The World Bank (WB) has raised a serious concern over the Nepalese government’s plan to distribute housing grant to the earthquake affected people in two instalments instead of current arrangement of three instalments.
The WB, which leads Multi Donors Trust Fund (MDTF), administering over $500mn fund to support the housing grant for the earthquake affected households, wrote a letter to Nepal Finance Minister Bishnu Poudel on Thursday reminding him about the principles under which donors agreed to provide assistance while warning against breaching those principles.
The Nepalese government has announced providing $1,846 (Rs200,000) for each household affected by last year’s deadly earthquake. As per the agreement reached with the donors, grant will be distributed in three instalments based on the four principles of equity, safer construction, ownership and
transparency.
However, last week, Nepal Prime Minister K P Sharma Oli told the parliament that the government would discuss with the WB-managed fund to alter the current arrangement in favour of providing two instalments.
But, in a letter to finance minister, WB country manager for Nepal Takuya Kamata has reminded that the principles of grant distribution under which grant should be disbursed in three instalments first as fast tranche release upon certification of eligibility while the subsequent two disbursements will be made upon achievement of defined milestones in
reconstructing houses.
“These are the modalities through which the World Bank is authorised to provide financial support to the programme. Each payment will be subject to certification by competent technical personnel in order to ensure that the grants are used to build houses according to safer standards using local materials and enhanced traditional construction techniques,” reads a letter obtained by Xinhua.
A senior World Bank official said that the use of word ‘authorised’ in the letter means the WB is not authorised to provide funds going against the agreed principles.
“The WB is concerned that converting the three phases of payments into two could result in breach of the principle of building back better as people would seek to build houses without following parameters of making houses earthquake resistant,” WB official said.
The multilateral donors have also reminded that other development partners involved in the rural housing reconstruction programme also follow the same principles and modalities in their respective support.