Institutional arrangements and rationale for IMF involvement

The IMF should adopt an explicit definition of prolonged use as a trigger for enhanced “due diligence” (i.e., systematic ex post assessments and forward-looking consideration of “exit” strategies). Greater efforts should be made to identify whether countries are ready to implement credible programs, and the IMF should be more selective in extending financial support where there is insufficient evidence of commitment to a credible program. To mitigate the “seal of approval” pressures for continued programs, the IMF should aim to provide the international community with credible alternatives to IMF lending arrangements as a condition for other official flows. A differentiated rate of charge for prolonged users should be introduced as a signaling device.

Program design

Specific operational procedures should be developed to maximize ownership, such as: (1) give the authorities the initial responsibility for proposing a reform program; (2) encourage a process whereby core program elements are subject first to a policy debate within the member’s own political institutions; (3) use surveillance to create a better understanding of what would be expected if a program should become necessary; and (4) undertake more explicit discussion of major uncertainties and how policies would be adapted if things turn out differently. Programs should place greater emphasis on key institutional changes and strengthening implementation capacity. This will require greater selectivity in program content and greater efforts to tailor the time frame of program design to the foreseeable length of a country’s adjustment needs.

Surveillance

Steps should be taken to ensure that surveillance is not crowded out by programs in prolonged user cases. A case exists for greater operational separation between surveillance and program activities for prolonged users in the context of prolonged use.

Internal governance issues

The ability of staff to analyze political economy issues should be strengthened and a review of internal incentives facing staff should be undertaken with a view to minimizing staff turnover on countries and to foster increased candor and accountability.

Program design

Directors broadly agreed with the IEO’s recommendations and underscored that they should be seen as part of a continuing effort at improving program design to ensure greater effectiveness. Many of the recommendations are incorporated in the recently approved revised conditionality guidelines which provide the appropriate vehicle for putting them into practice. Further work on program design, including research effort, will also be needed, focusing in particular on the link between structural reforms/institutional capacity strengthening and program objectives. The regular reviews of conditionality by the Board will be the main vehicle for monitoring progress on these issues.

Surveillance

Directors agreed that priority should be given to increasing the effectiveness of surveillance, including the need to combine clarity and candor with recognition of social and political realities. They highlighted the importance of efforts to ensure that Article IV consultations in program countries “step back” from program context. Progress in strengthening surveillance, including by introduction of a fresh perspective, will also be addressed as part of the Board’s work program for FY2004.

Internal governance issues

Most Directors encouraged the staff to enhance its analysis and reporting of political economy issues in staff reports. Some Directors cautioned that the IMF should be careful in venturing into this area, given its comparative advantage in technical analysis and the need to avoid intruding on internal political matters. Directors also underscored the importance of distinguishing clearly between technical and political judgments and that staff should be candid in its assessment of risks.

On internal incentives facing staff, the Task Force took the view that while overall personnel policies do not need to be changed, management should consider guidelines and incentives to reduce excess mobility in country teams.

Surveillance

IMF surveillance was generally successful in identifying macroeconomic vulnerabilities where they existed. In Brazil, for example, the IMF spotted the increasing vulnerability of the crawling peg exchange rate regime, especially in the face of fiscal weaknesses. However, in Indonesia, it underestimated the risks arising from financial sector and corporate balance sheet weaknesses and from the governance problems that contributed to those weaknesses. It also failed to recognize the macroeconomic impact of financial sector weaknesses in Korea, even though markets had begun to express concern on this aspect. The evaluation concludes that even when key vulnerabilities were correctly identified, the IMF’s role as confidential advisor was not very effective and suggests that the IMF probably could have been more effective at influencing policy if it had made its analyses public, thereby contributing to a wider policy debate.

Macroeconomic framework and projections

In all three cases, macroeconomic outcomes turned out to be very different from program projections. In Indonesia and Korea, the initial projections were overly optimistic, leading to a design of macro-economic policies in the programs that turned out to be too tight. In contrast, the initial projections for Brazil in 1999 were too pessimistic, perhaps in reaction to the earlier overoptimism in East Asia. However, this meant that the fiscal adjustment achieved in Brazil, welcome though it was, was less than it should have been, given the more favorable growth outcome. In retrospect, in light of Brazil’s continuing adverse public debt situation, this represented a missed opportunity. To some extent, these problems arose because macroeconomic projections in an IMF-supported program are necessarily the outcome of negotiation. However, there were also analytical weaknesses associated with the failure to take sufficient account of the large currency depreciation which might occur in view of the possibility of multiple equilibria, and the severe balance sheet effects that might result in view of currency mismatches.

