Examination of Witnesses (Questions 20-39)
DR MARTIN
GAINSBOROUGH AND
MR RAMESH
SINGH
19 JUNE 2007
Q20 Joan Ruddock: Have you any comments
on DFID?
Dr Gainsborough: I really do not
know. On the trafficking and HIV/AIDS, and trafficking is something
where women in particular suffer, it has probably moved on over
the last six years. There is a clear recognition, particularly
with trafficking, that this is a major problem. The government
is involved in lots of multilateral and bilateral and NGO projects
dealing with it. The question as to whether that is having any
real effect is the issue.
Q21 Chairman: Moving to another area,
obviously while we were in Vietnam, there was a lot of discussion
that if this progress continues, in the fairly near future Vietnam
will graduate to middle-income status, and specifically for British
interests but obviously significant, given our International Development
Act and the 90:10 split, it would lead to an inevitable disengagement.
Perhaps other donor countries are not quite so critical on that.
I wonder what you feel are the challenges that donors face. Sir
Robert Smith has made the point about vulnerability but I think
we accept that. You are only just getting out of that and you
may fall back. We take that point as a given. How should donors
and the international community deal with the movement towards
middle-income status in Vietnam in ways that ensure that that
does not lead to an abrupt end or complacency or cutting off programmes
or that if they achieve middle-income status, we may abandon perhaps
the vulnerable people who have not quite shared in that? What
do you think are the challenges that need to be addressed?
Dr Gainsborough: I do not know
the answer to this, but the important question for me is how aware
is the government in Vietnam that when they reach middle-income
status there will be a scaling back, if not a cessation, of aid.
They may be very aware of it. If they are not, and it is not so
long ago that Vietnam was just beginning to get aid, the thought
that it is now not so far away and they might not get it I suspect
is not uppermost in people's minds. It is very important that
this is discussed, talked about and the strategy and programmes
are tailored to deal with a limited timespan, if that is what
we are talking about. A lot of the emphasis should be in terms
of governance issues and the things I have highlighted in my written
submission. Managing a rapidly developing economy, rapid social
change and urbanisation, is phenomenally challenging. Moving towards
reforming the political system is really challenging.
Q22 Chairman: I suppose the point
is about the justification for saying that middle-income status
puts you in a different category. What essentially we are saying
is that the overall wealth of the country has now reached a level
that you should start to be able to address poverty reduction
in your own terms domestically. The question that arises, and
I know that your list of suggestions is relevant to that, is:
how well prepared is both the government and society in Vietnam
to take that responsibility forward? In other words, we have enough
potential resources in the country; can we have a mechanism to
ensure that we continue to share it out in a way that maintains
that poverty reduction, as opposed perhaps to moving into a situation
where inequality could mean that middle-income status could be
a mask for poverty beginning to increase in certain sectors.
Mr Singh: First, we need to bear
in mind that the role of international development assistance
and the history of that is relatively short. Secondly, we need
to recognise, and I know that this is all based on an income-related
classification and we are very critical of that, that if you look
at Vietnam and the current state of civil society, there is space
for participation in governance. We have talked about women's
rights. Those are things that move much more slowly than income
data. We would be worried, as we are in other places, and we are
trying to understand what is happening in other middle-income
countries where this engagement has led to difficulties for the
existing poor and how it affects them. In particular, in Vietnam
where there is plenty to do, we also think that strengthening
governance and continuing with longer term engagement on governance
issues and civil society are important. I feel that the international
development community, including DFID, has somewhat disengaged
from direct engagement with civil society in the wake of trying
to be efficient with money and budget support, which we wholeheartedly
support. That is the way to make it more recipient-led. As I was
saying earlier, the international development community used to
work with both international civil society there as well as with
the national emerging civil society. That engagement is much less
perhaps because of the reduction in the amount of money that goes
to civil society from international development communities in
Vietnam, including DFID. I feel that we need to flag that. I agree
with Dr Gainsborough that there needs to be a conversation with
the government, but at the same time the international development
community needs to recognise not simply economic data but also
the length and depth of those development experiences. We have
to applaud Vietnam as a country. Their willingness to learn is
quite phenomenal. We know from our own experience that if they
are convinced and if they want to learn and if there is a method
and model that we are able to sell to them, that spreads and becomes
deeper. There is plenty to do in many areas which are masked by
easy growth. We have discussed the ethnic minority sector, women's
rights and human rights on which civil society is based. There
is plenty to do which I hope we will not abandon. The length and
depth of international development engagement needs to be kept
in mind. We are warning about taking a very mechanistic view of
the middle-income countries. This is different from other middle-income
countries where international development and civil society have
grown over a period of 40 or 50 years. The history is very short
here.
