Poor political governance in Solomon Islands – what can donors do?

Written by Terence Wood

In recent blog posts (here and here) I have discussed problems of political governance in Solomon Islands, along with their probable causes. This discussion was, in part, a response to an excellent discussion paper and blog posts (here and here) written by the World Bank’s Tobias Haque. In the paper and posts Tobias argued that political governance problems in Solomons are better explained by rational actor based models than by alternative explanations in which culture is the culprit.

In his blog posts and paper Tobias also suggested several mechanisms through which donors might improve political governance. It is these suggestions that I will focus on now. With respect to national political governance Tobias argues that donors should:

1. Attempt to incentivise MPs (through additional aid) to encourage them to disburse their discretionary ‘constituently development’ funds in ways that are more transparent, foster greater community participation, and less directly tied to voter support. (This suggestion is only made in the working paper.)

2. Encourage voting system changes (this suggestion is just made at a general level and no details are provided).

3. Encourage increases in the size of constituencies to make patronage based politics more difficult. His logic here is that larger electorates make clientelism expensive, and therefore less appealing to voters and politicians.

4. Direct more aid through Solomons government systems and place fewer constraints on its use. Tobias’ reasoning for this recommendation is that donor constraints leave very little space for meaningful political competition at the national level. Because everything is tied up by donors, Tobias argues, voters have no real reason to vote nationally, and so don’t.

Suggestion 1 — using aid to foster better use of constituency development funds — is a good idea. Currently, these funds stem from aid from the Republic of China (Taiwan) and domestic tax revenue, and are provided to Solomon MPs to spend within their constituency for the purpose of helping constituents. Unfortunately, fund administration is haphazard with few rules governing spending and constituency funds are used by many (but not all) Solomons MPs as a tool for rewarding their political supporters rather than as a means of developing their constituencies. And yet the funds aren’t entirely bad: in an environment of poor government service provision there is something to be said for a simple, electorally accountable, conduit between aid money and those in need of it. Some of the villages that I visited in my fieldwork were lucky enough to be receiving constituency development money, and in these villages its impact was often more apparent than other forms of government funding. So constituency funds could potentially be a good form of aid, if they were administered in a way that wasn’t used by MPs to reward supporters. I’m not sure if Tobias’ specific suggestion for change (additional donor money given to MPs who meet certain disbursement criteria) will work, but I’d endorse further thinking in this area.

I can’t engage with Tobias directly on his second suggestion — changing electoral systems — as he doesn’t provide specifics. However, it is worth noting that if you believe, as Tobias and I do, that there is a logic underpinning the current situation where most voters vote in search of local assistance, you need also concede that shifting to preferential voting (currently the alternative electoral system most often suggested) is unlikely to be transformative. Preferential voting may help by, hopefully, forcing MPs to spread their spending more widely within constituencies, in the search of preference votes, but it wouldn’t change the central problem of poor national governance in Solomon Islands: the fact that MPs are be elected on the basis of constituency performance rather than national performance. Likewise, party strengthening laws, such as those that were adopted and then decreed unconstitutional in PNG, may possibly have desirable impacts in terms of political stability but they are very unlikely to change the way people vote, or foster party politics of the type that exist in Australia and New Zealand. Finally, it is worth emphasising that decisions about electoral systems are something that are largely out of the hands of aid donors. Change may come in this area but it will have to come from within.

In the case of the third suggestion — while it seems plausible that increasing constituency size might undermine clientelism by making it very expensive, and in turn promote less particularistic politics — available evidence from Solomon Islands suggests that it won’t. In terms of numbers of voters, there is already substantial variation in constituency size between the largest and smallest Solomons constituencies, and yet I heard nothing during my own research to suggest that the larger constituencies I visited were any less prone to clientelism than the smaller ones. Moreover, a simple, first-cut analysis of election results (which I’ve done here [PDF]) offers no quantitative evidence to suggest that politicking is less clientelistic in larger constituencies.

