The permanent national government of Iraq was established by a constitutional referendum in October 2005, followed by election of the first Council of Representatives (Parliament) in December 2005 and the selection of the first Prime Minister, Nuri Kamal al-Maliki, in May 2006. By mid-2006, the cabinet had been approved, and the government now has 34 ministries responsible for providing security and essential services including electricity, water, and education for the Iraqi people (see fig. 1). The size of the ministries varies considerably in terms of staff numbers and budget. As of May 2007, the U.S. government ministry capacity development programs target 12 key ministries—10 civilian ministries are the focus of State and USAID programs, while the Ministries of Defense and Interior are targeted by DOD programs. These ministries contain 65 percent of the workforce and are responsible for 74 percent of the current budget (see table 1). According to U.S., international, and Coalition Provisional Authority (CPA) assessments and officials, years of neglect, a highly centralized decision-making system under the former regime, and looting in 2003 decimated Iraq’s government ministries. To address this problem, multiple U.S. agencies have conducted capacity development efforts at individual Iraqi ministries since 2003. The implementation of U.S. efforts to help build the capacity of the Iraqi national government over the past 4 years has been characterized by (1) multiple U.S. agencies leading individual efforts without overarching direction from a lead entity or strategic approach that integrates their efforts with Iraqi government priorities and (2) shifting timeframes and priorities in response to deteriorating security and U.S. embassy reorganization. State, through the U.S. Embassy Baghdad’s Iraq Reconstruction Management Office (IRMO) began implementing a number of 1-year projects intended to jump start capacity development in 2006 at the 10 civilian ministries designated as key to enabling the Iraqi government to sustain its reconstruction and deliver essential services to the Iraqi people. It also targeted other national level organizations, including the Prime Minister’s office and anticorruption entities. USAID focused primarily on implementing a medium-term effort to improve the public administration capabilities of the Iraqi government. DOD conducted relatively intensive capacity development efforts at the ministries of Defense and Interior. However, the lack of a lead entity to provide direction and an overall plan contributed to the three agencies developing separate metrics to assess and track the capacity levels of ministry functions common to all ministries and blurred the distinction between the efforts of USAID and IRMO. Since January 2007, moreover, capacity development efforts have been subject to changes in focus, agency roles, and organization, with the U.S. embassy and MNF-I seeking immediate improvements in ministry performance and results in areas such as budget execution. No single agency is in charge of leading and providing overall direction for U.S. ministry capacity development efforts. As of May 2007, six U.S. agencies were implementing about 53 projects at individual ministries and other national Iraqi agencies. State, USAID, and DOD are leading the largest number of programs with funding allocations totaling about $169 million at individual ministries and other national Iraqi government agencies. As of May 1, 2007, about 384 U.S. military, government, and contractor staff from these 3 agencies were working with the ministries and were implementing or completing capacity development projects. State advisory teams led by the embassy’s senior consultants were assisting capacity development efforts at the 10 key civilian ministries— the Ministries of Oil, Electricity, Planning, Water, Health, Finance, Justice, Municipalities and Public Works, Agriculture, and Education. These teams, ranging in size from 20 positions for the Ministry of Oil and 18 each for the Ministries of Finance and Electricity to 3 for the Ministry of Agriculture, typically interact with the minister, deputy minister, or department director levels, according to State officials. State also leads efforts to strengthen the capacity of three national Iraqi anticorruption entities—the Commission for Public Integrity (CPI), the Board of Supreme Audit (BSA), and the government’s 29 ministerial Inspectors General. As of early May 2007, State, through IRMO and its successor organizations in the Baghdad embassy, had 23 capacity development projects worth over $50 million completed, contracted, or under way. These projects ranged from supplying and installing news media equipment in the prime minister’s press center to providing subject matter experts to mentor, train, and assist Iraqi staff in their areas of expertise in the Ministries of Water and Electricity. See Appendix II for the list of State-led capacity development projects. USAID conducts a number of ministry capacity development efforts, primarily through its 3-year contract with Management Systems International, Inc. (MSI). For example, MSI’s Arabic-speaking staff provide