Remarks Prepared for Delivery by Special Inspector General John F. Sopko at the Royal United Services Institute, London, UK

"Obstacles and Opportunities in Afghanistan"

Director Clarke, ladies and gentlemen, good evening. I am delighted to be in Great Britain again, and honored to be appearing at this venerable institute.

The Duke of Wellington conceived the idea of the Royal United Services Institute in 1831, more than 150 years before the United States Congress thought of creating my agency. It was, and remains, a splendid idea. I wonder, if we had such an institute in our country, possibly the need for special oversight organizations such as mine might have been less urgent. Of course if there was a RUSI in the United States, that little disagreement we had with King George nearly 250 years ago would have ended differently and I would now be speaking in a language you could understand.

I indeed note with admiration that RUSI, through its Journal and other publications, has provided a platform for candid and thought-provoking observations about Western dealings with the governments and peoples of Afghanistan. Many comments from RUSI publications still resonate, including:

• More than a century ago, in 1911, a British Army officer who wrote that a Kabul regime change promoted by the UK had been "a mistake in policy, and a crime in morality," and was conducted with a "lack of harmony between the political and military authorities from start to finish;" [1]
• Less than a year ago, Director Clarke noted that "Iraq sucked all the strategic air out of Afghanistan in the policy-making offices of Washington, London, Brussels, and Mons. Being neither politically out of Afghanistan, nor properly in it, US and ISAF forces made the situation worse in almost all respects;"[2] and
• This past spring, the RUSI Journal carried a strategic and operational critique by Brigadier Ed Butler, former commander of British forces in Afghanistan, who noted with some concern the pursuit of "diametrically opposed" approaches of nation-building and reconstruction on one hand, and counterterrorism military operations on the other.[3]

Although I neither endorse nor contest any of those comments, I cite them as examples of RUSI's long-standing openness to tough thinking, plain talk, and speaking "truth to power."

As Special Inspector General for Afghanistan Reconstruction (SIGAR for short), I also try to encourage the same and spend much of my time trying to discern fact from fantasy and reality from government press releases. I would argue that now more than ever it is essential to face reality in Afghanistan. If our monumental efforts are to be sustained, decision makers in both the U.S. and the UK must think honestly and critically in order to ensure our ultimate success.

As Europe well knows, Afghan heroin floods the streets of European cities and Afghan refugees are estimated to make up the third largest group crossing the border, contributing to the ongoing humanitarian crisis. So there should be no question about Afghanistan’s relevancy today. The bottom-line is that for all we have committed, lost, and achieved, Afghanistan's problems extend far beyond its borders and we ignore them at our peril.

But, while the challenges are great and the failures have been epic, there is still hope.

Tonight, I want to discuss the obstacles, the opportunities, and the "mission critical" role oversight plays in Afghanistan. In the U.S. as in the UK, respect for the civilian and military lives lost and still at risk in Afghanistan, and for the vast sums of public funds committed there, demand frank examination of realities and speaking "truth to power" to ensure lasting success.

SIGAR AND ITS MISSION

In that respect, SIGAR's mission is similar to the UK's Independent Commission for Aid Impact (ICAI). The commission's charter says it "focuses on maximising the impact and effectiveness of the UK aid budget for beneficiaries and on delivering value for the UK taxpayer." Change the "UK" to the "U.S." and SIGAR could be content with that description, at least as far as it pertains to aid to Afghanistan. Both agencies are independent. Both report to legislatures-SIGAR issues reports to Congress; the commission issues reports to Parliament.

One big difference between us and the commission, is that SIGAR not only inspects and audits reconstruction programs in Afghanistan, but also has armed investigators with badges, guns, and powers of arrest, search, and seizure. They have been obliged to use those powers hundreds of times, both in Afghanistan and in the USA, against persons suspected of fraud, theft, money laundering, bribes, conspiracies, and other offenses. Although we cannot arrest Afghan nationals in country, we do cooperate with Afghan law enforcement, who (sometimes) use our referrals and evidence to bring criminals to justice. Remember the Afghan justice systems has been described as the best justice money can buy; unfortunately neither the U.S. nor the UK can do so.

Another difference between SIGAR and other oversight agencies is that our statutory mandate (1) focuses our work exclusively on Afghanistan reconstruction, and (2) directs us to examine U.S. reconstruction operations irrespective of departmental or agency boundaries. That means the Departments of Defense, State, Treasury, and Commerce, as well as the U.S. Agency for International Development and other federal entities are subject to probing and questioning by SIGAR.

