Remarks by USAID Administrator Dr. Rajiv Shah at the Brookings Institution

Thursday, January 19, 2012
Subject 
U.S. Aid and Transparency for Global Development

Good morning, and thank you, Noam, for that kind introduction and for your important work here. I'm pleased to be able to join you today and want to thank Brookings for all the great work that you've been doing in this space.

I also want to congratulate Brookings. I think recently you just won the award again as being amongst the best or the best think-tank in the world, and I certainly feel that way about many of the publications and ideas and initiatives that are housed here that have such important impact on the way policymakers and others think about what's achievable and what the standards of excellence should be that we try to achieve.

I'm also particularly grateful for Brookings because Ann Doyle, our wonderful new public affairs and policy leader, is from here and now with us, and we're so pleased to have Ann on board. So, we thank Brookings in a regular and consistent way for that. (Laughter)

You know, you have a great panel here so I'm going to hopefully keep this short. But, I do want to start by emphasizing this administration's commitment to transparency in aid and in foreign assistance, but also in asking for your help. And, I'll conclude with a few specific areas where I hope you as a community will continue to push and continue to help push the thinking forward on what the standards ought to be that we all try to achieve.

You know, on his first day in office President Obama issued a directive to make federal government more efficient and more accessible. He ordered every federal agency to develop an open government strategy outlining the steps we would take and the new technologies we would use to fulfill a commitment to transparency that we have made to the American taxpayer. This is a universal policy that affects USAID, the State Department, but also all of the other federal agencies that engage in foreign engagement, foreign assistance, and foreign development, which as you know is a broad pool of partners.

Now, because this information is held in hundreds of different databases, we sought to implement part of that pledge by creating foreignassistance.gov, a one-stop dashboard that should over time allow anyone to go and see how the entire U.S. government is approaching transparency in assistance. It's not an overnight fix, and I'll talk through some of the challenges in a moment, but it is my aspiration and it is our absolute commitment to keep improving, keep filling the holes, and keep expanding the set of partners that are included in the foreignassistance.gov platform.

The President also launched the Open Government Partnership, a multilateral initiative to ensure that countries sat together discussing their approaches to open government and making similar commitments to both promote transparency and fight the corruption that in so many places undermines the ability of governments to function and build trust with their people.

And this year, at that meeting at the UN General Assembly, President Obama announced that the United States would join the Extractive Industry's Transparency Initiative, requiring oil, gas, and mining companies to disclose the payments that foreign governments demand of them. Fighting the resource curse starts with fighting rent-seeking, bribery, and graft in potentially lucrative contracts and markets. By joining EITI and strengthening our own domestic resource reporting requirements, we're fighting the corruption that has devastated so many potentially prosperous and equitable societies.

And just two months ago at Bussan, Secretary Clinton announced we would go above and beyond our open government partnership commitments by joining on as a full member to the International Aid Transparency Initiative. Not just one agency, not just one department, but the entire United States government is committed to full membership in the IATI. This will be a challenging task. We're confident we can achieve it, and we have the support of necessary internal partners, but this is going to stretch what the U.S. government has done in the past in terms of making in particular multi-year budget planning publicly accessible. But, we will achieve full membership.

We also seek to push ourselves beyond the traditional international standards of achieving aid transparency. The reality is we live in a world where there's a lot of documentation that's publicly available. Most of our grants are online. I dare you to find them, but most of them are online. (Laughter) And, most other partner agencies can say virtually the same thing around the world.

The truth is, as we've all learned from our own interface and use of technology over the past several decades, simply having the information online is not enough. Having it accessible, having it designed such that it can be utilized by the broadest possible community to empower them to coordinate better, to come up with new ideas, to conduct data analysis and research, to share new insights with the rest of the world should be our aspiration.

And that's why we're currently in the process of piloting an effort to geotag all of our projects and programs in selected countries. And if that is successful, we would like to make that platform openly accessible, because I want anyone with an Internet connection and the ability to download Google Maps to be able to get online and scroll through the globe, identify projects and programs, drill down into them, and understand not just what we're doing and what our partners might be doing, but also to get a sense of other data that can be spatially overlaid on that context. Weather data, soil quality data, information about climate and market trends.

