All 3 entries tagged International Development

Using specific–purpose grants to achieve development goals

Photo credit: Jens Buurgaard Nielsen (creative commons)

Written by Jamelia Harris

How can specific-purpose grants be designed to better achieve development goals? This blog sets out important design considerations and argues that a delicate balance between grant conditions and preserving the autonomy of sub-national governments must be achieved to enable accountable service delivery.

Decentralisation has been increasing in developing countries, oftentimes, with the encouragement of development partners. It is estimated that intergovernmental transfers account for about 60 per cent of total local government revenues in developing countries. Given this trend, the question of the relative share of conditional/specific-purpose grants versus unconditional general grants becomes important.

There is growing evidence that large increases in grants, without adequately taking account of the incentives/disincentives created, have the potential to create unforeseen problems in terms of local government performance and longer-term sustainability. Given this, many have advocated for specific-purpose or conditional grants as they have the potential to enhance fiscal equalisation at the sub-national level, improve economic efficiency, and promote greater accountability and service delivery. Empirically, conditional grants dwarf unconditional ones in countries like Uganda and Tanzania.

How should such specific purpose grants then be designed? This is precisely the type of question that concerns countries like Ethiopia as it reviews its specific purpose grants.

A team of researchers and development consultants from Fiscus has been involved in investigating the answers to this question as part of a technical assistance programme to the Government of Ethiopia. As part of the process, a comprehensive review of conditional grants in Rwanda, Kenya, South Africa, Uganda, and India was undertaken. From this, four key lessons emerge that should guide developing countries in designing specific purpose grants.

1. Clear conditions must be set for conditional transfers

There should be clear agreement between central and sub-national governments on conditions of the grant. In Kenya, this includes input-based conditions such as a specified expenditure type, output-based conditions such as achieving a set level of service delivery under a performance-based system, and/or a grant-matching requirement where the sub-national government agrees to contribute an agreed percentage. In Rwanda, specific-purpose grants target set sub-accounts, and performance contracts or imihigo are agreed with district-level mayors. India requires states to commit a matching grant, which varies based on regional development. Uganda uses a performance-based financing approach. South Africa legislates conditional grants under the annually updated Division of Revenue Act. The Act requires all grant programmes to publish a clear framework setting out rules for allocation and use, measurable objectives, disbursement schedules, reporting requirements and records of past performance. In all five countries, conditions have been credited with improving services delivery.

2. Robust monitoring systems need to be established

Given that clear conditions are agreed, a robust monitoring system is required where results can be documented and tracked. Although Kenya has a strong framework for setting conditions, documenting results is one of the weaknesses of the system. This means that service delivery gains and progress toward development outcomes could be even higher. In contrast, Rwanda has drawn on the traditional imihigo system to enhance accountability. Imigiho targets are linked to performance metrics and scores. Monitoring systems have improved significantly in South Africa. Here, monthly and quarterly sub-national government reports on revenue, expenditures and non-financial performance are submitted to relevant sector departments and the National Treasury, who in turn submit quarterly reports to Parliament. A strong monitoring system improves intergovernmental accountability and service delivery at the sub-national level.

3. Sub-national capacity should be considered

An assumption underlying decentralisation is that sub-national governments can deliver once they have access to finances. Evidence from India and South Africa suggest that regional-level implementation capacity can often constrain service delivery. This implies that effort must be placed on strengthening local capacity when intergovernmental transfer systems are being reformed. This may be done through a conditional grant similar to the Capacity-Building Grant in South Africa, which aims to develop management, planning, technical and budgeting skills in municipalities.

4. A balance with regional autonomy is needed

Some have argued that earmarked transfers, if excessively used, can limit regional spending autonomy. For instance, 80 per cent of transfers to districts in Rwanda are earmarked for precise activities, with only 20 per cent left for discretionary spending. Conditional transfers should therefore be cognisant of the larger decentralisation agenda, which often aims to give more power to subnational governments. For example, if regions are responsible for education spending, an earmarked grant can complement this by focusing on the poorest schools or poorest children. In so doing, the fiscal autonomy of the regions is preserved, but pro-poor spending is enhanced.

In sum, specific-purpose grants have significant potential to enhance service delivery and achieve development goals. To maximise benefits, these instruments should have set conditions and robust mentoring frameworks, which are cognisant of local capabilities and respectful of subnational autonomy.

Jamelia Harris is a Research Economist at Fiscus and Visiting Research Fellow at the Politics and International Studies Department, University of Warwick. Her research spans a range of topics and includes foreign aid and the labour market, political patronage, and government finances.

