The broad consensus behind the Post15 panel's conclusions that well-functioning institutions really produce results for poor people is in a way treacherous. Now we who work with development assistance should seriously ask the question of what can be done better to support domestic institutions for good and effective governance, writes SIPU consultant Karin Metell Cueva
Results for poor people have been in focus in development assistance in recent years. This has been drummed in from the political leadership and translated into target matrices with indicators to measure everything from children's schooling, reduced maternal mortality, to increased democracy. But what is it that leads to long-term and sustainable results for poor people? Knowledge in this area has increased exponentially in recent years and today there is actually a fairly broad consensus among experts, development economists and other researchers, about what leads to prosperity or development in different countries. The conclusion is simple and is written in one word: Institutions.
Institutions in a broad sense include, in simple terms, common rules for social and economic interaction in a society. The importance of well-functioning institutions cannot be overestimated. Much has been written in recent years about the need for functioning institutions for investment, private sector development and job creation, but they are equally important in providing the citizens of a country with functioning services, schools, education, health care, transport - yes, everything we actually mean when we talk about development.
Although there may be a fairly broad consensus about the importance of institutions, this consensus can be treacherous in our understanding of what well-functioning institutions mean and how they are defined. Recently presented the UN expert panel, where i.a. Gunilla Carlsson included, her recommendations for future millennium goals, which will take over when today's goals will pass the best-before date in 2015. The panel presents partly critical views on the design of the previous millennium goals (MDGs). The goals, it is said, focus on the symptoms of poverty, ie the lack of education, health care and food instead of on the core and causes of poverty. The new report, and not least Gunilla Carlsson herself, chooses to consistently highlight the importance of good governance and institutions as a prerequisite for achieving the long-term goals, ie focusing on the causes rather than the symptoms.
This is a welcome and necessary shift in the development debate and for development aid in general. Good governance is a prerequisite for prosperity and not something that arises in retrospect, as a result of the country's prosperity increasing. But what risks being forgotten is that good governance, or quality of government which is also used as a concept, means so much more than just openness and transparency and far from "just" democracy. The concept usually includes impartiality, accountability and legitimacy, but also and not least, efficiency in administration.
Behind the concept of institutions thus hides a functioning administration. An administration that can provide services in the form of police, judiciary and tax administration, ie basic functions in a state apparatus. But the administration must also, in order to be perceived as legitimate, be able to deliver services at the local level in the form of, for example, better roads, functioning health care and quality education. Why else would entrepreneurs and citizens be willing to pay taxes in the first place? A functioning administration is governed by openness and demanding responsibility, but also by efficiency. Corruption is a scourge and clearly one of the biggest development threats. But to focus too one-sidedly on corruption, openness and transparency as goals in themselves, without looking at what comes out in the form of services from the public administration, risks in the worst case undermining people's trust in both democracy and state-building and thus its institutions. The vicious circle risks ending.
I would like to claim that many actors who work with Swedish development assistance have long understood these connections. Maybe that is why the government's initial focus on results caused so much unrest and resistance both at Sida and within individual organizations. It has been known that results for poor people are not achieved by focusing on the symptoms but on the underlying causes, but measuring this type of result is, although not impossible, much more difficult. With a greater consensus on these issues, there are now good conditions to focus on what really makes a difference, both in the implementation of development assistance but also in the follow-up and evaluation of the effects of development assistance.
Swedish development assistance, in particular bilateral development assistance, has long worked precisely to strengthen administrations and institutions in our partner countries, often in collaboration with our own central government, which has assisted with knowledge transfer in many areas. Sweden's credibility and long experience in this area give us a unique position to continue to pursue this issue. We who work with development assistance should, however, seriously consider the role that development assistance can play in building and supporting domestic institutions for good and effective governance. Can it be done better? In what way should and can aid best be delivered, in a political context, so that it strengthens, rather than overturns, the domestic institutions?
If development assistance can focus on strengthening open, responsible and impartial institutions that are also effective intermediaries of services and services that are in demand by poor people, then we have filled the institutional agenda with content and managed to focus on long-term sustainable results for poor people.
Karin Metell Cueva