The U.S. Congress established SIGAR in 2008-seven long years into the Afghan war. President Obama appointed me Special Inspector General in 2012 to replace the original IG, who was forced out of office by the Senate for inactivity and quiescence. I am a former state and federal prosecutor, with the Department of Justice, Organized Crime and Racketeering Section, as well as a former partner at an international law firm. I spent more than 20 years on Capitol Hill working for the likes of Senator Sam Nunn, then chairman of the Senate Armed Services Committee, and for Representative John Dingell, the powerful chairman of the House Energy and Commerce Committee. Both of them made strong, bipartisan oversight the hallmark of their careers.

I learned from those two fine lawmakers, as well as others, that the role of a good inspector general is to be independent and speak truth to power. After I was appointed to be the IG, I told SIGAR staff that our job was to provide tough, fair, and effective oversight of the funds appropriated to promote security, governance, and socio-economic development in Afghanistan. And I emphasized that my staff better have a 'Fire in the Belly' for this work, since the "brief" I received from the White House was unambiguously short and simple-"fix it and fix it fast."

With those instructions in mind and the fact we are a temporary agency, I also firmly believe that our mission extends beyond merely filing reports with Congress and executive agencies. I have learned in the over 30 years observing the workings of our government in Washington that we must also reach out to the public if we wish to change things. It is their money, after all, that we are overseeing, and it is their voice that can add a touch of flame to the typically dry language of IG reports.

Although many bureaucrats decry my work with the press, I often quote our great American jurist Louis Brandeis, who opined that "Sunlight is the best of disinfectants and publicity is commended as a remedy for social and industrial diseases."[4] A century earlier, that great British utilitarian philosopher Jeremy Bentham said, "Publicity is the very soul of justice. It is the keenest spur to exertion, and the surest of all guards to improbity. . . . without publicity, all other checks are fruitless"[5] If Bentham could leave his mummy cabinet at University College to join us tonight, I am sure he would approve applying his publicity precept to inspectors general broadly and Afghanistan in particular.

The need for such an approach is clearly great in Afghanistan. Since 2002, Congress has appropriated nearly $110 billion for that reconstruction effort in Afghanistan. To oversee that massive commitment, we do a great deal of probing and questioning and sometimes like John Cleese in the Monty Python Pet Shop Sketch, I argue that "this reconstruction project is dead to an obstinate bureaucratic Michael Palin"-many times repeating the same findings and conclusions to such officials.

Since my appointment in 2012, SIGAR has issued 136 audits, inspections, alert letters, and other products, totaling nearly 400 recommendations and that identified over $1 billion in potential savings. In addition, our investigations unit has conducted 538 investigations, resulting in 73 arrests, 69 convictions or guilty pleas, and savings of over $500 million. I'll note three recent products just to give you a flavor of the breadth of our activities:

• In June, we sent an inquiry to USAID about its claims of progress in Afghan school enrollments, which supposedly rose from 900,000 in 2002 to more than 8 million in 2013. We noted that USAID's claims were unverifiable, and that Afghan ministers and officials had spoken publicly in their parliament of doctored statistics, nonexistent schools, embezzled funds, and other problems.[6]
• In August, we submitted a review to USAID noting that the $355 million Tarakhil Power Plant produced less than 1 percent of its energy potential for the Kabul-area electrical grid. We also noted that the plant was designed to run continuously, that stop-and-start operating was damaging equipment; and that no economic fuel option has been developed to end the plant's use of highly expensive diesel fuel that Afghanistan does not produce and cannot afford to buy.[7] And
• Just the other week, SIGAR issued an audit on a failed program to assist Afghan refugees, for which the U.S. has provided nearly one billion dollars. A timely topic that demonstrates how success or failure of one project in Afghanistan can reverberate across the world, or in this case, Europe. [8]

The security situation is another area ripe for strong oversight. More than 60 percent of U.S. appropriations for Afghan reconstruction has been devoted to building up and sustaining the country's army, air force, and national police. Much of SIGAR's oversight work has therefore concentrated on Afghan security issues. Details of these complex examinations are laid out in reports posted on SIGAR's website, so I shall not cite them in detail tonight. I will simply mention that we have audited or otherwise examined problems in areas that include unverifiable personnel counts, questionable capability assessments, capacity deficiencies in the Afghan ministries, excess or deficient facilities construction, and purchases of unsustainable equipment.

I must remind you that just because the number of U.S. and UK troops in Afghanistan has gone down, does not mean our mission is ending there. Even now, 14 years on and with the U.S. military presence much diminished, nearly $12 billion more in reconstruction funds wait in the financial pipeline, appropriated but not yet spent. The United States and our allies have pledged billions more for years to come. To put things into some perspective, the $110 billion in U.S. funds already appropriated for reconstructing Afghanistan, after adjusting for inflation, exceeds the value of the entire Marshall Plan effort to rebuild Western Europe after World War II.[9]

Unfortunately, large amounts of taxpayer dollars have been and continue to be lost to waste, fraud, and abuse. SIGAR professionals have documented details of U.S.-funded clinics that lack staff or medicines, schools that can collapse on their occupants because of shoddy construction, contracts that weren't performed properly or at all, troop rosters that can't be verified, cash assistance that can't be traced, and many other outrages. These disasters often occur when the U.S. officials who implement and oversee programs fail to distinguish fact from fantasy, or output from outcome and impact, and operate in a world where personal accountability is nonexistent.