Dr Gainsborough: Quickly in response
to that I would say that my point is that this is a relatively
capable state that, for example, has provisions of its own for
natural disasters. There is a sense in which as Vietnam is moving
to middle-income status and the ability to cope on its own, there
will be a need for some change in mind-set. You deal with problems
of poverty at the moment with big budgets, large amounts of that
coming from external actors, donors and so on. Then suddenly Vietnam
is going to have to finance these things themselves. There is
recognition that that is what it will do. There is a commitment
to do that. There is some sort of mind-set change. I come back
to the point that in the meantime between now and Vietnam reaching
middle-income status, it is about a system in Vietnam to strengthen
critical institutions, whether it be in health and education to
reverse some of the problems that have emerged with the marketisation
of those sectors, which is clearly having implications if they
do not have money, or turning a talked about social security system
into a functioning system, which I am not convinced has happened
yet.
Q23 Ann McKechin: Could we turn to
the issue of WTO membership, which Vietnam has recently joined.
Dr Gainsborough, you talk about the fact that Vietnam has to make
major concessions. That seems to be the general opinion of the
agreement. Are you seeing any early evidence of the impact of
that agreement, particularly in terms of the poor and vulnerable
members within Vietnamese society or have either of you any concerns
about where this agreement is likely to lead in terms of vulnerability?
Dr Gainsborough: Generally speaking,
it is too early to say what impact WTO membership is having, whether
it be on poor communities or on industry or services in general.
I am trying to recall a conversation I had second-hand with the
Head of Oxfam. Some of his concerns about what the agreement would
consist of have not been realised. They were particularly highlighting
areas they were worried about that, Vietnam was being pushed to
concede and suggesting that the letter of agreement was not as
bad in some areas, and they were very much focusing on poor communities
as had been anticipated. I think we have to wait for that evidence.
It is just so recent, is it not?
Mr Singh: I agree that we have
to wait. No doubt there will be a fall out, particularly on the
poor people's progress, small producers and farmers. We have seen
that elsewhere, including in China. We are monitoring that.
Sir Robert Smith: We certainly see a
challenge for the environmental with the rapid growth in motorbikes
and the use of vehicles on the roads as the import tariffs come
down and the economy opens up to that side of things as well.
Q24 Ann McKechin: This leads to the
question of whether or not production costs in places like the
neighbouring countries of China, Cambodia and Laos will have an
adverse effect on the ability of Vietnam both to compete but at
the same time sustain the growth in their economy.
Dr Gainsborough: I am relatively
optimistic about the ability of Vietnam to compete for a number
of reasons. The economy is more open than the formal picture presents
anyway because of smuggling. Vietnamese companies have shown themselves
able to cope with some quite big challenges in terms of breaking
into new markets. A good example would be the catfish sector where
about 80% of their exports were going to the United States. The
United States said, "These are not catfish. You are trading
under a false name. You cannot export them". The sector was
thrown into turmoil for a period. Now, 80% goes to the European
Union. I thought that was quite impressive. There are real challenges
in terms of moving up to higher technology products. That is really
where Vietnam has to go. That is definitely challenging. The other
area where there is perhaps greater vulnerability in terms of
adjustment is in the services sector. The banking sector is being
opened very rapidly. Foreign banks and Vietnamese banks often
work together. The foreign banks have technology and up-to-date
knowledge and local banks have political connections and access
to local markets and so on. It is not necessarily going head-to-head
in that sector.
