Good governance by design
Carefully designed social programs offer the best chance to avoid corruption, inefficiency and other governance problems.
Good governance involves delivering high-quality programs in an accountable and responsive manner. Evidence suggests many social protection programs in Asia suffer from fraud, corruption, and mismanagement. Poor governance results in exclusion of people who need these programs, inaccurate and irregular cash payments, and misuse and leakage in food distribution and public works programs.
How can governance be improved in social protection programs?
There are two dominant ways of thinking about governance among development professionals. One view is that a broader institutional and political economy context is key and that improving program governance can be daunting as it requires improvements in a country’s governance. Context of course is important but this does not imply that governance risks cannot be addressed at a program level.
The second view attributes poor governance to implementation bottlenecks. If only local agents had greater capacity and were given more training, if service providers were more diligent, if there was more supervision, things would be different, according to this view. This perspective is also correct, but it only touches the tip of the iceberg, overlooking the importance of program design in determining performance.
Program design encompasses the structures, rules and procedures for performing core service delivery functions, including those that determine who gets what and how program benefits should be delivered. The design is the script for implementation. Seeing programs through the project cycle lens, we often separate design from implementation, whereas successful implementation is a reflection of a good design.
What is good design in practice? Let us consider the example of targeted programs. Poor program design opens up opportunities for nepotism and corruption. Corrupt local officials can collude with ineligible applicants and register them as eligible, whilst excluding eligible persons. The perception of unfairness in the beneficiary selection provokes people’s dissatisfaction, social tension and mistrust in local governance.
The key problem here is that these programs do not clearly determine, communicate and enforce the rules about who gets what and on what basis. Objective, clear and transparent eligibility rules and selection criteria are essential for fair and transparent beneficiary selection. Effective information dissemination and sensitization campaigns can ensure that people understand selection criteria and accept the decisions made by program administrators and local leaders. Local officials need to receive guidance and support on how to effectively conduct beneficiary identification and selection.
The Pantawid Pamilya Pilipino conditional cash transfer program has been successful in overcoming governance challenges owing to its effective design. It is administered by the Philippines’ Department of Social and Welfare Development (DSWD) and supported by ADB and the World Bank. Pantawid has set objective and transparent criteria and methods for beneficiary identification and selection. Eligible households should have an estimated income below the provincial poverty threshold and a pregnant member or children aged 0-18. Pantawid relies on the national poverty registry Listahanan to draw the initial lists of beneficiaries. Listahanan identifies poor and near-poor households using a survey of socioeconomic factors associated with poor living conditions. The initial lists are then verified through a community assembly. The Pantawid experience shows that the use of poverty registries can improve the accuracy and transparency in beneficiary selection. Poverty registries have also been developed in Pakistan under its flagship Benazir Income Support Program and in Indonesia.
Effective grievance redress is another design feature to reduce the likelihood of unfair selection and exclusion. However, many social protection programs in Asia suffer from inadequate grievance redress. Effective grievance redress requires channels for feedback, appeals and complaints as well as adequate institutional arrangements for registering and processing grievances. Procedures for enforcement of grievance redress also need to be developed as part of the program design. They involve clear, uniform guidance to implementers and regular internal monitoring and reporting.
Pantawid’s grievance redress system sets a good example in the region. Grievances can be submitted via multiple links, including face to face contacts as well as SMS hotline, e-mail, letter, and drop boxes. A computerized database allows effective recording and tracking of complaints. The program requires routine spot checks by senior officials and independent parties to determine the quality and effectiveness of grievance redress. The program’s grievance redress measures have resulted in retroactive payments to households and de-listing of beneficiaries that were found illegible.
Effective program design requires strong technical capacity, but it does not need to be too expensive. There are a variety of policy and programming options and not all of them require significant resource investments. For example, developing clear and consistent rules and procedures for program implementation may be less resource-intensive than introduction of technology-based registries or payment systems. In practice, this translates into supporting the development of legislation, operational manuals and guidelines that underpin programs. These measures are feasible and can be critical for establishing an effective, solid governance foundation, before directing efforts towards identifying options for more costly activities. ADB’s experience shows that the support of international organizations and donors can help strengthen national capacity for policy formulation and implementation.