Local staff and aid effectiveness: does integration matter?

Much has been written on this blog and elsewhere about the potential impacts of the DFAT-AusAID merger. Some have emphasized the positives: the aid program will more closely align with our foreign policy agenda and be more accountable, and even that it might use less jargon. Others have suggested that it could lose direction, and that DFAT could lose its capacity to implement a quality aid program.

Robin Davies wrote about the need to reconcile two different workplace cultures, and hold onto the wealth of experience from AusAID whilst adjusting to the realities of the new DFAT aid architecture and organizational culture. While integration is still a work in progress, it’s interesting to consider the consequences beyond Australia and how this change will impact locally engaged staff – the backbone of AusAID.

In DFAT, local staff are decidedly subordinate to Australian diplomatic staff (‘A-based’ personnel). In recent years, this was not always the case with AusAID. But the changes that have taken place since the AusAID-DFAT merger have seen the aid program return to the sorts of structures used typically in foreign ministries – with local staff mainly in clerical, administrative and logistical roles, and certainly not supervising A-based staff or speaking on behalf of Australia.

There are early indications from Indonesia that as a result of this, local staff are looking for, and finding, alternative options. Their departure in substantial numbers, which looks very likely, could compromise the quality of aid delivery and thus reduce the claimed foreign policy dividends from the merger.

Anyone who has worked in international development understands the critical contribution that local staff make. An independent audit [pdf] of the Australian aid program by the ANAO in 2009 pointed out that local staff brought context-specific knowledge and language skills, and provided a degree of continuity with regard to corporate knowledge that posted Australian staff could not.

According to a Boston Consulting Group report on aid to middle-income countries, to be successful, donors need to strengthen their skill set beyond the traditional talent pool of aid administrators. Staff need experience working within national governments and the ability to credibly engage with government authorities, build relationships and gain access to stakeholders. This is what local staff bring to the aid program.

Recognising this reality, James Gilling, Mark Baird, and Hal Hill argued [pdf] in a 2008 ODE assessment that the sort of aid program needed to score serious diplomatic points in middle-income Indonesia required staff with a deep knowledge of national development issues and capacities. They concluded that AusAID would ‘need to invest far more systematically in the capacity of staff in Australia and overseas, and take much greater advantage of the excellent skills and experiences of locally recruited staff.’

And AusAID did just that.

Prior to the DFAT merger, AusAID was widely regarded as one of the best places for an Indonesian to work in the development sector, if not the best. As part of the changes introduced, locally-engaged staff were taking on increasing responsibilities and being empowered to drive and run a cutting-edge aid program. AusAID also engaged a cadre of local hires (including some international experts resident in Indonesia) to advise AusAID staff on program decisions, convene groups of local stakeholders to push for policy reforms, and open doors with government officials. The increasing responsibility given to local AusAID staff was reflected in levels of pay and conditions sufficient to ensure that AusAID could attract the ‘best and brightest’. The large size of the aid program and the cutting edge program being delivered in Indonesia meant that AusAID quickly became the envy of other bilateral donors (USAID, DFID) and multilaterals (the UN and the World Bank), which had traditionally had their pick in terms of local staff.

AusAID’s local staff were the ‘cream of the crop’, graduating from leading universities in Indonesia, Australia, Europe and the United States. Even some of Australia’s top Indonesian aid experts were supervised by Indonesian staff. They brought extensive experience working for other aid organisations and a wealth of experience from other sectors. Many managed some of AusAID’s most innovative programs, overseeing teams of staff – Australians and locally-engaged alike – and large budgets.

So why should Joe Bloggs care?

Australia’s $500m aid budget to Indonesia is a sizeable investment that has had some very positive results [doc]. Countless visiting Australian officials can attest to how well it is has been received and you could go anywhere in Indonesia from Aceh to West Papua and hear about the great work of AusAID – exactly the sort of value-for-money foreign policy objectives an Australian Government is keen to see. The high quality aid program is one of the strongest pillars of our close bilateral relationship with Indonesia.

The high quality of local and international expert staff and the quality of the programs they managed in Indonesia were in large part responsible for these significant benefits to Australia’s image in Indonesia. Where there have been differences between the two governments, they were often the ones to bridge cultural gaps and perceptions. Through their vast networks, they were often able to gain access to senior government officials and their staff. Some were even on a text-message basis with very senior Indonesian government counterparts. During one of the lowest points of the Australia-Indonesia relationship – the spying allegations in 2013 – it was local staff who maintained communication with Indonesian officials when this was not possible for DFAT representatives.

