Andean Group - August 2009 (ISSN 1741-4466)

President Alan Garcí­a delivered his third state-of-the-nation speech to congress on 28 July. He ducked several key issues, in particular negotiations with indigenous groups in the wake of the violent clashes in the Amazon in June, and offered little new on others, most notably the internal conflict with the guerrilla group, Sendero Luminoso. He also aired one controversial proposal: a popular referendum related to electoral term limits - specifically the introduction of mid-term elections to renew half of congress. By far the most interesting thing he had to say, however, was about decentralisation.

“I have two big objectives this year: defending the rule of democracy and saving Peru from the global crisis by strengthening social programmes," Garcí­a said. This seems to consist of providing more social assistance in the Apurí­mac and Ene river valley (Vrae) - the epicentre of the conflict with Sendero - on the medical and health fronts as well as alternative development schemes to replace coca growing.

These are hardly new promises so it was no great surprise that the opposition was unconvinced by Garcí­a's strategies for meeting his objectives. Various opposition deputies singled out his failure to offer “anything new" as regards the conflict with Sendero and narco-terrorism. The opposition Partido Nacionalista Peruano (PNP), of Ollanta Humala, was also critical of Garcí­a for avoiding any mention of the progress of talks with the indigenous organisations behind the violent clashes with the police in Bagua in June [RA-09-06]. The outcome will have ramifications for the government's handling of future social unrest in Peru's provinces.

When the new prime minister, Javier Velásquez Quesquén, appeared before congress a week later to receive the habitual “vote of confidence" from deputies, he provided little additional detail on either matter, simply echoing Garcí­a's words that “strengthening democratic stability and social inclusion" were the government's priorities. Unsatisfied, the PNP voted against him. Various deputies from Unión por el Perú (UPP), Alianza Parlamentaria and Bloque Popular abstained from voting.

Velásquez Quesquén did win the approval of congress, however, thanks to the backing of the ruling Partido Aprista Peruano (PAP) and the fujimorista Alianza por el Futuro (AF), although the latter was given begrudgingly. The spokesman for the AF, Carlos Raffo, said his party was not fully convinced by Velásquez but would support the government for the sake of democratic stability.

Corruption
One issue on which Velásquez Quesquén did elaborate was corruption, the spectre of which continues to stalk the Garcí­a administration. During his state-of-the-nation address, Garcí­a seemed to skirt around the issue. On the one hand, he proposed a draconian punishment for those found guilty of corruption: a work camp in the jungle. On the other hand, he did not announce any preventative measures, which are essential as a deterrent.

Velásquez Quesquén was slightly more forthcoming. He promised to work with congress to create an anti-corruption plan, including stricter enforcement of the penal code and an integral protection system for whistleblowers.

Electoral reform
Velásquez also revisited a controversial issue, given the origin of the constitutional crisis in Honduras, raised by Garcí­a during his address: electoral reform. Garcí­a had argued that mid-term congressional elections to renew half of congress would “reduce tension that gathers during the five-year term". He said the reform could be approved by means of a referendum, with the collection of 1.5m signatures.

Velásquez took a different tack. He called on congress to give priority to the debate to install mid-term elections. Congress has actually been debating the issue for several months but it has made no headway as deputies are understandably loath to curtail their own (future) mandates.

Garcí­a made the case for the electoral reform on the grounds that the overwhelmingly negative public image of congress should improve if voters were presented with the opportunity to effect a change halfway through the congressional term. What he fails to see is that the negative regard in which congress is held is far less to do with the actual elected deputies than it is with the perceived corruption, inefficiency and, ultimately, powerlessness of congress.

What is more, the public would almost certainly prefer to have the option of replacing the president halfway through his term by means of a recall referendum (something for which the opposition PNP has long been pushing) but Garcí­a unsurprisingly did not suggest this. There is no provision in the constitution for a recall referendum along the lines of that introduced by Venezuela's President Hugo Chávez .

Decentralisation, with a difference
Garcí­a did mimic Chávez in another way, however, although it was inadvertent. Garcí­a called for “popular decentralisation" which, while he would be at pains to deny it, bears no small resemblance to the structures put in place by Chávez in Venezuela.

Garcí­a defined “popular decentralisation" as a means of deepening the regional decentralisation process. He proposed forming what he described as “executive nuclei", comprising four people, including a president and a treasurer, from local communities across Peru. These would be made up of campesinos and social organisations requiring funding for a specific local project.

Garcí­a said that disbursing state finance in this way - for infrastructure and public works projects selected by the public - would not just cut through the layers of bureaucracy preventing government funds from reaching the poorest and neediest but would also help to avert social protests in the provinces, where Garcí­a's government is notoriously unpopular and Humala has his powerbase.

The “executive nuclei" proposed by Garcí­a would be accredited by the regional governments and national ministries, which would approve the funding for the specific projects. Garcí­a said that the objective for 2009 was to channel 5% of the remaining investment budget for the regions, some NS$1bn (US$334,000), to these accredited local groups. He maintained that there were some 30,000 small, low-tech projects being demanded by local communities, which would cost an average of just NS$300,000 (US$100,000) to complete.

Garcí­a is well aware that one of the most enduring criticisms of his government is its failure to transfer the benefits of years of impressive growth to the poor. He argues that the new nuclei will involve millions of Peruvians who are currently only passive spectators. He is laying himself open to the charge that he is creating an alternative form of decentralisation because the PAP only controls two of the 25 regional governments and just 250 of the 1,900 municipalities. Chávez also claimed to be reinterpreting the meaning of “decentralisation" to transfer power to the people in March this year. He said that national funding would go straight to local community councils to carry out social projects rather than states or municipalities.

• Second stage

Javier Velásquez Quesquén told congress that he was starting the “second stage" of the government of President Alan Garcí­a, who has a little under two years of his term to run. This neatly overlooked the fact that he is in fact the third prime minister, after Jorge del Castillo and Yehude Simon, to serve under Garcí­a since he took office in 2006.

• Regional elections

President Alan Garcí­a also called for the introduction of a second round of regional elections to define the 25 regional presidents and councils in Peru. At the moment regional authorities in Peru's 25 departments are elected after just one round of voting. Garcí­a said that if regional presidents required an absolute majority it would confer greater legitimacy on the victor. The opposition argued that the extra election would simply be an unnecessary drain on public finances.