Diagnosing Corruption in Ethiopia - Ethiomedia

Rural Water Supply Corruption in Ethiopia 141
more funds because they have greater local government capacity to prioritize
and administer them. And some regions (the more established
ones) have developed their own regional formulae for cascading funds
down to zones and woredas.
A broad conclusion is that although corruption in the transfer and
allocation of funds between different levels and sectors is probably minimal,
there may be significant subregional variation in the transparency of
budgeting, in the administration of budgets and procedures, and hence in
corruption risk. In contrast, WASH funds allocated to regions and woredas
through the donor trust fund (Channel 1b) are clearly ring-fenced
through special accounts at each level, reducing the perceived risk of
leakage to other sectors, corrupt or otherwise. The key issues here relate
more to the use of funds (low utilization rates) than to abuse as well as to
the potential trade-offs between procedural oversight, scheme quality,
and the speed of implementation. Project-based investment, meanwhile,
is also strictly controlled, albeit through a variety of different organizations
and accounting arrangements.
Risks from decentralization. One policy shift highlighted as offering corruption
opportunity is administrative decentralization. Although decentralization
policies have devolved tasks and responsibilities down to lower
levels of government, funding has not always followed. In particular, control
of woreda budgets tends to remain at the regional and federal levels,
with small shares transferred through block grant channels for capital
expenditure. Hence, one reason why subregional corruption is viewed as
low-risk is because of the small amounts of money filtering through, presenting
few opportunities for the misappropriation of funds in spite of
low pay and weak accounting systems.
Should there be more devolution to the woredas, or are the risks too
great? Although it makes sense for woredas to plan and implement lowend
technologies (for example, spring protection and self-supply) and to
be funded accordingly, there are sound technical, economic, and anticorruption
arguments for retaining borehole procurement at regional-zonal
levels—where the core expertise exists, where economies of scale are
present in the batching of contracts, and where procurement and oversight
systems work reasonably well.
Needs for greater oversight and transparency. Monitoring and evaluation
were also identified as weaknesses by both the study team and workshop
participants, though the systems in place are arguably superior to