The New Zealand Herald ran an article this morning on an issue that many in the NGO sector are aware of, namely a proposed shift in how the organisation that facilitates New Zealand government foreign aid is structured.

At the moment, the budget for foreign aid is facilitated through an entity called NZAid. I do not wish to go into the details of how NZAid is structured, its history and the proposed future, what I do want to address is two sentiments the Foreign Minister, Murray McCully, expressed in the article.

Mr McCully referred to the aim of “Poverty Elimination” as being too broad. He then referred to the current mode of distribution of foreign aid via NZAid as being a “hand out rather than a hand up”. With these two things in mind he was quoted as saying:

You could ride around in a helicopter pushing hundred-dollar notes out the door and call that poverty elimination.

This view is extremely simplistic and betrays a lack of understanding about how foreign aid is largely understood in New Zealand, especially within the ranks of NZAid and partner organisations like CiD (Council for International Development). My hunch is that Mr McCully is not that simplistic and is employing language and phrases that will endear the public towards whatever plan he has.

It is true that the aim of poverty elimination is broad, but it would be easy to note that the aim is broad because the problem is broad. To leave it at that though would betray the strict criteria by which foreign aid is distributed. No government organisation exists without criteria on how it will meet its objectives. NZAid has very strict principles by which it operates to achieve its mission. Joe Public can get a brief overview of this strict criteria by looking at the NZAid website.

On their website, amongst other things, you can view such things as:

• International targets
• Priorities
• How aid is delivered
• How they make aid work
• Evaluation at NZAid

A cursory glance through the above will quickly reveal that NZAid’s broad mission is backed up by a strong foundation of best development practice.

Since its establishment in 2002, NZAid has done an outstanding job of focusing the money our government spends on foreign aid. It has reduced the number of projects our taxpayer dollars are engaged in and it has brought more effectiveness to every dollar spent.

New Zealand gives 0.3% of our GDP to foreign aid and development, we are still 0.4% short of our UN commitment to 0.7%. What many Kiwis might not be aware of is the fact that whilst that is all we give, our current structure means that our administration of that money is one of the most effective in the world. There are countries that give more than that, but because of how those funds are structured, the money is nowhere near as effective as the current NZAid system. For that reason, there are many in the development sector around the world who look at New Zealand with a certain amount of envy.

With the criteria of NZAid distribution of funds in mind, their use of best development practice, the recognised effectiveness of New Zealand aid as compared to other countries that give more, Mr McCully’s comment likening current practices to throwing money out of a helicopter simply falls short of the reality and can only find an audience within people who look no further than the sensationalism of such a comment. I trust that the New Zealand public is smarter than that.

To state that the use of the funds has become more like a hand out rather than a hand up is also simply reverting to populist language to further a predetermined cause. The current government effectively campaigned on reducing needless spending within government ranks. They broadcast the idea that the last government was wasting money and propping up people who did not need to be propped up. This may have been true in many instances, but the use of tax payer money through NZAid to assist in community development amongst the poorest of the poor around the world (with a focus on the Pacific region), was not one of those instances.

The current government, including Mr McCully would rightly have a high view of trade, but it is clear that the effect of trade only goes so far and in most instances it does not reach the poorest of the poor in the developing world because such people people are marginalized and have no way of accessing the positive flow on effects of global trade. Any approach to assisting the poor and marginalized must be two prong.

A common understanding of trade involves a “trickle down effect” where the benefits “trickle down” throughout society, but a good approach to development amongs the poorest of the poor must involve lifting them to a place where they can access that which “trickles down”. Thus trade and development go hand in hand. Good development, as undertaken by the current structure of NZAid does exactly that, it facilitates the lifting of communities and far from simply throwing money out of a helicopter in the hope that it might make a difference, it engages the best development practices currently available to us in order to move poor communities towards self sustainability. If it does not act as a “hand up” then it falls short of NZAid’s criteria.

In light of all this I urge the Minister to truly examine the effectiveness of development aid prior to the establishment of the current NZAid structure, compare it to now and rather than pursuing a pre-thought agenda, engage the sort of developmental approach that good NGOs operate under – assume ignorance on your part, listen to the community whom you will be working with, hear their solutions, find a common ground and resource an effective way forward. Don’t rely on simplistic understandings to inform change since lives around the world literally depend on this. Any impact analysis will reveal that change of any sort will have a negative impact on communities we are engaged with globally – are we willing to count the cost in actual human lives?

To the public, I urge you to go beyond the populist, simplistic, and sensationalistic speak that has a pre-thought agenda behind it and do the investigating. If you do so, you will find a robust system of foreign development and aid within the New Zealand structures, a system that is the envy of the world.

Frank Ritchie
Education and Campaigns Manager (TEAR Fund NZ)

Related posts:

1. The SSC Review of NZAID