The accidental NGO and USAID transparency test

The following post was written by Till Bruckner, PhD candidate at the University of Bristol and former Transparency International Georgia aid monitoring coordinator.  An op-ed from Bill in Monday's Wall Street Journal mentioned Till's struggles with USAID; here Till provides the details. The aid industry routinely pushes institutions in developing countries to become more transparent and accountable. But a slow and almost comically incomplete donor response to a request to see some specific project budgets sheds light on exactly how willing donors are to apply such “best practices” to themselves.

As I described in a previous Aid Watch blog post, I filed a Freedom of Information request with USAID after ten international NGOs working in the Republic of Georgia refused to publish their project budgets. After a painful, 14-month struggle, including failing to respond at all to my first three communications, USAID finally released a set of documents covering project budgets of 19 UN bodies, NGOs and private contractors.

The documents are disappointingly full of blacked-out non-information. The level of disclosure varies drastically from one document to the next. Some budgets are provided in full, while others appear as blacked-out row upon row. In three cases, USAID even withheld the identity of the contractor itself. USAID explained this inconsistency saying that it was legally required to contact each grantee to give it “the opportunity to address how the disclosure of their information could reasonably be expected to cause substantial competitive harm.”

I wondered why USAID is legally bound to follow its grantees' wishes in deciding which information to withhold. Can the grantees of a US federal agency really compel that agency to keep the total amount disbursed, or even their very identities, secret? Why doesn’t USAID specify full disclosure as a grant condition? I have filed an appeal with USAID to address these questions, and will keep the readers of this blog updated.

Since according to USAID every piece of blacked-out information was withheld on request of the grantee, the budgets provide a fascinating glimpse into aid agencies' willingness to open their books. If USAID blackouts do NOT correspond to NGO requests, I would be happy to correct the record.

Perhaps surprisingly, the United Nations showed the highest consistent commitment to transparency. The budgets of the two UN agencies funded by USAID are both reproduced in full.

UMCOR, Mercy Corps, and AIHA emerge as the most transparent NGOs. These charities apparently felt that they had nothing to hide, and did not request USAID to black out any of the information contained in their budgets.

In contrast, Save the Children apparently asked USAID to withhold all information related to salaries. As even the aggregate subtotals for international and national staff have been blacked out, concerns about the privacy of individual staff members cannot have been the sole concern driving the organization's response. Still, the fact that all non-salary related budget lines remain visible put Save the Children in the middle ground in terms of NGO transparency.

CARE's response is harder to interpret as USAID inexplicably sent only an aggregated “summary budget” that leaves little to conceal. What information exists shows that CARE did not object to the release of unit prices for supplementary food items, or of aggregated staff and operational support costs. In contrast, CARE appears to regard its “indirect cost rate” and “cost share” as confidential. To hide this information, USAID also had to black out the budget's bottom line, thus leaving unclear how many taxpayer dollars were handed over in total.

The least transparent NGOs in this test are CNFA, World Vision, and Counterpart International. They apparently requested that USAID black out all information in their budgets except for the grand total. Apparently, these NGOs consider budget items such as “office furniture” (CNFA), “visibility items (t-shirts, caps, publications)” (World Vision) and “forklift expenses” (Counterpart) as confidential information whose release could cause them substantial competitive harm.

What does this transparency test tell us? First, USAID's mechanism for responding to Freedom of Information requests desperately needs an overhaul. It took USAID 14 months to respond to a simple information request. Ironically, in terms of FOIA responsiveness, USAID is less transparent than public institutions in the Republic of Georgia, as recently assessed by a local watchdog organization. And we are still waiting to hear why USAID allows its own contractors to operate in secrecy whenever they wish. All of this places USAID in an awkward position as it recommends greater transparency and accountability to Georgia.

Second, NGOs have publicly committed themselves to transparency and accountability, but their actions show that their interpretations of what this entails in practice differ widely. For example, World Vision is a full member of the Humanitarian Accountability Partnership, but still asked USAID to hide all of its budget information apart from the bottom line. The Georgian country office of Mercy Corps had earlier refused to release its project budgets, but its headquarters apparently has no such reservations. Save the Children is willing to release indirect cost rates but refuses to divulge even aggregate salary information, while CARE appears more relaxed regarding human resource expenses even as it fiercely guards information on its indirect costs rates. Both USAID and the NGOs have too often violated the elementary principles of transparency.