Too many advisers spoil aid programs
JOSEPH GROSSMAN
Australian aid to Papua New Guinea is on the agenda during the visit by Foreign Minister Stephen Smith to the country this week.
Recent debate in the Australian media on the role of Australian aid advisers, particularly in Papua New Guinea, has raised concerns regarding their large number, excessive remuneration and questionable effectiveness. The use of advisers to build targeted capacities in recipient countries has become an integral AusAID strategy. It is estimated that more than 50 per cent of the AusAID budget for PNG, Solomon Islands and the Pacific finances aid advisers. Most of these are long-term Australian advisers who spend, on average, 18 months to two years in the assigned country. Many are Australian government employees who are "deputed" to serve in the Regional Assistance Mission of the Solomon Islands (RAMSI), or in PNG's Expanded Co-operation Program (recently renamed Strongim Gavman Program).
Placement of Australian public servants in Pacific government positions raises questions regarding their ability to transfer relevant skills in a sustainable and culturally appropriate manner – skills and experience they are not required to have for their Australian positions. The enormous salary discrepancies between these expats and their counterparts are also an issue of concern.
Most advisers are typically charged with capacity development – a rather nebulous term for which monitoring indicators remain ambiguous and accountability questionable.
Simply going by the number and cost of advisers devoted to PNG and Solomon Islands in the past decade, this strategy is largely a waste of public monies. Both countries remain deeply mired in their inability to manage key functions of government efficiently and effectively on their own despite the huge investments in advisers. The Pacific has been the beneficiary of more than $17 billion in Australian aid in the past 25 years (along with billions from other donors such as the World Bank and the Asian Development Bank). Yet, almost all Pacific countries still lag behind the developing world on their Millennium Development Goals indicators.
However, behind this issue of advisers lies the larger question — what really should be Australia's approach to aid in PNG and the Pacific? Is the strategy of designing large, costly, adviser-heavy programs really appropriate?
The evidence indicates that these programs have failed to effect sustained improvements in the performance of target institutions proportional to their level of investment.
The problem lies in the way AusAID approaches the design, and methodology employed in these programs. Typically an army of expat-dominated consultants is fielded for six to 12 months to lead program design.
Effective aid is about helping key institutions (at national and local levels) in recipient countries improve their operating behaviours, efficiencies and effectiveness. Logically, this would demand that local leadership is not just involved but actually leads the design of a change management program. Who better to know what is going wrong than local management? It is their knowledge of the local situation and their commitment to change that should always lead the design of these programs — rather than expat consultants.
A second issue with regard to the design and implementation of these programs is their size. Typical programs for PNG, Indonesia and Solomon Islands are designed for three-to-five-year terms, costing many millions of dollars, often fielding an army of 20 to 40 advisers per program.
AusAID prefers this approach for various reasons. It moves out money in large chunks, provides predictability of budget disbursements and makes these large contracts attractive to major commercial contractors. AusAID hands over management for these programs to contractors for an attractive fee, thereby simplifying AusAID's own administration responsibilities.
The result is that large contractors essentially become "body-shops". They rarely have staff with the range of skills to address the requirements of the large programs they bid on. So they literally shop around for technical expertise and hire consultants on the open market on the basis of CVs. Not always the best way to ensure quality service.
The distressing fact is that the government has this year increased its aid budget from $3.8 billion to $4.3 billion. This will increase the pressure on AusAID to push out more money through large programs, despite past questionable results.
Finally, AusAID designs often lack clear performance measures nor does it identify who is accountable for end results. While it may be true that establishing effective performance indicators for capacity strengthening programs is challenging, this does not absolve program designers of achieving measurable outcomes. The focus needs to be on outcomes and impacts, whereas advisers typically focus on short-term outputs – performance measures need to address this discrepancy.
In effect, AusAID designs are inadequately informed by basic managerial theory. Factors of leadership, local culture, absorptive capacity, phased design and transparent accountability are regularly ignored. The programs are externally driven, externally financed, often well beyond local capacity and recurrent cost realities, and usually alien to local culture.
While the number and quality of advisers is of legitimate concern, the fundamental problem is the way AusAID designs and implements its programs, and the extent to which commercial contractors can and should be held accountable for development results.