Tobias’ final suggestion is his most problematic: the proposal that donors channel more money, with fewer constraints, through Solomons government processes (more budget support in other words). He argues that doing this would open the space for national political competition, and with more at stake nationally voters would vote nationally. I think this is very unlikely. First, it’s hard to think of any theoretically plausible argument as to why unfettered aid would lead to national voting as opposed to the obvious alternative: clientelism with more cash. Tobias himself explains electoral politics in terms of a collective action dilemma (unless almost everyone is voting nationally, it makes no sense for you to vote nationally) and I can’t see how unfettered aid would resolve this. Second, even with current donor constraints, there is already a lot at stake nationally in Solomons: legislation, the legal system, the operation of government departments, interactions with logging companies, the chunk of government revenue that comes from resource rents. This all matters to people’s welfare, the stakes are high, and yet it hasn’t lead to coherent national politics. Third, in both PNG and Solomons constrained aid has varied considerably as a portion of total aid and total government revenue since the two countries attained independence, and yet times of less constrained aid do not appear to have been times of better governance or less clientelistic politics. It is possible that more budget support might be warranted for other reasons but I do not think it can be argued to be a potential solution to the problems of Solomons politics. (As an aside, if you’re interested, Aaron Batten’s Development Policy Centre Discussion Paper provides excellent analysis of the impact of different types of aid on different types of government spending in Papua New Guinea.)

What would I suggest as alternatives?

First and foremost (and here I think Tobias would probably agree with me) I would emphasise that real solutions to problems of poor political governance in Solomons will almost certainly only come from within the country itself. There are limits to what external actors can do and real electoral change will only be built on domestically grown social change. Unfortunately, my guess is that such change may be some time coming. In the meantime donors need to work within the current political economy of Solomons in ways that lead to the most effective possible aid, while at the same time accepting that there are many constraints they can’t shift.

As much as trying to change political governance in Solomons, donors simply need to take it into account. And factor it in when deciding what types of aid endeavour will and won’t work.

Second, unlike Tobias, I think donors should continue to keep much of their aid money constrained and out of the arena of political contestation. To my mind the most important roles that aid can play in Solomons are: holding together key institutions in the hope that this affords space for development to take place in spite of poor political governance; and providing basic services to minimise the harm to Solomon Islanders caused by poor political governance. And these activities, I think, can be best achieved by keeping aid constrained (at least as a general rule).

Third, I would encourage ongoing experiments at fostering democratic decision making at the local level (something akin to this is already happening with the World Bank, EU, and AusAID supported Rural Development Programme). In its final form democratic governance in Solomons needn’t take the same form that it does in OECD countries, and different types of governance could potentially be decentralised and democratised to a range of different levels.

Finally, I would suggest that all of us (or, at least, all of us outsiders) still have a lot to learn in this area. Tobias has done an excellent job of showing that certain simple explanations for problems of political governance in Solomon Islands are incomplete, and hopefully I have added to this in some small way with my own posts. What is needed now though is more learning, more research, and more discussion.

This blog is a part of a series on political governance in the Solomon Islands. Other blogs in this series can be found here.

Terence Wood is a PhD student at ANU. Prior to commencing study he worked for the New Zealand government aid programme.

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Terence Wood

Terence Wood is a Research Fellow at the Development Policy Centre. His research focuses on political governance in Western Melanesia, and Australian and New Zealand aid.

7 Comments

  • I note with concern comments from Marcus re. ‘contracting and procurement’, issues of significant concern as between 60% and 70% of all government expenditure, including SIG, is thru its procurement system.

    I do understand that the SIG is currently taking action to improve its procurement specifically by undertaking a review of the PFAA was expected to go to Cabinet in October 2012 with a plan to pass legislation in early 2013 and enact the new legislation in January 2014. I also understand that the Treasury Division may take the opportunity to update the FIs in relation to procurement and draft a Procurement Manual and a set of standard bidding documents, including draft contracts. However, implementation of new legislation can take time and can be difficult. Implementation must be well planned and properly resourced.

    All are important steps to ensure that the SIG procurement system operates effectively and efficiently.

    However, a procurement system consists of more than just legislation, regulations and standard bidding documents.

    The SIG procurement system also includes (1) various procurement structures including a central government procurement unit and ministry procurement units, various tender boards, etc; (2) professional procurement staff in each of these procurement structures; (3) a body to oversight of all procurement; and (4) readily available procurement data, information and reporting. Where is the emphasis on these four components of the SIG procurement system?

    I do hope that Marcus’ current perception of SIG procurement will change with the current and possible future initiatives to reform and to strengthen the SIG procurement system.

    E. John Blunt is a Procurement and Institutional Expert with extensive experience in leading public procurement reforms in a variety of international development environments. He has recently completed a procurement reform assignment with the Southern African Development Community Secretariat and is currently on assignment with the Swaziland Revenue Authority to strengthen its procurement system.

