Owen abroad

Archive for the ‘Transparency’ Category

Alanna Shaikk writes about the good and bad of working in international development.  Here is a big part of the bad:

… You’re a bureaucrat. An awful lot of every expat’s job involves paperwork. Most people picture international work as feeding hungry people, providing health care to refugees, or building schools. In reality, it makes no sense to pay an expatriate to do that. Instead, we do what cannot be hired locally: English-language paperwork. We write reports to HQ and donors, proposals, and program guidelines. We write even more reports. We can go days without seeing anybody who is helped by our work.

This is a very acute observation, and it is confirmed by what I see here in Addis every day.

It seems to me that we must de-escalate the amount of paperwork involved in international development.

There has to be some record-keeping to enable us to account to the people whose money we are spending.  But the bureaucracy involved in designing and getting funding for projects, for hiring people, and for monitoring and reporting, has become an industry in itself. 

Akvo is promoting “Really Simple Reporting (RSR)” which is intended to simplify reporting.

The Skoll Foundation is also apparently working on a common reporting format to simplify the paperwork for grantees of US foundations. (I can’t find anything about this project online.)

I think the time has come for all donors – government agencies, international organisations, private foundations, and NGOs – to adopt a common reporting format for their grantees, so that each organisation can provide information about finances and performance in a single report – possibly provided online – on which all their funders can rely. 

The people whose money we are spending – taxpayers and individual givers – don’t want to pay people to fill in forms; and the people who work in development don’t want to do it either.  A common reporting format would also make the information more comparable and useful.

So help me I’ve read some rubbish in the Daily Mail over the years – and I know it to be a potent brew of prejudice and lies.  But this article must rank in the top-ten for stupidity.

The headline – “A heart rending dispatch from Ethiopia” – seemed promising.  Could it be that the Daily Mail is taking an interest in the challenges being faced by 80 million people here in Ethiopia?   Heaven knows, it would be about time.  About 5 million people here need emergency assistance, and about 75,000 children are suffering with severe acute malnutrition.  Approximately 73% of the female population undergoes female genital mutilation. Only 22% of the population has access to an improved water supply, and only 13% of the population has access to adequate sanitation services (less in rural areas).  Only 46% of girls in Ethiopia go to primary school, and fewer than 25% go to secondary school (these numbers are a huge improvement on the figures only a few years ago).

And the situation today is dire. Less than a year ago, a quintal of teff (a type of grain from which people make injera, a staple food) cost about 350 birr; today it has spiralled to to over 1,100 birr for the same amount, which is about what you need to feed a family for a month.

But none of that worries Liz Jones of the Daily Mail:

What I will remember most about my trip to Ethiopia is the sight of the grain market, held just outside the small town of Hossana – human population 70,000; equine population 91,040.  Mules – half donkey, half horse – are used for the terrible task of carrying grain because they are bigger and stronger than donkeys.

She is in a country in which children are dying of malnutrition and what she will remember most is the mules?

I’ve been vegetarian since I was a teenager,  so I count myself as someone who takes the rights of animals seriously, but I cannot begin to understand how Ms Jones can think that, of all the insults to dignity and humanity facing this country, the plight of donkeys could feature anywhere in the top ten.  But Ms Jones ranks donkeys right up there with Ethiopian children:

I tried to imagine how I would treat a donkey if I had seven mouths to feed, and I hope I would still have a vestige of compassion. But if my children were starving, I cannot be sure that that would be the case. No one can.

I don’t have children or a mule, but I am pretty sure that if I did, I’d put my children first. And I’d be keen to prosecute anyone who took a different view.

Almost every day here, I see women hauling huge loads of firewood on their backs from the outskirts of the city, to bring fuel for their family. A few are lucky enough to have a donkey to bear the load.  Ms Jones of the Daily Mail does not approve:

The owner explains that she has been walking with her donkey since 7am; it is nearly 5pm, and the sun is still beating down relentlessly. I ask why she has not taken the load from her donkey’s back, and she replies that she would not have the strength to lift the sacks back on to her donkey again.  Can she not let the donkey rest? The woman shakes her head. She has to hurry, to be home before 6.30pm, so that she can take part in a religious feast.

Ms Jones suggests you might want to give money to a charity to help the mules (and, almost unbelievably, to “educate owners in better animal care,
preventing problems from reoccurring”).

Alternatively, you might want to give money to a charity to help the people. You can donate to Médecins Sans Frontières (MSF) here, or Save the Children here.

The UK Department for International Development has started a group blog.  This is great news for those of us who believe that it has a good story to tell.

