Update on US aid reform

September 9, 2009

     By Duncan Green     

These are exciting times for anyone who wants to reform the US aid system, as years of preparation and lobbying start to bear fruit (see my previous blog and click here for an excellent introduction to US aid from Oxfam America). Congress has taken an early lead on reform – with three pieces of US aid by regionlegislation currently in the works (bipartisan bills in both the House and Senate and a new Foreign Assistance Act draft expected this fall).

According to the office of John Kerry, one of its co-sponsors, the Senate Bill:
•  restores strategic thinking to USAID by reestablishing a bureau for policy and strategic planning;
• calls for strengthening the coordination of U.S. foreign aid in the field under the guidance of the USAID mission director; 
• increases accountability and transparency of U.S. foreign aid programs by establishing an independent Council in the executive branch – the Council on Research and Evaluation of Foreign Assistance (CORE) – to objectively evaluate the impact and results of all development and foreign aid programs undertaken by the U.S. Government; 
falling US aid levels over time• strengthens personnel at USAID by mandating a comprehensive review of all aspects of human resources and establishing a high-level task force to advise on critical personnel issues.
That all sounds very pragmatic – no mention of making poverty reduction the overarching goal.
The House bill sounds a bit more strategic in this regard, at least according to Congressman Howard Berman, when he introduced the bill in April:

‘This bill requires the President to develop and implement a comprehensive National Strategy for Global Development, which will define and streamline the roles of each department and agency engaged in development policies, programs and activities overseas. In addition, the strategy will establish a process to review and improve coordination among the various departments and agencies involved.’
Even more important, it looks like Chairman Berman is going to introduce a US aidnew Foreign Assistance Act sometime in the next few months, which would change the landscape for foreign aid reform.  That is a huge undertaking, but anything less would leave any reform process crippled by the Byzantine out-of-date legislation currently on the books.  See here for why.

And there’s plenty of big picture thinking under way in other parts of the system. The State Department and USAID began their own Quadrennial Diplomacy and Development Review earlier this summer.   As they start to map out priorities, it was good to hear Secretary of State Hilary Clinton in her Nairobi speech last month call for the US to ‘focus on country-driven solutions that give responsible governments more information, capacity, and control as they tailor strategies to meet their needs’.

Last week, the White House stamped its leadership on aid reform by signing a Presidential Study Directive that authorizes a government-wide review of global development policy. Heavy hitters are in charge – the review will be formally co-led by National Security Advisor Gen. Jim Jones and chairman of the National Economic Council Larry Summers.  The NSC’s senior director for development issues, Gayle Smith, who reports to both Jones and Summers, is supposed to do the hard work. Early reports indicate that the review is due to be complete by January.

Now more than ever, it is critical that the Administration appoint a USAID Administrator to participate in all these efforts. Click here to vote in the Modernizing Foreign Aid Network’s poll for who you think should be the next USAID Administrator.

Update, October 2009: Read Oxfam America’s new report on Aid Ownership here

September 9, 2009
Duncan Green