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Paul Mason's Idle Scrawl

Real aid or phantom aid

  • Paul Mason
  • 4 Jul 06, 11:02 PM

The charity ActionAid tonight issued a report claiming that up to half of all aid money in the world is "phantom" - spent on private consultancy, non-poverty related projects or "tied" to foreign policy objectives and companies from donor countries. We got an exclusive look at it on the programme - and explored the whole issue of highly paid private consultants getting their private school fees paid out of money that most of us think is destined for the kind of schoolteaching that happens under a tree. I'll post a link to the report once it's there on the site - but what do you think? Hit the comments button and let's talk about something more important than my misvibing of Wazza's boot.

Comments  Post your comment

  • 1.
  • At 12:38 AM on 05 Jul 2006,
  • Glenn Jenkins wrote:

Greetings Paul

I watched your report on the Action Aid findings with a mixture of feelings - anger, relief and familiarity.

Its easy to know why I got angry - ANY half awake human being should be angry at the beyond scandalous fact that already well off 'private consultants' working in places where average incomes are $500 a YEAR should charge $1000 dollars a DAY.

The relief feeling was at seeing such a topic - brilliantly put together Paul - headlining on Newsnight. This scandalous consultancy lark is well past its sell by date and needs exposing for what it is - so thanks for that.

The recognition feeling arises from the fact that I live on the Marsh Farm estate in Luton, Bedfordshire which was given 拢50 million quid in 2000 within the governments 'New Deal for Communities' regeneration programme. As one of the UK's 39 'pockets of deprivation' the funding was given to us to encourage socio-economic regeneration - with the emphasis heavily upon community enterprise, social entrepeneurship, self sustainability etc.

Instead the scheme is known throughout the 39 areas as the 'New Deal for Consultants', because exactly the same scandalous syndrome exists here in the UK. Consultants arrive in posh motors to administer our programme, mentor us, capacity build us, develop our confidence, enhance our personal skills, and all manner of other stuff - all for the tidy sum of 拢350 per day. Ubnless its a temporary or short term contract of course - then they call themselves 'interims' and charge 拢550 per day. All of this in a community where families on benefits dont see 拢350 in a month! We call it 'jemmying open the poor box'...

The good news is that here in Luton we really reckon we've discovered the solution. We're working with a team of development workers from Brazil, Chile and Africa to pilot the UKs first ever 'Organisation Workshop (OW). The OW is a grassroots 'capacity building' process which makes use of 'Technical Experts' in the only way they should be used, in that they are there to facilitate the development of local capacity within an agreed time frame, then are available 'at a distance' for any further support necessary.

The old maxim 'give a man a fish and he'll eat for a day - teach him to fish and he'll eat forever' springs to mind..

Any time you feel like coming down to Luton to check out the proposed OW and to discuss the UK 'degeneration industry we'd be pleased to make you a cup of 'Just Change' tea.

Good old Action Aid and good old Newsnight!

  • 2.
  • At 05:34 AM on 05 Jul 2006,
  • ben dean wrote:

It's not surprising that Aid is yet another morally corrupt entity merely furthering our own interests, while often worsening poverty/problems.

Read confessions of an Economic Hit Man. The consultants are often deliberately misleading in order to enslave these poor small countries, thanks to international institutions like the IMF and world bank.

The consultants in all aspects of their work seem so allied to politics/big business that one cannot trust a word they say.

  • 3.
  • At 05:35 AM on 05 Jul 2006,
  • ben dean wrote:

It's not surprising that Aid is yet another morally corrupt entity merely furthering our own interests, while often worsening poverty/problems.

Read confessions of an Economic Hit Man. The consultants are often deliberately misleading in order to enslave these poor small countries, thanks to international institutions like the IMF and world bank.

The consultants in all aspects of their work seem so allied to politics/big business that one cannot trust a word they say.

As an ageing cynic, I'm not surprised at all. I have no wish to read the full report as it will only depress me. My apathy is shameful, but how are the Little People supposed to feel about things of this nature. If there are injustices in the world, the public should be informed about how they can change them.

  • 5.
  • At 10:33 AM on 05 Jul 2006,
  • Tom wrote:

Having worked on development projects overseas for a range of charities, I made the decision to discontinue my involvement with development work. This was a decision borne out of utter bewilderment at the naive and paternalistic attitudes of the large majority of aid workers. That Africa is poor was consistently 'someone else鈥檚 fault', nothing to do with corrupt regimes and inter-tribal warfare, but all the West's doing. Now it鈥檚 consultants who are to blame.

