Comments

My partner told me about this blog and I am glad I have seen it. I had the chance to be both an Austraining and AVI volunteer and I can confirm from my experience that AVI provided much more support to me throughout my assignment.

I would suggest that focussing excessively on skill transfer methods would neither make a person skilled at this (every teaching graduate realises this pretty quickly and pre-departure training is rarely more than two weeks long) nor would it be particularly helpful if it could. The research on cross-cultural effectiveness instead points to skills such as observation & listening, patience, open-mindedness, self-criticism and the ability to laugh at oneself, and other less technical skills. While having a professional skillset is important, volunteers who are encouraged to rush in and transfer skills (one-directional) immediately are more liable to make terrible mistakes than those encouraged to take sufficient time to learn the local culture, including the workplace culture, and be accepted in their host community. Development outcome boxes might not be so quickly ticked in the first months, but the sustainability and appropriateness of the efforts afterwards make up for that. The agencies which have been doing this since the 50s, such as AVI and Palms, are well aware of this, though there may be legitimate questions about pressures from impatient donors conflicting with a less forceful development model. Of course it also raises questions about the value of short-term placements, particularly for first-time volunteers.

Hi Joseph, Thanks very much for the thoughts (and thanks Cori for posting) I agree with most of your comments. Independent regulation certainly isn't the only issue affecting performance. Also important is the skill base of an organisation, accountability for performance (and clear organisational objectives/targets), internal controls etc. Unfortunately, it is difficult to measure these factors, and incorporate them into analysis of the kind above. I do think that as utilities are corporatised, independent regulation will become more important, given the tendency for excessively low tariffs in the region. Regional support for utility regulation of the kind in the East Caribbean makes sense in theory, and exists to some extent with the good work of organisations like PPA. But I suspect substantive moves towards regulation at a regional level in the Pacific will be hindered at the political level. On causality - you're right, and unfortunately the data don't allow for anything more than correlation to be established. There clearly are other factors at play as well, not just independent regulation. I would argue that in the case of the Fiji Electricity Authority, substantive reform happened before (truly) independent regulation was put in place (ie early 2000s). That said, the increasing role of the Commerce Commission (the independent regulator) has had a positive impact, enabling refurshbishment of power plants (eg half-life refurbishment of Wailoa) and much-needed investment in renewable power. Thanks again

Many thanks for your comment. The Australian Volunteers for International Development <a href="http://www.ausaidvolunteers.gov.au/" rel="nofollow">Annual Progress Report</a> 2011-2012 has the results of the Orima Research Survey of Returned Volunteers reported on page 7. Between July 2011 and June 2013, Austraining has mobilised 1148 Australian Volunteers for International Development. Of that number, only six volunteers returned early citing the reason of assignment mismatch for their return. Of the early returns, the majority of volunteers (85%) site their reasons for returning early as the following: • Assignment outcomes completed • Personal Reasons • Study/employment • Health Issues