Q25 Hugh Bayley: It is clear that
quite a number of players or donors will be scaling back their
involvement as Vietnam achieves middle-income status. Who do you
expect to fill the void in terms of providing outside reference
points, advice and guidance and so on, the sorts of issues you
are focusing on: income inequality, governance and so on. In particular,
does the UN have the capacity to do this? Is that the right body?
Dr Gainsborough: I feel a little
unsure as to precisely who will be scaling back and when and the
picture of scaling back in it is entirely. If one imagined, and
this may not be the whole issue, a donor-free environment at a
point further down the line, in terms of reference points, we
would need to look at the big foreign relations that Vietnam is
involved in. Clearly, they have to think in terms of China and
the United States, two powers which are very significant in Vietnam's
external relations. The UN clearly does have a role to play and
it has a wider programme of experience across a wide range of
areas, but I do not know what precisely how they will adjust their
involvement in moves to middle-income status. I do not know the
answer to that.
Mr Singh: The UN's ability to
fill a void by the passing of international donors is not proven
anywhere. The UN plays a particular role, that is not about money.
The transference does not take place in the same way. Their ability
to negotiate with the state is not strong because in many ways
it is subservient to the members and the UN's ability to negotiate
that is very different from international donor communities. Therefore,
I do not feel that that would have been covered by it and it has
not been done anywhere else, as far as we know. I think in other
countries civil societies are strong and they bring that international
connection and experience and continue to demand that accountability.
That is what I was alluding to earlier. That depth is not there
in Vietnam and therefore our appeal would be not to be too blinded
by this middle-income, income-based thing and we should look at
the depth of development that is happening. I do not think the
UN will do that. If we have a civil society that goes deeper and
that is internationally-connected and has space to hold the system
accountable as well as to negotiate, that is not going to happen
in Vietnam at the same pace as the middle-income status it will
achieve.
Q26 Hugh Bayley: I suppose the question
is this: inevitably there will come a point where the per capita
GDP of a country is such that it is possible for the government
wholly or largely to fund basic services addressing basic human
needs itself and it would be wrong to expect outside donors to
be funding that. Yet engagement with new ideas is still going
to be necessary. You seem to suggesting that the government only
engages with new ideas when it is "bribed" to do so,
incentivesed to do so, by donors offering money. I wonder whether
it really is a role for development agencies once per capita income
gets higher.
Dr Gainsborough: You wonder whether
there is a role?
Q27 Hugh Bayley: Yes. I think it
is for the private sector to do it.
Dr Gainsborough: How does Vietnam
get impartial advice? In other words, is the private sector the
best vehicle to provide that? I would have some question marks
about that in my mind.
Q28 Hugh Bayley: Governments set
their own agendas.
Dr Gainsborough: Indeed they do.
Of course, projects with large amounts of money attached to them
are attractive, with advice or not. There is a real recognition
that Vietnam is far behind its regional neighbours and many other
countries of the world in developmental terms. There is a real
curiosity to learn about the outside world. There is a determination
that Vietnam will find its own solutions by looking at a range
of different experiences. A key role for donors to play right
now is to make sure that Vietnam is exposed to as wide a range
of different experiences as possible, but perhaps that is also
about setting up a culture in which, as new problems come up,
there is a constant searching for new ways to deal with them.
The more donors are doing that, the better, it seems to me. Whether
they do it for ever, I agree with you, is the question.
Mr Singh: The British Government
does that. I admire DFID for constantly trying to learn, although
much of their learning derives from China rather than anywhere
else. I do not feel that the private sector will be able to address
all these issues of governance, the issues of social justice and
human rights. The private sector is not going to be able to address
those kinds of experiences and debates. I agree that the possible
volume of money and the flow of money from the international donor
community may be of a different scale, and also the nature of
engagement in the kinds of projects with which we become involved
will be different. I cannot see how so quickly the international
development community will be able to withdraw from Vietnam without
seriously endangering the gain that has been made in many ways.
The engagement will be required. We need to debate the nature
of that, and how that will be leaving it entirely to the government.
It is a mistake that is capable of being made. There is no question
that they do what they do well and want to do more, but there
is need for engaging on a range of issues which has not been done
in depth yet.
