April 11, 2024

What’s the secret to a successful donor-implementer relationship?

The majority of Australia’s development budget is delivered not by government, but by local, Australian and international organisations. Commercial contractors, NGOs, and multilateral agencies are the boots on the ground for Australia’s development program, and critical to its impact.

But the relationship between donor and implementer can be fraught, complicated by unequal power dynamics, competing objectives, and risk aversion. Managing contractors have indicated they’d welcome more collaborative management approaches that draw on their skills and expertise, not just their implementing muscle. For its part, DFAT has signalled its intention to work more strategically with these partners, and engage in ‘intelligent’ contract management.

So, what’s the secret to high-impact partnerships between Australia and its implementing partners? We asked three development experts.

Mat Tinkler
CEO, Save The Children Australia

In a word: trust.

We wrap this relationship in reams of legalese and jargon, but it boils down to one group of humans trusting another group of humans to do something that both have agreed on, for the benefit of another.

But there are traps to avoid. For donors, it’s easy to slip into butt-covering mode, where all the focus is on the (perceived) risks (to the donor), and the practical reality of delivering impact is forgotten. It results in program design by box-ticking and complexity – the arch nemesis of genuine outcomes.

And for implementers, there’s often an instinct to over-promise on impact and over-estimate one’s ability to deliver in a timely way. It’s important to be realistic. Implementers also often forget that the ‘political economy’ of aid and development relies on some benefit flowing to the donor too – be it reputation, influence, or some other strategic advantage. Implementers need to accept this is a cost of doing their altruistic business.

Trust requires honesty, an understanding of each other’s objectives and, critically, the needs of the local community, to ensure they are (mostly) aligned.

Trust also requires a willingness to have the hard conversations, to listen with intent to learn. Be prepared to fail fast and iterate. That needs bravery on behalf of the implementer, and flexibility on behalf of the donor.

Lastly, my message to those on both sides of this relationship is: heed your own advice. Many organisations play a dual role, sometimes as implementer and sometimes as donor or intermediary. Don’t tangle your partners up in the same red tape you rail against.

Mat is a leading voice for children’s rights and a deep policy thinker. Before joining the development sector, Mat was a commercial lawyer, parliamentary adviser and Ministerial Chief of Staff, working across social policy, financial services and education portfolios. At the Lab, we admire Mat’s bold leadership, sharp strategic and policy instincts, and commitment to holding Government to account.

Vania Budianto
Researcher and social development specialist, ANU, Crawford School of Public Policy

The ‘secret’ to a successful donor-implementer relationship might be the acknowledgment that there’s no one-size-fits-all formula. Whatever the context, it requires continuous effort and adaptability, open communication, and a willingness to invest time and resources to build and maintain the partnership.

The term “donor-implementer” itself is quite problematic as it reflects the power imbalance between the two parties. Relationships can become challenging when 'the donor' behaves in a manner that expects agreement without first being willing to listen. Conversely, 'implementers' may view themselves as the technical experts, undervaluing the donor's perspectives and interests. A more equitable partnership, based on mutual respect and shared objectives, helps redistribute that power.

The most effective approach to development partnerships is when Australia actively promotes and incentivises collaboration among various partners. Australian-funded programs often find themselves competing against one another, either due to conflicting interests of partner governments, the nature of ‘managing contractor’ modalities or limited funding leading to rivalry among local NGOs. In my experience, Australian-funded programs work best when they facilitate and build bridges between different stakeholders with shared objectives. An illustrative example is the collaboration of DFAT programs to support Indonesia's disability regulations by bringing together Disabled People's Organizations (DPOs) and relevant government partners.

The way aid governance is structured means donors need to maintain strategic relationships with individuals in key government agencies. Australia could do more on building coalitions of (local) actors that can contribute to broader systemic changes, rather than solely ‘picking winners or champions’ among powerful entities. This can include broadening engagement with government agencies with limited capacities including sub-national governments, giving more resources to local organisations, or working with non-traditional development partners. Such approach can ensure that aid programs do not perpetuate existing societal inequalities by favouring already-powerful institutions.

Vania is a development practitioner and researcher with over 10 years of experience working in Indonesia’s development sector including in disaster management, poverty reduction and social protection. In a previous life, she was a Senior Program Manager at the Australian Embassy in Jakarta. At the Lab, we love Vania’s instinct for collaboration – a rare quality, that just comes naturally to her.

Mark Moran
Development effectiveness researcher, adviser and analyst

The first thing that springs to mind is one of the better experiences I had, working for an implementing partner with an Australian High Commission (AHC) in our region. It began with a threatened food security emergency. The staff from both the donor and implementer were authorised with clear incentives to solve the problem, with a high political priority placed on responding. The relationship was fast moving, including short, frequent, and informal brainstorming. People found ways to be available on short notice and gave fast feedback. They shared sensitive information, so they understood what was at stake. In an inherently unstable situation, somehow there was an appetite for more risk. There was none of the months of paper warfare, of writing, waiting, and meticulously tracking changes.

The usual tensions between diplomacy and development aligned, bringing high-level support. The AHC respected the local context and development thinking. The Australian Managing Contractor (AMC) respected the levers of public sector management, across both national and Australian governments.  Both AHC and AMC staff needed each other to succeed. Both sides had effective relationships internally with their respective bosses. They did not need to seek permission to talk to each other. There was none of the confusion, precariousness, submissiveness, and fear from unclear lines of responsibilities.

The emergency passed but the working relationships flowed forward into a high-level strategy which set the future for bilateral development cooperation in the region, and an enduring partnership with subnational levels of the national government. This is what a successful donor-implementor relationship looks like.

Mark is an expert in development effectiveness, political economy of governance and community development. In a previous life, Mark led the University of Queensland’s teaching and research into development effectiveness in Indigenous and international development contexts. Mark is a pracademic through and through, applying his considerable analytical capabilities to the toughest development challenges and contexts.

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