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by the Haiti Support Group
On May 26, 2011, just 12 days after
his investiture as President, Michel Martelly made his first
major policy pronouncement: the launch of the National Fund for
Education (FNE). Its aim was simple: get 1.5 million of the
Haitian children not regularly in school into the classroom by
the end of his five-year mandate. As a basic UN Millennium
Development Goal, the ambition was widely applauded by Haitians
and foreign donors alike.
The $360 million in funding needed for this ambitious project
was to come from levies on incoming telephone calls [$.05 per
minute-HL] and money transfers [$1.50 per transfer-HL], thus
tapping into the relative wealth of the several-million strong
Haitian Diaspora. As an added bonus, no new taxes would have to
be raised or old taxes actually collected at home in a country
where non-payment of tax by those rich enough to owe, is not
just the norm but is viewed as a basic right.
The fanfare that greeted the
Fund’s launch subsumed many of the vital questions being asked
at the time about the legitimacy of the electoral process that
had brought Martelly to power, his past as supporter of brutal
military rule and very serious doubts about his nationality and
thus whether he was actually eligible to be President.
Also ignored were voices
pointing out that unilaterally instituting such a tax without
Parliament’s consent was unconstitutional, or that the tax would
disproportionally affect the poorest, with the $1.50 levy on a
remittance of $20 dollars to a family struggling to feed itself
being the same as that on a transfer of hundreds of thousands of
dollars for a business or property purchase.
Equally unclear was who would
be the main beneficiaries: would the Fund be paying the private
school fees of better-off Haitians, thus using the remittances
of the poorest to subsidize the education of the relatively
well-off? And in a country where up to three-quarters of primary
school pupils are in private schools, would the Fund simply be
subsidizing the expansion of private schools rather than
reinforcing the woefully inadequate and underfunded state
sector?
Although the Central Bank – BUH
– was to be in charge of collecting the money on transfers, no
one knew who would be contracted to manage the levies on
international calls, or, indeed under what terms. Despite this,
the new President was adamant that the Fund would be managed in
an independent and transparent manner, citing the IMF and
auditors Price Waterhouse Cooper as guarantors.
As it turned out, Martelly
appeared to have a ready-made candidate for this in the form of
his former business partner and the director of his election
campaign, Laurent Salvador Lamothe. As head of his own company
Global Voice, Lamothe had extensive experience of how profitable
such levy systems could be in various African countries.
Profitable for him as well as his client states, that is.
Renowned as a tough negotiator, Lamothe’s company had reportedly
been getting up to 50% of the value of all levies collected in
such schemes.
Almost nothing was heard of the
Fund until September 2011, when the President’s Education
minister-designate, Gaston Merisier, stated that the FNE had
amassed $28 million. However, it soon emerged that only $2
million of this, the share from money transfers, was with the
BUH. The remaining $26 million was credited to an account in the
name of CONATEL, the national telecoms regulator, and as such
closed to even the most elemental external scrutiny.
The lack of any basic
accountability or transparency meant that serious discrepancies
in consequent figures as to the value of the Fund cited by
Diaspora news organisations, members of the Haitian Senate,
civil society organisations, and even the head of Digicel,
Haiti’s largest telecoms operator, tax payer and employer, could
not be reconciled.
In January 2012, mounting
concern forced Martelly to address the issue of the FNE,
declaring: “Not one cent of the money has been touched... the
people around me are not thieves... the money is so secure I
can’t tell you anything about it.” To ensure nothing was
revealed “about it,” government lawyers began threatening the
news outlets asking questions.
Meanwhile, Digicel’s concern
rapidly evaporated, perhaps their energies were focused on their
imminent takeover of their only sizeable rival in Haiti, Voilà –
a transaction that attracted minimal regulatory interference
from CONATEL, despite it granting them an effective cellphone
monopoly.
Sadly, one thing does confirm
Martelly’s assertion that none of the Fund has actually been
disbursed: there has been no discernable boost to the Haitian
education system. While a number of pupils who had not
previously attended school are now getting ‘free education’
(albeit far fewer than the government claims, as its figures
include pupils already in free education), both public and
private schools have been overwhelmed by an intake of unfunded
students for whom they are unable to provide the basics, not
least teachers.
Nothing has changed in the year
since Martelly’s only comment on the Fund. The start of the
2012-2013 school year was again delayed by a full month due to
lack of funding. Teachers continue to demonstrate in pursuit of
months of unpaid wages. The original lack of a legal framework
in setting up the FNE means its proceeds cannot be handed to the
Ministry of Education. That state of affairs has now become
institutionalized, the failure to hold elections for a number of
Senate seats means it remains inquorate and thus
constitutionally unable to ratify any retroactive legal
framework.
But what of the actual value of
the Fund? While in Florida in December 2012, where he had
somewhat bizarrely decided to make his ‘State of the Nation’
(Haiti, not the United States) address, Martelly told the Miami
Herald that the FNE was worth $16 million. That was dramatically
at odds with the estimated revenue at its launch, which after 16
months would have been $136 million, not to mention a statement
by CONATEL on 31 December, which put the Fund’s value at $81
million.
Is the discrepancy explained by
the level of Global Voice’s percentage take for collecting the
levies? If so, either of the figures above would mean, that
percentage is well above the generous 50% Global Voice has
pocketed elsewhere in the world. Someone who would know has,
since the inception of the Fund, been promoted to Prime Minister
of Haiti, namely Laurent Lamothe.
Worse still, perhaps, is the
fund being used for other purposes, governmental or
non-governmental? Presidential slush funds are hardly unknown in
Haiti, in fact historically they have been the norm. It was just
this sort of transparency vacuum that allowed the national
Treasury to become the personal purse of the Duvaliers. And as
Haitians are now asking: if this level of opacity and poor
governance surrounds such a flagship as the FNE, what else is
going on in even less scrutinized parts of this administration?
First published in Haiti Briefing, Number 73, February
2013,
www.haitisupportgroup.org
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