It reminds me of a joke that we had in Malawi about the proliferation of useless (and often fraudulent) NGOs – we talked about the NGO TWACIB, which stood for “Two wankers and a computer in Blantyre.
On a recent trip to London I was taken aback by the widespread view that small NGOs are more effective than large NGOs and official aid agencies because they don’t have bloated bureaucracy and they are closer to the beneficiaries. That is not the general perception here in Ethiopia, where people regularly bemoan the proliferation of small NGOs. These organisations tend to have high overhead costs in proportion to their programme (each needs a Director, an office, drivers, etc). Many of them have to spend a disproportionate amount of time and effort raising money. These costs are spread over small programmes with modest impact. Of course, some are very innovative and successful, and they design programmes that should be taken to scale (but all too rarely are).
According to local newspapers, there are roughly 3,800 NGOs here in Addis Ababa, spending roughly $1.5 billion a year between them. The Government’s annual health budget is roughly $300m a year, and it is impressively effective. If there were 20% fewer NGOs, and the money went to the Government instead, health spending by Government could double and there would still be too many NGOs.
If the aid world were more business-like, there would be mergers, acquisitions, takeovers, and bankruptcies, which would naturally cull the proliferation of small organisations. The most successful organisations would grow, or become part of an established organisation, while unsuccessful and inefficient organisations would either be taken over or would be allowed to fail. In the absence of any of effective evolutionary pressures, the NGO world remains a pool of tadpoles.
A friend of mine is the country director of a small NGO based here in Ethiopia. She thinks that what they do is worthwhile, but that they are far too small to be a cost-effective way to help people. Ideally she would like the work she does to be taken over and absorbed into a larger organisation; but there is no way in the aid industry for this to happen.
I’ve got nothing against NGOs, big or small. But there is nothing in the system that pushes NGOs (or indeed official aid agencies) towards being the right size; and there is nothing that weeds out the ineffective organisations. And so we should not be suprised that as well as many very effective organisations, there are a lot that are far too small and ineffective.