Aid effectiveness for whom? (part 2)

12 April 2011

By Marc Purcell, Executive Director of the Australian Council for International Development (ACFID)

Part 1 of this blog can be found here.

Three examples: Indonesia, Burma and the Solomon Islands
Civil society in all its manifestations is a critical component to human development and essential part of human freedom. In Indonesia, student and CSO agitation led to the fall of the declining Suharto dictatorship in the wake of the 1997-98 Asian economic crisis. Since then there has been an explosion in the variety of civil society organisations and social service providers and a more vibrant media. This forms a critical social component of the stable, prosperous middle-income country that has emerged today.

So, do Australian aid policy-makers recognise the essential role of Indonesian civil society and seek to foster it as a compliment to the bilateral aid given? To some extent, they have begun to—with funding to Islamic social service organisations— but a coherent approach to CSOs is still wanting as AusAID staff are often too stretched to liaise with civil society or Australian NGOs and their partners in Indonesia.

In authoritarian states, such as Burma, changes in the ways citizens are organising are often disguised by the overt conflict or stasis at the national level. In Burma it is estimated that there are over 214,000 CSOs assisting citizens with a multitude of social needs at a local level.  In the wake of Cyclone Nargis in 2008, it is argued by some that the unofficial assistance flowing into the country from the diaspora, and outreach of indigenous organisations, equalled official donors’ programs. CSOs have developed and proliferated in the twenty two years since the failed 1988 democracy uprising and the collapse of the previous military dictatorship. Can donors like Australia factor in strategies to support this trend and foster greater human development in coming decades?

In the Pacific, and as an example the Solomon Islands, the role of churches as CSOs serves to further highlight the importance of community organisations in effective aid and development. The mainline churches’ involvement in education and health service delivery is significant throughout the Pacific. In the education sector, both formal and non-formal, churches provide about 27% of educational services, and in the health sector they provide about 13%.

These short examples highlight that the role of civil society in achieving development outcomes for the poor cannot continue to be considered peripheral by the Australian government’s aid program.

What does all this mean for the AusAID scale-up?
The premise that foreign aid is an effective tool to reduce poverty via support for economic growth in developing countries is under increasing pressure globally. The need to better demonstrate the positive impact of Official Development Assistance (ODA) on poverty reduction has re-emerged following the impact of the global financial crisis on developed countries, the patchy progress of fifty years of investment in economic growth in low-income countries, new security risks, continuing governance and corruption issues in aid recipient nations, and calls for greater emphasis on the benefits of trade and private investment.

We warn against defining effectiveness and efficiency from the point of view of domestic media concerns and that contractual risk alone is self-defeating, and will lead to a loss of confidence in the aid program by the Australian public.

We also argued to the Review Panel that a better frame for measuring our work is not just increases in income, but also the reduction of inequality and insecurity over time, and this can be best assessed against objectives and accepted benchmarks in the Millennium Development Goals and internationally agreed human rights standards.

Finally, ACFID believes that Australia must redefine the core objective of the aid program to one of assisting developing countries to reduce poverty and achieve sustainable development, as has been recommended in previous reviews of the aid program. This will focus the program on effectiveness in the longer term, and make it more resistant to attempts to harness ODA to other government foreign policy or defence goals without reflection or evaluation of human development impacts. Only then will a clear message about Australian aid effectiveness emerge.

These issues are also critical to the review of the Paris Declaration and Accra Agenda for Action that will take place at the High Level Forum in Busan at the end of 2011.

This post is based on the ACFID submission to the Aid Review Panel. ACFID is the peak council for 70 Australian not-for-profit aid and development agencies, and the regulator of the ACFID Code of Conduct. Image by Flickr user Horia Varlan.