Making the link: from managing finances to providing services

At a World Bank governance conference last week, I was surprised to find that there is relatively little knowledge on how public financial management affects service delivery. Advice and assistance to public financial management is largely considered one of the Bank’s successes in recent years. Unlike, programmes supporting large scale public sector reform, which have generally not had impressive results, assistance for improving financial management has been fairly effective. Yet, how such improvements in financing affect the quality of the services they fund is not really understood.

In recent weeks, I’ve been looking at the challenges of reforming healthcare, and in this the system for financing healthcare is very important. Donor sponsored systems for payment by results are particularly popular and have been shown to really raise the quality and accessibility of healthcare by using financial incentives. However, I would argue that this does not provide a long-term solution. For example, using financial rewards to encourage healthcare staff to turn up to work or change the way they treat patients is not sustainable if it relies on donors always providing the money. Rather, I think that understanding what else motivates and constrains the way health workers behave is more important for really improving healthcare services.

I believe we need to look beyond money to the many other pressures which health workers are likely to face. For example, having attentive supervision from senior staff members may give a sense that their work is important and so be a motivating factor. Or, unhelpfully, demand from patients for antibiotics and more technical treatment may push health workers to prescribe unnecessary medication. Recognising the non-financial pressures which shape behaviour is crucial for understanding how and why healthcare workers do their job but I’m not sure that social and cultural incentives receive the attention they deserve. Analysis of incentive structures seems to focus more on financial or political gains without enough consideration of factors outside the regular political science field.

Having spent some weeks reviewing how donors try to support public sector reform and service improvement, I am convinced that we do not think broadly enough about how a public service functions. Drawing on knowledge and theory from other fields, such as organisational management, psychology, and anthropology could be really useful for better understanding how service provision could be improved. I think that it’s time we looked beyond the international development literature and integrated more learning from other disciplines. Combining expertise on many subjects should, I believe, help us to join up the dots from budgets and finance to behavioural norms, and so support better functioning public services overall.

Daring to fund creativity

It seems like everyone is talking about innovation at the moment. It’s not just the development world which thinks we need new ways of doing things, austerity in the UK has led to pressure on the government to innovate. In the UK, this has basically meant doing more with less – by pooling resources, streamlining services, and encouraging people to help out with delivering public services (the Big Society etc.). The severe cuts to public funding have forced government to find new ways of providing public services. While the cuts have been (and continue to be) extremely harsh in particular areas, austerity has at least pushed people to think differently about how public services work.

So, in the development field how can development practitioners and donors also be encouraged to think differently about public sector improvements? The BRIC countries are not facing the same spending constraints as many Western economies and so low- and middle-income countries need to be able to develop solutions according to their own context. Recent development thinking has called for ‘development entrepreneurs’, who are people with a strong understanding of the politics and economy of a country and who can work creatively to solve particular problems.

However, Pritchett et al. talk about ‘capability traps’ which suffocate innovation in developing countries. There traps occurs when bureaucracies are incentivised by aid to replicate ‘best practice’ forms of government funded by donors. Beneficiary governments may appear to have followed donor advice on how to reform their public sector but often new organisational forms are created without changing enough for the intended outcomes of reform to be produced. Pritchett et al. also talk about how donors place high demands on developing countries to rapidly transform their public sector which overburdens the existing system, reducing its ability to manage problems and develop solutions. In short, developing countries are swamped by donors funding huge public sector reform programmes based on ideas which have been developed in other country contexts.

It’s easy to criticise but faced with the complex challenge of supporting a country to improve its public sector, it’s unsurprising that donors look to support forms of government which are seen to function in other places. This seems like the safest option, especially when a donor is accountable to tax payers. But, given the general lack of success in supporting public sector reform, allowing countries to experiment and develop their own solutions is increasingly seen as the new way forward. Of course, there has to be the will to solve problems on behalf of the national government first, but assuming there is some motivation for improvement, donors are in a unique position to fund innovation. The UK government is funding innovation in its own government so why not take the same risk and fund innovation elsewhere too?

