Posted by Greg Horman
A practice more or less universal across all legislative assemblies is to provide members—MPs, for short—with allowances to enable them to represent their constituents effectively. Typical allowances cover expenses associated with staying in close contact with voters, such as travel to MPs’ constituencies, operating local offices, and communicating through mailings and various media. Although they are the cause of the occasional scandal, debate about these allowances is more over the scope of costs that they cover and up to what ceiling, than over the principle that they are necessary in the first instance. Frequently, these allowances—representing spending by the legislature, not the executive—are outside the government’s budget.
What is uncommon, however, is the situation where MPs themselves administer and distribute funds from the government’s budget.
The Solomon Islands is a case in point and an example of this modality of budget execution taken to an extreme. Depending on the calculation, perhaps 30 percent to 50 percent of the development budget in the Solomon Islands is represented by “constituent development funds.” These are appropriated funds that are directly allocated to and held by MPs for distribution to their constituents. In practice, the funds are deposited into MPs’ own bank accounts, and there is little transparency or accountability for how MPs manage or distribute this money from the public purse. Nor is there any analysis of the impact or effectiveness of the use of the funds. Moreover, expenditure in the development-budget that was originally appropriated to ministries is occasionally re-programmed into constituent development funds. Staff of the Ministry of Finance and donors—grants account for around two fifths of total revenue—agree that this practice undermines sound public financial management.