Fiscal policy

All three programs initially involved fiscal tightening, albeit to different degrees: mild in Indonesia and Korea and fairly strong in Brazil. The evaluation does not support the claim that the fiscal tightening in Indonesia and Korea was the cause of the output collapse. The initial intention to tighten fiscal policy in Korea was probably not warranted, in view of the very favorable debt situation and the unexpected downturn in output, and the same consideration holds for Indonesia, although to a lesser extent. However, in both countries fiscal targets were relaxed quickly when the extent of output collapse became evident. The output collapse can be better explained by severe balance sheet effects arising from the currency collapse and (in the case of Indonesia) the negative effect of political developments on domestic investment. Brazil saw much stronger fiscal tightening, as was appropriate because fiscal sustainability was a major issue driving the evolution of the crisis. Sharply higher primary fiscal surpluses were achieved in line with program targets, but this turned out to be insufficient to achieve the objective of reducing the debt-to-GDP ratio.

Monetary policy

The stance of monetary policy in all three countries was initially tight and there was an explicit recognition of the trade-off between higher interest rates and a weaker exchange rate. The outcome differed considerably across the three countries. In Indonesia, the maintenance of tight monetary policy envisaged by the program was initially not implemented because open-ended provision of liquidity to distressed banks led to a loss of monetary control. In Korea, the tight monetary policy envisioned in the initial program was implemented but this was not by itself sufficient to stabilize the exchange rate. It was only after the rollover of external debt was achieved that conditions stabilized and interest rates were gradually lowered in early 1998. In Brazil, there was an easing of interest rates immediately after the program was approved—over the IMF’s objections—and this may have contributed to the timing of the collapse of the crawling peg. However, after the currency was floated in January 1999, there was a decisive tightening of monetary policy in March 1999 and this led to the restoration of stability in the foreign exchange market. The experience of the three countries does not provide a definitive answer to the ongoing debate on the effectiveness of high interest rates in stabilizing the exchange rate. However, it is clear that an interest rate defense on its own is unlikely to be sufficient, particularly when balance sheets are weak.

Official financing and private sector involvement

The inadequacy of the official financing package was a major weakness of the initial Korean program announced in early December 1997. The IMF was aware of the problem and brought it to the attention of the major shareholders, even suggesting that if financing was not available then a rollover of debt should be orchestrated. However, faced with reluctance on the part of the major shareholders to take an initiative on this matter, the IMF arbitrarily resorted to unrealistically high assumptions about rollover rates in order to match the programmed financing gap to the available financing. It sought to bolster the financing available with bilateral credit in the form of a “second line of defense” which would be available if needed. However, the availability of this financing was visibly uncertain to the markets, and the program quickly collapsed when the markets reacted adversely. In Indonesia, the size of the package was not relevant—the problem really arose because of weaknesses in program design, the lack of political commitment to the program, and the complicating factor of political uncertainty and instability and its impact on domestic investment. In Brazil again the problem was not the size of financing but the fundamental unviability of the crawling peg. In Korea and Brazil, the IMF’s role as crisis coordinator in organizing private sector involvement was limited by the initial reluctance of major shareholder governments to use nonmarket instruments to influence the behavior of private sector institutions and concerns that such action might precipitate an exodus of capital from emerging markets. However, in Korea, once a decision was made by the major shareholders to ask international banks to maintain exposure, the IMF played a useful role in facilitating information exchange and setting up systems for monitoring compliance.

Bank closure and restructuring

The experiences of Indonesia and Korea suggest that programs for bank closure and restructuring to deal with a distressed banking sector must be based on a comprehensive and well-communicated strategy in which transparent rules are consistently applied. The lack of such a strategy in Indonesia was a major cause of the collapse of the November 1997 program. The issue of whether a blanket guarantee for deposits should have been introduced in Indonesia in November 1997, instead of the partial guarantee actually offered, deserves careful consideration. The evaluation suggests that Indonesia’s banking crisis was not yet systemic in November, so that the partial guarantee was appropriate. The system collapsed for other reasons and as it happened, when a blanket guarantee was introduced in January 1998, it was subject to abuse and consequently raised the fiscal cost of bank restructuring.

