July 14, 2011, 5:38 p.m.
The paper, The Clash of the Counter-bureaucracy and Development, by Andrew Natsios a former USAID Administrator, looks at the dilemma between compliance and programmatic/technical aspects of development. There is an inherent conflictbetween the two due to the fact that development programs are extremely difficult to measure and can take many years after the funding for a program has ended to see results. The focus of a good, long-term view development project is on institution building which intrinsically is difficult to measure, takes a long time to see results, and as a result frequently is underfunded. This also makes it difficult to garner public support for these programs. In order to justify the funds that go towards development Congress and their constituents want to see documentation that funds are going to their intended audience, checks and balances are in place, and that compliance to rules and regulations are being met. However, the danger comes when the focus is so focused on compliance that program substance is lost and compliance becomes counterproductive. When the focus rests solely on measurability then programs that have development significance can be lost.
Natsios lists four main reasons for how USAID has gone off track from their original goal of development assistance:
One of the little understood, but most powerful and disruptive tensions in established aid agencies lies in the clash between the compliance side of aid programs—the counter-bureaucracy—and the technical, programmatic side. The essential balance between these two in development programs has now been skewed to such a degree in the U.S. aid system (and in the World Bank as well) that the imbalance threatens program integrity. The counter-bureaucracy ignores a central principle of development theory—that those development programs that are most precisely and easily measured are the least transformational, and those programs that are most transformational are the least measurable. Relieving the tension between the counter-bureaucracy and development practice would require implementing new measurement systems, conducting more research on overregulation and its effects, reducing the layers of oversight and regulation, and aligning programmatic goals with organizational incentives.
The compliance officers often clash with the technical program specialists over attempts to measure and account for everything and avoid risk. These technical program specialists are experts in the major sector disciplines of development: international health, agriculture, economic (both macro and micro) growth, humanitarian relief, environment, infrastructure, and education. Undertaking development work in poor countries with weak institutions involves a high degree of uncertainty and risk, and aid agencies are under constant scrutiny by policy makers and bureaucratic regulatory bodies to design systems and measures to reduce that risk. In practice, this means compromising good development practices such as local ownership, a focus on institution building, decentralized decision making and long-term program planning horizons to assure sustainability in order to reduce risk, improve efficiency (at least as it is defined by federal administrative practice), and ensure proper recordkeeping and documentation for every transaction.
The counter-bureaucracy ignores a central principle of development theory—that those development programs that are most precisely and easily measured are the least transformational, and those programs that are most transformational are the least measurable.
The demands of the counter-bureaucracy are now so intrusive that they have distorted, misdirected, and disfigured USAID‘s development practice to such a degree that it is compromising U.S. national security objectives and challenging established principles of good development practice. This regulatory apparatus has created an incentive structure that has led to an emphasis on process over program substance and, in so doing, has produced a perverse bureaucratic result; as the career staff has declined in size absolutely and proportionately to the size of the aid budget, the compliance side of aid has taken over management and decision making at the agency. When the agency does not comply with the commands of the counter-bureaucracy, it faces stiff penalties, but there is no legal or regulatory consequence if agency staff do not regularly interact with government officials, civil society organizations, and the business people in developing countries about political, economic, and social policy reform—i.e., the central practices of development work.