What does the future hold for the 'third arm' of the World Bank?

World Bank President Jim Yong Kim’s shake-up of the World Bank’s organizational structure has elicited a wide range of emotions: hope, fear, confusion, doubt, optimism, inspiration. Budget cuts, projected staff layoffs and the introduction of 14 new “Global Practices” had many inside and outside the institution expressing concern about the fate of bank-led development initiatives, which they feared might be sidelined or diminished as a new structure took hold. Eight months after the most significant reforms took effect, bank staffers and development partners are beginning to take stock of what effect the changes have had on some of those prized programs. Civil society leaders, nongovernmental organization chiefs and champions of citizen-driven development have kept a close eye on a new grant facility — described by Kim as a “fundamental change” in the bank’s approach to civil society. The “third arm” of the World Bank, the Global Partnership for Social Accountability, was created in June 2012 to provide grants to civil society organizations focused on improving public sector delivery of essential services for the poor such as water, electricity, and textbooks, and to support citizen-feedback mechanisms. Now, the GPSA is settling into the new Governance Global Practice, and Devex spoke with industry insiders about whether that has been a plus or a minus for the small facility — and what it means for the future of the World Bank’s third arm. A ‘third arm’ for effective development Effective development isn’t always about technical solutions. In many cases, development problems linger even when technical solutions are readily available. Why? Because of gaps in the relationship between citizens and governments. That was the thinking behind the creation of the GPSA. The GPSA was designed to provide a space for the World Bank to work with civil society and citizens in developing countries the way the International Development Association and the International Bank for Reconstruction and Development allow the bank to work with the public sector and the International Finance Corporation and the Multilateral Investment Guarantee Agency allow the bank to work with the private sector. Effective service delivery to the poor, GPSA proponents argued, is essential to good development practice, and the bank saw this new partnership as a way to support public sector — civil society dual efforts to put strong service delivery programs in place in developing countries. “The GPSA represents a fundamental change in the way the World Bank Group looks at the importance of civil society,” Kim said during last year’s GPSA Global Partner’s Forum held in Washington, D.C. “So we have to protect it. We have to make sure … that the grants that we’re providing are really having an impact.” Initially anchored within the World Bank Institute — the part of the bank that supports the incubation of new programs and innovative ideas — the GPSA was designed to transition to the operational side of the bank after two years. By the time the grant facility’s first two years came to an end in the summer of 2014, Kim’s reform agenda was in full swing and instead of moving into the governance sector of the bank, the GPSA transitioned to the newly created Governance Global Practice directed by Chilean economist Mario Marcel. The move concerned some proponents of the GPSA who worried the facility’s placement under the wing of one of 14 freshly created global practices, led by a brand new director, could result in a lack of senior management commitment to the initiative. “Initially, there were concerns expressed that … the leadership commitment at the higher levels to this program would somehow be diminished or diluted,” said Lindsay Coates, acting president and CEO of InterAction and member of the GPSA steering committee. According to leaders at the GPSA, that hasn’t happened — and in fact, the small facility is looking for ways to expand its reach. “The money is there, even in a very tough environment today where the bank is going through an expenditure review,” program manager for the GPSA Roby Senderowitsch told Devex. “Having honored a commitment to the GPSA in that environment I think is a huge signal of support by the bank,” Senderowitsch added. When the GPSA was approved in June 2012, the bank’s Boards of Directors promised that $20 million of funding for the initiative would come from from World Bank, Senderowitsch said, adding that not only has this commitment come through year after year, but over $8 million has additionally been contributed by outside donors including civil society, foundations and donor governments. Settling into World Bank operations The transition into the Governance Global Practice has been a positive one according to Senderowitsch who said the new structure allows the GPSA to work on their grants in collaboration with a variety of Global Practices in addition to the Regional Units that they worked with in the past. Coates agreed, adding that any concerns associated with structural change at the bank has been, “very much counterbalanced by the fact that the GPSA has survived the funding cuts.” Randy Tift, senior policy adviser at World Vision — an international NGO that received a three-year $1 million GPSA grant to carry out development work in Indonesia — told Devex the facility can