Examination of Witnesses (Questions 100-106)
DR MARK
ROBINSON AND
DR RATHIN
ROY
15 SEPTEMBER 2004
Q100 John Barrett: Just to follow that
through, I am tempted to add that perhaps we could get a political
consensus around the table in here, even in Britain, that the
withdrawal of the state from airlines and railways has not worked
perfectly, even now. It is something that we are struggling with,
put it that way, and in that light, if DFID were to offer at least
some support, help, expertise. I am a little bit surprised that
the Government of India asked DFID not to provide any support
to a public sector enterprise restructuring, and if they are drawing
up a definition of a strategy could we not at least help to engage
in some of the issues and show what our experience has led to
for good and for evil?
Dr Roy: I think this is the major
point that occurs to me. The trouble with a lot of things in the
development business, including especially privatisation, is they
are presented to governments as if there were at any point in
time only one way of doing them. Power sector reform is a good
example. The old logic used to be, "Well, unbundle and all
shall be well." I will not go into the detail. Perhaps the
value-added point for institutions like DFID, as partners, as
opposed to business, is precisely this, to stay in league with
the wider constituency of development partners and to present
compelling evidence-based policy options which would inform the
debate on things like practice. I do not think enough of that
is happening, not just with DFID but in the entire development
community globally, including in India. In India particularly
that would be effective because, as Mark pointed out, there is
no shortage of knowledge about individual level initiatives that
can be taken, how they all fit together, what the thinking is
and how different, innovative ways of doing things that are politically
feasible and implementable can be done. Sure, that could be a
very, very important area of work and possibly therefore have
a virtuous policy influence, if I may say so.
Q101 Mr Davies: How effective do you
think that the Government of India has been, or DFID has been,
in combating leakage from these programmes, corruption, personal
rent-seeking, misappropriation of funds for some politically-inspired
purpose outside the intention of the programme, all of those things?
What is your assessment?
Dr Robinson: Moderately effective,
at best. I think there is a great deal of recognition of the scale
and intensity of the problem, the fact that the scale and intensity
is such that it undermines India's anti-poverty and development
efforts quite fundamentally. You have had evidence presented to
you of the government's own recognition of the scale of the problem,
and indeed Rajiv Ghandi, as Prime Minister, actually drew attention
to that in the first place. There is a huge amount of recognition.
Various sorts of initiatives have been developed, but nothing
which is comprehensive. There has been a root and branch series
of institutional efforts, support to grass roots anti-corruption
campaigns, which are there in evidence in some states, as a combined
series of activities to try to address this particular problem.
There is a fundamental problem that the government is conscious
of but has not yet come up with a comprehensive way of dealing
with it.
Q102 Mr Davies: What is your impression
of the scale of the problem? There seem to have been estimates
bandied around involving 30 or 40% leakage?
Dr Robinson: I do not have a personal
view on the scale of it but I think both the Prime Minister and
senior people in government, including the Planning Commission,
would indicate that is probably a sensible estimate.
Q103 Mr Davies: What is your assessment
of the relative strengths and weaknesses, good policy planning,
good selection of programmes, effective implementation, effective
monitoring of the use of budgetary support and, above all, impact
on outcomes, in other words, effectiveness and efficiency, as
between DFID, the USA, the EU and the World Bank, if those are
the major donors who are still allowed in India? Most of the minor
ones have been kicked out, as we know. How would you compare and
contrast the performance of those international donors?
Dr Robinson: I am not sure I am
qualified to make the comparison in India across those six donors.
Q104 Mr Davies: Who would be? I think
we need to get a focus on that?
Dr Roy: If I may draw your attention
to something that was shown to me. I do not know where it came
from, it came to me informally in my main job, my day job. DFID
itself has done a comparison of the effectiveness in terms of
numbers of people whose poverty has been alleviated globally,
and that is the best I can do. India specifically, I do not know.
They have not looked at USAID but they have certainly looked at
the Bank, they have looked at UNDP, they have looked at the ADB
and they have looked at a couple of other bilats. DFID comes out
rather well there. It does not come out on top, the African Development
Bank I think comes out on top, I cannot remember. I see other
such global comparisons done and my impression from global comparisons,
I do not remember it from in India, is that DFID is certainly
amongst the better performers in terms of the effectiveness of
its programmes, India being a party to the issue, there obviously
are clients still in there. Given that India is a fairly big state,
I would imagine it would be possible for DFID to be a bad performer
there but a good performer globally, it is just possible.
Q105 Chairman: Dr Robinson, can you tell
us what you think about the central government in Delhi's decentralisation
policies, because how those relate and how the federal government
and the states relate is obviously quite important?
Dr Robinson: Just by way of background,
because I think you have not had that much evidence to date on
this, you may know that it has been over ten years now since the
Government of India has had a political mandate to deepen the
commitment to decentralisation through two Amendments to the Constitution.
The 73rd and 74th Constitutional Amendments, which were formidable
pieces of legislation, in theory would actually mean quite a fundamental
shift of power and decision-making and resources away from state
governments and down to three tiers of local councils, so the
framework is a very impressive and potentially a very effective
one. As with many things in India, the actual experience of implementation
has been extremely uneven across different states. The state of
Kerala, which you are visiting, was long seen as a leader in this
regard, and in the late 1990s transferred something like 40% of
state development expenditure down to local councils. There will
be plenty of important lessons learned during your visit to Kerala
in that regard. Unfortunately, no other state in India has matched
that level of devolution of financial resources to local councils.
What is very encouraging is that the new government in power in
Delhi has said that it wants to concentrate much more on issues
of providing a higher proportion of services through Panchayat
councils and also to devolve greater levels of financial responsibility.
That is a very positive policy trend, I think, for poverty reduction
in India.
Q106 Chairman: Dr Roy, DFID runs a programme
with the objective of strengthening the pro-poor aspect of World
Bank lending to India. In your judgment, is that effective, is
it appropriate?
Dr Roy: I think the key issue
there is how such a programme would be effective in terms of selling
it to the government authorities; that would be really key. It
could be technically very effective because if the government
does not buy it then its effectiveness gets reduced. Moreover,
in my judgment, if DFID is seen to be aligned with one agency,
and for whatever reason, something does not work or works badly,
then that could raise credibility issues and political capital
issues for DFID as a whole. In terms of DFID's engagement with
the Bank, it is a laudable measure to engage with the Bank in
terms of enhancing its pro-poor activities, but that must be seen
in the context of does one work just with the Bank or work more
inclusively with other agencies? To avoid the impression that,
again, as I said earlier, there is only one way of doing business,
because if that one way does not work or works less effectively
then the credibility of the entire spend is undermined, I would
feel quite strongly that there is a very good case for DFID to
get involved more in the business of presenting policy options
rather than single sets of policies, and to do this to engage
with a broader range of actors in the international community
than perhaps just one actor. However, this is not a policy decision
unique to India, this is a global policy decision and the decision
to engage more in a more diverse way will have to be taken globally.
Chairman: Thank you both very much. Dr
Roy, I understand that you are on your way from New York to Cambodia
via London. You can see the crowd that have turned out to welcome
you in Parliament Square today. Thank you very much for coming
and giving us such specialist advice. It has been really helpful,
because I think we have got to get our minds around whether we
just kind of tick the box and say that what DFID is doing in India
is fine or actually we have to think whether some other approaches
are needed. Thank you very much.
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