Structural reform

While all three programs involved structural conditionality, the Indonesian and Korean programs (especially the January 1998 Indonesian program) contained a proliferation of structural reform measures. In contrast, the scope of structural conditionality in the Brazilian program was limited to structural fiscal reform and prudential regulation. This difference is partly due to the absence in Brazil of many of the distortions present in the two Asian cases. While measures to rehabilitate and reform the financial sector were necessary in Indonesia and Korea, many of the nonfinancial structural reform measures were not necessary to restore confidence, although they may well have been beneficial in the long run. The evaluation suggests that, particularly in Indonesia, the proliferation of nonfinancial structural conditionality led to a loss of focus on critical reforms in the banking sector, and also contributed to the lack of ownership at the highest political level.

Communications strategy

A program for restoring confidence must include a strategy to communicate the logic of the program to the public and the markets, in order to enhance country ownership and credibility. None of the three programs contained such a strategy initially.

Human resource management

The effectiveness of surveillance was reduced by the lack of sufficient incentives to make judgments that were frank and potentially unpopular with country authorities, resulting in a tendency for sharper elements of a diagnosis to be diluted in final Board papers. In crisis management, the quality of IMF response was compromised by a delay in the appropriate reallocation of staff resources and an insufficient utilization of available internal knowledge.

The role of the Executive Board and the IMF’s major shareholders

The Board and major shareholders interacted closely with management at all stages. The evaluation recognizes that such close involvement is necessary when major decisions need to be made quickly, though contacts at multiple layers can be counterproductive. However, there is evidence that some decisions were subject to micromanagement and political pressure, contributing to a blurring of technical and political judgments.

Collaboration with other international financial institutions

Tensions sometimes developed over the role that different IFIs should play in an IMF-supported program, particularly in matters relating to the financial sector. While a good working relationship eventually developed, it depended too much on personalities, and not on a well-defined procedure.

Precrisis surveillance

Surveillance should take a stress-testing approach to analyzing exposure to a potential capital account crisis. In particular, staff should itemize risks and assess their potential impact, and develop greater understanding of political constraints on policymaking and of market perspectives on policy, in part through wider dialogue.

Increased transparency and incentives for candor

To increase the impact of surveillance, staff assessments should be made more candid and more accessible to the public. In particular, there should be a presumption of publication for Article IV staff reports. Management could develop modalities for escalated signaling to provide the Executive Board with a vehicle for signaling when failures to address identified vulnerabilities have become an increasing source of concern. Escalated signaling would give member countries enough time to address underlying vulnerabilities, while also progressing toward greater candor as a means of increasing the effectiveness and impact of surveillance. Moreover, management and the Board should explore the possibility of seeking “second opinions” from outside the IMF as part of the surveillance process when the authorities disagree with the staff’s assessment on issues that are judged to be of systemic importance. This would improve the degree of objectivity with which contentious issues are handled in the surveillance process and may enhance the impact of surveillance.

Program design

A comprehensive review of the IMF’s approach to program design in capital account crises should be undertaken. In particular (1) greater attention should be paid to balance sheet effects; (2) program design should allow for a flexible response, in case unfavorable outcomes materialize; (3) conventional financial programming-based conditionality should be reviewed and possibly adapted for capital account crisis circumstances; (4) parsimony and focus should be the basic principles of structural conditionality, and crises should not be used for pushing reforms that are not critical to crisis resolution, however desirable they may be in the long run; and (5) there should be an agreed communications strategy, characterized by a high degree of transparency.

The IMF as crisis coordinator

The IMF should ensure that the size of the financing package is sufficient to generate confidence and that its quality is such as to make it credible. In particular (1) packages should not rely on parallel official financing unless the terms of access are transparent and credible; and (2) terms for the involvement of other institutions providing parallel financing should be specified at the outset. The IMF should be proactive in its role as crisis coordinator. In particular, management should provide a candid assessment of the probability of success to the Executive Board and shareholders, and ensure that the technical judgment of staff is protected from excessive political interference. While the nature of private sector involvement will have to be determined on a case-by-case basis, the IMF should play a central role in identifying circumstances where concerted efforts can help overcome “collective action” problems.