Australian aid to Papua New Guinea is on the agenda during the visit by Foreign Minister Stephen Smith to the country this week.
Recent debate in the Australian media on the role of Australian aid advisers, particularly in Papua New Guinea, has raised concerns regarding their large number, excessive remuneration and questionable effectiveness. The use of advisers to build targeted capacities in recipient countries has become an integral AusAID strategy. It is estimated that more than 50 per cent of the AusAID budget for PNG, Solomon Islands and the Pacific finances aid advisers. Most of these are long-term Australian advisers who spend, on average, 18 months to two years in the assigned country. Many are Australian government employees who are "deputed" to serve in the Regional Assistance Mission of the Solomon Islands (RAMSI), or in PNG's Expanded Co-operation Program (recently renamed Strongim Gavman Program).
Placement of Australian public servants in Pacific government positions raises questions regarding their ability to transfer relevant skills in a sustainable and culturally appropriate manner – skills and experience they are not required to have for their Australian positions. The enormous salary discrepancies between these expats and their counterparts are also an issue of concern.
Most advisers are typically charged with capacity development – a rather nebulous term for which monitoring indicators remain ambiguous and accountability questionable.
Simply going by the number and cost of advisers devoted to PNG and Solomon Islands in the past decade, this strategy is largely a waste of public monies. Both countries remain deeply mired in their inability to manage key functions of government efficiently and effectively on their own despite the huge investments in advisers. The Pacific has been the beneficiary of more than $17 billion in Australian aid in the past 25 years (along with billions from other donors such as the World Bank and the Asian Development Bank). Yet, almost all Pacific countries still lag behind the developing world on their Millennium Development Goals indicators.
However, behind this issue of advisers lies the larger question — what really should be Australia's approach to aid in PNG and the Pacific? Is the strategy of designing large, costly, adviser-heavy programs really appropriate?
The evidence indicates that these programs have failed to effect sustained improvements in the performance of target institutions proportional to their level of investment.
The problem lies in the way AusAID approaches the design, and methodology employed in these programs. Typically an army of expat-dominated consultants is fielded for six to 12 months to lead program design.
Effective aid is about helping key institutions (at national and local levels) in recipient countries improve their operating behaviours, efficiencies and effectiveness. Logically, this would demand that local leadership is not just involved but actually leads the design of a change management program. Who better to know what is going wrong than local management? It is their knowledge of the local situation and their commitment to change that should always lead the design of these programs — rather than expat consultants.
A second issue with regard to the design and implementation of these programs is their size. Typical programs for PNG, Indonesia and Solomon Islands are designed for three-to-five-year terms, costing many millions of dollars, often fielding an army of 20 to 40 advisers per program.
AusAID prefers this approach for various reasons. It moves out money in large chunks, provides predictability of budget disbursements and makes these large contracts attractive to major commercial contractors. AusAID hands over management for these programs to contractors for an attractive fee, thereby simplifying AusAID's own administration responsibilities.
The result is that large contractors essentially become "body-shops". They rarely have staff with the range of skills to address the requirements of the large programs they bid on. So they literally shop around for technical expertise and hire consultants on the open market on the basis of CVs. Not always the best way to ensure quality service.
The distressing fact is that the government has this year increased its aid budget from $3.8 billion to $4.3 billion. This will increase the pressure on AusAID to push out more money through large programs, despite past questionable results.
Finally, AusAID designs often lack clear performance measures nor does it identify who is accountable for end results. While it may be true that establishing effective performance indicators for capacity strengthening programs is challenging, this does not absolve program designers of achieving measurable outcomes. The focus needs to be on outcomes and impacts, whereas advisers typically focus on short-term outputs – performance measures need to address this discrepancy.
In effect, AusAID designs are inadequately informed by basic managerial theory. Factors of leadership, local culture, absorptive capacity, phased design and transparent accountability are regularly ignored. The programs are externally driven, externally financed, often well beyond local capacity and recurrent cost realities, and usually alien to local culture.
While the number and quality of advisers is of legitimate concern, the fundamental problem is the way AusAID designs and implements its programs, and the extent to which commercial contractors can and should be held accountable for development results.
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