Development activities must be undertaken in a secure environment, so good security sector governance is critical. Yet what role should the International Monetary Fund (IMF) and the World Bank play in improving governance? Would their involvement in security sector reforms constitute political interference, contrary to their Articles of Agreement? This paper suggests that it is both possible and essential for these institutions to be involved in advancing security sector governance. Moreover, such a role reflects two of their key functions: strengthening governance and transforming public institutions.
Other donors expect the IMF and World Bank to be involved in supporting policies to improve security sector governance. These two key institutions have the resources, expertise and reputation for leadership. So how can they work within their mandates yet realise this development priority?
The IMF and World Bank take a governance approach to most public sector interventions and the paper concludes that a governance approach to the security sector focussing on public expenditure management is entirely compatible with their Articles of Agreement. Other conclusions are that:
- The World Bank, the IMF and other donors need to shift from a concern with the level of expenditure in the security sector to a focus on the quality of governance in the security sector. Such a shift will make it harder for borrowing countries to argue that the security sector should be off limits for reasons of sovereignty
- Without the appropriate institutional and human capacity to ensure sound governance of the security sector, a suitable and sustainable balance between expenditures on security and development will never be achieved
- Although many countries could use the resources allocated to their security sectors more efficiently, it is not clear that even very poor countries are over-funding their security sectors. An objective assessment of their security environments indicates that the defence, public security and intelligence services are necessary and will cost money. Appropriate tasking of the security services may well, however, require a shift between defence and intelligence on the one hand and public security on the other
The IMF and World Bank’s public expenditure work should include the security sector. Policy advice to support this objective includes:
- National stakeholders must lead any work aimed at improving security-sector governance. International actors can promote and sustain national efforts by providing technical, financial and material support
- It is important that the Bank, the Fund and other donors provide support for the full range of civil management and oversight functions in the security sector
- The Bank and the Fund should broaden their scope within the security sector and look beyond resourcing the defence forces by including all relevant security activities
- Mechanisms currently employed by the Bank and the Fund, such as Poverty Reduction Strategy Papers and Public Expenditure Reviews, can easily incorporate the security sector
- To the extent that terms relating to the security sector are included in loan agreements, the Bank, the Fund and other donors should shift from implicit conditionality on the level or composition of security-related expenditures to process-related conditions.
