners we provide assistance to are not on certain terrorist lists. We make sure that our

partner organizations are in good stead with their own government

from a financial perspective on their own, whether they pay taxes

or whatever their particular rules are.

And we are particularly mindful of what was called the

Negroponte guidance from the last administration, which basically

asks us to assess the risk in each of our partners and to adjust our

controls depending upon the risk we assess with that particular

partner in that particular geographic area from a point of view of

the money going to hands to whom it should not go.

Mr. TIERNEY. Thank you very much.

Ms. Chu, you are recognized for 5 minutes.

Ms. CHU. Well, last week militants stormed the northern Pakistani offices of World Vision and killed six workers, injuring five.

It is the world’s largest Christian charity and works in some of the

poorest and most politically unstable places on earth, and also educates and employs local women. All these factors make it a target

for extremists.

46

My question is, concerning this situation, what implications does

this have for Pakistani NGO’s that receive aid, and what about

their safety and security?

Mr. FELDMAN. Certainly we condemn the actions on World Vision, and we are very, very sorry and troubled to have seen that

incident, but it is, unfortunately, not uncommon for NGO’s and others doing this type of work to be targeted. We are continuing to

work, as we discussed here today, within the constraints that we

have to walk that fine line between continuing the very important

assistance work, the work focused on women’s issues and some of

the other things that World Vision was doing, in the neediest areas

with the security concerns.

So I know Jim can talk a little bit more about the kind of security mechanisms that we try to put in place or try to work through

in the most conflict-ridden areas, but it is, as I have said, a constant calibration that post tries to work through in terms of where

we will continue to target our work, to target our resources, to try

to continue the assistance, while also being as cognizant about the

real risks that people are facing, and trying not to put them directly into harm’s way.

Mr. BEVER. I would just add that in this case World Vision, they

were not a direct recipient of USAID, but where they are we have

urged our partners to come to us and say, If you perceive security

risks, please describe them to us. Tell us what you feel you need

for your people while they are traveling, if it is the kind of vehicles

they travel in, if it is the protection around where their offices are,

those are the things we can help with financially as part of a grant

or cooperative agreement or contract. And we have had a lot of experience in this, but they do have to take some initiative to come

to us if they perceive problems.

But we are not being just passive that way. We have also

reached out to them. I met with every chief of party of every contractor, grantee, and implementing partner in Pakistan when I was

there in the fall, and I will be going out again soon. I will meet

with them again. And one of the things we did talk about was security. Again, these were ones we support.

They, however, are in close touch with others who we don’t support, and they share information, and we have told them anyone

who is U.S. registered is welcome to come to, now I think it is a

monthly, briefing with the Diplomatic Security Officers, and

USAID has our own security officers at the post in Islamabad,

where they share information, they hear about those concerns, they

get advice, and there are ways to sort of establish best practices,

because their own network is faster and better even than ours,

frankly. And there are other techniques that could be used, but this

is not the appropriate forum to discuss that. But we could discuss

it offline if you would like.

Thank you.

Ms. CHU. Just as a follow-up, I know that many of the attacks

have targeted local Muslim women who were involved with American aid organizations. Is there a way to balance the safety of these

women involved in these programs without compromising our goal

of advancing the rights of women and girls in Pakistan?

47

Mr. BEVER. Obviously we encourage women’s groups or women

to participate in all the programs of our assistance. It is, first and

foremost, the responsibility of the Pakistani security entities to protect their citizens. That said, there are some things, for example,

in schooling and education that we have learned that if schools

need walls built around them to protect the children, including the

girls, that that is a very legitimate thing for us to do with the

American people’s money since we want the education to happen

and we want more girls, in particular, to participate in the education system. That is a simple thing, very simple, that, in fact,

does make a big difference.

Another, frankly, is training female teachers. The more that

there are female teachers in the country, the more families are

willing to allow their daughters to go to school, because they feel

that the teachers will be more responsive to them and less of a possible personal security threat to them.

These are things Pakistanis have told us, lessons they have

learned that we want to be able to help support.

Ms. CHU. Thank you.

Mr. TIERNEY. Thank you very much.

We have finished our first round of questioning. With your indulgence, I am going to see if the Members want a question or two

more before we fold here today.

I am going to start that. Mr. Flake has deferred, and I appreciate

that.