Human resource management

Human resource management should be adapted to develop and better utilize country expertise, including political economy skills, and to establish “centers of expertise” on crisis management issues. In particular (1) the length of staff assignments should be monitored to ensure continuity of staff expertise, and a critical mass of expertise on each systemically important emerging market economy should be developed; (2) Resident Representatives should play a more central role in surveillance and program design; and (3) internal procedures should be made to protect those who raise uncomfortable issues through proper channels, but consequently attract complaints from the authorities.

Surveillance, transparency, and candor

Directors concurred with the overriding message of the report: to strengthen the effectiveness of IMF surveillance by extending and systematizing current guidelines for assessing vulnerabilities. They supported the call to itemize major potential shocks while emphasizing that stress-testing should not be mechanical but should focus on key risks facing a particular country. Most agreed that the IMF should develop greater understanding of political constraints on policymaking, although some cautioned that this could be counterproductive if it was seen as interference in domestic affairs. Most Directors saw great value in systematic discussions with the international financial community. Many Directors were not in favor of shifting from voluntary to presumed publication of staff reports, but some strongly supported presumed publication. Directors agreed with the need for greater emphasis on candor in staff reports. Reactions to the proposal for escalated signaling were mixed, with many Directors considering it an idea worth pursuing while a few felt it would undermine the IMF’s role as a confidential adviser. On the related issue of second opinions, many Directors were not in favor, but some felt it may provide a fresh perspective.

Program design

Directors endorsed the IEO’s recommendations on program design, and hoped that forthcoming staff papers on program design and balance sheet effects would give due attention to them.

The IMF as crisis coordinator

Directors generally agreed with the recommendations on financing packages, while noting limitations on the IMF’s influence on other sources of financing. The Board stressed that the recently revised access policy must be observed and emphasized the importance of program credibility, not large financing packages, as the heart of IMF involvement. The Board stressed that political judgments and decisions should be its exclusive domain and that it should be involved early in program discussions but without micromanaging operational details. Directors attached particular importance to the early involvement of the private sector.

Human resource management

Directors generally agreed on the need for institutional change to ensure that the IMF is in a position to respond rapidly to member countries facing crises. Many Directors supported the creation of centers of expertise; longer country desk assignments; a greater role for Resident Representatives; and modification of internal guidelines and human resource procedures. They also noted that human resource issues are management’s responsibility.

It was noted that ongoing Board discussions would revisit specific operational aspects of the recommendations, particularly those endorsed by the Board. Biennial review of surveillance will be the main vehicle for assessing what has been done to address surveillance-related recommendations. Many of these and other issues would be discussed again by the Board in the context of discussions on transparency, financial soundness indicators, the balance sheet approach, reporting requirements, data standards, and sustainability assessments, and operational decisions will be taken by the Board in the context of those discussions.

Specific actions have already been taken by management in some areas addressed by the report, including the setting up of an Internal Task Force to review broad strategic issues relating to the IMF’s Resident Representative program and the recent reorganization of the Monetary and Financial Systems (formerly Monetary and Exchange Affairs) Department.

Is there a “one-size-fits-all” approach?

The evidence does not support the view that IMF-supported programs typically adopt a one-size-fits-all approach to fiscal adjustment, nor the perception that programs always involve austerity by targeting reductions in current account deficits, fiscal deficits, or public spending as a percent of GDP. In fact, 40 percent of the programs examined targeted a widening of the current account deficit as a percentage of GDP, while slightly over a third planned an increase in the primary fiscal deficit and primary spending as a percentage of GDP.

Variation across countries obviously does not establish that the targeted fiscal adjustment is appropriate in each case. The evaluation used cross-section analysis to examine factors underlying the observed variation and this revealed some patterns: the targeted adjustment in the fiscal deficit is higher when initial fiscal deficits are higher, when expenditure levels relative to GDP are high, and when proposed current account adjustments are large. However, these issues could not be pursued in the individual country programs examined because program documents do not indicate how fiscal adjustment targets are determined and how they are related to the specific assumptions made about the pace of recovery in private sector demand and short-term growth prospects. In the absence of such information, an evaluation of the appropriateness of the adjustment attempted in individual countries could only have been attempted by undertaking a detailed study, specifying an appropriate (counterfactual) program for each situation, and comparing the fiscal adjustment in that program with the targeted adjustment in the IMF-supported program. This was beyond the scope of the evaluation.

