Local Accountability and Transparency… During and Post Project?

Jindra Cekan

Local development partners? Check. Long-term transparent and accountable investments through them as “local solutions” partners? Not so much.

While President Obama and former United States Agency for International Development (USAID) Administrator Raj Shah promised up to 30% of all contracts would go to ‘local solutions’ that “promote sustainable development through high-impact partnerships and local solutions”, nowhere near that percentage became true then, much less now. While there seem to be good examples such as Haiti,  Afghanistan is a poorer example. While most international non-profits implement projects through local sub-contractors, certainly building their capacity to manage and account for foreign taxpayer dollars spent, like this MSI in Lebanon example, if we extend the measure of ‘success’ beyond our project implementation, policies and programming needs to change to sustain capacity and implementation post-exit (see INTRAC report).

How local partners are presented can appear as somewhat of a shell game. For while Haiti and Afghanistan have been featured by USAID, I have never seen a full inventory of partners for even a handful of the 60+ countries and regional missions that USAID works in. We hear about ‘local solutions’ and undoubtedly USAID’s ‘implementing partners’ do much good using local subcontractors. Yet are the locals winning the contracts these days? USAID posts contracts lists, for instance those who ‘won’ contracts amounting to $4.68 billion in 2016. The for-profits of Chemonics ‘won’ over $1 billion, then Tetra Tech and DAI got $800 million of contracts each. These three contractors comprised 39% of all USAID obligated contract funding that year, whereas (U.S.) non-profits garnered 13% of the contracts and small and woman-owned businesses 12% and 7%. Only Kenya Medical Supplies Authority, a state corporation, was listed in the top 20, winning a five-year $122 million contract for Kenya.  There are no equivalent sub-contractor lists, much less amounts allocated to national NGOs which would prove we are building ‘development’ ground-up.

While I am focusing on USAID, I believe this is true of most bilateral and multilateral donors. For USAID, caveats abound regarding their ability to accomplish local and sustained ‘development’. A 2015 Congressional Research Paper about their Background, Operations and Issues, cites “multiple challenges in the course of fulfilling its mission”, including:

• Local Solutions. Providing assistance to local entities incurs the risk of loss of taxpayer dollars. Efforts to mitigate risk generally require more personnel and consequent funding to monitor local entities and build their capacities.
• Sustainability. ‘Country ownership’ and domestic resource mobilization efforts are two ways the agency has sought to address sustainability, but a clear path to sustainability remains a work in progress….

For more accurate accountability and transparency for bilateral, multilateral, pro-profit and non-profit implementers, we must look within data underlying the ‘development’ allocations abroad.

For instance, the US government’s country-level foreign appropriations overall budget for 2017(see Table3a) shows that $36 billion funded a variety of branches of the US government’s ‘development’, it would be instructive to see what the amounts of the funders’ award contacts which would be broken down into: what % went to implementers, what % went to national governments or local contractors, and what % was directly used for our participants. Maybe this is a new aspect the industry-standard Charity Navigator can add to its existing Accountability and Transparency criteria. On my repeated wish list for them is to show evidence the nonprofit is systematically doing and learning from post project sustained impacts evaluations. I first asked this 5 years ago.

While I am scratching the surface, at least one private sector Corporate Social Responsibility company seem to have more transparent systems. This balance sheet from Abengoa, a sustainable energy technology company, could be updated with such a breakdown.

Their website also talks about its 25-year CSR investments (which is an enviable timespan, for most donors have 1-5 year projects). “Abengoa believes that the good relationship it has with local communities, as well as respect and development in the areas where it operates, reaps benefits, referring to this method as “social licence to operate”. Abengoa’s social engagement aims to further the social and cultural development of the communities where they operate. From 2014 to 2016, the company reported its social performance in line with the criteria proposed by the London Benchmarking Group (LBG) methodology. This model defines a method to measure, manage, assess and disclose contributions, achievements and impacts of the company’s social engagement with the community….”

Their website also describes current events. “A flagship initiative of the company is the PE&C (People, Education and Communities. Committed to Development) programme.… is now present in nine countries (Argentina, Peru, Brazil, India, Mexico, Chile, Spain, Sri Lanka and Morocco), [but] currently, the complex situation that the company is undergoing and the severe limitation of financial resources in recent months has meant the gradual and temporary reduction of the contributions made to social projects in the different regions. As part of the restructuring plan agreed with creditors and in order to limit the social engagement items based on the resources available in the different business units, each company has assessed its capacity to fund social development projects, maintaining, in some cases, their commitment to certain local social projects. In an effort to avoid the negative impact on these communities and disadvantaged groups, the company has worked hard to find partners and collaborators who could provide continuity to these projects until Abengoa can recover a solid economic position that allows it to continue working and giving support to them” [which their Press Room tells us they have in 2018].

Sharing “achievements and impacts of the company’s social engagement with the community”, “find[ing] partners and collaborators who could provide continuity to these projects” is not often done in bureaucratically time-fixed global development. For too rarely do the fixed timelines andbudgets, inflexible metrics and demanding deliverables enable true partnerships. Save the Children’s 2008 brief on aid modalities for country ownership includes a vital point, which is willingness. “The United States lags behind other donors in its willingness to use all the aid mechanisms that would build capacity, such as channeling aid through host countries’ systems”, including where only “1 percent [of aid] was passed through projects directly implemented by the host government.” At least US funds were aligned with national government priorities in Bangladesh, Ethiopia and Malawi and in Liberia the US partnered with UK’s DFID for community infrastructure. Nonetheless, even aid to governments must be as locally transparent as possible for true accountability.

Local NGOs are a key actor in holding host governments accountable for the delivering meaningful results, and should increasingly be an importantlink between government and community through communications and provision of services…

So why aren’t we funding more? We don’t know, don’t much data how well we are, but unless we start with accountability to the country nationals we are ostensibly‘developing’, sustained success will not ensue.

The scant number of post project sustainability evaluations have shown how rarely our international donor funded partners return to partners and participant communities to see what they could self-sustain after our projects ended.  So much for accountability to our true clients! Public and private sector needs to turn away from being data extractors aiming at short–term results, and rather turn to being led by sustained partners’ priorities and myriad voices. Private sector companies may have lessons to teach, for would they stay afloat if its investors did not learnhow well their product worked by not returning to ask after the sale assess client satisfaction?

We don’t have a moment to waste.

Thoughts? Questions? Look forward to your comments.

PS – There are surely 500 sources I didn’t find in time to include, including this blog regarding Cambodia and aid, huge numbers of organizations focused on capacity building and also thanks to Abu Ala Mahmudul Hasan for a Pelican online discussion that spurred this. We hope to create a podcast this spring, so stay tuned…