A small sample of problems SIGAR repeatedly identifies include:

• failure to define requirements and assess suitability and sustainability of projects;
• lack of coordination within our own government and with the Afghans and other governments and organizations;
• poor planning, execution, and accountability;
• theft and corruption by both American and Afghan military and civilians;

These problems in turn have led to such massive U.S.-sponsored failures as:

• Spending over $8 billion on a counternarcotics effort that has failed by every conceivable metric;
• Purchasing nearly half a billion dollars' worth of planes that never could fly and had to be turned into scrap metal;
• A building that literally melted before your eyes when it rained; and
• A half a million dollar health clinic that lacked water and electricity and resulted in washing newborns in the nearby river.

That is a sad and somber, but incomplete list. No doubt the experience of many of you and the imagination of others can supply additional items to this list.

OBSTACLES

As the European Union Council summarized in July, "Progress in achieving the objectives of the EU strategy for Afghanistan has been uneven." [10] The EU Council's delicate phrasing reminds me of Emperor Hirohito's broadcast to the Japanese people in August 1945, when he said, "The war situation has developed not necessarily to Japan's advantage."[11] Indeed, progress in Afghanistan has been "uneven," while imprecise and unverifiable data reported by government agencies mask results that we have found are "not necessarily to our advantage."

But before U.S., UK, and other donors abandon themselves to guilt and gloom, it is only fair to note that uneven progress is not the same as no progress. For all the official and oversight concerns about program data reporting, effectiveness, spending, and accountability, it is clear that Afghans are largely healthier, safer, better educated, and better able to participate in social and economic life than during the civil war, or during Taliban rule.

That said, we must also note that some daunting obstacles to mission success lie within the Afghan social, economic, and political environment.

In order to help our U.S. reconstruction agencies and congressional appropriators, SIGAR distilled much of its work on the obstacles to reconstruction success in Afghanistan last December by publishing the SIGAR High-Risk List.[12] The list calls attention to program areas and elements of the U.S.-funded reconstruction effort in Afghanistan that are especially vulnerable to significant waste, fraud, and abuse.

Applying that screening protocol gave us a list of seven high-risk areas:

• Anticorruption and Rule of Law
• Sustainability
• Afghan National Defense and Security Forces Capacity and Capabilities
• On-Budget Support
• Counternarcotics
• Contract Management and Oversight Access, and
• Strategy and Planning

Each of the seven discussions in the High-Risk List cites numerous points from SIGAR and other agencies' work to illustrate the nature and severity of the risk.

SIGAR's High-Risk List also discusses the sources of risk, often a critical factor in deciding how to address threats to the reconstruction mission. The High-Risk List notes that sources of risk for the reconstruction effort in Afghanistan include-but are not limited to:

• widespread corruption in Afghan society and government entities-the obstacle that I and many other observers believe is the paramount threat not only to the reconstruction effort, but to the long-term viability of the Afghan state
• limited institutional and human-capital capacity in Afghan institutions
• operational demands and constraints imposed by an active insurgency
• Afghan reluctance or inability to impose accountability, especially on the wealthy or well connected
• poor record keeping and data retention by U.S. agencies and Afghan entities
• frequent personnel turnover and loss of U.S. agencies' in-country institutional memory
• U.S. noncompliance with existing rules and regulations, and
• limited visibility into Afghan records and data

These points of actual and potential failure give you some idea of the vast amount of work that an oversight agency like SIGAR faces in Afghanistan. And the challenge is growing. The drawdown of U.S. and Coalition troops and the consequent reduction in security, transportation assets, and access has led other federal oversight agencies to reduce the number of employees posted to Afghanistan, or to withdraw their presence entirely - leaving more and more of the oversight to SIGAR which has the largest U.S. oversight presence in country.

OPPORTUNITIES

While we face daunting obstacles, we can also glimpse opportunities. The most encouraging sign we have had in some time is that the contentious and controversial 2014 elections in Afghanistan ultimately and nonviolently produced a National Unity Government that appears to be working. The leadership of President Ashraf Ghani and Chief Executive Officer Abdullah Abdullah encourages me.

They are willing partners who understand and appreciate the investment of American, British, and other Coalition partners' sacrifice in blood and treasure for the future of their nation. These leaders are actively engaged and working closely with the United States, as well as reaching out to regional actors such as Pakistan and India. I have met with both, and my staff is working with them and their senior leaders to fight corruption and reform Afghan ministries.

