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Cablegate: New Anp Pay Distribution System a Positive Step

VZCZCXRO6549
OO RUEHDBU RUEHIK RUEHYG
DE RUEHBUL #5566/01 3261243
ZNR UUUUU ZZH
O 221243Z NOV 06
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4208
INFO RUCNAFG/AFGHANISTAN COLLECTIVE
RUEHZG/NATO EU COLLECTIVE
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
RUEKJCS/OSD WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RUEKJCS/JOINT STAFF WASHINGTON DC
RHMFIUU/HQ USCENTCOM MACDILL AFB FL
RUMICEA/JICCENT MACDILL AFB FL
RHMFIUU/COMSOCCENT MACDILL AFB FL
RUCNDT/USMISSION USUN NEW YORK 3281
RUEHNO/USMISSION USNATO 3347

UNCLAS SECTION 01 OF 03 KABUL 005566

SIPDIS

SIPDIS

STATE FOR SCA/FO DAS GASTRIGHT, SCA/A, S/CRS, S/CT, EUR/RPM
STATE PASS TO USAID FOR AID/ANE, AID/DCHA/DG
NSC FOR AHARRIMAN
OSD FOR KIMMITT
CENTCOM FOR CFC-A, CG CJTF-76, POLAD

E.O. 12958: N/A
TAGS: PGOV SNAR MARR AF
SUBJECT: NEW ANP PAY DISTRIBUTION SYSTEM A POSITIVE STEP

REF: KABUL 5499

1. Summary: A recent reform of the pay distribution
system in Afghanistan makes it possible for Afghan
National Police employees in the provinces to
receive their pay directly from a branch of the
central bank or one of several commercial banks.
Previously, pay was distributed by means of
middlemen and much of it was pocketed by corrupt
officials at all levels of the administrative chain.
By the end of November the new system will be
operational in 27 provinces, and it will reach 31
out of 34 provinces by the end of December. While
remote districts cannot be covered under the new
plan due to lack of banking infrastructure, a
majority of ANP employees are now able to receive
their salaries directly from a bank teller. This
should prove a positive impetus for recruitment and
retention in the ANP, as well as mitigating a
prevalent cause of administrative corruption. End
summary.

2. Reliable payment of salaries for the Afghan
National Police (ANP) is a critical element in
building a reliable police force. Traditionally,
money for police salaries was transferred from the
Ministry of Finance (MOF) to the Ministry of
Interior (MOI), and then physically carried to the
various districts within each province where it was
distributed to patrolmen by a representative of the
provincial police chief or governor. There were
plenty of opportunities for middlemen and senior
officials to take a cut before the money ever
reached the hands of individual employees.

Afghan Interagency Cooperation
------------------------------

3. In June 2006, Combined Security and Transition
Command - Afghanistan (CSTC-A) began to develop a
new payroll distribution system that would as much
as possible eliminate the middlemen and tighten
controls over distribution. CSTC-A Finance
Transition Team officers began by obtaining
Government of Afghanistan interagency cooperation
through a series of meetings with representatives of
MOF, MOI, Da Afghanistan Bank (DAB - the central
bank), UNDP, and the INL contractor Dyncorp, which
provides mentors to oversee the set up and pay
process. The German Police Program Office (GPPO)
was kept fully informed and has been very supportive
of this initiative.

4. Logar province was chosen as a pilot, for a
number of reasons: it is close to Kabul (within
easy driving distance), there are mentors in place,
it has a relatively small police population, and
there had already been some registration of
patrolmen (unlike in other areas, where the actual
number of policemen has not been verified). The
first payment under the new system was made in Logar
in July. More provinces were brought on line every
month thereafter. By the end of November, 27 of 34
provinces will have converted to the new system; by
the end of December the number will have increased
to 31, with only Day Kundi, Nimroz, and Nuristan
excluded.

Funds Distributed to Individual ANP Employees
---------------------------------------------

5. Under the new distribution system, payroll is
wired to provincial branches of Da Afghanistan Bank
and then distributed directly to the patrolmen at

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the provincial bank branch (or in the case of Herat
also in several district centers). The first time
the payroll is distributed in this manner, a
verification process takes place consisting of a
personnel officer (representing the police chief),
an MOI finance officer, and an MOF Mustofiat
(Finance Office) officer. Having representation
from the three offices minimizes opportunities for
non-patrolmen to claim they are on the force when
they are not. At the same time as their employment
is verified, patrolmen sign up for national ID
cards, a process that includes digital photos and
fingerprinting.

6. A second stage of the program is the gradual
transition from DAB to commercial banks. Four banks
(Kabul Commercial Bank, Azizi Bank, Afghan
International Bank, and Milli Bank) have been
chartered to handle ANP payroll. Two have begun
offering the service in Kabul and Nangarhar. In
Kabul, an electronic funds transfer program has been
established that is being used by 4,000 ANP
employees. The commercial banks charge a nominal
fee of 25 afghanis (50 cents) per transaction. In
Kabul that expense is paid out of the
internationally-funded Law and Order Trust Fund
Afghanistan (LOTFA) account; in the provinces it is
paid by the MOF. The commercial banks have
indicated that they may eventually drop the fee,
particularly if the new program results in ANP
employees opening individual bank accounts.

Challenges Remain
-----------------

7. While the program is very much on track, some
challenges remain. CSTC-A program designers
estimate that it will take at least six months of
monitoring in order for the systems to really take
hold. INL mentors have been asked to take on this
duty for the three days per month during which
payroll is distributed. A larger problem is getting
out to remote districts. ANP employees within
approximately 30 miles of the provincial center are
now expected to come into the capital to collect
their money, and this number is estimated to
constitute 80 percent of the work force within most
provinces. However police in the most isolated
areas are not able to participate due to a lack of
banking facilities - and these are often the areas
that have the highest security threat. Lack of a
DAB branch in three provinces has also made it
impossible to extend the program there. Another
serious issue in the field is that the program makes
no explicit provision for back pay: patrolmen are
paid after the month they actually worked (as in the
U.S. civil service), and previous irregularities in
salary payments have to be addressed separately.
Kickbacks remain a problem as well, even at Chief of
Police level, as police in many areas are pressured
to make payments to benefactors deemed responsible
for getting them their jobs. Finally, there have
been reports of threats and night letters against
central and provincial government officials involved
in implementing the new program, probably emanating
from those who had been able to take a cut of the
profits under the old system.

Auxiliary Police Also Included
------------------------------

8. The Afghan National Auxiliary Police (ANAP) also
come under this new payroll distribution plan. The
delay in receiving the first paycheck due to the

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need to formally enroll in the system, however,
together with unfulfilled claims to back pay for
those transferring from the disbanded highway
police, has in some cases given rise to erroneous
concerns that new recruits were not going to be
paid, e.g. in Zabol (reftel). This appears to have
been resolved for the first 41 graduates of police
training in Zabol Province, who were paid during the
week of November 15-19. CSTC-A has agreed to do
everything possible to speed up the paperwork so
that ANAP recruits can be paid as soon as possible
after their training is complete.

Comment
-------

9. Like everything else in Afghanistan, bringing a
new, transparent payroll distribution system on line
has required a tremendous amount of work, including
countless hours of negotiations with all the
parties. It may take some time to work out all the
kinks in the program, so we will probably continue
to hear of irregularities over the short term.
Within a few months, however, this new plan should
go far to address one of the most basic complaints
associated with the ANP: that patrolmen often only
receive half of their already low salary due to
skimming along the way. In an environment where
police reform is a major challenge, CSTC-A,s Finance
Transition Team should be commended for designing
and implementing this important positive change.
NEUMANN

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