Just Contract it Out

    Last week in Tunis, had you stopped by the worn Sheraton Hotel, you would have witnessed a small but surprisingly important gathering of developing country ministers, aid effectiveness academics, and donor agency execs. This group - brought together by the African Development Bank and the OECD Partnership for Democratic Governance and attending with ties, microphones, video crews, and name placards - came to debate the issue of contracting out basic services in post-conflict situations.

    It turned out to be less of a debate and more of an education. In post-conflict situations, where little works, sometimes the only way to get basic services like water, electricity, and medicine to the people who need it is to bring in outside capacity. In other words, to contract it out. There's not much to debate, frankly, other than methodologies and forms of contracting.

    Of course this goes on in the richest countries in the world. We regularly argue over charter schools and private health providers in the United States, for example. But in a fragile state, the situation is less academic: Providing basic health services quickly in Somalia, southern Sudan, or the Democratic Republic of Congo requires outside capacity, full stop. Where the discussion should be focused is the best way to contract out in such circumstances.

    What makes a post-conflict situation unique is that most often, the funds available for hiring outside contractors come from donors. These donors may well have their own desired approach and procurement process. A multi-donor fund could be an ideal solution, allowing a recipient country's weak government a chance to make its own decisions about how to spend the money (within transparency guidelines, of course).

    And that's where the conference failed to conclude. Because try as this small group might, it can't control parliaments in Western countries that set up barriers to untied aid, hesitate to put taxpayer money in the hands of seemingly untrustworthy foreign governments, or want to make funding decisions themselves. Contracting out may be practical and even inevitable, but its time will only come as donor governments change their perspective on aid from political largess to strategic investment. It will only come when donors and the governments that back them are willing to take risks and give up control to support fragile governments and at-risk people.

    Just ask the minister of finance of East Timor, the minister of health of Liberia, or the former deputy minister of finance of Afghanistan. All three seemed to view the contracting-out discussion to be like a theoretical lab experiment. In their real lives back home, experiences with misguided aid, donor ulterior motives, and wasted assistance colored their view of any donor-led initiative to more effectively deliver basic services through contractors.

    So while some attendees may have been frustrated that contracting-out was often conflated with the broader aid-effectiveness debate, to this attendee it seemed worthwhile to get everyone's issues on the table. If we are going to bridge the gaps among nonprofits, contractors, donors and developing world governments, what better way to start than two days in Tunis?

    About the author

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      Raj Kumar

      Raj Kumar is the Founding President and Editor-in-Chief at Devex, the media platform for the global development community. He is a media leader and former humanitarian council chair for the World Economic Forum and a member of the Council on Foreign Relations. His work has led him to more than 50 countries, where he has had the honor to meet many of the aid workers and development professionals who make up the Devex community. He is the author of the book "The Business of Changing the World," a go-to primer on the ideas, people, and technology disrupting the aid industry.