Civil society and the aid system

Today, international development is characterized by the aid system's urgent embrace of the concept of civil society. The following subsections investigate what has happened to date and what this means for an appraisal of NGDOs within international development thinking and practice. To do so, requires a brief explanation of the aid system itself.

The aid system

At its core, the international aid system is premised on both accelerating and directing a country's development through the transfer of, mainly concessional, resources. Figure 1 provides a very simplified schematic overview of the system. Important resources are money, knowledge, technology and expertise. The ultimate users or beneficiaries of aid flows are intended to be the 3 billion poor or excluded citizens that form the deprived underlay of civil society in the South and East.⁷ They are to be found as individuals, as members of households, village and community-based organizations and specific groups, such as the disabled, the illiterate, people with HIV/AIDS, and so on. They provide the overt justification for the aid system.⁸

⁷ The terms North, South and East will be used as a shorthand, respectively, for donor countries, countries typically receiving aid since the 1960s, and former countries of the Soviet Union that have been recipients of aid since the late 1980s.

⁸ Aid also serves other purposes as an instrument of foreign policy and trade relations.

Figure 1 : The Aid System - Highly Simplified Financial Links and Flows

The primary sources of international assistance are from the Northern tax-base - i.e. official aid - and from private donations and investment income - i.e. private aid. In 1998, $47.9 billion⁹ of tax funds were allocated as official overseas development assistance (ODA) (World Bank, 1999:68). Since 1990, the amount of concessional finance within ODA has been decreasing. In 1998, it stood at $32.7 billion, down $12 billion since 1990. Within concessional finance, the grant element has declined more sharply than the loan element. By a ratio of 3:1, multilateral flows supersede bilateral allocation in distributing the $9.7 billion of concessional loans in 1998.

⁹ All references to dollars are to US dollars.

The major institutions providing official aid can be divided between bilateral donors - that is the specialized development agencies of Northern countries, and the multilateral agencies of the United Nations system. In 1997, 70 per cent of public tax-based funds were allocated bilaterally, the remainder through multilateral channels (Randel and German, 1998). By and large, the international financial institutions (IFIs) within this system - the International Monetary Fund (IMF), the World Bank Group and its sister regional development banks - provide loans for financial stabilization and reform as well as for development investment. United Nations agencies typically employ grant funding. The private aid system (of foundations, charities and NGDOs) also works on a grant basis.

The issue is how to get (the advantages of) these resources to beneficiaries in ways that are both effective and sustainable. The common answer is to use intermediaries who should own and be committed to the assistance they ask for and obtain. The natural intermediaries for official aid agencies are the member governments of these institutions and their civil service structures. The natural intermediaries for private donors and the general public are international and domestic NGDOs (INGDOs and DNGDOs). Both channels typically end up interfacing with people who are poor or marginalized through local organizations set up by them. Together with intended beneficiaries, private aid agencies as funders and intermediaries comprise the civic element in international development.

In the past 10 years, as a matter of policy, most official donors have included and expanded the "civic channel" as intermediaries for, and direct targets of, their assistance. As shown in Figure 1, his support can flow directly (line A), as designated NGDO allocations or as contracts; or indirectly (line B) via the recipient government as a subvention or a contract. Current estimates suggest that, of the $13-15 billion that NGDOs are thought to disburse annually, just over half comes from taxes and official aid (see footnote 28).¹⁰ This is up from less than 30 per cent 10 years ago. This suggests that some 13 per cent of ODA is channelled to and through NGDOs. In short, a simplified interpretation of the aid system indicates that it is basically made up of a twin chain of institutions through which resources flow, with increasing interaction between and dependency of the private chain on public sources.¹¹

¹⁰ This figure includes funds for humanitarian aid and emergency assistance. The proportion of NGDO disbursements coming from the business community or from NGDOs own economic activity is minimal (in the order of 1 per cent) but is growing rapidly.

¹¹ For simplicity, other linkages in the chain, such as advocacy, are not included.

But whom, within civil society, is the aid system approaching? Put another way, how is civil society understood and approached by aid agencies, and with what aims in mind? The following subsections address these questions.

