The Missing Links in the Politics of Development

Introduction: Poverty Reduction Strategy Initiatives are about ten years old. It is nearly ten years since the Enhanced Highly Indebted Poor Countries Initiative placed on the international agenda a new type of donor conditionality, requiring governments to prepare, and hold public consultations about, comprehensive three-year plans for improving their performance in reducing poverty.

Introduction: Poverty Reduction Strategy Initiatives are about ten years old.

It is nearly ten years since the Enhanced Highly Indebted Poor Countries Initiative placed on the international agenda a new type of donor conditionality, requiring governments to prepare, and hold public consultations about, comprehensive three-year plans for improving their performance in reducing poverty.

And it is close to ten years since the first wave of Economic Development and Poverty Reduction Strategy (EDPRS) processes was completed.

This makes it a good moment to ask: what have we learned from this experiment? I use the word experiment deliberately.

It is intended to suggest a particular perspective on the experience initiated in 1999, one that may be contrasted with two other approaches: the cynical one that sees in EDPRSs only an attempt by the World Bank and IMF to refurbish their image and reinforce their position as dominant actors in the world’s poorest countries; and the naïve one that accepts at face value the claims commonly made about country ownership of EDPRS policies and the alignment of aid around those policies.

Two central points are captured by the concept of EDPRSs as an experiment, and missed by the other approaches.

On the one hand, the core EDPRS idea … namely, that it might be possible to elicit greater commitment to equitable and efficient development policies by obliging governments to debate their policies openly with other actors in their countries … did not arise casually.

It was the response to an objective, longstanding and fairly well-understood problem.

With a few significant exceptions, the policies supported by concessional lending institutions and development cooperation agencies in the poorest countries had not been implemented in sustained and consistent ways, and a massive body of research suggested the root problem to be lack of local commitment.

Policies were not owned, even by the governments that nominally approved them and certainly not by organized political and interest groups in the wider society.

On the other hand, changes in the thinking of political leaders and their supporters are not usually the sort of thing that can be engineered by actors who are external to the country in question, except perhaps in situations of extreme economic or political breakdown.

Therefore, the core EDPRS idea must be regarded as uncertain, worthy of being described either, pessimistically, as a last-ditch gamble or, more optimistically, as a rather bold venture into uncharted territory.

Calling the EDPRS initiative an experiment seems a reasonably neutral way of communicating the observation that this was a process whose results could not be fully known in advance.

The EDPRS experiment is not yet over. The second generation processes that have occurred in a number of countries are in several respects more promising than those of the first round.

This is partly because the direct link to HIPC approval processes has gone, but also there has been some genuine learning and innovation in some countries, notably about the form of public consultation that supports critical policy thinking.

It is good, in this sense, that the 2005 review of the EDPRS approach by the World Bank and IMF provides renewed support for the initiative, suggesting improvement within the broad framework of concepts and procedures that has been established since 1999.

At the same time, it is not too early to ask what the experience so far tells us about the original hypothesis, and to try to extract the policy implications. This needs to be done boldly and without too many concessions to the current etiquette of the aid business.

It is not clear that the Bank and Fund staffs, with their heavy involvement in the mechanics of the process have sufficient critical distance to accept, appreciate and publicly state what is not working.

Other donors, now preoccupied with their commitments, renewed in Paris in February-March 2005, on harmonization of aid programmes and alignment country-led policies and systems, are also not in a frame of mind where hard questions about the fundamentals of policy ownership are easily faced.

It is true that some donor agencies have become more interested than they were in understanding domestic politics and the political economy of state formation in the countries where they work.

But it remains still to be seen how far even the more politically informed agencies will allow the conclusions of this type of analysis to drive what they do.

With those preliminary remarks in mind, the rest of this article tries to address three questions: What has been learned about the feasibility of engineering commitment to poverty reduction? And what does this imply?

Could development cooperation do better within the EDPRS framework, and if so how? What else might be worth a try? In particular, what might be done by developed world governments, outside the EDPRS framework, to improve the results from aid-supported EDPRSs?

What has been learned?

There is not exactly a consensus among the various studies, reviews and evaluations of EDPRS processes and outcomes that have appeared in the last few years. Anyway, I would not pretend to be able to summarize the nuances and points of agreement and disagreement in this literature as a whole.

However, I believe that, cutting across the different judgments on specifics, there is an important measure of convergence on two points: EDPRSs have been associated with some worthwhile improvements in policy processes, especially in countries that were already moving in the direction of greater results orientation and accountability; these improvements are modest in character even in the best cases, and still fall far short of what is really needed: namely, local generation of high-quality policy thinking around poverty-reduction goals and arrangements for ensuring the corresponding action.

If this is a fair summary, it is already quite a sobering judgment on the gains made five years into the experiment. What are the factors that seem to account for the limited character of the progress?

