By Ned Colt, NBC News CorrespondentBAGHDAD – For Um Wissam, a small office packed with food aid in Shiite-dominated Sadr City is a lifeline. With her son killed two years ago, the widow has nowhere else to turn for support.

"They're really great," she said. "They give us whatever they possibly can."

"They" are fervent anti-American cleric Muqtada al-Sadr and his Mahdi Army.

VIDEO: Uprooted Iraqis aided by militias

A new report from Washington-based Refugees International says that Muqtada and his Mahdi Army are the largest "unofficial" aid agency in the country. And they're not alone. In the patchwork quilt of sectarian neighborhoods that make-up Baghdad, almost all aid is delivered through political and religious groups, according to report co-author Kristele Younes.

Filling a gap
"They are giving them money to pay rent. They are giving them oil and food. They are providing them with generators for electricity. They are really meeting all the needs that the government and the U.N. should be meeting at this stage," Younes said.

What about the United Nations? Its role here is limited. After a massive bombing at its Iraq headquarters killed 22 five years ago, it pulled out most of its foreign staff. For years now, the U.N has had only 35 international staffers based here, though that number is supposed to rise. 

How about the Iraqi government? It has done little. While the rising price of oil has enabled the Iraqi government to amass $30 billion in reserves, the Refugees International Report said little funding has gone to help Iraq's most vulnerable. And there are many of them. Oxfam said more than half of all Iraqis are living in "absolute poverty."

Part of the reason for the lack of government aid is that corruption is pervasive and organization poor. According to Younes, the government has "proven to be unwilling and unable" to respond to the needs of Iraqis. The report also suggests the government is hobbled by being perceived as allied with another powerful Shiite group, the Supreme Iraqi Islamic Council. Known by the acronym SIIC here, the group is best known as fielding its own militia, the Badr Army.  

It's perplexing, and some suggest dangerous, that aid is being used a tool by the militias the U.S. is intent on stamping out. It helps solidify support and brings in new recruits.

"The U.S. and Iraq should be very concerned about the fact that these groups are not only assisting these Iraqis, but they're also gaining political and military ground thanks to this assistance," said Younes.

And those gains could come with a renewed threat of violence when coalition forces begin to withdraw. Younes said militia leaders who met with her co-author in Iraq "made it extremely clear that they were waiting for the American military presence to diminish. They were just waiting for the other side to be weakened."