It’s a question of daring to experiment, taking a venture capitalist approach to development where donors expect some things to fail but understand that continuing to fund the same approaches to development is far more likely to be a path to disappointing results. Finding new ways of supporting public sector reform and delivering services calls for imagination and experimentation, and donors’ role in this should surely be to fund creativity.

 

Means or ends? Form or function…? What really matters?

When it comes to new thinking on governance and progress, there is a commonly recurring theme of ‘function over form’. What this means is that a system of governance is valued for the quality of services it offers and the improvements it generates, rather than the nature of the organisations which carry out the work. So, it is now more widely accepted that human development outcomes, such as lower maternal mortality and higher primary school attendance rates can be achieved by non-democratic, unrepresentative governments. It may take a while for western governments to openly admit it, but democracy is not necessarily (or usually) the first step to poverty reduction. Actually, it probably never is.

It’s very tempting to try to find a common path which all countries have followed as they have developed but there does not seem to be a nice step-by-step guide to development. Instead, focusing on what on what can be achieved with the means available is becoming a more popular (and realistic) approach. This is ‘best fit’ instead of ‘best practice’; prioritising the outcomes a government achieves over the way in which it achieves them.

This can be interesting if we consider women in leadership. Following the last post about women’s empowerment in Tunisia, to what extent did women entering government mean more progressive government policy? Of course, there is a risk of drowning in normative words like ‘progressive’ but, in general, does enabling women to occupy positions of power, have a positive effect on development? An immediate reaction might be to assume it does. It seems logical that gender inequality issues, such as lower rates of education, employment, pay etc. for women are more likely to be addressed if more women have an influence over government policy.

However, increasing the number of women in leadership, while often a development objective, does not necessarily support gender equality. You can look to the tea party movement in the US or the presence of female religious fundamentalists in Tunisian government as examples. While women being in positions of power may seem like an indicator of progress, nothing can be taken for granted. The question is whether the development community should support more women entering leadership for its intrinsic value of equal opportunity, or whether support should be focused only on changes which result in more tangible development outcomes?

This is not a real decision since most people could accept that both are important but it does force us to question what we consider development to be and why. It is almost impossible to move away from values of equality and justice when discussing development, and any notion of ‘progress’ will be subjective, no matter how it is defined. This isn’t a problem though as long as there is honesty too. It seems fair to celebrate better healthcare and education in Rwanda, just as it is to be glad that Tunisian women can join political parties. Being explicit about what we value is what matters because development is always going to be messy.

Women’s empowerment – a by-product of political bargaining?

I’ve recently been struck by just how important the fight for political power can be for many aspects of development. What drives a political party to implement a particular policy? Usually political incentives; pleasing voters, strengthening the party’s alliance against the opposition, improving international ties, or another way of consolidating their position of national power. Of course, the desire to stay in power, whether in a democracy or not, does not necessarily lead to pro-poor, sustainable, equitable (etc.) policy-making.

But sometimes it does. Take, for example, women’s empowerment in Tunisia. A case study I’ve been working on this month has found that since Tunisia’s independence in 1957, women’s rights and freedoms have gradually improved as subsequent governments reformed social policy to encourage all children (boys and girls) to go to school, gave women far more control over fertility, and allowed women to work and participate in government. These policy reforms, along with others, have led to Tunisian women today having far more freedom and power than women in the other North African countries.

The important question is why did the various Tunisian governments bring in these reforms? Out of a strong concern for gender equality? Not necessarily. Most of the key policy changes appear to have been fuelled by one of two political pressures. One was the recurring need for the party in power to strengthen its alliance with other progressive groups against the threat of the Islamist opposition. The other was the need to improve economic growth to maintain the political support of the business community. Tunisia has a service-based economy, reliant on a skilled and healthy population and so investing in education, health, and fertility control was important for economic growth.

Women’s empowerment seems to have occurred as a by-product of this political bargaining. For example, investing in public education and healthcare meant that women and girls were now freer to go to school and go to work. Likewise, in the ‘80s when the Islamist opposition grew strong and threatened the ruling party’s grip on power, the regime of the time sought an alliance with women’s groups for which the religious fundamentalists were also a threat. As a result of this alliance, women’s groups gained a stronger role in government and women’s status in the public sphere grew. As more women have accessed education, employment and public office, so their power to demand equality has grown, and women’s participation in life outside the home has become slowly more socially acceptable.