    • Hi John,

      Thanks for your comment. I’m not familiar with the specifics but concur with your argument that procurement systems are weak and need to be further strengthened.

      I think donors can, and should, work in this area but I would also add that in a country such as Solomons where the forces of political governance pull strongly against efforts to strengthen the machinery of governance such strengthening will (a) be hard and (b) be almost impossible to do in a manner that will be sustained after donor pressure is removed (unless the political economy changes in the meantime).

      Such work is most definitely still worth doing. But we need to be realistic what it might achieve…

      Thanks for your comment.

      Terence

      • Thanks John for your well-informed comments. And Terence, who I largely agree with on most issues discussed here. I too, hope that my perceptions will be changed by the current and future procurement reform initiatives in SI that you’ve outlined. Ideally these initiatives are driven by the political demand for procurement reform being made upon the Finance Minister and the Prime Minister by SI citizenry. I hope that procurement reform efforts will recognise that sub-optimal public sector performance does not arise purely out of technical ignorance, but also because of the power/information asymmetry that allows small groups of insiders to capture public resources at the expense of the vast majority. I hope that consequently procurement reform in SI focuses on seeking a more equitable distribution of the current power and information asymmetry that is the primary cause of procurement maladministration and malfeasance in SI. This may mean putting transparency, accompanied by an understanding of Northian concepts of ‘open access orders’, at the centre of procurement reform efforts.

        I know I’ve used the word ‘hope’ a lot, and “hope is not a strategy”, but if we base our collective efforts on understanding the nature of the problem unfettered by preconceived notions of what we would prefer the problem to be, then we’ve got a better chance that our response to the problem is based more on sound, frank and open analysis (and less on hope).

  • Firstly, I apologise for this belated post. I suspect most of the devpolicy blogosphere has moved on, so it’s now much safer for me to enter these torrid waters.

    Here’s my view of three of the main points discussed in this series? 1. Can electoral design change the game of political governance in Solomon Islands?; 2. Should donors (mainly AusAID) channel more of their funds through SI government systems?; and, 3. Can donors work with the slush funds (CDF) to improve their development effectiveness?

    I will try and use what I’ve learnt through Terence and Tobias (and others) to consider these questions. My lens appears to be incentives, incentives, incentives.

    1.Electoral design? It would seem that the evidence supports the contention that at best, electoral design only works at the margins in respect of changing the underlying political equation. The wise Bill Standish always said[pdf], despite the unbounded optimism of its proponents, that the OLIPPAC political stability laws of PNG were unlikely to alter the fundamental nature of electoral politics in PNG. I think history has proven him correct, on balance. Jon Fraenkel, and Alphonse Gelu would agree broadly with Standish on this issue, though considering that Dr Gelu is now Registrar of the OLIPPAC Commission he may believe he can do good work on the margins (as he evidently is now doing, but the big changes come through the momentum of being part of a wider social and political movement. I would follow this view, and even though it is difficult to imagine an electoral system that is more disconnected from its society than the current regime in SI, I don’t think any changes to the architecture alone will alter the ground that the system sits on. No electoral system ‘makes sense’ (how does voting for the Australian Senate work, again??), but underlying political functionality of their polities can make them work regardless.

    2. More budget support for SI government? I have to disagree with Tobias. The application of this principle in SI would represent the triumph of ideology over common sense. There is anecdotal evidence to support the contention that that there is a strong underlying culture of misappropriation and malfeasance in contracting and procurement in SIG Ministries, at the present time. If true, this is depressing for the many good public servants who struggle against this prevailing culture. The fact that donor resources continue to flow, and in fact are accelerating, further undermines the will of the coalition of those who oppose the dominance of this culture. If we accept the intellectual legitimacy of political economy concepts such as monopoly, oligopoly, competition, and incentives, then we understand that a strong state is infused with the energy of, and informed and held to account by, its citizens. Aid donor resources in SI are currently propping up a parasitical and enfeebled state that has little to no connection with its citizenry and is wholly focused on the state-centric programming of international donors to exist, with no good reason to answer the telephone just in case it’s an ordinary Solomon Islander at the other end. (somebody please write something about the huge SI allocation of overseas tertiary scholarships in its education budget, when the majority of the population are functionally illiterate. Exclusive political institutions feeding off eachother?) When I hear an aid donor in Honiara saying, “We must partner with the SI government”, I am led to think, “Do they mean Namson Tran MP, Bodo Dettke MP, or Snyder Rini MP? Who is Minister for Fisheries, Aid Coordination, or Forestry this week?” I acknowledge the reality of the conundrum, “how do we support an effective centralized state if we by-pass its fiscal systems?” In response I think an idea worth pursuing is Collier’s ‘Independent Service Delivery Authority’. Which leads me to point 3.