work well under the Governance Global Practice if bank leadership continues to recognize the GPSA’s value, if they continue to engage with local partners through grant mechanisms, and if the bank leads by example “by contributing its own financial resources.” Governance Global Practice Senior Director Mario Marcel never worked with the GPSA prior to his appointment in his post, but Senderowitsch said Marcel has extensive experience working with civil society in his home country Chile, and while at the Inter-American Development Bank. Senderowitsch also said Marcel tackled issues related to social accountability while working for the Organization for Economic Cooperation and Development in Paris, and that at the Governance Global Practice he aspires to create a “citizen-centric governance approach.” New donors and new call for proposals While the GPSA is hosted at the World Bank and receives base funding from the institution, it relies heavily on the support of outside donors and partners, including civil society, foundations, multilaterals, bilaterals, academia and the private sector. So far, about $8 million has been contributed by donors outside the World Bank according to Senderowitsch, including most recently the government of the Dominican Republic, which Senderowitsch called “a big deal” for the grant-making facility. The Dominican Republic is one of 40 developing countries that have opted-in to the GPSA as a participant, and last month they announced an initial contribution of $25,000 — a tiny commitment financially, but a significant one symbolically, according to Senderowitsch, who added that it demonstrates financial support “from the south and not just the usual suspects.” The government of Finland has also expressed the desire to contribute financially to the GPSA and are in the final stages of an agreement, Senderowitsch said. Meanwhile, Senderowitsch told Devex, the GPSA secretariat is now preparing the 2015 call for proposals — a process by which the GPSA requests proposals from civil society organizations in participating developing countries that seek to implement social accountability initiatives to improve service delivery to the poor. Selected proposals will receive grants between $500,000 and $1 million from the GPSA to carry out their initiatives over a period of three to five years. Every proposal should have certain key elements Senderowitsch said, adding that first, successful proposals should demonstrate how an initiative will help solve a problem for the citizens of a country. Second, the proposal should demonstrate how results or findings from an initiative will be used by the public sector in the country to affect change. The GPSA steering committee wants to know who from the public sector would use the information gathered from a civil society initiative and why they would do so. Approximately eight to 10 proposals are expected to be approved. The future of the GPSA Senderowitsch and his team are gearing up for the GPSA’s second annual Global Partners Forum on May 12 and 13 — an opportunity for participants and supporters of the partnership to network and share ideas about social accountability and development. Kim is expected to attend as he did last year, and champions of social accountability hope he will reaffirm his commitment to the World Bank’s third arm. Speaking at last year’s Global Partners Forum, the World Bank chief emphasized the importance of the new initiative and explicitly expressed his commitment. “Are we committed to growing this part of our work? In the name of ending poverty, in the name of boosting shared prosperity, in the name of economic growth, absolutely,” Kim said. Looking ahead, Coates said it’s hard to forecast the bank’s commitment. “My sense is that the bank is actively seeking other partners to support this work, and I don’t have a crystal ball so I can’t predict whether the bank will continue to commit at the level that it has in the past.” Tift meanwhile said the idea of the GPSA establishing itself as a multidonor fund is positive, but said he hopes that it doesn’t mean the bank diminishes its own financial support. “We do not want the GPSA to become a mechanism for collecting other donor government’s funding without also utilizing the financial support from the World Bank,” Tift said. “We want the bank to lead by example.” Regardless of whether the World Bank maintains, expands, or diminishes its financial commitment to the GPSA, members of the steering committee and other supporters of the partnership want social accountability to be infused in international development practice. Coates said she wants the GPSA to be “the new normal.” “It’s possible to think about a GPSA like model changing the way that we all do development,” she said. For now, the World Bank remains committed to its third arm — despite the institution’s structural upheaval — and support from outside donors is growing, giving social accountability a more prominent space in the development landscape. What do you think about the GPSA and its label as the World Bank’s third arm? Are there other World Bank programs that haven’t fared as well through Kim’s reforms? Let us know by leaving a comment below. Read more international development news online, and subscribe to The Development Newswire to receive the latest from the world’s leading donors and decision-makers — emailed to you FREE every business day.