Mixed reviews for DFAT-AusAID merger five years on

By David Donaldson

Monday March 18, 2019

ausaid foreign aid dfat

Program design and management capability is suffering but Frances Adamson’s leadership is “a strength”, finds independent review of DFAT.

It’s five years since the Department of Foreign Affairs and Trade began the difficult process of absorbing AusAID.

DFAT is now recovering from the massive loss of experience sparked by the merger, but there are still clear areas of risk remaining, according to a review by an independent contractor published last month.

Insider views on the impact of integration “differ markedly”, writes reviewer Richard Moore, who served as AusAID Deputy Director General for Asia from 2007-2011. He interviewed over 75 expert analysts, advisers and officials, including private contractors and non-government organisation staff.

More than one-third see more gains than losses, but around one-quarter believe the impact has been strongly negative.

“The remainder—close to 40%—believe that while basic systems continue to function adequately, risks are rising and opportunities are being missed,” says Moore.

The biggest impact has been in staff turnover.

“According to the former head of AusAID’s human resources department, almost 1000 years of expertise left shortly after integration. Estimates suggest another 1000 years of experience has been lost since,” writes Moore.

“Interviewees assess that the reduction in senior, locally engaged staff has had the biggest single impact on the quality of management of development activities.”

Much of this exodus was due to DFAT managers misunderstanding what is needed to plan, design, implement and manage successful development cooperation. Then-secretary Peter Varghese later admitted he had underestimated the policy complexity involved.

But those early morale problems “have largely receded” and many former AusAID staff have moved into new roles, including 20 in head of mission or deputy positions.

“The positive story of integration is that after one of the biggest organisational changes in its history, DFAT has bedded down its new development cooperation business,” Moore explains.

“Programs are being delivered and independently vetted results appear strong,” he writes—though some query the accuracy of much of the data the department produces.

The current leadership of the department “is a strength”, he says. Secretary Frances Adamson and her senior team “enjoy considerable respect. Her systematic, whole of department approach—that may make her its first real CEO—is needed.”

Known for its responsiveness to ministers—sometimes at the expense of longer-term thinking—DFAT has managed to meet nine out of 10 of the government’s strategic targets in aid and development, driving major shifts in aid allocations towards infrastructure and the Pacific.

“There are also examples of development goals being more strongly advanced through joined-up, whole-of-department efforts. This includes significantly enhanced Pacific policy, stronger private sector collaboration and improved humanitarian action,” he says.

But there are other problems looming, including “a pronounced deterioration in skills and systems for preparing and managing bilateral activities”.

Capability in program design and management has declined. This is not helped by the increasing prevalence of generalists in a complex area requiring specialist skills.

A lack of clear strategic direction also risks poor development coordination.

“The risk is that without clear departmental signalling, individuals will make very different assessments of what is required,” writes Moore.

“That is the clear advice from the field. Some go as far as to say there is no longer a coherent Australian aid program, rather a series of separate programs reflecting individual preferences.”

Stakeholder survey results

Another recent publication also sheds light on how Australia’s development program is faring: the ANU Development Policy Centre aid stakeholder survey.

It too reports mixed results, with things looking better than the last survey in 2015, but in many cases well below where they were before the change of government in 2013.

However, the survey found former foreign minister Julie Bishop was seen positively by most stakeholders, and her popularity had increased over time. Her key ideas received mixed reviews, with her work on gender being viewed very positively, innovation somewhat positively, and “aid for trade” negatively.

Almost all stakeholders argued the amount of money government gives to aid and development should increase—though their expectations for what will likely occur were much less optimistic.

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