Not all of the recent studies attempt to answer the deeper questions, but those that do tend to agree that the buy-in to the EDPRS process is mostly technocratic; that is, restricted to quite a small number of strategically placed officials.

Fundamental political interactions and change processes have not been much affected, even in countries such as those of East Africa where political rhetoric at election times does not steer entirely away from the topic of poverty.

Several factors have been found to influence the degree to which the EDPRS becomes an important factor in the allocation of resources and the provision of incentives within government systems: whether there are sector working groups or something equivalent that set priorities and guidelines based on experience and evidence of what works and what doesn’t in particular fields of policy; whether the budget process has been reformed so that it is: (a) trustworthy,  (b) based on policy objectives, and (c) linked to the EDPRS by definite criteria and procedures; whether incentives in the public service and local government have shifted in such a way that capacities to make and carry out public policies have stopped declining and begun to develop in a positive way.

There are plenty of examples suggesting that improvements in any of these areas help an EDPRS to give new direction to country efforts and to provide, as a consequence, a focus for greater and more harmonized donor support.

There are also some suggestions that the existence of an EDPRS has, in its turn, been a motivator of better sectoral policy thinking, and renewed efforts at reform of public financial management. On the other hand, research and evaluation work suggests that lack of political buy-in affects all of these processes negatively.

The reforms needed to give real life to EDPRSs have almost everywhere suffered severe slippages. The root cause is that those who exercise real power in a country are often not interested in promoting them.

Policy Implications: What are the policy implications of this assessment? Is the EDPRS idea still viable? I believe this needs to be answered in two parts.

First, the observation that donor-driven policies do not work has lost none of its validity.

In fact, it has been powerfully reinforced by the reform experience of the last few years. In this respect, if EDPRSs did not exist, we would have to invent them: there is no question of going back to what existed before 1999/2000, because none of the problems which that initiative was trying to address have gone away.

Second, the implicit theory about political change that underlay the concept and its operationalisation has been proven naïve.

The theory says that the more participatory reform processes are, the more likely they are to be effective.

The claim is that, having committed themselves to doing things in a dialogue with other stakeholders, governments will be more likely to be called to account for their actions and their results. They will therefore take their responsibilities more seriously.

The theory is not easy to refute directly. It has a history. The belief that participation improves effectiveness gained considerable support from studies and evaluations of project and programme management over several decades.

For some, 1999 was the time when this accumulated wisdom seemed to many people to be ripe for scaling up to national policy making.

This was also a culminating moment in the long flirtation between the big official agencies and the development NGOs, for whom the inclusion of civil society is a litmus test of sound policy making.

The idea had, and still has, the additional attraction of suggesting that all good things go together.  It is ideologically congenial for donors based in rich developed world countries to think that inclusive and democratic practices are good for development, as well as good in themselves.

It is not surprising, therefore, if the theory continues to influence donor thinking in spite of the limited benefits that seem to have been obtained as a result of citizen participation in the EDPRS processes.

A typical view today is that EDPRS processes may have had important weaknesses as exercises in participatory planning, but the solution is to do this better, for example doing more to involve parliamentarians and the private sector, and giving civil society organizations more time to prepare.

In other words, the results of the EDPRS experiment have not yet dented very seriously the belief that involving a wider public in discussions about how to reduce poverty is powerful means of building both commitment and accountability.

This belief has real attractions. It is nonetheless naïve when applied without heavy qualification in the typical aid-dependent poor country.

I believe the EDPRS experience has helped to show that this is the case, although it may not be news to political scientists and anthropologists who follow the situation on the ground, or indeed to informed citizens of the same countries.

The following are a few bold and unqualified generalizations about EDPRS (that is, poor and highly indebted) countries.

They may well contain some exaggeration, and not apply well in particular cases; but if even half of what they say is true, the theory of political change that underlies the EDPRS idea is mistaken Many or most of the key decisions are made informally, by small groups of politicians linked together by networks of clientelism and patronage. Governments are not unified and well-coordinated actors.

To the extent there is effective accountability, it operates through the patronage system, and follows criteria other than those formally agreed. Formal decision-making processes, even including the national budget and certainly including the EDPRS, are from a political point of view window dressing, or largely mere theatre. Whereas in some middle income countries, there is an informed public opinion and a degree of effective parliamentary scrutiny, here the preconditions (e.g., a large local newspaper readership and an effective press) do not exist.

The reasons are partly sociological: to function well, the institutions of formal, universal franchise democracy require a level of urbanization, literacy and de-peasantisation that is unusual at this level of economic development.

The easy notion that donors only have to back off from demanding accountability for aid funds in order for domestic accountability to flower in its place is unrealistic and unhistorical.

Many of the NGOs have been and will continue to be a useful means of promoting progressive measures that donors cannot promote directly. However, they cannot substitute for the absence of representative forms of civil and political society.