DfID has a very good reputation abroad, but hardly anybody in the UK knows anything about it, or appreciates how much DfID contributes to positive perceptions of Britain.  I hope this blog will help tell the story in a very direct and personal way.

I used to blog when I worked at DFID, but that was before the government had guidelines about blogging. Let’s hope that the Government will be willing to accept that there will be some uncomfortable moments but that the benefits hugely outweigh the risks.

The Guardian reports that the UK is pushing for greater transparency of aid in an initiative to be launched tomorrow:

The UK wants donor countries to provide full and detailed information of all the financial assistance provided to each country; details of individual projects and their aims; and reliable information on future aid flows so that developing countries can plan ahead.

This political pressure is a very welcome boost for our work on the need for greater transparency for aid, with strong civil society backing, and the UK Government deserves great credit for pushing it. It

The next stage for us is an intensive period of listening to people in developing countries – parliaments, finance ministries, civil society, the private sector – as well as in donor countries, to understand exactly what information should be published, and how.

And that’s what we’ll be doing for the next couple of years.

I’ve posted about the High Level Forum on Aid Effectiveness on our aidinfo blog.

I’m very excited to have made an inaugural post on the new aidinfo blog. This is the website for the work we are doing to increase the transparency of foreign aid.

This RSS feed gives you an update of what is changing on the site – add it to your favourite feedreader today.

Yash Tandon, writing in Business Daily Africa says that that the Paris Declaration on aid is a form of collective colonialism by donors:

under the pretext of making aid more effective the Paris Declaration project is a form of collective colonialism by Northern “donors” of those countries in the South that (because of their weakness and vulnerability and psychology of “dependency”) may allow themselves to be subjected to it at the Accra September Conference.

This is massively overstated, but there is a kernel of truth here. Donors have the money, the choice and the power, and however progressive individual officials want to be, that power relationship is translated into institutional mechanisms such as the Paris Declaration.

That said, the Paris Declaration is the best opportunity for a generation to change that power relationship, by committing the donors to improving their behaviour as donors, including several measures which could, over time, rebalance the power.

I will be at the Accra September Conference and will report on whether we make progress.

The Economist has reported a paper by Oya Celasun (IMF) and Jan Walliser (World Bank) which looks at the impact of unpredictable aid:

They show how unpredictable such aid flows are. The paper finds that the average absolute difference between aid promised and aid given was equal to 3.4% of each sub-Saharan African nation’s GDP between 1990 and 2005.

The paper is pretty interesting. It reiterates the difference between volatility and unpredictability; volatile-but-predictable aid (eg lumpy payments for a large infrastructure) is rarely destabilizing and is not problematic. It also reminds us of the positive reasons why we might want aid to be unpredictable (eg because project implementation is slow or because the government’s commitment to poverty reduction becomes uncertain) which they distinguish from negative reasons for unpredictability, such as bureaucratic delays, changes in donor political climate, or fickle interpretation of conditions.

The empirical findings are pretty striking. On their samples:

• on average annual aid disbursements deviated by 3.4% of GDP from aid commitments in sub-Saharan Africa (there is a trend decline in this deviation, to 2.8% in recent years, but it is still a massive economic disruption to a country to have that degree of unpredictability)
• no all unpredictability is a shortfall: sub-Saharan Africa received on average 1% of GDP more aid than was committed;
• up to 40% of the variations can be explained by changes in country circumstances; the remaining 60% is unexplained (the authors’ hypothesis is that this unexplained component is fickle donor behaviour such as administrative delays)
• budget aid disbursements fall short by about 1% of GDP from projections, representing about 30% of budget aid promised on average. Budget aid is less predictable than local tax revenues.
• Governments adjust to budget aid shortfalls by accumulating more internal debt and reducing investment spending; the losses in investment spending are not reversed in good times: budget aid windfalls lead to higher government consumption and some reimbursement of domestic debt. Thus the overall consequence of unpredictable budget aid is increased government current spending and reduced government capital spending compared to providing the same amount of aid predictably;
• if you believe (with Easterly etc) that public investment is positively and reliably correlated with long-term growth, then this means that lack of predictability of budget aid has a quantifiable and significant negative impact on long-term growth and poverty reduction.

I was struck that budget aid appears to be more predictable than other aid (though still woefully unpredictable). The mean absolute deviation in budget aid (1% of GDP, using the IMF projections) is much lower than the mean absolute deviation in overall aid (3.1% of GDP, using the DAC data). This is contrary to the conventional wisdom, which is that budget aid is more unpredictable than projects.