Yet, what does this say for development? The Tunisian case made me think a few things:

  • development outcomes don’t require a democratic government, just a ‘favourable’ political settlement. And this can change. Advances in Tunisian women’s rights waxed and waned as the political arrangement shifted from religious fundamentalist to more progressive. Settlements, policies, rights, ‘development’ are vulnerable to change and can always be reversed;
  • religion (and its importance to national identity) has a strong influence on political parties and elections in ‘developed’ as well as ‘developing’ countries (thinking about the links between religion, political parties, and gay rights in the UK, for example); and
  • the economy seems to always be at the root of it all. Had the Tunisian elite relied on their own control of a lucrative natural resource for their power, rather than the support of the wider business community who wanted to trade with Europe and who needed a skilled workforce, maybe there would not have been such investment in public health and education. But since wealth creation required ordinary Tunisians to go to school and work, it was in the elite’s interest to implement pro-development policy.

I am perhaps being overly cynical and I definitely oversimplifying things but, for me, a clear question emerges: if political settlements at the top are so influential, how can these be shaped so they produce development-friendly outcomes? Again, the challenge of working politically and all within the constraints of international politics, donor requirements, and public scrutiny…

Behaving like a politician

Having let my blog lie dormant for a while, I feel the urge to start sharing my ideas about development on the blogosphere again. I’ve just started a new job as a researcher at the Overseas Development Institute (ODI) which is inspiring me a lot! This blog is of course my own thoughts and not a reflection of ODI’s work.

So, this post has come from reports I’ve been reading about how aid can work politically. It’s a well-discussed topic at the moment, following lots of excitement about ideas from people like Matt Andrews, Lant Pritchett, and Michael Woolcock, and the Africa Power and Politics Programme on the importance of politics to development. However, it’s one thing to talk about how politics affect the quality of public services, and another to find a way for large aid donors to support a change in politics in another country. Working politically is inevitably a sensitive and difficult task for international donors as they face scrutiny and criticism for failing to respect a country’s sovereignty or creating harmful political unrest. But, case studies are emerging of how donors have managed to engage with the politics of a country to bring about really significant improvements.

One much celebrated example is a case in the Philippines in which a team of activists, assembled and guided by Jaime Faustino of The Asia Foundation, managed to get a law on Residential Free Patents pushed through government. This legal reform directly and quickly led to a 1400% improvement in residential land titling which had really important development implications for the Philippines. But, rather than discussing the law itself, I’m going to talk about how aid money was used to support this huge legislative change.

To bring about the reform, Jaime and his team effectively worked like politicians; drawing on their connections in business and politics to form alliances, negotiating details of the reform, and finding ways around the opposition. The funding the team received was (relatively) free from the usual strict donor demands and so the team had the freedom to be inventive, changing their strategy as different opportunities arose. The team were also a mixed bunch; coming from different sectors and backgrounds, each with their own networks, and all personally driven to see the policy changed (at times even working unpaid).

The Philippines case brings up all sorts of really interesting questions but here is just one: how does a large, publically accountable, aid donor go about recruiting people to work as development activists in the murky world of politics? The team in the case study were not motivated by money (there was no ‘per diem culture’) but instead were personally motivated to see the reform passed and enjoyed having autonomy over their work. They worked nimbly, rather than following a standard workplan and, crucially, they were problem-solvers, not just problem-analysers. Recruiting the right people seems to have been a large part of the success story.

Working in a politically cunning way does not necessarily come naturally to the average development officer who is used to plans, reporting, accountability, and transparency. All those things demanded by the (now criticised) good governance agenda. Finding people who are ‘intrinsically motivated’ (essentially ‘do-gooders’) but who are also comfortable making friends with unlikely people; police chiefs, senior staff in multinationals etc. (more on this in my next post) is a challenge. For donors to recruit and fund people to work in this way, they may need to relax the way they hire, sub-contract, and manage their programmes. Donors need to trust small teams to work creatively, at a distance (and somewhat sneakily) so that they can work politically. This is because, ultimately, working politically may mean working like a politician.

The power of local government?