public administration training and other support to the Ministry of Planning’s National Center for Consultancy and Management Development (NCCMD) and other regional civil service training centers, using a “train the trainer” approach. MSI has additional advisors working with the Council of Minister’s Secretariat and six ministries, to create, among other things, capacity development plans that will guide the development of public administration skills within the ministries. In addition to these medium-term projects, MSI trainers have supported USAID and embassy efforts to achieve more immediate improvements in ministry budgeting and procurement performance. As of June 2007, MSI had 34 international staff providing training to Iraqi government staff, according to a USAID official. USAID reported that MSI was also working with the Ministry of Planning to develop a pilot self- assessment process for possible future use by other ministries to identify their own capacity development needs and priorities. By July 2007, USAID reported that 855 Iraqi national government employees, including staff from all 10 key civilian ministries and the Ministry of Interior (MOI), had attended MSI-sponsored courses at Iraqi government training centers. They had been instructed in, among other things, budgeting, procurement, leadership and communications, information management, and anticorruption policies. Officials from three other ministries, the Prime Minister’s Office and the Council of Ministers’ Secretariat were also attending MSI courses. USAID also has had a governance program contract with BearingPoint since 2003, which includes a project worth about $8 million to implement the system and train government staff on the use of an electronic ledger to record government payment and revenue transactions called the Financial Management Information System (FMIS). FMIS is intended to serve as the primary financial transaction system for the entire Iraqi government. According to USAID and BearingPoint officials, BearingPoint’s Iraq staff had trained approximately 500 Iraqi government employees, as of February 2007, on how to use FMIS. The coalition’s Multinational Security Transition Command-Iraq (MNSTC- I) is leading a substantial effort to develop the capacity of the two security ministries. As of March 2007, the U.S.-led coalition had assigned 215 military, civilian, and contracting personnel to the Ministry of Defense (MOD) and MOI to advise Iraqi staff about establishing plans and policies, budgeting, and managing personnel and logistics, among other things. According to MNSTC-I advisors, they work with their Iraqi counterparts on a daily basis to develop policies, plans, and procedures. For example, a senior advisor to the joint staff worked with MOD staff to develop the counterinsurgency strategy. He provided them with a planning template, reviewed their work, and suggested they add details such as the source of the threat, the risk level, and the forces required to counter threats. The advisors are embedded with MOD staff from a number of offices, including Plans and Policies and the Iraqi Joint Staff. According to the senior U.S. budget advisor at MOD, he and his team work directly with the budget director and his staff to prepare budget spreadsheets and ensure that the departments justify their funding requests. MNSTC-I advisors were also working with Iraqi officials at MOI at all levels in the ministry, although they are not embedded in the ministry to the same degree as MNSTC-I’s MOD advisors. Among other efforts, these advisors are helping MOI develop processes for vetting Iraqi security forces, including collecting and storing biometric data; establishing an identification card system; and establishing a personnel management database that will house inventory, payroll, human resource, financial, and budget data. Table 2 provides additional details on State, USAID, and DOD efforts. Two factors help explain the lack of overall direction and a lead agency for U.S. capacity-development efforts. First, from their inception in 2003, U.S. efforts evolved without a plan for capacity development or the designation of a lead entity. Instead, U.S. agencies individually provided assistance to four successive governments in response to immediate needs, according to former CPA officials and senior advisors. In 2003, for example, the first programs at the ministries were initiated by the CPA’s senior advisors, who ran the ministries using U.S. funds and made personnel and budgetary decisions. According to State and former CPA officials, each senior advisor operated their ministries without an overall plan or overarching guidance; efforts to create an overall plan in late 2003 were dropped after the United States decided to transfer control of the ministries to a sovereign Iraq by mid-2004. In May 2004, the President issued National Security Presidential Directive 36, which delineated State and DOD responsibilities for the U.S. effort in Iraq. The directive made State, through Embassy Baghdad, responsible for all U.S civilian activities in Iraq, but gave DOD’s Central Command (CENTCOM) responsibility for security and military operations.