Guest Post: An Insider’s Look At Development Consultancies

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After two years of studying development I felt, like many students, full of cynicism towards traditional aid structures and naive idealism about my own ability to escape the mainstream development agenda. And then somehow I landed smack in the belly of the beast – working as an intern for a private international development firm. Imbibed with dependency theory and neo-marxist critiques of the neoliberal agenda I certainly felt like I was selling out. At the same time,  private firms practicing international development for profit were something of a mystery to me – as much as my lectures had discussed the political agenda of donors or the effectiveness of NGOs, this 3rd very important actor was, on the whole, not mentioned. I found this quite surprising – if there is one thing that international development academics love it’s contention, and practicing development for profit seems as controversial an issue as possible.

There are so many questions to be asked: does running development programmes like a business make them any more effective? Are these companies at all concerned with benefiting the poor or just their own bottom line? I embarked on my internship eager to discover the truth behind this industry and answer some of these questions for myself.

For those of you reading this impatient for undercover espionage and dirt on the international development industry – perhaps covert intelligence of bunga-bunga parties for international aid workers funded from the taxpayers’ pocket – I’m afraid I will have to disappoint. I have not found anything nearly as controversial, but I have also not found black and white answers.

The author of this post interns at a development consultancy in London. They do not wish to be identified.

International development companies manage large-scale development and humanitarian projects for bilateral and multilateral donors. We tend to think of big donors such as the World Bank, USAID or DFID as relentless aid machines churning out funds and programmes.

The truth is most donors simply do not have sufficient institutional capacity to manage multiple aid projects across the globe.

Hiring managing organisations is way for donors to transfer some of the responsibility and work associated with managing a multi-million project to an external organisation that has both the capacity and the expertise to deliver the project successfully. Upon being contracted by a donor, the companies become directly responsible for project management, team management, activity implementation, donor and stakeholder relations and overall oversight of the programme operations.

As easy as it is for anyone critical of aid to imagine an international development company simply siphoning off money that is meant for the poor, this is not how the business operates. While there are some direct charges involved, the majority of the profit is made on consultant fees – charging the donor a slightly higher rate than the original rate paid to the consultant.  Recruitment and mobilisation of top-notch technical experts lies at the heart of international development business. These international consultants are involved in a wide range of activities – assisting institutions in policy formulation, reviewing donor policies and programmes, monitoring and evaluating progress, conducting sectoral reviews and political economy analyses to determine the best development interventions.

Such an approach to development has been criticised for not only being unsustainable but also failing to account for poor country ownership of reforms. In many ways it represents the unequal relationship between the First and Third world and the cultural determinism inherent in much of development work.

R.L Stirrat points out in his essay The Cultures of Consultancy: “the assumption on which development consultancy work is based is that consultants can somehow penetrate to the ‘truth’” – that they can somehow grasp the sources of underdevelopment that have been eluding local populations for centuries and, through their Western pragmatism and knowledge, bring about change. These experts possess this authority not only because of the awareness they may have of a specific sector or degrees they hold but also because of where they come from and what their knowledge represents. The Eurocentrism inherent in this form of development assistance has led some critics to claim that that the professionalisation of development sustains the unequal power relationships between donor and beneficiary that are founded upon colonial relations.

From my quiet observation point at the bottom rung of a global international development firm it is difficult to ignore the legitimacy of such critiques – most consultants that I have met so far have been white, usually male, and educated in elite schools in Europe and the US. However, to critique the neoliberal incentives that might guide their work would take away from the great work that many of these consultants do and the commitment they have to development – they do want to create a positive change in the world.  I am quite certain that in their 20s many of these consultants were imbibed with the same sincere desire to do good that I feel. It may be easy to criticise the system but it is equally hard to completely discount the work and the intentions behind the work of international development consultants.


One thought on “Guest Post: An Insider’s Look At Development Consultancies

  1. An interesting post that I can relate to having done a stint as a junior consultant for a London based development consultancy (and later done a stint with an aid agency).

    The DFIDs, USAIDs and World Banks of the world have for decades now been contracting out project implementation to private firms – usually a western based firm, who then pulls together a consortium of local consultancy firms, independent experts and the like. Important to state that firms are chosen by competition – leading to the horrors of bid writing (the bulk of which falls on the interns and junior consultants staying up to the small hours ‘tweaking’ CVs and drafting ‘approach’ sections). Competition does help keep costs down however.

    The tenancy for consultants to be white and male reflects in part the desires of senior managers in developing country governments (who are usually the counterparts for any project – eg the Ministry of Health in Ethiopia is the counterpart to a DFID funded maternal and child health project). The Ethiopian Deputy Health Minister wants an international expert, and these tend to be western.

    The private sector model is arguably more accountable than the previous method of aid agencies implementing projects in house – if things go wrong it is much easier for DFID to blame the consultancy and not renew their contract, than to blame their own staff. Its not all a panacea however- a huge amount rides on the budget that DFID or USAID allocate to a project – if they get this number wrong it can be very wasteful – too high and the consultancy will get in high margin consultants to do pointless work so to keep the burn rate up – too low and the project can never get off the ground and achieved precisely zero. The pressure for western countries to spend growing aid budgets (so to get towards the fabled 0.7% of GDP) means that over-budgeting had been more common although the global squeeze on budgets is reversing this.

    At the end of the day the focus should be on value for money and impact of a project as a whole – it is very easy to look at the $150,000 salary of a senior consultant and criticise – but real question is whether that project is doing anything useful and pulling people out of poverty.

    Whilst controversial over the past ten years the shift in focus towards budget support (giving money directly to recipient country governments) backed with lots of Public Financial Management support to ensure this money isn’t wasted, is probably the least worst way to go. Doubtless however the aid pendulum will swing in another direction in 10 years time and some new “approach” will be tried. There is no magic bullet in the aid industry.

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