    3. Improving the effectiveness of slush funds? I think we need to give serious consideration to Collier’s idea of an Independent Service Delivery Authority for Solomon Islands. An agency such as this would operate not unlike the PNG Sustainable Development Fund. Its mission would be to singly focus on delivering and maintaining grassroots health, education and infrastructure. It would be governed by a Board with a minority of government reps (say 1/3), with a majority of non-state, regional and international Directors (people with genuine expertise who can add value – not just aid donor staff nominees). The ISDA could say to MPs, “if you give us your CDF money and agree to use our systems, we will double your money. If it is grassroots services you want to deliver in your communities with your CDF, then we can double whatever you can deliver alone with your CDF”. Government agencies can contest these funds on merit with the private sector, or in PPPs. The ISDA would solely and wholly focus on and be held to account for the delivery of services to poor people – no vague and fuzzy goals of capacity-building, response to the demands of Ministers, the whim of the most influential donor head-of-mission, or the need to buy political capital from someone or somewhere. Public goods for poor Solomon Islanders.

    Em no moa. Thanks Terence and Tobias.

    • Thank you Marcus for a very interesting comment.

      On point 1 – I agree with you with the caveat that possibly more imaginative electoral engineering, very approximately along the lines of the participatory budgeting system (which I’ve written about at link 1 below) might help, although it still wouldn’t solve the central problems of Solomons PE.

      On point 2 – broadly I agree (more or less the same point I made in my post).

      On point 3 – I’m not sure that what you’re suggesting is exactly what Collier had in mind, but it is certainly a very interesting. The challenges would be in the resources required to set it up and overcoming political opposition. Still, the idea is very interesting.

      Also, for those who are interested Daron Acemoglu and James Robinson have an interesting series of blog posts on how some countries have escaped clientelist traps (link 2 below).

      Link 1 Participatory budgeting [pdf].

      Link 2: A&R post with links to previous posts.

  • Hi Tobias,

    Thank you for your comment.

    If I understand you correctly you are describing a system where:

    1. Solomons politicians are deciding the projects that go into the national development plan. And, in many instances, they are choosing these projects based on their own individual political interests.
    2. Donors are choosing projects to fund solely based on what is in the national development plan and how it has been prioritised.
    3. Donors are then implementing projects generally avoiding SIG systems.

    If this is how the majority of donor funding is currently being delivered to Solomons then I agree the system is deeply flawed (and somewhat different from how I understood aid delivery to take place there). And I agree that it would be conducive to clientelist politics.

    However, I don’t see a shift to budget support doing anything to improve the situation. Either budget support is heavily constrained, in which case the odds of clientelist spending and corrupt practices are reduced but so to is budget supports potential to foster national politics (if such potential actually exists). Or budget support is unconstrained, in which case the money will, it is true, enter the arena of political contestation but would not, in my opinion, change the collective action dilemmas underpinning clientelism in Solomons at present. And, because of this, achieve little other than adding more fuel to the flames.

    Personally, I think the optimal approach to aid delivery in Solomons is for:

    1. Donors ascertain the key binding constraints on welfare in the country. Constraints could be determined through different means depending on geographical scope: locally through participatory community processes (as the RDP currently does); or nationally, through study and consultation. In doing this I would place very little weight on the opinions of local political actors – their interests are often their own, and the incentive structures that they work under at odds with development for the country as a whole.

    2. Donors act to relieve these constraints using the optimal means for this task chosen based on a weighting that places considerably higher emphasis on lifting the constraints themselves than on other desired outcomes such as strengthening partner systems for their own sake. The optimal means may, of course, still be using partner systems (obviously, the Ministry of Education is the only possible means of running schools in Solomons). And strengthening partner systems may be an integral part of actually attaining the welfare improvements that have been prioritised. However, where government systems are used, I would suggest we need to be very careful about unintended consequences, and need to strive to avoid the trap of isomorphic mimicry. And that we need to be very realistic about what these systems can achieve and about our ability to influence how they may run.

    3. Engage in an ongoing manner to assist in holding key institutions (electoral commission, parliament, central bank, courts, police) together in spite of the centrifugal pull of the country’s clientelist politics.