Being careful with the concept: One Western size does not fit all

The aid system has tended to adopt a formal, uniform and ahistorical view of civil society in relation to international development. This has led to an array of criticisms of the perspectives and assumptions underlying the aid system's embrace of civil society and particularly its expectations of NGDOs - i.e. what they are, the roles they can play and what they can achieve.

First, the developmental framework adopted for civil society is exclusive rather than inclusive. It tends to equate "civic-ness" with formal organizations. This ignores social configurations and how citizens interface with each other and with the state. This overly formal perspective also misrepresents how the poor associate in order to cope and survive (Edwards, 1999c) informally through intricate trust-based webs of familial and other networks (Hann and Dunn, 1996). In such systems - which can be very formal for those within them - primacy is given to mutual support and reciprocity that builds and maintains social capital.¹²

¹² The notion of social capital tries to understand and capture the importance of this informal relational realm, and its underlying values, for the development of economies and societies (Woolcock, 1997).

One reason for neglect of the informal that the Western understanding of civil society is essentially urban, not rural (Mamdani, 1996). Yet, despite rapid urbanization, the majority of the world's poor still live in rural areas where other relational premises and designs apply. From this perspective, it can be argued that the Western experience driving aid thinking and practice is too limited in its time frame and geography. This invites caution when "exporting" or "strengthening" civil society across the world.

Second, the developmental approach to civil society underplays the fact that not all civic groups are "civil" in their behaviour (Holloway, 1997). The Ku Klux Klan, fundamentalists of various persuasions, and pro-and anti-abortion groups do not necessarily operate according to norms that reject violence and other "uncivilized" behaviour. Only a thin red line separates "uncivilized" behaviour from legitimate civil resistance, demonstrations and "constructive" confrontation. Forceful expression is a legitimate part of the repertoire of public action open to citizens. Recent examples have been demonstrations at the World Trade Organization and protest by Iranian students in favour of greater democracy. Tiannamen Square is "celebrating" its tenth anniversary. In other words, civil society is a source of and an arena for violence and constructive social contention as well as co-operation.

Third, it is incorrect to assume that forces that create poverty, exclusion and injustice exist only in governments, public policies and market institutions. They lie within civil society as well. In other words, civil society encompasses contending power relations and group interests that can both advance and impede poverty reduction, equity, inclusion, justice and other social development objectives. Civil society is essentially political in its meaning. The civic arena contains roots of power differences that are used to perpetuate poverty and exclusion. This reality must be factored into development initiatives.

In sum, as a new development concept and potential "instrument" or "partner", civil society requires deep understanding of civil societies in their own terms. One (Western) size does not fit all. Moreover, engaging with this sector demands new approaches from development institutions whose practices are premised on resource transfer within the framework of governments. In other words, working with civil society requires new rules of the aid game and methods to match. In addition, the onus is on the aid system to prove its honest commitment and worth, adapting to civil society, not the other way round.

What will civil society do for international development?

What does the international development community expect from a closer relationship with civil society? What can this institutional "sector" do to advance the social development objectives and commitments negotiated at Copenhagen and in other international conventions and covenants? A recent comparative study identified a variety of "developmental" expectations about civil society (van Rooy, 1998). These contributions are:

· To improve development by, inter alia:

o directly delivering services to the poorest;

o building social capital;

o promoting equity, through activism for a fairer share of national wealth and the benefits of growth; and

o replacing state aid.

· To foster democracy through:

o establishing civic functions, such as checks and balances on state behaviour; blocking capture by interest groups; generating a stake in the social order; fostering political participation; acting as a source of political leadership; resisting authoritarianism;

o containing a source of countervailing power, acting as an antidote to state expansion;

o originating and nurturing democratic institutions;

o fostering a culture of democracy and "civility".

· Other functions include:

o supporting "friends" in the post-Cold War era; and

o promoting the free market or the "civil private sector".

Obviously, in pursuit of social development goals, some of these functions are more relevant than others and some may be mutually contradictory. Nevertheless, the issue is whom can the aid system engage with? Which civic actors are best able to deliver these types of development contribution?