In Paris and Accra, I think the United States was widely seen as, if we're being honest, dragging our feet on transparency. Our goal going in to Bussan was to lead, and of course when you get to a certain place after decades of continual process, you can't flip the switch right away. But the commitments the President, the secretary, myself and others in the development landscape in our government have made is unwavering, and we will not only meet these international standards but we will, over time, put forth some of these new tools like the geospatial mapping that will really empower people in a fundamentally different way to play with data, connect with development challenges, meet and be introduced to institutions that are conducting projects and programs on the ground, and see the impact of that work.

Now, I hope you've heard of USAID Forward, because as you know I don't go anywhere without talking about it. But USAID Forward is our effort to put forth a package of operational reforms to help USAID institutionally become the best modern development enterprise we can possibly be. We've focused our assistance where it matters most; doubling our aid to Africa, closing a 40 percent staffing gap on the continent, pushing our assistance into results-oriented initiatives, and meeting our Gleneagles pledges. We've increased assistance in Africa, for example, from $980 million in 2001 to nearly $10 billion today.

And, we've tried to approach that work in a manner that is accountable for concrete results. Instead of paying contractors to evaluate their own projects, we've defined a new evaluation policy and strategy that we hope is quickly becoming a gold standard. We've sought resources from Brookings and other institutions in town and around the world to help us implement that policy, so that programs from the beginning have baseline data that's collected. There are counterfactuals built in to program design. Data reporting is required on an outcomes basis, not a process basis, and we are committed to making sure that every program within three months of its completion has an evaluation that's publicly available.

By the end of this year, we think we'll be able to publish more than 200 such evaluations just by looking at the backlog of evaluation data that has existed that hasn't been made publicly accessible in an easy-to-use manner, and our commitment goes beyond that. We're committed to not rewriting the evaluations, or even evaluating the evaluations before we make them public. We want an automated system that allows independent evaluators to put data and information online so that we, all of you, and so many others around the world and in this community can learn together and get better at carrying out our incredibly meaningful human mission.

And finally, we're committed to a dramatic set of procurement reforms.

Now, I don't know if you think of procurement reform as absolutely required in order to achieve aid transparency, but I want to argue that it is and I'd like to argue that the United States over the last several decades and our European counterparts in the same timeframe -- although we've gone in different directions in terms of how we provide assistance, we've both veered off course in terms of using our resources to build the kind of local institutions and local capacity that create the genuine conditions for exit over time.

The goal of our work, as President Obama said in the policy directive on development, shouldn't be to continue to support contractors and implementing partners to serve those who are least fortunate. The goal of the work should be to build the institutions, the private sector, and civil society required to allow aid to come to an end.

And in that context just weeks ago we eliminated a series of what I consider painful regulations that required our staff to seek waivers every time they wanted to buy goods in country. That means if you're in a country that drives on the left side of the road, you now don't need to wait months for a waiver just to buy the right type of vehicle and use that in a program or project.

Most critically -- and I would add that that's part of an effort to untie as much of our assistance as possible. Between 2005 and 2009 the level of untied aid has gone from 32 percent to 68 percent with the U.S. government. Now, I believe the international average is somewhere in the 70 percents and as people keep moving forward I'm convinced the United States will essentially catch up to the international norm. But, I'd also argue that the traditional definition of untied aid, of not necessarily specifying the types of institutions or where they come from that ought to be part of the implementation process for programs and policies, may not be the optimal definition of excellence and development. If we're really focused on building local institutions we should actually think about how you create mechanisms that allow governments, donors, multilateral partners to invest directly in those local institutions and to do that in a manner that helps them build capacity over time. Not by flying consultants in to teach capacity building. I don't know that the track record of that approach has necessarily been strong.