It's great working with you Matthew, putting this article together. I received a number of encouraging and insightful comments via email and had some very engaging discussion on this topic. I would like to share feedback from Joseph Mayhew who would also appreciate your thoughts: Thanks Matt, John and Cori for the interesting blog and for starting a discussion on an important topic in the Pacific energy sector. It's heartening to see the data from the benchmarking study being used to delve into and analyse issues in the sector. Pacific power utility performance is mixed across the board, and while I support the thrust of your analysis I do have a few comments and musings: - In addition to Fiji, Vanuatu, and Tonga, I note that Samoa also has a regulator in the electricity sector. This may not have been in place when the benchmarking was done. Having previously only regulated telecommunications, the Office of the Regulator now is responsible for electricity too. - I think the point you make about ‘outsourcing specialised functions for tariff determination’ is important. If there is support for more extensive tariff regulation in the Pacific power sector, a regional support programme may be viable and appropriate. I don't think it is realistic to expect numerous small regulators, with often limited capacity, to provide high-quality and quite specialised functions. As there is a lot of commonality in their roles, support for regulators through one of the regional agencies or programmes may be worth considering. - That said, once the appropriate methodologies to determine electricity tariffs are established, well understood in the sector, and ideally quite transparent, the regulator's monthly tasks can be quite mechanistic. This suggests that it is vitally important that a suitable foundation is established for the regulator to be effective. This has to include clarity on the roles, relationships, and responsibilities between the government, the utility, and regulator. The relationship is often fraught at the best of times, but it seems to me that this is often influenced by ambiguity of roles and mandate, and perhaps a lack of appreciation about value of having a regulator, rather than any necessary or fundamental conflict. - As you indicate, an emerging issue is of private sector independent power producers bringing in generation competition. The role of the regulator varies significantly if, in addition to regulating retail tariffs, they also have to have a view on wholesale or offtake prices under a Power Purchase Agreement with an independent power producer. This can add an additional layer of complexity and potential confusion. Again, it comes down to being clear what is, and what is not, within regulators' mandates. - I don’t think it is necessarily correct that having a regulator removes political influence in establishing tariffs. Electricity tariffs increases from a low and often subsidised base, even when commercially justified, can be perceived as problematic. - I know you don't go into causality, but I do wonder to what extent the higher performance of the regulated utilities is really down to tariff regulation. Is it a case of correlation and not causality? In some cases, even though there is a regulator there remains political influence in tariff setting, and in other cases high performance may be also supported by historic relationships and arrangements with parent companies. I have no doubt that tariff regulation can encourage commercial practice and sound decision-making that can lead to better performance, but I guess my point is only to suggest that isolating the regulator-factor is probably quite difficult, especially as there is sometimes a mismatch between the regulator’s role in theory and in practice. Thanks again for the useful article, Best regards Joseph

Colin, I believe that you are correct that the wage disparity gives an incentive to work in other countries. I also believe that for every expat in all the various fields, two PNGians should be trained in the expats country of origin. This could be a component of the aid provided by those countries. Steve Day puts it nicely but does not take it far enough "The greatest training tool I ever found was to send them to Australia to work in their trades for a few months. Gave them the opportunity to work with people who were not wantoks, wairas or any of the other tribalists, which I believe are impediments to success that they are constantly attacked by in PNG". The dreaded wantok system explains why people are more productive out of PNG. The wantok system can equally be a path to riches or more often a slippery slide to mediocrity. Tony Flynn

It is indeed a sobering thought when you start to think about how the influx of funds into the government machinery will be managed and spent in a transparent way to reach those people in the remotest parts of WP or PNG. Sadly the track record of successive governments does not inspire confidence, Whatever happens I hope that the state maintains the spending on reducing the environmental impact of the mining at the levels that PNGSDP has ensured over the last 11 years