What struck me most was that people working in development aid (not the consultants) had very often done little else but work in development. Talk of business, profit, entrepreneurship were anathama to people living out their left wing fantasies promulgating 'pro-poor' solutions. In my four years working in development, not once did I meet anyone who understood the concept of wealth creation being the real key to raising living standards. Look at China and India for shining examples.

Too many people in development see wealth as a finite pot from which the West is taking the lion's share. In reality, real economies make money and generate new wealth, but this isn't something development workers want to hear. Instead, we get the clarion call for more aid to be ploughed in corrupt regimes and an infantilisation of a peoples perfectly able of standing on their own two feet, if only the cloying attentions of the aid community were a little more considered and focussed.

  • 6.
  • At 10:46 AM on 05 Jul 2006,
  • Rosa wrote:

Action Aid should confess to a hidden agenda. Technical aid, so damned in their report, does not flow into the coffers of 'poor' development charities like Action Aid, so perhaps not unsurprisingly they take a dim view.

Let's get real here, anyone working in development has seen lousy development projects, whether they be run by CARE, ActionAid, Oxfam or as Technical Assistance projects.

This findings of this report would ring a little truer, if there wasn't such a blantant agenda on the part of Action Aid. I would be very interested to see the report assessing the impact their projects have had over the last 20-30 years, but no-one gets to see these.

  • 7.
  • At 12:17 PM on 06 Jul 2006,
  • edmund wells wrote:

All of this looks rather different when you read the withering piece on this dodgy ActionAid report in the Independent by Paul Vallely who was co-author of the Commission for Africa report. ActionAid are clearly being rather dishonest here. It's like saying: why hire a qualified pilot to fly your plane when you could ask the local streetsweeper who'd do it much cheaper!
Edmund Wells

The Independent:

Paul Vallely: Distortions, half-truths and aid agencies

What has been lost is the integrity that once characterised the development lobby

Published: 06 July 2006

Who guards the guards? One third of British aid is wasted - or so we were told yesterday by the campaign group ActionAid, which issued a report "revealing" that 29 per cent of the aid budget went on "phantom" aid such as "ineffective and overpriced" consultants.

But hang on. Look at the detail and you find that the report is full of dodgy assumptions. Read on and you find it is a terrible mish-mash of self-evident truths, half truths, and selective distortions interspersed with islands of sensible analysis. It juxtaposes statements about global aid and British aid and invites misleading inferences. Its figures are vague and based on extrapolations from guesstimates. It relies on anecdotes and anonymous quotes.

It is far from alone. The latest report from Christian Aid breathlessly begins: "Despite good intentions and billions of pounds worth of aid and debt relief, more money flowed out of poor African coffers into Britain last year than the other way round." But again, look at the detail, and you find they reach this conclusion by confusing a balance of payments deficit with a financial loss. This is economic illiteracy masquerading as analysis.

What has happened to Britain's aid agencies? Once they could be relied upon to act as impartial judges of the best interests of the world's poor. Increasingly they seem intent on twisting the facts to fit some preconceived agenda.

There is plenty wrong with the rich world's aid. It can be haphazard, unpredictable, unco-ordinated, and self-serving. But it can also be well-delivered, as British aid now largely is. Among ActionAid's "phantom aid" is debt relief which has, since Gleneagles, made health care free in Zambia, fed four million drought victims in Tanzania, is building roads for poor farmers in Ghana, and is getting 3.5 million more children into school in Nigeria.

Likewise with expat consultants. Such "technical assistance" can be overused. What African schools need is trained teachers, books and school buildings with toilets - not curriculum experts from Warwick University. But there are situations where outsiders are essential. If you want to upgrade an African port you need expertise in crane, storage, computer and customs systems, which will almost certainly not be available locally. And if you want good people to do these things, you have to pay the going rate.

ActionAid fails to acknowledge that. Instead it adopts a cheap-shot "down with fat cats" tone, comparing the cost of consultants with local salaries - as if all skills could be purchased locally. It highlights just 拢101m over five years - out of an annual 拢5bn budget - paid to big accountancy firms like KPMG or Deloitte but fails to say what it was spent on. You need top accountants to design good accounting systems to combat corruption in Africa. So why are aid agencies exaggerating to grab cheap headlines?

In part the answer is political. Some agencies such as War on Want and the World Development Movement fit development into a wider picture of disgruntlement about the uselessness of capitalism.

Inside ActionAid and Christian Aid there are elements which appear to regard trade and foreign investment as a bad thing and regard the poor world as a crucible for utopian self-development. Even the more sensible agencies like Oxfam, Cafod and Save the Children - whose analysis is generally sound and useful - occasionally succumb to peer pressure from other agencies to exaggerate. In a world where every agency is battling for "market share", no one wants to be left behind.

