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Newly Declassified Document From Inspector General: U.S. Climate Change Spending Abroad Is A Mess

Inadequate oversight, lax bookkeeping, sloppy paperwork, haphazard performance agreements and missing financial documentation have plagued U.S. State Department spending of tens of millions of dollars to combat climate change, according to a report by State’s internal financial watchdog — and the problem could be much, much bigger than that.

The audit report, issued last month by the State Department’s Office of the Inspector General (OIG), casts an unflattering spotlight on a relatively obscure branch of the State Department that supervises climate change spending, and depicts it as over-extended in its responsibilities, unstaffed in critical monitoring posts, and more concerned with spending money than in monitoring its effectiveness.

According  to a State Department website, the U.S. has contributed some $5.1 billion in climate change funding to developing countries in 2010 and 2011 alone, with additional money still pouring forth in 2012.

  • OIG looked at  seven of 19 program grants totaling $34 million, and discovered they contained no specific plans for monitoring the results. As the report demurely noted, “Without comprehensive monitoring of grants, the department may not always have reasonable assurance that federal funds were spent in accordance with the grant award; that the grant recipient performed program activities as dictated in the grant award; and that the program’s indicators, goals and objectives were achieved.”
  • So-called grant oversight officers whose responsibilities included developing the monitoring plans, also failed to provide written reviews of compliance with State Department reporting standards, along with a variety of other financial procedures. In some cases, there apparently weren’t enough oversight officers to go around; when three left their jobs, OIG found evidence that only one was replaced.
  • Oversight officers apparently didn’t do a lot of overseeing. The OIG discovered that actual visits to climate change sites were rare, and when they occurred, not much effort went into examining the actual paperwork involved. In one series of Indian cases examined by OIG, the officers’ reports “typically summarized meetings held with grantee officials where only the statuses of the programs were discussed.”
  • Requirements that grant recipients submit quarterly financial statements were apparently ignored, even though procedures called for cutoffs if the statements were not provided. The report cites an unnamed recipient in Hyderabad, India, who got two separate grants totaling $1.1 million: funding continued to be doled out throughout the project, even though the reporting requirements were completely ignored. And in other cases, even when quarterly reports were received, they were often flawed.
  • The same cavalier attitude toward reporting apparently applied even when projects ended. As the report discreetly puts it, overseers “did not always obtain the final reports needed to ensure that final deliverables were achieved, funds were reconciled, and proper closeout of the project was completed.”
  • One reason for this, apparently, is that reporting requirements for detailed results toward specific indicators — along with general goals and objectives — were not included in any of the seven grants examined by OIG. One of the missing indicators in a number of cases was the actual amount of greenhouse gases removed from the atmosphere by the project.

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