More encouraging, the Afghan leaders' words have been matched with concrete action. At the London Conference of donors in December 2014, President Ghani promised that the new government was "determined to do business differently." As an example of this change in attitude, after SIGAR uncovered collusion and bid rigging to the tune of over $200 million on a $1 billion fuel contract, the President took prompt action against officials and vendors implicated in our investigation. This had never been done before by the Karzai administration. President Ghani also established and leads a national procurement council to examine proposed awards of large contracts. He has ordered new action in pursuit of justice and financial recovery against principals in the theft of Kabul Bank assets and, earlier this month, President Ghani called for a holy war" against the "cancerous lesion of corruption." [13]

As a former World Bank official, he is keenly aware of the importance of international assistance for his country-and of the necessity of maintaining donors' confidence by showing results for their investments. I am happy to report that he is using SIGAR reports to highlight deficiencies and hold his ministers accountable. All of these steps, and more, are encouraging signs of opportunity for new progress and demonstrate the necessity of having oversight to assist the Afghans as they try and tackle the challenges with which they are confronted.

President Ghani has also maintained his long-standing advocacy for greater use of conditionality as more donor aid is delivered on-budget for the use of Afghan ministries. SIGAR has expressed concerns about the earlier lack of oversight and accountability for funds that are delivered as direct assistance, or transferred to the control of multilateral trust funds such as the Law and Order Trust Fund for Afghanistan that SIGAR and the EU auditing agency uncovered was poorly run by the United Nations.

In the face of such concerns, carefully designed and mutually agreed-upon conditionality for aid can provide reassurance for donors while increasing the opportunity for Afghans to plan budgets and develop the capacity of their institutions. As the United States and other donors work toward their commitments to deliver at least half of development assistance on-budget, intelligent use of targeted and meaningful conditionality will become increasingly important in ensuring the Afghans tackle the tough issues they face. SIGAR's work will continue to highlight areas where the U.S. is failing in setting conditions and where the Afghans' performance must improve.

CONCLUSION

In conclusion, I note a recent issue of the RUSI Journal carried an informative and thought-provoking article by British historian Heather Campbell. Titled "Lessons to be Learnt? The Third Anglo-Afghan War," the text includes a 1919 quotation from Lieutenant General H.V. Cox, military secretary of Britain's India office. General Cox said, "I cannot imagine a less profitable country to 'protect' than Afghanistan-a veritable wasps' nest." [14]

Nearly a century later, traces of the general's sentiment may linger. Many in my country, and I imagine in yours, are weary of Afghanistan, which still remains a dangerous place and every time an American or coalition member is hurt or killed there are calls to totally pull out. I am glad to see that cooler policy heads have prevailed in such instances. They, like I, recognize foreign diplomacy and reconstruction cannot be totally risk free.

Accordingly, the United States and partners like the United Kingdom have decided that Afghanistan is worth helping in order to protect against terrorists and violent extremists, and also that the country is worth assisting along the path to democratic and economic development.

For both humanitarian and national-security reasons, the mission to reconstruct Afghanistan remains critical. With $12 billion currently awaiting disbursement by U.S. agencies, and billions upon billions more to follow, there is both a necessity and urgency to improve the effectiveness of our efforts, and the time to finally make a lasting difference in the outcome. I like to say that SIGAR and the other oversight bodies act as an insurance policy that protects our 14 year investment of lives and treasure in Afghanistan and it is why we must consider our oversight efforts "mission critical," to use a U.S. military term.

However, we should not kid ourselves about Afghanistan. It will continue to be a long struggle. Defeating a determined insurgency, improving health and education, altering attitudes toward women, reducing corruption, and building government competence are not casual, short-term undertakings.

We can also safely say that the struggle in Afghanistan won't be shortened, much less, won, by official happy talk and cheerleader-style press releases. The U.S. and European public, and I am sure the Afghans as well, have had enough with the kites and balloons and unverifiable accomplishments that do not withstand critical scrutiny. Improving the likelihood of mission success requires, as a start, honest, accurate, verifiable, and pertinent data-accompanied by aggressive and independent oversight. Poor data and assessments not based on reality but rather biased by self-interest career advancement and rank P.R., can only lead to unrealistic judgments, unjustified hopes, and outright fantasies with no link to the reality on the ground faced every day by our many brave and dedicated career diplomats, soldiers and civic servants.

I keep reminding some agencies in Washington, repeatedly just like John Cleese that not only is the parrot dead but the Afghans are well aware of its demise, and apparently only the U.S. Congress and the American taxpayer are still awaiting the punch line.

That said, I can assure you that for the foreseeable future, I and my SIGAR colleagues will continue our oversight responsibilities-poking, prodding, and asking tough questions, holding people accountable and shining the disinfecting light of publicity on Afghan reconstruction. We welcome your interest and support, just as I do your questions and comments now. Thank you.