(Pacnews) - A much vaunted Australian Government programme designed to improve governance in the Pacific region is flawed, with no way of knowing whether it has been a success, according to an internal review.

After threatening to withhold aid funding from neighbouring countries unless they tackled corruption, Australian Prime Minister John Howard unveiled the Pacific Governance Support Programme (PGSP), which he said was "vital to the future stability and prosperity" of the region. The Prime Minister made the announcement in Samoa during the Pacific Islands Forum three years ago and he, like Australian foreign minister Alexander Downer, has since emphasised the importance of such work.

Risk of wasted investment

"Unless governance is strengthened, corruption reduced and basic security provided, increased economic aid risks being a wasted investment - and feeding the underlying problem," Mr Howard told the Australian Strategic Policy Institute last month.

But while more than $16 million (US$12 million) has been spent on the programme, an internal review has been unable to determine what benefit, if any, the PGSP has been to the region.

"Much of the reporting concentrates on what was done, rather than the benefits of the activity," said a report obtained by The Australian under Freedom of Information laws.

"As a result, it is difficult to get a sense of whether PGSP is meeting its objective and the impact of individual activities."

Underspent

The report shows that the programme, which gets $7 million (US$5.5 million) a year, has been routinely underspent by up to 20 per cent; does not encourage longer term activities; has been in conflict with AusAID's in-country programmes; and "the procedures, documentation and monitoring of the programme have proved unwieldy."

The programme's primary focus, of developing public sector expertise in Pacific states and building institutional capacity, was also "beyond the capacity of (whole of government) participants at this stage."

Shared policy dialogue

"Few activities currently seek to build truly regional capacities outside of sustaining a shared policy dialogue," the report said.

"Some capacity building or skills transfer activities are being funded, but they tend to be multi-country rather than regional activities."

Whole of government agencies "have difficulty in sustaining longer term, in-country placement of officers" in countries with specific skills shortages, and have limited capacity to engage in the Pacific region "given their national mandates and workloads."

Effectiveness review

The review made a series of recommendations but AusAID, which manages the program and was asked by Mr Downer to respond to questions from The Australian last night, would say only that some were being implemented and others were being examined.

An AusAID spokeswoman said that while the objectives of individual activities funded by the program were being met, an effectiveness review would be undertaken to enable the agency to more closely monitor its progress. PNS August 17.