I also thought that Celasun & Walliser underestimate the harm done by unpredictability of budget aid. They focus on the resulting shift from government investment to government consumption, which may have costs (though I do not entirely share the fetish for investment over consumption). The costs of unpredictability go much wider: for example, within current expenditure, predictable aid could be used to restructure public service wages; whereas unpredictable aid is more likely to be used to buy in consultants to fill the gaps. There are also macroeconomic costs that are not included here (for example, higher borrowing leads to higher government interest payments, and also to higher interest rates which crowd out private investment). The agencies that give this unpredictable aid would complain like mad – and rightly so – if they did not have predictable budgets from their own Treasuries; so why would public services in developing countries be any different?

For the purposes of this paper, “predictability” is defined in a short-term sense (the gap between commitments for a given year, 0-6 months ahead, and disbursements that year). It is clearly a huge problem that in-year disbursements deviate from commitments by as much as 3% of GDP on average, and it is a problem which donors should do something to fix. But there are other dimensions of predictability – such as the ability to budget 3 or 5 years ahead – which may be just as important, or more so, and which are not discussed in this paper. My belief is that 3-year commitments which are sufficiently solid to be programmed in the budget are worth much more to developing countries than ten-year partnership agreements which are insufficiently reliable for them to be able to programme; if so, we should be emphasizing firmer commitments rather than longer time horizons.

While short term (in-year) unpredictability is a serious problem, the best solution to this may not lie in persuading donors to behave better (on which we have achieved little) but in helping to promote institutions that could help developing countries to smooth out the flows. This might take the form of insurance markets or mutual pooling arrangements, as well as improving access to financial markets. It may also be worth exploring the idea that donors could establish escrow accounts (“bathtubs”) through which aid would flow. Tackling medium term predictability, by contrast, probably does require changes in donor behaviour.

And finally, as you would expect, I strongly agree with Celasun & Walliser in highlighting the importance of greater transparency of aid data.

A paper by Princeton academics says that:

It would be preferable for government to understand providing reusable data, rather than providing websites, as the core of its online publishing responsibility. Rather than struggling, as it currently does, to design sites that meet each end-user need, we argue that the executive branch should focus on creating a simple, reliable and publicly accessible infrastructure that exposes the underlying data. Private actors, either nonprofit or commercial, are better suited to deliver government information to citizens and can constantly create and reshape the tools individuals use to find and leverage public data.

The paper goes on to say:

Rather than struggling, as it currently does, to design sites that meet each end-user need, it should focus on creating a simple, reliable and publicly accessible infrastructure that exposes” the underlying data. … Data should be available, for free, over the Internet in open, structured, machine-readable formats to anyone who wants to use it. Using “structured formats” such as XML makes it easy for any third party service to gather and parse this data at minimal cost.

This is, fortuitously, exactly what my colleagues and I working on aidinfo – an initiative to improve the transparency of aid information – have been saying. (Temporary website at www.aidinfo.org)

Reference: Robinson, David, Yu, Harlan, Zeller, William P. and Felten, Edward W., “Government Data and the Invisible Hand” . Yale Journal of Law & Technology, Vol. 11, 2008

Hat tip: Power of information blog

Clare Lockhart in Prospect Magazine June 2008 issue 147 (pay firewall):

We would like to tell you the story of $150m going up in smoke,” said the young villager. “We heard on the radio that there was going to be a reconstruction programme in our region to help us rebuild our houses after coming back from exile, and we were very pleased.”

This was the summer of 2002. The village was in a remote part of Bamiyan province, in Afghanistan’s central highlands, and several hours’ drive from the provincial capital—utterly cut off from the world. UN agencies and NGOs were rushing to provide “quick impact” projects to help Afghan citizens in the aftermath of war. $150m could have transformed the lives of the inhabitants of villages like this one.

But it was not to be, as the young man explained. “After many months, very little had happened. We may be illiterate, but we are not stupid.

So we went to find out what was going on. And this is what we discovered: the money was received by an agency in Geneva, who took 20 per cent and subcontracted the job to another agency in Washington DC, who also took 20 per cent. Again it was subcontracted and another 20 per cent was taken; and this happened again when the money arrived in Kabul. By this time there was very little money left; but enough for someone to buy wood in western Iran and have it shipped by a shipping cartel owned by a provincial governor at five times the cost of regular transportation. Eventually some wooden beams reached our villages. But the beams were too large and heavy for the mud walls that we can build. So all we could do was chop them up and use them for firewood.”

My current work is about how we can make aid more transparent, so that this kind of thing does not happen.