It has been nearly 50 years since the U.S. foreign assistance system was formally established through the Foreign Assistance Act of 1961 (FAA). In that time, the structure of U.S. foreign assistance has become bloated and unwieldy. Currently, 12 Departments and 25 government agencies are charged with implementing foreign aid policy as defined through over 400 development objectives. To complicate things further, numerous amendments to the FAA and over 20 additional pieces of legislation were passed to direct U.S. foreign aid in the time since the FAA’s passage. With such a muddled structure, it is no wonder U.S. foreign assistance has come under assault in recent years, as calls for serious reforms have continued to mount. Luckily, reform efforts are moving ahead at full steam.
Two weeks ago, Representative Howard Berman, Chairman of the House Foreign Affairs Committee, introduced the first two sections, or preamble, of a draft of the Foreign Assistance Act rewrite. This draft marks an important step in the process of overhauling the U.S. foreign aid system to make it more coherent and effective in achieving the goals of global development. While the preamble is meant more as a formative document, designed to provide the development community with a first glance and guide a discussion, it offers insight into some of the new initiatives and strategies to be included in the final draft.
For the most part, this draft presents a broad picture of the direction in which the reform effort is moving. Through a declaration of general principles, policies, and goals of U.S. foreign assistance, the preamble offers insight to the guiding tenets of the reform process. Within these broad principles and goals, all four of Global Washington’s principles of effective development are accounted for: coherence and coordination, transparency and accountability, local ownership, and targeting aid to those most in need.
To ensure coherence and coordination, the draft calls for a streamlined foreign assistance structure to clearly delineate authority and responsibilities and to ensure consistency across all policy areas.
In order to improve transparency and accountability, the draft’s “principles of assistance” include a call for improved monitoring and evaluation mechanisms, as well as the need for detailed information regarding foreign aid budget and expenditures.
With regards to local ownership of aid projects, the preamble offers several principles to increase local capacity and ensure local ownership of development programs. According to this draft, it should be the policy of the U.S. government to develop assistance programs in partnership with local stakeholders that increase local capacity in the government and civil society. As a result, foreign assistance programs can be more effective and sustainable.
As a means of ensuring aid is targeted at those most in need, the preamble recommends that assistance be based on “poverty measurement tools and gender analysis.” Included in such measurement tools would be, among others, the Human Development Index rankings, per capita incomes, local capacity, and prior performance records.
Apart from the statement of general principles and policies, the preamble does introduce new, specific initiatives and organizational structures. Most important amongst the specific items in this draft is the designation of a national development strategy to guide foreign assistance activities and to ensure coherence across all foreign policy objectives.
The preamble also suggests that a rewritten Foreign Assistance Act would establish Development Support Funds to provide the USAID Administrator with the authority and resources to provide assistance to developing nations that will support local capacity and ensure aid is targeted at those most in need. Such an initiative offers stark contrast to the current policy planning strategy. Instead of using sector-specific goals and objectives to guide development policy, USAID would be afforded the flexibility needed to create effective programs.
To ensure that development activities reflect the needs and priorities in the field, each Development Support Fund will contribute a percentage of its funding to the administration of Country Investment Strategies for Development. Each Country Investment Strategy for Development will be prepared every three to five years by each USAID Mission Director. This is another departure from the previous policy of allowing specific goals and objectives to guide development policy. As a result, conditions in the field would inform the creation of development policy much more significantly than in the past, making programming more flexible and responsive to the needs in the field.
Paramount to the success of any reformed foreign assistance structure is consistency and coherence. In an effort to ensure development policy is consistent throughout the government, a rewritten Foreign Assistance Act would create a newly established Development Policy Committee. Such a committee would be composed of the USAID Administrator and a representative from each department and agency that has a stake in global development such as the Departments of Agriculture, State, and Defense, as well as at least eleven others.
While this draft is a mere outline of what a rewritten Foreign Assistance Act will look like, it provides a great deal of hope that reform is truly within reach. However, with only a few weeks of legislative business to go before Congress recesses for the mid-term elections, whether the new Foreign Assistance Act will even be considered in this Congress remains to be seen.
To review the draft preamble in its entirety, please follow the link here. To read more about Global Washington and our recommendations for a reformed foreign assistance structure, please visit the Policy Work section of our website.