Mr. Bever, we concentrate a lot in this committee on the personnel over there and the ramping up of U.S. personnel. Many of

us have the impression that we were hollowed out over a period of

time and now we have to get our capacity back. So if we are decentralizing, we are going to smaller predominantly Pakistani contracts that need oversight from people in our USAID, what is the

recruitment process we have to get people in and how is that

going? What do our numbers look like? What is the training process, so we get them up to the capacity that they can actually supervise and manage other people, as opposed to just do certain functions?

I think, last, that leads to a question that was discussed a little

bit beforehand: what, if any, legal authorities does USAID need in

order to do that recruitment training and retention of sufficient

numbers of personnel for service in Pakistan?

Mr. BEVER. Thank you. Mr. Chairman, if one looked at, say, contracts officers or procurement professionals, for example, we now

have about a half a dozen in Islamabad. These are U.S. contracts

and agreements officers, not to mention Pakistani. We expect to expand those procurement officials in country over the coming year,

probably doubling them. We expect to move them out into the local

areas, into Lahore and Karachi, as well, to help oversee our

projects as we get——

Mr. TIERNEY. So you will have a total of 12 in the entire country?

Mr. BEVER. It will be approximately 12, as I understand it.

Mr. TIERNEY. So do those 12 people essentially do all of the procurement or overseeing all of the procurement?

Mr. BEVER. They also have Pakistani negotiating assistants and

others that have experience doing this with World Bank or ADB or

48

others from whom we have hired some of these staff to be able to

help us, and we bring in——

Mr. TIERNEY. But you want those people, the procurement officers, to be able to know whether or not the Pakistani staff is performing up to sufficient——

Mr. BEVER. Yes.

Mr. TIERNEY [continuing]. And knowledgeable.

Mr. BEVER. Yes.

Mr. TIERNEY. So still you are going to get——

Mr. BEVER. We are still building. We are still building, if that is

what you are saying.

Mr. TIERNEY. How many eventually would you like to have?

Mr. BEVER. I would think we want to move up to 16 or 24, something like that, between the American and the Pakistani staff over

time.

Mr. TIERNEY. So basically by the time we are in our last year of

this Kerry-Lugar-Berman money, you will be getting up to a point

where you want to be?

Mr. BEVER. I think we can move much faster. We are trying to

do this this year and next fiscal year.

Mr. TIERNEY. I see. So you are going to do a half dozen more this

year, but then maybe double it up in the next year?

Mr. BEVER. That is what we ought to be doing. And not just in

that case, but in terms of project officers and others I think we

have to face the reality—and you are aware of this, Mr. Chairman,

that after 7 or 8 years of working in these highly risky conflict

zones where usually they are officers unaccompanied by their families, their spouses, it has taken its toll on the agency, and that is

why we appreciate the support for the DLI part of it, development

and leadership program.

Those people do have to be brought in, trained up, and then assigned to some of these more challenging posts. That will take

time. That is why we are moving to expand the number of mid-career development professionals we are bringing into the development leadership initiative, and we are also now recruiting outside

to bring people in under what we call Foreign Service limited hire,

which are Foreign Service officers, but they are limited to 5-year

appointments at a time that can be renewed once.

So it is a technique we have developed in Afghanistan, and we

started in Iraq. I was also the Deputy Assistant Administrator for

Iraq for 2 years.

Mr. TIERNEY. Are these people experienced in particular areas

that you are going out for these 5-year periods?

Mr. BEVER. We look for people who have had conflict zone experience. Generally our requirements are pretty stiff. We look for master’s degree plus 8 years experience, of which four has to be in conflict zones. When we can’t get that, we then ask for 8 years, even

more years of work experience, and then we do, of course, personal

references on all of them.

But I guess the other thing I would just want to say here is that,

in terms of training them, this also takes time. It is a difficult

thing to do in the conflict setting, which is why we try to find people who have already got some of this experience to bring into

the——

49

Mr. TIERNEY. Do you have any success in bringing back former

USAID personnel?

Mr. BEVER. We have. We have reached out to former senior Foreign Service and regular Foreign Service officers, and with the help

of Congress we have special provisions to bring a limited number

of officers back who can be sworn in again and retain their annuity, as well. So in terms of certain authorities that would be helpful

to us, Congress has been forward-leaning on that. We can bring

certain personal service contractors onboard, as well as Foreign

Service limited officers.

