The Independent Evaluation Office (IEO) of the IMF was established in 2001 to “conduct research and evaluations on issues of relevance to the mandate of the fund”, and to be “independent of IMF management and staff and to operate at arm’s length from the board.” The IEO’s establishment followed many years of board-level discussions and advocacy by civil society for an independent evaluation body to increase the transparency and accountability of the Fund. IEO evaluations have had a significant impact on Fund policy and upon perceptions of its role. Significant studies include the evaluations of the IMF’s responses to the Argentina crisis of the early 2000s, and more recently its evaluation “International reserves: IMF concerns and country perspectives”. The IEO usually publishes two evaluations per year. To date it has produced 24 evaluations, most recently in November with “IMF Response to the Financial and Economic Crisis”. The IEO reports to the IMF’s executive board, rather than to Fund management.
Structure and staffing
The IEO currently employs 11 staff, the majority of whom are required to come from outside the Fund. The current director is Moises Schwartz, a macroeconomist who previously served as the director of the National Commission for Retirement Savings in Mexico and as head of research at Banco de Mexico. The director is appointed by the IMF executive board for a non-renewable period of six years. The Director is not subsequently eligible for appointment to the Fund staff. His responsibilities include the selection of IEO personnel and the preparation of the budget. The budget of the IEO amounts to 0.5% of the IMF’s budget and is hence significantly lower than the budget of equivalent organizations in the World Bank Group (The budget of the Independent Evaluation Group in the World Bank amounts to 1.2% of the Bank’s budget).
The evaluation cycle is composed of eight stages: consultation on the work programme, preparation of an issues paper, research, preparation of the evaluation report, board discussion of the report, management implementation plan, monitoring of the implementation by the board and post-evaluation activities.
In the first two stages involvement of country authorities, executive directors and IMF management, staff and external stakeholders is actively sought: both in deciding upon topics for future reports, as well as in commenting upon the issues paper. Once the evaluation topics are selected, research is conducted using IMF documents and surveys, interviews and focus groups. In stage three, the draft version of the report is circulated among IMF staff for factual corrections prior to publication.
Publication is followed by three further steps. Following discussion by the board, a Management Implementation Plan is prepared by IMF staff and management (in place since 2006), which states the recommendations to be followed. Finally, the annual Periodic Monitoring Report (PMR) assesses the extent to which the report’s recommendations have been adopted. The PMR is conducted solely by IMF’s management and only assesses the implementation of recommendations from the IEO’s evaluation that the board had accepted. Often the Periodic Monitoring Reports cover several evaluations.
Accountability of the IEO
A regular external evaluation is required by the IEO’s Terms of Reference. The first took place in 2005 with the Lissakers report conducted by Karin Lissakers, former U.S. Executive Director to the IMF. Key findings included questions regarding the IEO’s independence from the Fund. It recommended different measures to enhance the IEO’s effectiveness, such as the introduction of the MIPs, PMRs and measures to make IEO’s staff more independent of the Fund. Some of the suggested measures, such as the MIPs and the PMRs, have been incorporated in the evaluation cycle.
A second external evaluation was chaired by Jose Antonio Ocampo, of Columbia University and former minister of finance of Colombia, in 2013. The evaluation found that though the IEO had positively contributed to the IMF’s external credibility the implementation process for recommendations derived from evaluations did “not work well”. It suggested the IEO drop the mandate of “promoting greater understanding of the work of the Fund” as well as an increase to the IEO’s budget. Following the Ocampo report the IEO begun producing re-evaluations of already published evaluations. These are used to assess the validity of past evaluations and the extent to which the recommendations remain valid. So far four of these updates have been published.
Civil society and other stakeholders can provide input to IEO evaluations in three ways. The IEO invites consultation on the subjects for evaluation via its publication of proposed topics for evaluation in the medium-term. Consultation also takes place on the draft issues paper prior to research commencing for an individual evaluation. The regular external evaluations of the IEO, which now occur every five years, also provide stakeholders the chance to comment on the functioning and effectiveness of the IEO itself.