There is no doubt then that local staff add significant value to the aid program. This suggests that DFAT should think carefully about the implications of the recent merger for local staff. Unless handled very carefully, the changing conditions brought by it will inevitably affect the quality of the aid program. It may be possible to access some degree of local knowledge and expertise through contractors and other development partners. But serious questions need to be asked about the extent to which contractors can really be a suitable replacement for this embedded institutional capability.

Ben Davis is International Development Coordinator (Southeast Asia) at the University of Sydney. He worked with AusAID/DFAT across a number of programs in Canberra and Jakarta from 2009–2014. Rivandra Royono is graduate student at the John F. Kennedy School of Government, Harvard University. He worked with the World Bank and AusAID/DFAT in Jakarta from 2006 to 2014, with a focus on the education sector.

Ben Davis

Ben Davis is International Development Coordinator (Southeast Asia) at the University of Sydney. He worked with AusAID/ DFAT across a number of programs in Canberra and Jakarta from 2009 – 2014.

Rivandra Royono

Rivandra Royono is graduate student at the John F. Kennedy School of Government, Harvard University. He worked with the World Bank and AusAID/DFAT in Jakarta from 2006 to 2014, with a focus on the education sector.


  • Integration brought with it uncertainty for the local O-based staff (now LES). At the same time it also brought with it opportunities for the local staff. Change is a process that has to be properly managed to mitigate consequences and/or expectations. Change with Integration brought with it realization amongst local staff that they should start consider other opportunities outside of the new DFAT. In fact ALL local staff should thank DFAT (or former AusAID) for bringing them this far with the skills they’ve developed. I am Local Staff with DFAT at Sols Post. I see Integration as an OPPORTUNITY to explore beyond!

  • I wholeheartedly echo earlier comments on the importance of national staff in managing, implementing and guiding Australia’s aid program. I am seeing the same thing happen in other countries where the aid program works, not just Indonesia – this loss of expertise that will only leave the aid program weaker. It’s good to see that this critical part of the AusAID abolition is being discussed, and I can only hope that such discussion will have an impact where it really matters.

  • Ben and Rivandra, thanks for your excellent and candid analysis. Let me suggest a positive (unexpected) outcome out of all of this. The exodus of highly qualified Indonesians from DFAT may be exactly what Indonesia needs. In much of the developing world Aid agencies are the best places to work when it comes to ‘policy work’ (not development, since, after all, development policy is what Aid sending countries call policy in developing countries).

    These dissatisfied former AusAid staff may join local NGOs, the government, universities and even the private sector. (In a way one could argue that Aid Agencies had prevented them from joining these domestic organisations. By offering much higher salaries, professional international opportunities and the perks that come with working for Aid agencies, they may have undermined the capacity of local CSOs, think tanks, universities, and government.)

    What they have learned while at AusAid will probably come in handy for them and their new employers. Who knows, former AusAid staff working in government will be able to negotiate better deals with DFAT and other funders. They may use their networks to forge connections that bypass aid entirely (see unmediated aid suggestion here). New researchers at Indonesian think tanks will be better at accessing funding, too.

    This happened in Latin America. When DFID left, many of the local staff went on to lead new initiatives and work in government. Much of the impact that their work on governance, identity and social exclusion had, for instance, was due to this ‘migration’.

    I think that this ‘migration’ out of Aid agencies will happen in countries like Indonesia anyway. Ad they grown and develop and their political communities offer more and more interesting opportunities policy wonks will prefer to join Parties, ministries, CSOs, universities, think tanks, consultancies, etc. It makes perfect sense.

    And it could be seen as an unexpected positive consequence of the AusAid/DFAT reforms.

  • Well ‘spoken’ Ben and Riv – such true words – when I have worked in Indonesia the local staff in Indonesia have proven their worth many times over. They have provided the important context and the necessary continuity – and, as you say, they are some of the best and brightest. Let’s hope our Government comes to its senses before it is too late

  • Thank you Ben and Rivandra. The very best mentors throughout my working life have been the locally engaged AusAID staff in Sri Lanka, PNG, Fiji, Solomon Islands, and other places where I have had the privilege of having worked. Their nuanced understanding of the political economy, and the peace conflict dynamics have made my job so much richer, and easier. During the past six months I have had many conversations with locally engaged staff who are demoralised and outraged by their sudden change in circumstances. These are the people that the Australian government need in order to deliver ODA successfully, not fly by nights like myself who drop in and out of countries.

Leave a Comment