Q29 Hugh Bayley: Why would the gains
be at risk? Are you saying the gains have been made in spite of
the government because donors have set an agenda the government
does not support? It is incredible to me that the government is
going to take steps which mean that progress may indeed be set
back. How could a refocusing of donors' money in countries where
there are greater numbers of desperately poor people lead the
Government of Vietnam to sabotage the gains that have been made?
Mr Singh: I do not think all of
those gains will be lost. It is a question of continuous gains.
Let us face it, there is no question that, compared with many
countries where we work, Vietnam as a government and a state is
much more committed to their citizens. They have good policies;
not all of them have been implemented. All big changes require
some mediation. In the last couple of decades, the bigger changes
of openness and governance changes, budget related issues, have
been mediated. It is important to recognise that, while the government
is strong and can do much, many of the bigger changes require
mediation and support, not only financial but also ideas and methods.
I am alluding to the fact that there are lots of things related
to governance, citizenship and women's rights that have not found
a depth yet. It is not so much that they will lose the gains.
These are the things that are likely to remain where they are
and we will have a situation where the GDP of the middle-income
people will produce a chronic level of poverty and issues that
are not tackled. It is true that at this point in time it is a
matter of speculation. It may not allow some of the gains that
have been made to be sustained, not only because of the will of
the government but also the things that are left without depth
to them.
Q30 Ann McKechin: Dr Gainsborough,
you spoke about the social security system in Vietnam currently
not being adequate to meet the needs. We heard when we made our
visit to the country that there is quite a detailed health insurance
plan already in operation with a view to 100% coverage in a few
years' time. On pensions, the strategy is less clear and it seems
to be involving only those who are in the formal sector and not
those who are self-employed or casual labourers, so there is a
difficulty about whether or not the country has a full decision
that it is going to be able to address the poorest and most vulnerable
people. What do you think the hurdles and risks are of providing
a sustainable social security system and specifically, to both
of you, can I ask what role you think donors and civil society
can play in its design and its implementation.
Dr Gainsborough: The first point
I would make is that the bureaucracy is totally and utterly Kafkaesque.
They can talk about these things and some people will genuinely
recognise that they are important; others will not. It is important
to try to educate people about why social security systems are
important, and there is still work to do in that respect. Simplifying
the system, making it operational, making it possible for people
to claim and to find their way through the system is an area that
needs attention. What is the role of NGOs in this? We have not
talked a great deal yet about civil society but civil society
in Vietnam is very embryonic. I am not convinced it is in a position
to play a major role in these areas at the moment. What we did
get a sense of is that the role that civil society should play
is as a watchdog of the government. I cannot see it playing a
significant role in the provision of social services or leaving
it to deal with problems of poverty.
Q31 Ann McKechin: The answer would
be that the government has to take the major part, as you would
expect in most countries. Obviously in Vietnam the political development
would attend to that. Would you say that donors, such as DFID,
should become involved in it and, if it is their intention to
become more involved in helping them to set up these types of
schemes, that they should in turn be trying to reduce the bureaucracy
and should focus on technical assistance and advice?
Dr Gainsborough: I think that
just focusing on, very simply, a workable system, a system which
can be navigated by ordinary people has to be a central element
to any donor intervention in this important area. I can well imagine
that you could have very grand and beautiful schemes on paper
but that would still be a nightmare to function and then who actually
is benefiting and being served by these systems?
Mr Singh: We cannot get these
things properly done by just emphasising the supply side of it.
That is where civil society comes in; it is not simply about being
a watchdog but who is going to prepare the people who are going
to claim the social security and that is the role of civil society.
The Women's Union can play a role. Vietnam has a different kind
of civil society and we need to learn to live with that. They
have an outreach to the demand side. I do believe that it is important
for the international development community, including DFID, to
make sure that it supports the social protection and social security
side but not only working at the supply side of that. The supply
side is only as strong as the demand side, and working with people,
ensuring that they have a safe design.
Q32 Ann McKechin: If you build up
a network at the grassroots of people who know what their entitlements
are and are able to work through the system, that will then put
pressure on the system to become more efficient because otherwise
the demand would be much more visible on the other side?
