Decentralisation – an instrument of choice

Draft: A policy development note by John Sinclair – July 2016  

It is well understood in the development business that decentralization makes sense. When people in Ottawa try to plan and control development programs located 10,000 kilometres away, projects are much more vulnerable to poorly informed design and local adaptation. Can you Imagine Canadian aid officials paying to build a bread factory with a roof designed to Canadian winter snowload specs when it was to be located on the equator? But it happened at huge costs in time, money and credibility. This sort of thing happens far too often. Somebody responsible and informed on the ground can greatly minimize this risk.

Canada’s record for many decades is as one of the most highly centralized of bilateral donors. Officials talked of ‘localitis ‘as a failing – being too close to the country knowledge could undermine objectivity. This became an obsession in the control-focused Harper decade where project documents gathered dust on Bev Oda’s desk and our partners never knew for months if a project was approved or rejected.  The small CIDA team on the ground had no delegated authority to communicate with the nominally partner country without a HQ authorisation. This meant projects and country strategies were designed in Ottawa for a country that key staff often saw once, maybe twice, a year on a brief mission. Senior management, including policy-makers, most likely had never visited any recipient country except for an international conference.

How can such approaches be seen as developmentally optimal or cost-effective? The net effect is that we dismissed the value of local knowledge of the partner country officials despite the reality that they obviously better knew its economic and social realities. They are also the ones accountable, increasingly via democratic governance, for the wellbeing of their citizens.

How have these bad practices survived?  The explanations are many but a key factor is an imbalance of power, and, in the Canada context, an excessively bureaucratic approach to ‘accountability’.  Western donor institutions and multilateral institutions like the World Bank, controlled the money. They, their staff, far too often thought they knew best. This is not partnership.

That mindset was nominally rejected a decade ago by Canada and the international donor community when we signed the Paris Declaration (2005) which recognized development  effectiveness required ‘country ownership’ and a  ‘country in the driver’s seat’.

The old HQ-centric approach to our relationship with developing countries was never developmentally effective. And now, it is no longer politically acceptable in a world where most developing countries, even the poorest, have governments and citizens/civil societies who feel empowered to be masters in their own land.

The way forward is decentralisation.

Central to Canada really being ‘back,’ is that our relationship with developing countries needs to be a real partnership. As a donor this means our programming should be responsive and inclusive. This is particularly true of the core countries where it needs to be managed in a decentralized mode by strong professionals, with empowered leadership, a resident country director.  The rationale is very practical, not just political correctness. Effectiveness and impact improve substantially if we are close enough to see our partners weekly if not daily – not for reasons of control or book-keeping, but to ensure an optimal understanding of current local realities and the early correction of flawed approaches.

Decentralisation is not new. In the mid-80s CIDA launched into a massive decentralisation exercise following the lead of other bilateral donors. It probably over-reached and, in a strained relationship, let DFAIT co-opt too much of the special start-up funding for buildings. Within three years the pilot was closed. The official explanation was cost; the reality is more that senior management inside CIDA, but also in central agencies, such as Finance, Foreign Affairs and PCO, felt insecure – they had lost their driver’s seat position for what was seen as a distant co-piloting exercise via an in situ partnership between an empowered CIDA field team and the national planning office of  a country such as Tanzania.

Many DAC donors, notably the US, UK and Nordics, have shown more staying power than Canada.  They, including Canada, pushed the World Bank into its massive decentralisation in the late-90s. But we have only returned to decentralisation in a few donor favorites where it was effectively mandatory.

Will the Trudeau government reverse this situation?  The basic arguments still hold. Indeed, in today’s world, Canada wants a stronger set of relationships with developing countries for political and economic reasons. But it is not so clear that the present generation of GAC senior bureaucrats are willing to let go and allow development partnerships to be designed and driven in situ, not a Pearson Building tower. Key will be if good managers will eagerly leave Headquarters. In the World Bank transition, its President bluntly told managers: no promotions, no career, without a stint as a decentralised director!

Cost is often raised as a problem. But decentralisation was affordable once and the technique of using local professionals in so-called PSU’s (program support units) not only dramatically reduced costs but meant that the Canadian field staff had even close contact with local policy-makers and think-tanks. Decentralisation is an enriching professional experience, but to work staff need a distinct set of skills and attitudes to sustain the partnership.

An in-situ director quickly gets to know the inside story on host government policy. Delegated authority, as evidence of trust from the HQ, in turn facilitates a trusting working relationship with host country ministers and senior officials. Donors in situ often work together in thematic partnerships. In the Canadian embassy, it is typically the development people, not the lone trade officer, who learn first of big local deals and scams. As Canada shift attention to the poorest, especially fragile states, often with absorptive capacity constraints, we will need even more of that closeness for effective implementation.

For Canada to regain its political and professional credibility as a partner in the developing world the present GAC consultations needs to draw some bold conclusions on strengthening decentralisation. That ‘boldness’ should emerge from recognition of the effectiveness and relationship gains from such partnership. Certainly more ODA is needed by LDCs, but decentralisation will help ensure us a richer return from that investment.