    4. Undertake research to learn all that we still don’t know about governance and politics (a lot) in Solomon Islands. And from this, maybe consider interventions that target these areas directly, but also be open to the idea that there’s little we can do directly.

    What would this achieve:

    It would not directly solve the problems of governance and politics in Solomon Islands but:
    1. It would improve the quality of people’s lives (And would be a more efficient means of doing this than any approach to aid that mixes this objective with a range of other overly ambitious desired outcomes associated with institution building for its own sake).
    2. Hopefully, would — through improving education outcomes, and affording the possibility of economic change and the social change that comes with it — aid in the possible growth of cross-cutting social and political movements that ultimately change the nature of politics in Solomon Islands.

    To me this seems like a better approach than the status quo or any shift to higher order aid modalities made solely on the hope that they will give birth to national politics.

    I could be wrong though, and definitely appreciate hearing your insights as someone with on the ground aid experience in Solomons.

    Thanks again for the comment.

    Terence

  • Thanks Terrence for the excellent posts on this topic.

    As you say, I think we agree far more than we disagree. And where we do disagree, you go far further than merely attributing behaviors in Solomon Islands to “culture”, as if it were some ubiquitous, exogenous, and primordial force. You treat behavior as if it is something that is amenable to analysis, with an important role to be played by rational choice models. So I am happy. I don’t think I have all of the answers. But I know that we need serious analysis (like yours) to find them, rather than outsiders blaming problems of economic development and political governance purely on the ill-defined “culture” of locals.

    I also agree, though, about where we disagree most – the importance of development partners making greater use of Government systems.

    I don’t believe that we can expect Government accountability to emerge unless Government can reasonably be held responsible for more of what impacts on Solomon Islanders’ lives. Why would you care about national-level politics when the school has a Taiwan sign on it, and the clinic has an AusAID sign on it, and there are no local roads or public infrastructure, and there are no local businesses operating within formal regulatory or legislative frameworks, and the police visit every three weeks but leave just about everything to village-level dispute resolution systems? Legislation, regulation, policy and Government service delivery do not appear as large parts of your life.

    Would more budget support change this? I think donors making better use of Government systems and delivering aid through Government agencies and in alignment with Government policy programs would certainly help. It would allow an expansion in the reach of Government services. It would switch some accountability for service delivery and private sector development towards Ministers and away from foreign donors. It would, if provided through appropriate SWAPs or sector budget support, reduce the amount of funding available for the development budget pork-barrel. It would also move the emphasis of donor dialogue, which I believe can be an important motivator for change, away from fragmented projects and implementation issues, towards broader issues of policy.

    40% of public expenditure in Solomon Islands is from donors. Most of this money goes straight into project implementation, without hitting the sides of Government systems. Often, Government doesn’t even know what donors are doing or how much has been spent because of the complete inadequacy of reporting systems. Two hundred projects, some of which have marginal linkages to any Government development strategies but are – of course – covered by a National Development Plan that includes everything you can think of.

    Funds channeled through these projects are anything but “out of the arena of political contestation”. As in most countries, the development budget is a far more active arena of political contestation than the recurrent budget, which is largely absorbed by payroll expenses, inflation adjustments, and rolling over of nationally implemented programs. The recurrent budget provides for far fewer of the short-term, geographically targeted infrastructure, “private sector development”, and community programs that populate the development budget – perfect bite-sized morsels for engaging in clientelist politics.

    Use of Government systems is widely seen as desirable for many reasons and it is something that donors have already signed up to at Paris, Accra, and Cairns. To me, one of the most important of these is the impact on political governance. Increasing the resources to support recurrent programs will make what central Government does more noticeable. Reducing money through projects will reduce some of the scope for clientelism. A fair amount has been written about the importance of using Government systems for these reasons, especially in fragile contexts (examples here: http://go.worldbank.org/QLKJWJB8X0 and http://scholarworks.umass.edu/econ_workingpaper/42/).

    Some resources perhaps wouldn’t be used very well. But that’s part of the process and bad spending happens everywhere. Even (don’t tell anyone) under donor projects. But at least if Government is plainly in control of the spending (and under the right constitutional/electoral arrangements) there is some chance the Government or minister responsible will be held accountable for that at the next election.

    Other than some quibbles, this is the only area where I think we are actually at odds. Look forward to your next post.

    Tobias

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