Mr Singh: There are already other
kinds of systems with money given to our actions and, because
it is strong on the demand side, they are delivering, even though
that is still a factor in whatever the existing security system
is. I do feel that the international development community, donors,
need to learn to live with the current situation, whatever civil
society says. There is an international and national civil society
interface. I repeat that attention has been slightly eroded because
it is very attractive to want a strong state and go only into
the supply side. Attention needs to be paid to the demand side
of this system, and the demand side of the governance needs some
attention.
Dr Gainsborough: Can I respond
to the comment you made about building up civil society so that
people know what their rights are, and in a sense that is putting
pressure on the system to respond. There is a crucially important
role for donors to play in helping to strengthen civil society
in Vietnam. That is very important. One of the things I am very
conscious of is how if donors do that and jump on that bandwagon
without understanding the concerns and suspicions on the part
of the state to the greater civil society, you could be contributing
in a sense to a pressure cooker. Civil society becomes more powerful.
The state is not ready for that. Civil society becomes more demanding.
What I have been saying is that of course there should be work
to develop civil society in these particular areas, but one also
needs to think through how one builds a greater understanding
within the government and the party about the positive role that
civil society can play. I feel it is important that those two
are done hand-in-hand to avoid that.
Q33 Ann McKechin: One suggestion
might be that we show to the government that this is the more
efficient way of delivering the output because it will actually
reach the poor and vulnerable people, whom they have indicated
they want to ensure are not left out.
Dr Gainsborough: Indeed, and I
am sure there are many ways that this can be done. It is important
to do both sides of the coin.
Chairman: It is certainly true of the
European former, communist states, that civil society and NGOs
very often are still regarded with suspicion, sometimes with justification.
Q34 Hugh Bayley: It is one thing
for the state to work with civil society on the welfare agenda.
It is obviously much more challenging to work with civil society
on questions of governance, political reform and dealing with
corruption. You have stressed the importance of donors using what
leverage they have to make progress on governance. What is the
role of civil society in that regard and how can donors support
the capacity of civil society to grapple with these politically
challenging and probably politically unwelcome agendas?
Dr Gainsborough: I think for me
what donors should be focusing on in terms of dealing with governance
issues, and of course there is a whole range of areas if we think
in terms of broadening the political space which in a sense is
a vague term but it is about creating a more dynamic society where
people set up organisations in a whole range of different areas,
whether that is in environment or education or health or leisure
or whatever in ways it has not happened before, you create this
plurality within society. That is important. That is the area
in which donors should be working. It is important to recognise
the sensitivities in this area, that if you were to push NGOs
in human rights areas, then it would backfire on you very quickly
in the current climate. If one lays the foundations in terms of
working to assist the growth of civil society in other areas,
in time, with the right emphasis and approach, that can ease the
suspicions of the state and the next step can be taken. For example,
the law on association has been backwards and forwards to parliament
and has never been passed. This just reflects what a politically
sensitive issue it still is. A few years ago, you could not even
talk about civil society and now you can, but it is still a sensitive
issue. It is important not to be counter-productive. That is all
I am saying.
Mr Singh: I agree that we need
to recognise the specific context of the political system in Vietnam.
I have to say there is nothing that we have wanted to do and we
have not been able to do in terms of raising issues. It is not
possible to come out on the street like in India or Bangladesh
and go to the newspapers. One needs to gain trust but there are
practical things we can do. We can do pilot projects jointly,
and we worked with a particular department for two years to develop
adult literacy. They were very cowed but once they agreed, it
became mainstream. We have been able to point out to the provincial
authorities that they were regressively taxing poor people by
equally taxing the building of schools or whatever. They have
retracted. The government does have the right intention particularly
related to economic and social aspects. If something works, we
are allowed to do it. We can go and talk about things. When I
went there for the first time, the budget was still a state secret.