I think the time will come, though, when we need to find ways

to retain, how to retain these officers in these posts that are both

dangerous and they are away from their families. What are the motivations to keep them there a second year, or even a third year?

For example, can we relocate families closer by in that theater,

which is what was done in the Vietnam war, so that both military

and civilian officers, in fact, would stay longer?

Are there other financial incentives that potentially could be provided, or caps lifted on the pay that they can earn? These are just

a couple of simple examples that we really need to be looking at

to retain the officers once they get there. They will be four times

more effective in their second year than they are in their first year.

Mr. TIERNEY. Do you have somebody in your office that you could

delegate to deal with Mr. Flake’s staff and our staff here to maybe

talk through some of those issues in more detail?

Mr. BEVER. We would be happy to. Absolutely.

Mr. TIERNEY. The staff director, Mr. Wright, will contact you and

follow up on that.

Mr. BEVER. Okay. I would just add that we have done something

unique in AID’s history in the last 6 months, both for Afghanistan

and Pakistan. Recognizing the challenge to get senior officers of the

current corps to come to post, we have designated all the office director positions, of which there are approximately 10 in both posts,

as what we call senior management group officers, and that means

the Administrator personally approves who goes there, and they

have to be what we call FS–1, class one officers, at a minimum, or

senior Foreign Service Officers to go. So normally those designations are required only for mission directors or deputy mission directors, so we have stepped up to the plate here and stepped up

the internal incentives for our officers to serve there.

Mr. FELDMAN. Mr. Chairman, may I just say, in addition to that,

that the number of direct hires I believe throughout Pakistan has

increased 70 percent from 2008. I think it has gone from 336 to

580, with plans to add another 125 by 2011. So we also are closely

monitoring the staffing situation, trying to get the best people out

there as quickly as possible, and would be happy to join in any sort

of briefing on those issues.

Mr. TIERNEY. Thank you.

Mr. FLAKE. I was just going to ask if you can give us a ball park

number on how many you have been able to bring back, the Foreign Service officers, through this program?

Mr. BEVER. I am going to have to give that to you separately, but

I can tell you I spend a part of every day calling colleagues who

used to work for AID seeing if we can attract them back, and they

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are serving in Iraq, they are serving in Afghanistan, they are serving in Pakistan.

For example, our deputy director who is in Peshawar is a rehired

senior Foreign Service officer. One that we are currently attracting,

trying to bring to Karachi, will be a rehired senior Foreign Service

Officer. We also have looked to other missions to loan their mission

directors or their deputies to Pakistan, and we have brought three

other mission directors out to Pakistan to help us over the past fall

and winter. So we are doing everything we can to bolster the senior

level of the mission.

Mr. TIERNEY. Thank you.

Does any other Member wish to ask an additional question? Mr.

Lynch.

Mr. LYNCH. Thank you, Mr. Chairman.

Just to illuminate the problem we are having in attracting

former or retired members, Federal employees, up until about 6

months ago, we could not get very highly skilled Federal employees

to come back to work for the Government because they would have

to, under the law, forfeit their annuity.

Now, the corporate world has this right where if they have a special problem they just pull people back in out of retirement to go

to work for them. That person has no learning curve. They know

the business as well as anyone. But we in Government prevented

some of our most skilled Foreign Service officers to come back into

Government because we would require them to forfeit their retirement.

About 8 months ago, Senator Akaka and I got together. We

changed that under the Defense authorization bill, but only for the

last 6 months have we started to reach out to former Federal employees. These are highly skilled folks that have 20, 30 years experience, but it has only been in the last 6 months that we have been

able to bring folks back.

One of the things I wanted to raise with you, sir, is I think we

only allowed them to come back for 2 to 3 years, and then that expires. I am just asking, you are talking about a 5-year, these special contracts. We might have to amend that to 5 years in order to

get them to come back under your program. So maybe that is something that we could work on together. I happen to Chair the Subcommittee on Federal Employees, so maybe that is something we

could work on.

Mr. BEVER. We would welcome working with the committee,

yourself, sir, and others on this. I am not aware of that particular

limitation, but if it is there—I’d have to check the legislation

again—and then we could extend it, that would be helpful.

