Five challenges when making defence budgets more transparent

Maria Gili and Leah Wawro of Transparency International’s Defence and Security Programme outline obstacles to more transparency and accountability in how countries spend their defence budgets.  

Defence budgets are the primary tool that legislators and civil society can use to hold their governments and armed forces to account and see how their taxes are being spent. Yet the ability to use that tool is rare, since most countries disclose too little defence and security spending information to their public, and many disclose only limited information even to their legislatures. Accountability builds public trust in defence and security establishments, and helps reduce corruption that hurts their effectiveness.

photo: TI Defence and Security Programme

TI’s Defence and Security Programme’s latest report, ‘The Transparency of Defence Budgets’, ranked 93 countries according to their defence budget transparency and accountability. The study found that only 13 of those countries score as having high transparency, 20 as moderate to high, 14 as moderate, 21 as moderate to low, and 25 as low. The scale of the challenge is clear: nearly 65% of countries studied scored moderate or below.

So why do so few countries provide defence budget information to their public, and even their legislative bodies?

1)      National security as an excuse for secrecy: Confidentiality is vital to certain aspects of public work, and in no sector is this more true than in defence and security. Yet far too often, national security is used as a blanket excuse for highly aggregated budgets, over-classification, and as a veil for corrupt activity. Our report found that 61 of the 93 countries studied spend more than 8 per cent of their defence budget on secret items. Although protection of confidential information is important, this does not mean it cannot be compatible with accountability. Effective and robust systems of monitoring and control must be in place in order to allow adequate oversight and monitoring from the legislature, even in sensitive items. For example, governments should have a clearly defined and open process of justifying classification of documents as secret, and where necessary enable a special security-cleared legislative defence and security committee for secretive budget items.

2)      Poorly-defined budgeting processes: Many countries are limited by the lack of a clearly-defined defence policy. In the absence of a comprehensive document of this kind, there is no guidance to the allocation of resources for the defence and security sectors—and without a layout of strategic aims, justifying spending decisions is nearly impossible. Countries should develop a national security and defence strategy and make it available to the public.

3)      Lack of capacity and staffing constraints: Auditing budgets can be a challenging task, as a certain level of knowledge about the sector is generally required.  Staff needs to be trained in order to acquire the financial knowledge needed to analyse the money flows within defence and security institutions. Our report found that 33 of the 94 countries studied do not employ designated staff for these matters, and 10 do, but not the level necessary to fulfill the task.

4)      Audit body independence: Distance is also a key element of auditing. When the auditing body is not independent from the Ministry of Defence, conflicts of interest can arise which prevent accountability. Autonomous auditing processes are vital to achieve transparency in defence budgets. Internal oversight should be complemented with external auditing.

5)      Lack of civil society and media pressure: Defence budgets have the reputation of being “untouchable” because of their confidentiality and technical content. Nevertheless, it is the government’s duty to make the documents as accessible as possible. Putting them in the public domain is only a first step—they also need to be simple and clear to read.  Civil society can play an important role in raising awareness on defence budget transparency. In Guatemala, for example, civil society organisations Grupo de Apoyo Mutuo (GAM) and Centro Internacional para la Investigacion en Derechos Humanos (CIIDH) worked with the UNDP to monitor defence spending after the peace accords signed in 1996, encouraging a decrease in military spending and a shift towards a more development-focused budget.

Because corruption wastes resources and diminishes public trust, it is in the interest of any government to be effective and transparent when allocating, managing and overseeing resources for its defence and security sectors. This is also true of ministries of defence and security and the Armed Forces, as the risk of corruption increases if they lack accountability in the way they spend their money. This makes them weaker institutions, reducing their effectiveness.

In the defence and security sectors, certain secrets have to be kept. Yet there must be processes to ensure that the government and defence establishments remain accountable to the citizens they serve, and whose money they spend. A defence budget which is open to the people, and to the legislature, and which is properly developed, overseen, and audited, is a vital tool of accountability.