The provincial authorities would have a handbook but we could
never see it. We can now go and talk about budgets. That is where
the role of civil society comes in, working in a smaller area
and generating enough experience and engagement. Much of the work
that civil society does in Vietnam leads to engagement through
models and sharing information, but there is a space. The outright
language of human rights is not going to take us very far. In
1999, we could not even use the word "advocacy". Now
the government itself uses the word "advocacy". There
is a possibility to do that. We require investment, not a huge
amount of money, and we need to make sure that it is on the agenda
of the international donor community that there are lots of governance
issues that we need to address. As you know, the growth of national
civil society or NGOs and international NGOs is quite organic,
if you look at the experience of other countries. There is a need
and space but it has to be done very differently in Vietnam from
other countries, in my experience.
Q35 Hugh Bayley: You make a strong
case for pluralism in the field of welfare. You suggest that is
an area where progress can be made, but seems to me that political
pluralism is needed and there will become a level of development
that Vietnam cannot get past without a measure of political pluralism.
I think you are telling me that is just off the agenda now. That
concerns me very much. Dr Gainsborough, you made the comment in
one of the papers you provided to us that it is a mistake to see
all political transitions as necessarily leading to liberal democracy.
I am not sure I agree with that because there are many forms of
liberal democracy. You can have a Swedish model or a Japanese
model; they are both liberal democracies but they are not at all
like each other. The fundamental characteristic, though, is the
contestability of the political space by people who are not part
of the ruling class. Surely, a liberal reform that does not allow
contestability of a political space by people who are not part
of the government or part of the ruling class is not political
reform that will allow the kind of transparency that enables you
to deal, in the fullness of time, with corruption, human rights
and the rights of minorities and so on.
Dr Gainsborough: I think that
Vietnam will, in time, move to a more pluralistic system and it
may move towards a system where there is more than one party.
Whether it will be the Swedish model, the Japanese model, the
Singaporean model, the Cambodian model, one dominant party state
(there is more than one party but one party wins), the Korean
or Taiwanese model and there is a whole range, is a guessing game.
We can have views in different directions. I would like to come
back on the point that this more substantive political change
is off the agenda and comment on that. I do not want to say that
it is off the agenda. It is about donors or external actors building
relationships such that these issues can begin to be discussed
but discussed quietly. That is quite important. You can begin
to have a dialogue with the Vietnamese Government on these issues
but if you do it in a loud noisy way, it will not work. Sensible
people within the system recognise there is a major political
transition of some nature somewhere down the line. What are the
experiences of other countries in this? How have other countries
dealt with this? What did other countries do well and what did
they do badly? That particular report to which I drew your attention
was really trying to do that. If it was conservative in some respects,
it was because I was trying to recognise where the state was and
how we can move on. If I were to get that wrong, then my report
would just be dismissed out of hand. For me, that is the sort
of intervention that is needed. It is a very carefully drafted
subtle intervention. Donors should be clear about the political
system that they think is advisable, but if we do it very noisily
and publicly, then at this point in time it is likely to backfire.
Q36 Hugh Bayley: How do you get advice
from other Asian countries? This comes back to my question: when
should the donors step back? I hazarded that maybe the private
sector could provide the role and expertise, and you knocked that
one on the head. Maybe Malaysia, Korea and China have more lessons
to pass on to Vietnam. How do you ensure that others in the region
are more closely engaged in the policy agenda?
Dr Gainsborough: These particular
countries you have mentioned—
Q37 Hugh Bayley: I do not know the
region at all well. I was not able to go on this visit. I remember
once going with an international group of MPs to West Africa to
evaluate the World Bank's performance there and the contributions
of Indian and Malaysian MPs challenging the development paradigm
in Africa was much more powerful than what Westerners were doing
about governance because they have much more contemporary experience
of economic development than we do in the UK when we took off
on this two or three years ago.
Dr Gainsborough: Obviously I am
a researcher, so I think in terms of research. I have some experience
of working with the Vietnam Academy of Social Sciences. The research
capacity, the ability to do good, high quality international standard
research, is weak in Vietnam, for a whole range of reasons. I
know that one of the areas that DFID and others are beginning
to try to work in is to strengthen that capacity to do good research
but, more than that, actually to strengthen the institutional
framework such that that research can then be fed into policy
debates and influence policy-making. That is a worthwhile area
to work in. I am sure there are ways in which insights from around
the region could be brought to bear in that research process and
then feeding it into policy circles and policy making. That is
important.