How flexible are targets?

The cross-country evidence does not support the view that IMF-supported programs are insufficiently flexible in an ex post sense, forcing a rigid pattern of fiscal adjustment that is insensitive to changes in circumstances. In fact, many programs fail to meet initial targets, and these targets are revised to reflect reality.

On average, IMF-supported programs achieved only about one-half of the targeted improvement in overall and primary fiscal balances. However, there is significant variation around this average; about 60 percent of programs underperformed, with SBA/EFF-supported programs in nontransition countries registering the highest incidence of shortfalls, while SBA/EFF arrangements in transition countries had the smallest shortfalls. Moreover, almost all fiscal adjustment achieved in the first two years occurs in the first year of the program. Except in the transition country arrangements, programs were on average unable to achieve further fiscal gains during the second year of the program, in spite of relatively more ambitious fiscal targets for the second year.

As many as two-thirds of the programs studied incorporated revisions to their initial fiscal deficit targets by the time of the completion of the second program review. The revisions are asymmetrical—fiscal targets are often revised downward when growth is below expectations, but less often revised upward when growth is higher than originally projected. Interestingly, the evaluation found that program documents do not explain clearly the extent to which the fiscal shortfall observable at the review stage is due to a weaker policy effort or to the effect of exogenous developments.

Is fiscal adjustment unnecessarily contractionary?

This is one of the most controversial issues related to the design of IMF-supported programs and the evaluation revealed some interesting patterns. There is no evidence that growth rates in program years were systematically lower than the trend in the preceding decade. However, there is considerable cross-country variation around this average behavior. There were a number of cases, particularly the group of capital account crisis cases, where growth did slow down and in some cases even turned negative.

There is clear evidence of overoptimism in projecting investment rates and GDP growth. Actual investment rates in the second year of the program were below projections in 60 percent of cases and 5 percentage points of GDP or more below projections in about one-fourth of cases. Growth optimism is particularly evident in programs that started from an adverse situation. When growth was negative during the first year of the program, growth projections for the second year were on average twice as high as in reality. Programs were also generally reluctant to project a slowdown in growth and very rarely projected negative growth. This “reluctance to predict a downturn” has potentially significant implications for program design, since it means that the need for countercyclical fiscal policy and its appropriate role is rarely discussed explicitly.

A tighter fiscal stance by itself cannot be called contractionary since it may be needed in situations where private investment demand is potentially buoyant and fiscal contraction is necessary to create room for financing private investment. However, it may not be appropriate when there is a sharp downward shift in the investment function, or when the level of private demand responds more sluggishly to the program than originally projected. In such cases, a demand stimulus may well be appropriate, calling for a less contractionary fiscal stance.

The lack of clear explanation of the rationale of the extent of fiscal adjustment in individual cases makes it difficult to determine whether the fiscal stance is indeed unnecessarily contractionary. A contractionary bias is most likely when both output and investment are below projections, the current account deficit is lower than programmed, and reserve accumulation is above the program target (indicating that external financing was not a constraint). In addition to the findings regarding output and investment optimism, the evaluation found overperformance on the external side in about one quarter of cases. Under these situations, it is possible that the adjustment planned was unnecessarily contractionary. However, even this conclusion needs to be qualified, because it focuses only on the impact of fiscal adjustment on aggregate demand. Where debt sustainability is an issue, a loose fiscal stance justified on countercyclical grounds may actually prove to be destabilizing if it is misread by markets as indicating a lack of commitment to macro stability, leading to a delayed return of confidence. Weighing these different considerations is difficult, but these issues need to be explicitly discussed and explained in program documentation, which is generally not done.

Program documentation

Program documentation should provide a clearer justification for the magnitude and pace of targeted fiscal adjustment and how it is linked with assumptions about the recovery of private sector activity and growth.

Program review

The internal review mechanism should place more emphasis on the early stages of the process, and the key briefing paper for program negotiations should also articulate more clearly the basis for the fiscal program and its links with debt sustainability issues.

Formulation and implementation of key institutional reforms

Programs should make stronger efforts to specify those structural reforms which should be carried out during the program horizon as part of a broader road map of priority reforms that ideally should have emerged in the course of surveillance.