Mouzayian Khalil : 26 Jan 2022 14:47 |  Tags: Development Goals International Development Specific-Purpose Grants |  Comments (0) |  Close comments |  Report a problem

Studying international development during the Covid–19 pandemic

Studying international development during the Covid-19 pandemic

Written by: Dana Unzicker and Fabian Tigges

Term One: International Development Group Photo (Source: authors)

The advent of the Covid-19 pandemic in early 2020 radically changed the setting and conditions in which we study and think about international development. In this article, we want to reflect on how these extraordinary circumstances impacted our postgraduate studies in international development that took place at the University of Warwick. Despite the limitations on teaching that came with government guidance and national lockdowns, we made incredible progress as students of international development in an ambivalent study setting, where, on the one hand, we were virtually connected to students and scholars across the globe, but, on the other, were physically bound to our desks at home.

International Development Symposium (Source: authors)

It is evident that the research object of development studies has been deeply impacted by the effects of the pandemic. Besides the obvious and disastrous impact on global health, the pandemic pushed more people into poverty, increased the global shortfall of employment, and reinforced and exacerbated existing inequalities. Furthermore, the interruption of global value chains challenged processes of ever-increasing global economic integration.

It was in this setting that we studied and discussed current issues and actors in international development, covering topics like globalisation, gender, poverty, inequality, trade, structural adjustment policies, food security, the everyday political economy of microfinance, and many more. All these issues were affected in one way or another by the pandemic. Some have experienced the acceleration of existing trends such as a shift in power relationsin the globalisation debate, in others, the pandemicincreased awareness of already existing human crises as in the case of food security. Yet, the study of international development post-2020 goes far beyond the effects of the Covid-19 crisis, despite its unprecedented nature and omnipresence in public and academic debates. A key lesson learned from the effects of the Covid-19 pandemic has been its effect of drawing our attention to the invisible. For instance, the pandemic has shed light on critical issues along the lines of raceand gender inequality as well as economic inequalityand (inter-)dependence in the construction of global value chains. Our wonderful professor taught us the importance of visibility in the study of international development; how paying attention to the numerous invisible actors and their relations to a visible decision-making elite is essential when reflecting upon power relations in the global political economy. Beyond that, in impacting the ways in which we study and research, the pandemic not only drew attention to visibility but also, and crucially, to who is heard in the discourse of international development.

While visibility of issues and actors in international development was the key take-away from this year of study during the pandemic, it also closely relates to the overarching concept of space that accompanied us throughout the year. While we started our programme in international development in face-to-face classes on campus in Coventry, the winter lockdown sent us back to online teaching for the whole of spring term, where different living rooms became visible – or not, when cameras remained switched off. Many student homes became a place of both rest and study, as our classroom transformed into a virtual space.

Throughout the year, we engaged with scholars from across the globe, making our classroom virtual and also global. The year culminated in the Warwick Symposium for International Development in the last week of spring term at the University of Warwick, where we discussed the study of international development in times of Covid-19, listening to inspiring presentations and talks by students and scholars, and findings from the WICID everyday in lockdownproject. The pandemic thus created a somewhat ambivalent offsetting for our seminars. On one hand, we remained connected to our coursemates (some in the UK, some overseas) as well as with scholars from different parts of Europe, Hawaii, Canada, and India. On the other hand, the national lockdown bound us to our desks at home, making it our place of study and living. Hence, we were in a position, in which we communicated with the world, discussing international development and the global economy, while we were unable to freely leave the house and explore our local cities.

This was and is, of course, a challenging situation. However, it also serves to emphasise that our perspectives are limited in certain ways, framed through agenda-setting of powerful actors, and focused on particular regions and actors in the world. It highlights that we tend to view the world through particular lenses and angles that facilitate and allow us to see and hear certain actors and challenges, while at the same time preventing us from seeing and hearing other voices that are marginalised by different means. In a sense, this draws attention to the importance of space: To reflect on where we stand in different spaces but also to re-think space in order to render visible or hide challenges and connections between them, and to amplify or exclude different voices.

From scholars in the field, we learnt that the pandemic required a reconsideration of the role of the researcher and different research methods. This allowed us as students and our teachers to reconsider how we study development. Shifting the classroom to the virtual space made it possible to connect with scholars across the world to exchange ideas and research findings. This experience gave us new ideas for how to overcome some barriers to the global conversation on development, connecting people from different cultural and geographical backgrounds, but also, and crucially, made us aware of the barriers that remain. For instance, we speak different languages, live in varying time zones, and not all of us are privileged enough to have access to the technology required to connect to the world or to the funds necessary to pay university tuition fees.Thus, some barriers – shaped by (postcolonial and gendered) power relations – remain, and we need to be aware ofthem, when studying and thinking about development.