I will just toss one suggestion out. This is not Pakistan, but it

is really Afghanistan related and Iraq related up to a certain point.

Our brave soldiers that serve in war time, in war theater, are exempt from Federal tax during the time that they are there, as I understand it.

Also, our grantees and our contractors who are there under our

pay are exempt from the first certain amount of their income on

Federal income tax, though they have to pay some on certain benefit kinds of packages. I think it is $75,000 or $90,000. The only

Americans in harm’s way who do not receive that financial incenVerDate 17-JUN-2003 14:20 Jan 24, 2012 Jkt 000000 PO 00000 Frm 00054 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\71614.TXT KATIE PsN: KATIE
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tive to serve and continue to serve are U.S. Government civil servants and Foreign Service officers who are in harm’s way in these

war theaters.

So I will just toss that out as something to think about, whether

there is a way for those officers who are in harm’s way in the same

places where all other Americans who are there receive some benefit as a representation of the risk they are taking, might be able

to benefit from this in the future is the kind of thing that I think

will help both attract and retain officers in the field.

Mr. LYNCH. I totally agree with you. We have, especially in Afghanistan and in Iraq, where we have Agricultural Department

employees in there, we have a lot of civilian employees in there,

and they are not being treated nearly the same way in benefits or

even when they get injured in a war zone. There is a whole different way of treating them.

It looks like I might have another minute left.

Mr. TIERNEY. A minute and 8 seconds.

Mr. LYNCH. A minute and 8 seconds. Can you just give me a real

thumbnail on Swat Valley, because I know that we are putting a

lot of money in there. I had a chance to chat with Ambassador Patterson a few weeks ago, and that is sort of a microcosm of our effort there in Pakistan in terms of pushing the capacity of the Government out into some of these tribal areas. Could you just give me

a thumbnail on that?

Mr. BEVER. Well, I can give you my own historic perspective.

When I lived there I used to go fishing for trout in Swat Valley,

it was that safe, and it was a beautiful tourist area. Now, of course,

it is a different situation, and I, too, was alarmed, as Dan said earlier in our testimony, at how close the extremist elements were to

Islamabad. That resonated throughout the country.

Today we are working very closely with the Pakistan government

and the Northwest Frontier government, as well as with General

Nadim and First Corps and others, and with Pakistani institutions,

Parsa among them, to assist in the Northwest Frontier, especially

Mingora and Swat, with everything from reconstruction of those facilities that were damaged, but, more importantly, building back,

actually increasing the presence of the Pakistan civilian government.

Where they used to have one administrative center that may

have been blown up by the Taliban when they left, there will be

two or three administrative centers. Where there was one police

building, there will be two or three. Where there was one clinic,

there will be two or three. Those are ways to deepen the government service delivery, and the Pakistan Civil Service are returning

to the area and working. So we have spent quite a few hundred

million dollars there, $350 to $400 million, in relief efforts and reconstruction. There will be more to come.

Mr. LYNCH. Thank you for your indulgence, Mr. Chairman.

Mr. TIERNEY. Thank you very much.

Any other Member wish to ask additional questions?

[No response.]

Mr. TIERNEY. There being none, let me leave this last question

with you gentlemen. Can you tell us how much of President Bush’s

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$750 million program for FATA has actually been obligated or

spent in that region?

Mr. FELDMAN. I don’t have that information off the top of my

head, but we would be happy to——

Mr. TIERNEY. Could you give us a status report on that, on how

much has been spent, how much has been obligated, and how much

remains out there, and why it still remains?

Mr. FELDMAN. Sure. We will do that.

Mr. TIERNEY. And what his plans may be?

Mr. BEVER. We will get back to you on that.

Mr. TIERNEY. Thank you, Mr. Flake. We thank our witnesses

very much for your testimony, both written and oral, and your time

and your staff’s, as well. We appreciate it. We look forward to dealing with you in the future, and we will definitely ask Mr. Alexander and Mr. Wright from the committee staff here to talk with

Mr. Bever about some of those incentives, as well as the tax situation that he brought up.

Thank you both.

Mr. BEVER. Great. Thank you.

Mr. FELDMAN. Thank you.

Mr. TIERNEY. This meeting is adjourned.

[Whereupon, at 11:51 a.m., the subcommittee was adjourned.]

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