Surveillance

The surveillance process should be used to provide a domestically owned longer-term road map for fiscal reforms and also to assess progress achieved. The identification in advance of areas considered critical will foster greater domestic debate and encourage homegrown solutions and greater ownership while allowing the authorities flexibility in the timing and packaging of reforms.

The analysis should assess why important distortions were not addressed and what lessons were learned from past experience. This should include an effort to identify and unbundle the various constraints to critical reforms. Surveillance should include more systematic efforts to estimate the extent of tax evasion and tax exemptions, including the use of cross-country comparisons. Public debt sustainability could help anchor the road map of fiscal reform priorities proposed above and to assess trade-offs over time.

Role of the IMF in social protection

The IMF should clearly delineate the operational framework in which social issues will be addressed within program design in non-PRGF countries. This should include a clear indication of the IMF’s responsibilities and activities in this area, which should include alerting the authorities about the need, in crisis situations, to protect those social programs and spending categories that are critical to the most vulnerable groups. Since this requires preparatory work, the IMF could invite the authorities, regularly during Article IV consultations, to suggest what existing critical social programs and social services they would like to see protected in the event of adverse shocks. On the basis of the priorities identified by the authorities, the World Bank and the IMF could agree with them on reform of public expenditure management (PEM) systems, specifically geared to protect the specified programs and spending categories. This would be a concrete application of the ongoing collaborative initiative by the IMF and the World Bank to strengthen PEM systems according to priorities set by the countries themselves.

Program design and internal review process

Directors supported the recommendation that program documents should provide a more in-depth justification for the magnitude of the fiscal adjustment, and deemed that this initiative would instill greater discipline in program design, enhance transparency, and provide the public and the private sectors with a more convincing rationale for the program, thereby helping to overcome political obstacles to implementation. Nevertheless, they recognize that uncertainties regarding key macroeconomic variables particularly under crisis situations complicates this task. A few Directors cautioned against spurious precision in such justification. Directors looked forward to further staff analysis of the issue of growth projections in the context of the program design discussions.

Directors supported the recommendation that the internal review process should place relatively more emphasis on the early stages. They welcomed management’s recent initiative in this area.

Enhancing key institutional reforms and their links with surveillance

Directors agreed that these reforms can be more critical for fiscal sustainability than short-term expenditure and revenue measures. However, they recognized that short-term measures are hard to avoid if the immediate objective is economic stabilization. Medium-term institutional reforms are particularly relevant in countries that have achieved macroeconomic stability and where “second generation” reforms are necessary. Some Directors agreed with the report’s suggestion that reforms should be broken down into those that require executive action, legislation, and capacity building. Directors, however, pointed out that in crisis situations the pressing need to resolve a crisis may pose serious constraints on a medium-term approach. Careful judgment will continue to be needed to focus conditionality on reforms judged critical while at the same time ensuring that progress is made in addressing vulnerabilities and achieving programs’ goals.

Most Directors agreed that Article IV consultations should play a stronger role in identifying long-term reform priorities and the causes of past failures, and that this analysis should inform subsequent program design. Nevertheless, they underscored that the ultimate responsibility to develop a fiscal reform agenda resides with the individual country authorities, while the Fund should stand ready to provide advice.

Role of the IMF in social protection

Directors agreed that an important aim of program design should be to protect critical social expenditures. However, they stressed, as recognized in the report, that the Fund should not become involved in the detailed selection and design of social policy; this task is outside both the Fund’s mandate and its expertise. A number of Directors supported the IEO’s call for updating of the 1997 guidelines that direct IMF work in the social area, in order to improve their clarity and effectiveness as an operational tool in protecting the most vulnerable from economic shocks and budgetary retrenchment. Other Directors, however, viewed the existing guidelines as adequate, and a few considered that the annual and medium-term budgets of non-PRGF countries already adequately identify critical social sector programs. These Directors recalled that the new framework for Bank-Fund collaboration on public expenditure issues should enhance countries’ public expenditure reform strategies, including measures to protect critical social spending. Many Directors agreed with the recommendation that staff should inquire, during Article IV consultations, whether the authorities have identified social programs that they would like to protect in the event of a crisis, as they believed this would help dispel the criticism that Fund programs unduly curtail social spending. A few others considered this recommendation impractical, as it would create significant costs and pressures for the authorities with little benefit.