Changes to the overseas aid programme risk undermining accountability and effectiveness, writes Phil Twyford .
IT IS Government policy to pursue "trust-based relationships" with the voluntary sector, but overseas aid non- government organisations are wondering why they are getting the sharp end of recent policy changes.
Successive governments, both National and Labour, have pursued a close relationship between our overseas aid programme and NGOs such as World Vision, Save the Children, Oxfam, Caritas, Tear Fund and Christian World Service.
Now the foreign affairs minister has suspended the funding arrangements that channel $26 million a year to projects run by New Zealand NGOs, while officials devise an alternative scheme.
No consultation. No evidence base. No policy analysis. Just the assertion the funding arrangements are out of step with the Government's new aid focus on economic development in the Pacific.
This has created uncertainty for the NGOs and for the organisations in developing countries that implement their aid projects.
Small, often volunteer-run, groups helping some of the poorest people in the world are now wondering if multi-year commitments they have relied on are going to be cut.
The partnership between the Government and aid NGOs has been going for 35 years, based on the notion that a co-operative approach will deliver better outcomes.
NGOs not only raise a significant amount of money from the public (about $145m), but they build public support for aid and are often able to deliver it in countries where it is difficult for foreign governments to work (Fiji being a case in point).
The main NGO funding window has stringent accountability rules and is co- managed by the NGOs and ministry officials. Competition between NGOs ensures they keep each other honest.
When the scheme was reviewed by independent consultants in 1998 and again in 2004, it was found to significantly improve the ability of the NGOs to spend money wisely and run effective aid projects.
The auditor-general's office used it as a case study in its 2006 report on how to manage funding to NGOs.
With development aid, accountability and cost-effective stewardship of taxpayer funds are paramount. But this latest move by the Government is targeting NGOs which are internationally recognised as the most cost-effective providers of development aid.
So what is going on here?
This is an argument about what constitutes effective development aid. The Government wants to use the aid programme to stimulate private sector economic growth and foster support for free trade in the Pacific.
The NGOs, NZAid before it was disestablished, the United Nations, World Bank and most of the Organisation for Economic Co-operation and Development countries take a more expansive view of development. They believe human rights, good governance, protecting the environment and meeting the basic needs of the poor are also important elements in the effort to eliminate poverty, and key components of national security policy.
But the NGOs symbolise all the minister opposes. Murray McCully's decision to abolish NZAid and move aid back into the Foreign Affairs and Trade Ministry, against Treasury advice that it would lead to a loss of accountability, was in part motivated by his belief that NZAid had been captured by the NGOs.
Last year, with no explanation, he cut his ministry's funding of NGO umbrella group Council for International Development by 75 per cent. It is widely believed within the NGO community this was utu for the NGOs' criticism of the abolition of NZAid.
When announcing the latest changes to the NGOs' funding arrangements, the minister said in an interview that "rather too many of these programmes are focused on trade union rights in obscure parts of the world".
SUPPORTING the rights of workers in poor countries might not be Mr McCully's idea of reducing poverty, but his comment does raise the prospect of him vetting aid projects against his own version of political correctness.
It will be interesting to see what funding criteria his officials come up with. From the record so far, it is likely to be economic growth versus human rights and environmental sustainability.
David Culverhouse, of the Council for International Development, says the changes have been made in a way that causes "maximum confusion and maximum uncertainty". "We have no idea what he means to do and, in the meantime, he has paralysed the sector, stopping decision making in areas that are critical, life and death in fact, to small communities and the very urgent problems they're facing."
Accountability and effective development are being sacrificed. No consultation. No evidence base. No policy analysis.
Phil Twyford is Labour's associate spokesperson on foreign affairs and a former executive director of Oxfam New Zealand.
Dominion Post 05-19-10