I’m beginning to think that working on local governance accountability in Burundi might be jumping ahead a bit.  While some of the NGO projects really do improve local government transparency and accountability, this is definitely not the greatest problem in the provision of local public services.

Burundi has undergone a process of decentralisation in recent years which has left local government almost entirely financially independent from the central government. This means that local government funds only come from local taxes and it’s only people who have a regular salary or an established business who pay local taxes.  In most areas of the country, the vast majority of the population don’t pay taxes because they are peasant farmers or have a very small informal business.  Consequently, the major problem most local government offices here face is a severe shortage of funds.

Since there’s very little public money, if a local government wants to construct any public service infrastructure, such as a school, a road or a water source, the local community has to provide most of the building materials as well as free labour while the local government provides materials for the roof, for example.  Communities are meant to have a strong sense of responsibility for their own development since if they would like another classroom in the primary school, they have to make the bricks and build it themselves. While this may mean that people take responsibility for maintaining public amenities, it also means that local development is a very slow process and there is little hope for supporting the very poorest in society.

So, given the virtual absence of the national government in local development, it seems important that NGO projects continue to work on building the capacity of community organisations and local government staff as well as supporting closer collaboration between the two.  However, given the blatant lack of funds to invest in basic public infrastructure, it seems equally, if not more important, to work with national government to ensure much greater financial support for local development.

And on a completely unrelated note… last weekend I experienced a Burundian wedding!  I had been warned not to get too excited but I was curious all the same.  The church service was not unusual but the reception was something else.  It was held in a large room with a sort of stage at the front for the families of the bride and groom while the (hundreds of) guests sit in rows of chairs facing the stage as though it were a concert.  Once everyone is seated, the guests are offered a warm (!) or cold beer or soft drink and then the speeches begin.  The speeches began at 5pm and 8pm we left to get some food only to return at 10pm and find that the ceremony was still going.  Things were a little more lively by then as the local beer had been brought out and there was some kind of singing competition but really, Burundian weddings are not exactly a party…

Going with the grain

There has been a spurt of blog posts this week about going with or against the grain when it comes to development interventions (see Governance and Development blog and From Poverty to Power ). The basic idea is that rather than pursuing good governance ideals such as democratic participation, it may be more effective to work with existing governance structures and cultural norms to find incentives for the political elite to invest in sustainable national development. For example, in Senegal where secular state schools are unpopular, the state has worked with the Islamic community to provide new schools which teach the national curriculum but which also meet parents’ demands for the inclusion of Islamic norms.

On a local level, one of the projects which I am studying here in Burundi also follows the notion of ‘going with the grain’. The project aims to improve local governance and healthcare by forming a village network composed of representatives from different community organisations along with the elected village leaders and the Bashingantahe (local “wise men”).  An NGO provides training to this network of leaders on the subjects of health and hygiene practices, conflict resolution and how to seek external assistance. The idea is that the community representatives then pass on what they have learnt to the other members of their associations.  This should mean that the community’s health and social relations are improved through increased knowledge and collaboration between community groups.

On the one hand, it makes sense to strengthen the existing power structures by focusing the training on the current leaders because they can use their influence for the benefit of the community. The project should also make the community organisations more effective by uniting them to work on the same issues.  Interestingly, it has also been found that by bringing the elected leaders and community organisations together, the elected leaders have gained more power and recognition in the community. Before, for example, when an elected leader called a community meeting, only a few people would turn up but now, the majority of the village turns up because the leaders are better connected with the community.

However, as I discussed in an earlier post, not all the local leaders are good leaders. Some don’t show respect for women or youth or give them space to speak even when they have been chosen as community representatives. Therefore, reinforcing the position of these leaders without addressing problems of power imbalance between different social groups may mean that poverty, particularly among women continues to be reproduced. Unless women gain a voice in decision-making and a higher status in society, traditional rules which, for example, prevent women from having land rights, are unlikely to change.

So, it seems to me that “going with the grain” can be an important first step in development interventions and that it can improve the capacity of leaders to work for their community. However, if longer term changes are to occur whereby public policy is changed so that it effectively addresses the needs of the poorest, I think that problems of power imbalance in governance and community structures must still not be ignored.

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