You might have noticed that this post has generated a fair bit of media coverage, which I’d like to respond to for the sake of clarity. I’ve also come across another source which gives a more recent update of the situation, at least with respect to the ADB. Various Fiji sources have covered the story with glee, of course not mentioning my support for other sections. Rowan Callick's <a href="http://www.theaustralian.com.au/news/world/canberra-vetoes-fiji-global-bank-loans/story-e6frg6so-1226652554704" rel="nofollow">article</a> in The Australian included a response from DFAT which said "The World Bank and ADB are independent institutions with their own decision-making processes. Decisions to lend to Fiji are taken independently (of Australia) by both banks. Australia's support for the banks' work in Fiji is limited to providing technical advice and grants that directly benefit the people of Fiji, who are experiencing increasing poverty and hardship." In fact, as the World Bank's response (on which more below) clarifies, decisions to lend to Fiji (or any other country) are taken by the Banks' Boards, on which Australia is represented. What position Australia has been taking as an influential shareholder is not addressed by the DFAT statement. The World Bank's response was <a href="http://www.abc.net.au/news/2013-05-30/an-australia-vetoing-fiji-loans2c-says-economist/4721930?section=business" rel="nofollow">reported</a> by the ABC as denying the allegations, but in fact it does anything but. The Bank's response, which the ABC provided to me, reads as follows: "The World Bank Group has not committed any loans to Fiji in 22 years, with our last loan in 1991. The World Bank Group is a cooperative, and Board approval for any new lending - in Fiji or elsewhere - would normally be sought when there is a broad consensus among shareholders. Through grant funds, the World Bank Group has a carefully focused program designed to help the people of Fiji. This includes technical advice to the Government of Fiji to improve the targeting of its social protection system to assist the poor and also a risk sharing initiative to encourage commercial banks to provide greater financing for households and businesses to adopt renewable energy solution. The World Bank Group has also provided assistance to the telecoms regulator while investments by our private sector arm, the International Finance Corporation, IFC, in Digicel, have helped to significantly reduce the cost and expand access to mobile phones in Fiji. The Bank has also provided support through Pacific regional organisations to strengthen flood early warning systems along the Nadi river basin." The statement that "Board approval for any new lending - in Fiji or elsewhere - would normally be sought when there is a broad consensus among shareholders." supports my case. Why hasn't Board approval been sought? Because there isn't a broad consensus among shareholders. Which shareholders disagree with lending to Fiji? It could only be Australia and perhaps New Zealand. Two other clarificatory remarks about the Bank statement. The Bank draws attention to the lack of lending to Fiji over 22 years. Since coups have, sadly, been a recurrent feature of Fiji since the 1980s, this fact doesn't undermine the case I'm making. The Bank doesn't mention that it had a loan at an advanced stage of preparation at the time of the coup, which has since been dropped: see my article for the link. Finally, the Bank notes all the other things it is doing in Fiji apart from lending. This only further puts the spotlight on the question of why, given all this, no lending. A good explanation is that Australia is happy for the World Bank, and the ADB for that matter, to be active in Fiji as long as they are not lending to the government. (For those of you not familiar with the Banks, lending to governments is their main activity, and the World Bank is now preparing about 7-8 loans a year to various Pacific governments, but not Fiji. See <a href="http://www.fijitimes.com/story.aspx?id=223066" rel="nofollow">here</a>). Finally, I did come across another <a href="http://www.globaltimes.cn/NEWS/tabid/99/ID/780430/Fiji-thanks-ADB-for-technical-assistance.aspx" rel="nofollow">illuminating exchange</a> between Fiji and the ADB, this one more recent than the one I quote in my post. In fact, it was just a month ago. This time when Fiji asked about the prospect of ADB re-engagement, the new ADB President responded more positively: "While the president acknowledged the progress Fiji has made [towards democracy] and expressed the Bank's support for re-engagement, further discussions both within the Bank and with Fiji were necessary to agree on the processes and timelines to facilitate full access to the various forms of assistance available to member countries once re- engagement is formalized." Translated into non-diplomatic language, this would seem to mean: you’ve made some progress in returning to democracy, and we'd like to lend to you, but we need to check with Australia and New Zealand first.

Thank you for your comment Aidan -- I agree completely that there needs to be more teaching of the skills required to transfer knowledge. Improving pre-departure training could really help on this.

Technically, yes the 457 visa allows aged care, the occupation is classified as Regsitered Nurse (aged care). The ABS classify this as a highly skilled occupation, typically requiring a a Bachelor degree or higher and includes registration and licensing. However what I was referencing was a lower skilled occupation, probably Health and Welfare Support workers. These require certificates and diplomas as opposed to bachelor degrees. These occupations are currently ineligible for 457s. The other barrier that presents are the current salary thresholds, which is $51,400. Often in the lower skilled jobs, this threshold rules out employers hiring lower skilled workers. This threshold is a key component at keeping the 457 program as a highly skilled program. While there are many benefits to this, they do not include encouraging emigration from developing nations such as PNG and the Solomon Islands.

Yes Tony, I am well aware of the arguments in favour of the dual salary system in PNG. I was once a beneficiary of that system myself, when the public sector version was subsidised by budget support from the Australian government. However, my point was to explain why highly skilled Papua New Guinean workers have an economic incentive to emigrate, and why their emigration might not be such a bad thing for national development in PNG.

Thanks Margaret for this post and mention of the on-going work we're involved in. I would also just support Tess' comment around the lack of information on the effects of corporate development efforts. For a couple of decades now people like Colin Filer, John Burton, myself and others have been pushing for forms of 'social monitoring' around these operations that would provide rigorous evidence of development effects, with very patchy and partial results. In part it seems that companies simply aren't interested (there being no formal requirement, or at least none that is regularly enforced by the regulators), they don't have the skill sets needed to really research and understand the social effects and changes (the attribution of effects is tricky), and in part I think there is a fear that a transparent monitoring process might reveal (and implicate them by association) a range of dysfunctional social changes... The contrast with the extensive environmental monitoring programmes is revealing as these programmes are (surprisingly!) far less political and concern processes that companies have a high degree of control over, unlike the social processes that mining tends to induce.