Mr Singh: I believe that the Vietnamese
Government has its own huge amount of investment and it can learn.
The number of people who go to China for all kinds of things at
provincial and international levels is phenomenal. Whether they
are going further afield beyond China and South-East Asia is a
different matter. Certainly ASEAN[1]
provides that framework, although most of that is for economic
learning as opposed to political discussion and debate. It happens.
I agree that the research institutions and sometimes research
individuals have a huge amount of influence in Vietnam. If we
have to take something in, we also take the research institution
route because the politicians and bureaucrats read much more than
in many countries that I know. I acknowledge that it is happening
and it does happen in South-East Asia and in China.
Q38 Hugh Bayley: Is budget support the
best way for DFID to deliver funding in Vietnam? Has it enhanced
the policy influence that DFID has over the government's agenda?
Dr Gainsborough: All the intricacies
of how aid is delivered is not an area I feel qualified to comment
on. I would like to know more.
Mr Singh: At the level of principle,
we are supportive of budget support because it allows the recipient
to have a greater say, so, yes, I think it is a good instrument.
We need to go into it deeper and disaggregate whether this present
support is too linked to a World Bank-driven poverty reduction
strategy paper or not. Even though we know that DFID does not
have conditionality, and we are pleased with that, when we go
into the more co-ordinated strategy that other donors have, many
of them have conditionality attached. Vietnam still continues
to host missions; in 2005, Vietnam hosted 775 donor missions.
There is an issue but as a method, we think budget support is
good. As civil society, we have thought about the complete reliance
on budget support. DFID's interactions and funding to civil society
in Vietnam have gone to practically nil. This is a self-serving
comment at one level but it is important for us to realise that
that may have a cost both to DFID and to civil society in the
sense of the quality of that.
Q39 Sir Robert Smith: You emphasise
the importance of strengthening civil society for the longer term
foundation for stability. Do you think there has been an over
reaction because it is obviously easier for DFID to monitor if
you can trust the monitoring of the Government of Vietnam and
hand the money over to them than if civil society moves in and
out from a more direct involvement?
Mr Singh: We have been engaging
with DFID on this in a more sustained basis. A general comment
is that efficiency is not what it was because the number of staff
in DFID generally is reducing and there is less funding for staff
in Vietnam and globally. Therefore, resorting to budget support
seems very efficient in many ways. In other countries there is
competitive bidding. In Nigeria, a $120 million project is outside
the normal bidding capacity of an NGO because we just do not keep
that as opposed to profit-making companies who will bid for it.
We are looking to the effectiveness side of it, not just the efficiency
side, which is what has led to a push too much for contract bidding
and reduction of staff overall of DFID. It is not simply a financing
but a knowledge institution. That is a general conversation we
have and I am pleased to be able to bring that to your attention
here as well. In Vietnam, we have felt for a while, and we have
engaged with DFID on this, that there is a complete cut-off. I
think we used to engage with DFID. It was not a huge amount of
money but various international NGOs and civil society used to
have access to that. We do not have that now. When I went in the
early days to Vietnam, our connection and civil society's leverage
with the government were mediated by DFID and the Bank and other
people, which was a very unusual situation in many ways because
of the nature of the state and the political system. That needs
attention and we need to discuss whether the quality of contact
and of feedback and leverage for civil society itself might have
been lost without civil society's ability to connect, and money
is a way of connecting. I know we have other connections with
DFID and international donor communities through various forums.
We are able to give feedback to the strategies but there is less
of an organic link. In the scheme of things, this will always
be relatively small. This is not in contradiction to budget support,
which we wholeheartedly support.
Dr Gainsborough: Two things need
to be borne in mind in terms of giving money to civil society,
which I am sure is something that can be developed. Firstly, we
have to think through what the political implications will be
for NGO recipients of external money. In a sense, NGOs do what
they want to do; the good ones have a serious agenda but they
try to keep a low profile. Receiving external money would give
them a high profile and there are potential political consequences.
The other point is that there are large numbers of NGOs which
are purely about making money, so effectively they are businesses
but they call themselves NGOs. It is a case of determining which
are genuinely working with a public agenda and for the public
good.
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