That explains the fixation on issues which have domestic political resonance, such as water privatisation. This makes big waves in the UK. But in Africa only the top richest few per cent of the population get their water piped. The really poor buy it from street vendors at vastly inflated prices or get it from dirty streams. Water privatisation may be a bad idea but there are far more important things to get the UK supporter base worked up about. It's why, of all the vast array of trade issues, agencies concentrate on trade liberalisation disproportionately.

In part their behaviour is tactical. The received wisdom is that the more extreme their demands, the more change will come. At Gleneagles they had written their condemnatory press releases in advance, having, the key people privately admitted, decided that a negative response was the best way to keep the campaign alive. They have since had to revise that judgement. "The campaigning NGOs who queued up to dismiss the pledges to Africa at Gleneagles last year have been proved wrong," as Simon Maxwell of the Overseas Development Institute put it. But the basic mindset remains.

What has been lost is the honesty and integrity that once characterised the development lobby. In the old days if Oxfam's head of research, Kevin Watkins, wrote a report and its campaigns director, Justin Forsyth, lobbied on it, everyone took notice. So much so that Watkins was taken into the UN and Forsyth into Downing Street, where he has been instrumental in Tony Blair's large-scale adoption of an agenda that was once pushed only by idealist campaigners.

Today some agencies seem intent on providing ammunition for the "aid doesn't work" lobby. They have become figures of fun. Or at least they would be were not the lives of millions of poor people at stake.

p.vallely@independent.co.uk

  • 8.
  • At 10:58 AM on 12 Jul 2006,
  • Eric Dickens wrote:

I think Tom's Comment 5 is the most clear-sighted so far, especially where he says "...utter bewilderment at the naive and paternalistic attitudes of the large majority of aid workers. That Africa is poor was consistently 'someone else鈥檚 fault', nothing to do with corrupt regimes and inter-tribal warfare...".

During full-blown British Empire days, there was certainly paternalism and the theft of raw materials by metropolitan countries. But the aim was to ultimately get the countries to stand on their own two feet, which seems to have happened in India. China came by a different route - and even managed to survive the madness of Maoism! Other postcolonial countries continue to be hopelessly failed states; whatever the Brits did wrong, the Dutch, Portuguese, etc., did worse.

But now we in the West have little leverage with which to force countries to adopt good governance, yet we still throw masses of money at the problem - and then proceed to pay ourselves. The solution would seem to be a scheduled reduction of aid, so that r茅gimes sober up and know that we will stop, yes, stop subsidising them if they don't pull their socks up. We've had the carrot and carrot approach for far too long.

The Germanic tribes of Europe had two bad internecine spats during WWI and WWII, but we did survive and Europe is surely one of the best-governed parts of the world today. But we still sell our surfeits of arms to r茅gimes whose citizens we continue to infantilise. So they shoot one another instead of building factories. At the same time we send out masses of peace workers, advisers, aid workers, and so on.

Just as with the Polish plumber syndrome Britain is now suffering, we should train people to lead profitable lives in their own countries, and keep them there and invest in them, instead of doling out endless sacks of rice and lining the pockets of Western do-gooders.

  • 9.
  • At 10:06 AM on 18 Jul 2006,
  • Dominic wrote:

As usual, I think the truth is somewhere between ActionAid's allegations (which I agree with Paul Vallely are badly put) and DFID's defence.

There is no doubt that in the 10 years I've been in the aid "industry" that there has been an increase in DFID use of consultants. Many of those I've met are, frankly, overpaid, underqualified and over there.

However, NGOs are also self-interested and I thought The Independent's juxtaposition of the third DFID spends on "phantom" aid, with ActionAid's own third on admnistration and fundraising was sublime.

Ultimately, Tom in 5 is right - governments and people will have to learn to run their own countries. However, to suggest we have no responsibility for setting up nations where no nationhood existed, based on an economy of export to us, is ridiculous. We have caused many post-colonial wars - directly or indirectly. But we should be motivated by a positive desire to support, not a negative guilt. And not by our own political leanings towards or away from market economies. Policy at the global level is fine, but we have to support people to survive within the economic reality, not a self-designed utopia. I've seen too many communities organised to manage their own water supply as the only way to ensure sustainability - but are we really saying we want this for ever? Would I want to manage my own water supply? Do I have the time?

So the structures at national and district level need to be there. But governments (national or donor) have shown that are not be able to do this by themselves, so NGOs are needed to provide good models, support communities and individuals to exert their rights and build the capacity of local government to deliver.

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