Around the world, aid from international donors buys textbooks, hires teachers, and opens schools - all worthy and necessary contributions in the fight to educate every child. But largely, the development equation remains fundamentally the same.
A new book presented at the World Bank recently by the Center for Global Development flips that equation on its head with proposed progress-based aid for education. In essence, the idea entails paying a country not for inputs such as pencils or classrooms - but once each child educated passes certain bars such as completion of his or her grade level.
William Savedoff, one of the authors of Cash on Delivery: A New Approach to Foreign Aid with an Application to Primary Schooling, sketched out what such a scenario might look like:
- Donors, such as bilateral aid agencies or multilateral institutions, would agree upon set development outcomes
- The recipient country would have complete responsibility and ownership the planning and implementation process.
- Donors would independently verify the countries' results, and then pay on a per-pupil basis for each target met.
It is a compelling idea - given that the child is at the center of the Millennium Development Goals to reach Education for All and that new ways of thinking about achieving targets are urgently needed. Cash on Delivery is cast as a potential way to improve accountability while strengthening local capacity. But could this new way of doing business work in World Bank operations?
A captive audience of World Bank economists and education specialists discussed the promising possibilities of COD aid and more practical concerns in a recent event organized by the Chief Economist of the Human Development Network. Chief among those was the need for alignment of incentives from the ministry down to the school level, as well as looming problem of corruption when money is on the line. An end-of-the-line independent verification may not have either the oversight (nor foresight) to handle these challenges in the way that project staff and safeguards can.
Panelist Emmanuel Jimenez, Director of Human Development for East Asia and the Pacific, wondered whether such a scheme could truly work in low-capacity contexts. Fellow panelist Peter Harrold, Country Director for Central/South Europe and the Baltics, praised the idea of simplicity in indicators, but recognized the challenge this posed for the education sector. Ultimately, "do we want to place generation of outcomes at the center of what we do?" said Harrold. "Until we do, we won't become a genuinely results-based organization."
- Read the Center for Global Development's new Cash on Delivery report and listen to CGD President Nancy Birdsall speak about the concept on YouTube and the Global Prosperity Wonkcast
- Paolo de Renzio of Oxford weighs in the COD aid debate on the EFA GMR World Education blog and author William Savedoff responds on the CGD blog
Many thanks to the Human Development Network's Chief Economist's Office, who organized this event as part of its series on evidence-based policy making.