But rather, by doing what every other institution in the private sector around the world does. Building capacity by investing capital and trying to get things done, and in that context our procurement reform is designed fundamentally to build the type of local capacity that creates the conditions for the end of aid.

Rather than subcontract with the same Ethiopian NGO for 12 years because our regulations were too burdensome, we changed our regulations and now work with them and invest in them directly. Rather than renew billion-dollar-plus contracts that are difficult to manage and difficult to have visibility on, we've created a review board that essentially breaks them down into smaller, more manageable pieces, pieces that can be more transparent and more efficient.

Rather than pay beltway firms to provide vaccines in Liberia, we're shifting global health spending directly to the health ministry there, saving us $1 million while in a transparent way building institutions of state that will allow the Liberian government to take on its own responsibilities to provide public health services to its children.

By 2015, 30 percent of our overall assistance will be shifted directly and accountably to its local institutions. Those local institutions, whether they are African agricultural capital in East Africa working with JP Morgan and USAID's DCA program, or the Afghan Ministry of Health will continue to need services and support and consultation with the traditional partners that implement programs. But giving them the authority to seek and purchase the services that they believe they need and holding them accountable for achieving results and managing and insisting upon clean and transparent financial management systems -- not just in our traditional implementing partners but in those local institutions -- that's what aid transparency should be about, that's what building local capacity should be about, and that's what creating institutions that genuinely put us out of business over time should be all about.

Now, this is controversial. Some people don't think of this as untied aid, some worry that the resources are put at risk. I can assure you that our team, through its decades of history with host country contracting and deep, local engagement has developed very sophisticated tools that allow us to measure, track, and monitor resources no matter who our ultimate recipients are. I can also assure you that we have more transparency and more oversight in these direct assistance relationships than we do when we funnel the money through subcontracted systems and we lose insight on reporting and transparency at different levels of subcontracting.

Now, this may all sound too technical for a high-minded conversation about IATI and websites and dashboards, but I'm telling you if we as a community are going to survive another 50 years and if we're going to achieve the goals we want to achieve, and if we're going to build the kind of capacity that we can be proud of as leaving institutional legacy because of the partnership of the American people, we have to pursue these reforms aggressively. We are pleased that we've gotten support for this reform agenda from both sides of the aisle, and we will be vigilant about protecting American taxpayer dollars and absolutely insisting on results inclusive of the results of building local institutions that stand the test of time.

So, I would ask for your help, in conclusion, in a few specific areas.

First, you should continue to push as loudly and aggressively as you can on aid transparency. I know that there are holes in the foreignassistance.gov website. I know that when you look at the aid report, you know, some of that's a little bit dated because it gives us an "X" for ITI or an "X" for some of the things that we've done, and you should track and make sure that we live up to these commitments.

I also know that now that I'm exposed to the depths of federal budgeting systems and data management systems, that these changes -- and you should not expect these changes to take place over time. But if you as a community stay focused on the right goals and if you stay committed to ensuring people live up to them, and if you hold other international partners to similarly high standards about can people report on results? Are we building local institutions? Are we creating space for the private sector?

And, are we genuinely investing directly and respectfully with those we're trying to help? I'm convinced our field of development can reform itself, and in reforming itself we can achieve some tremendous goals. We're on the verge of being able to eliminate or create a generation without AIDS. We're on the verge of being able to see the endpoint in preventable child death. We now have the tools to end non-conflictrelated famine and hunger in our lifetimes. We have the capacity to ensure that every child on the planet has a curriculum in their hand and the ability to read, and testing systems and educational systems that at very low cost generate incredible outcomes.

As I look around this room, I see many of you that have pioneered efforts in all of these areas. So, keep doing that. But in order to really achieve success, those of you that focus on transparency, focus on local capacity building are going to develop the next construct for what untied aid should really mean.

I hope you will be energized to continue your work, to do it with visibility, to insist on outcomes, and to hold everyone -- including the United States -- to a high standard of accountability.

Thank you. (Applause)

Brookings Institution, Washington, DC

Last updated: November 18, 2014

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