In a nutshell, the past year of studying international development during a pandemic has stressed the importance of reflecting on our own positionality as well as on what is visible and whose voice is heard when thinking about and doing research in the field of development studies. It is a challenging time to study international development as the pandemic put numerous constraints on research and exacerbated pre-pandemic problematics. Nevertheless, the pandemic also opened spaces to render visible the invisible, to challenge power relations, and to provide a momentum for change. Finally, we are incredibly grateful for the opportunity to learn from our classmates, scholars from around the world and the opportunity to make the best out of a tough year!

Authors’ Bios:

Dana Unzicker is a Postgraduate student of International Political Economy at Warwick. Her research interests are centred around globalisation and inequality. She studied “Theories and Issues in International Development” as an optional module and is a member of the Warwick Global Development Society exec board. In October, she will continue her studies at the University of Konstanz to obtain a Double Degree in Politics and Public Administration from Konstanz and Warwick.

Fabian Tiggesis a Postgraduate student of International Political Economy at the University of Warwick and of Politics and Public Administration at the University of Konstanz. He is currently working on his MA dissertation with the title “From Austerity to Recovery Spending: Contemporary Economic Thought in Times of Crisis”. Since October 2020, he is an executive board member of the Warwick Global Development Society. He is also a student research assistant at the chair of political science and international politics of the University of Konstanz.

Mouzayian Khalil : 30 Jun 2021 10:46 |  Tags: Coronavirus Pandemic International Development Student Experience |  Comments (0) |  Close comments |  Report a problem

Security or Development: UK Government’s changing priorities

WICID Executive response to the announcement merging DfID with the FCO

Shirin M Rai, Briony Jones, Oyinlola Oyebode, Maeve Moynihan

British Prime Minister Boris Johnson’s announcement that his government will merge the Foreign Office (FCO) with the Department for International Development (DfID) should not come as a surprise. Johnson has previously said overseas aid needs to be spent “more in line with Britain’s political, commercial and diplomatic interests” and told the Financial Times in 2019 that Britain cannot keep operating as if it were a “Scandinavian NGO”. Although unsurprising, this merger signifies yet another regressive step in Britain’s attitude to international relations. It represents the intent of current political leaders’ to restructure the British civil service. In January, former international trade secretary Liam Fox, who still influences policy making, said of the Conservative’s huge majority in parliament: “the Conservative victory has created a political moment which is as important as Mrs Thatcher’s victory in 1979”. Conservatives are seizing that moment.

Tony Blair’s government set up DfID in 1997 after a long list of scandals about British foreign aid being used to leverage lucrative trade deals. For example, the UK government spent £243m on a controversial dam in Malaysia in exchange for an arms agreement in the Pergau Dam case. A cross-party committee on international development this year noted DfID’s good reputation internationally and said, “it is clear that it stands head and shoulders above other overseas development aid spending departments”. However, the danger in this merger lies in the potential for old aspects of corruption, like the Pergdau Dam case, to return. The aid budget for the most vulnerable communities, if such areas are not attractive to trade, may be reduced and have a highly detrimental impact on low- and middle-income countries that currently receive support.

The same cross-party committee noted above found that more than a quarter of the UK’s £15bn (0.7% of GDP) annual aid budget was administered through departments outside DfID, with accountability becoming increasingly “eroded”. Between 2014 and 2019 spending outside DfID rose from £1.6bn to £4.1bn. The Independent Commission for Aid Impact warned this meant a greater focus on middle-income countries; countries which are of interest to the UK from a security, climate or economic perspective, reinforcing the neoliberal agenda and the potential threat for old aspects of corruption to return.

Despite warnings, many have expected this merger to go ahead. Civil servants have expressed concern about the merger being forced through and Labour have accused the government of making changes “by the back door”. Nevertheless, despite a brief delay due to COVID-19, the merger is now going ahead as Conservative leaders look to Britain’s future relationships across the globe.

When he announced the plan in the House of Commons, Johnson said the departments were “designed to achieve the same goal”, which suggests he sees the role of DfID as primarily diplomatic, lubricating the wheels for greater commercial and political cooperation between Britain and its partners. He also said it was no use to have a British diplomat seeing the leader of a country and “urging him not to cut the head off his opponent” if the next day another representative of the British government arrived “with a cheque for £250m”. Not only is Johnson acknowledging Britain’s relationship with governments and dictators involved in oppression and human rights abuses, but he is also rehashing colonial-era tropes about uncivilised countries that the British try to civilize. Either way, the future doesn’t look bright for how British international development money is spent abroad. As countries around the world reckon with their colonial past and oppressive societal structures after the murder of George Floyd, Johnson’s decision to merge DfID with the FCO only reinforces such problematic antiquated tendencies and pushes the UK further into the past, rather than the future.

Mouzayian Khalil : 24 Jun 2020 17:23 |  Tags: Dfid Fco International Development |  Comments (0) |  Close comments |  Report a problem