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Donor Spending: A Drop in the Bucket - Dawn

Donor funding for education is highly visible in Pakistan. From television campaigns to public debates, donors and their dollars are a tangible force in shaping the public narrative on how the state education system can and should be salvaged.

Prime Minister Nawaz Sharif, Minister for CADD Tariq Fazal Chaudhry and Maryam Nawaz watch students perform a tableau during a visit to a model school in Islamabad. — File photo

Punjab’s education reform programme is the largest UK aid program in the world today. Pakistan is the largest recipient of UK aid today and, until a few years ago, second largest recipient of US aid.

However, the absolute numbers also reveal that bilateral donor spending on education in Pakistan is tiny – almost negligible – compared to the country’s own spending on education.

“We have to constantly remind Congress that the value of our investment is actually pretty small compared to what the Pakistan government is spending,” says a senior U.S. official who has worked on the aid programme for many years.

For instance, the UK budgeted around $150 million for fiscal year 2016 for Pakistan. That is worth exactly two per cent of Pakistan’s $7.5 billion education budget. United States’ spending on education last year was $65 million according to, which is less than one per cent of Pakistan’s education budget.

At its height, the US spending averaged the equivalent of about two per cent of Pakistan’s education budget per year.

The total $7.5 billion value of Kerry-Lugar-Berman - which will take ten years to come through - equals what Pakistan has budgeted on education alone in 2016.

In other words, the power to fix Pakistan’s social sectors, especially education, lies with the state of Pakistan. Donor spending is just too low. At best, it can have marginal value when it gives governments the spare budgets they need to support reforms.

But apart from the numbers, the different approaches of the donor agencies also shape whether or not their money is effective.

The Brits won’t touch Sindh govt

The bulk of the UK’s education funding goes directly to the provincial governments in Punjab and KP. The Department for International Development (DFID) releases funds directly into provincial budgets as the provinces achieve “milestones” related to their own multi-year plans for education reform, such as reducing the rate of teacher absenteeism. They do not track exactly how the government ends up spending the money.

A small part of DFID support is used to hire experts and young people, mostly Pakistanis, who support the governments to implement reforms. This staff is hired by international companies such as McKinsey and Adam Smith International.

Some are critical of the role of private companies in education reforms, because it sidelines the role of the education ministries.

“Between Michael Barber, who sits with Shahbaz Sharif, and all the PhDs at the World Bank, the [education] department feels it can no longer contribute to the discussion,” says a consultant for a donor in Punjab, “The education department has become an implementer of the agenda defined by the donors.”

DFID invests money in education where they believe it will be used well. For that reason, they do not work with the government in Sindh.

According to their 2012 assessment, “Given political uncertainties about the depth of the government’s commitment to reform and the lack of a comprehensive plan for the education sector, we do not believe it is feasible to fund the government directly…. Nor are we confident that we can achieve sufficiently rapid impact for Sindh’s out-of-school children through the provision of additional funding.”

According to their assessment, support from the World Bank and multiple donors for reform efforts in Sindh only increased enrollment from 50 per cent to 53 per cent between 2006/7 and 2010/11.

Instead, DFID has supported the Pakistan Business Council in administering vouchers for children in Sindh to go to low-cost private schools.

World Bank loans out money for reform

World Bank funding for education in Pakistan is the largest but it’s mostly in the form of loans that have to be paid back.

The World Bank supports the governments of Punjab, Sindh, and Balochistan at their request. Punjab and Sindh get loans of about $100 million per year.

Sindh also receives a small grant of about $20 million a year. Balochistan receives grants worth around $8 million a year. This grant money will not be paid back. The loans average $100 million or slightly less for Punjab and Sindh per year.

KP has, so far, not accepted World Bank loans but that may change.

In Punjab, the World Bank works in tandem with DFID to support the government’s reform agenda. The two donors are committed to providing long-term support. The World Bank programme started in 2003 and will go on till 2021. DFID support started in 2010 and ends in 2019.

World Bank staff consistently point out how small their funds are next to the province’s own budgets.

Punjab threw the Americans out

USAID has not been able to work with the Punjab government since 2011, when Shahbaz Sharif cancelled all programmes in the aftermath of the raid that killed Osama bin Laden.

The American agency had to re-route incubators, headed to the dilapidated Lady Willingdon hospital in Lahore, to Sindh. Punjab also cancelled USAID’s plans to renovate the hospital.

USAID also re-directed its education programming to Sindh, a province that has 46,000 schools. Their current programme centers on the construction of 120 schools. They are inviting the private sector to manage them.

Unlike DFID, USAID tracks its money closely because of congressional concerns about the risk of corruption or diversion of funds. They cannot participate in the reform programmes because such programmes release money to the governments without tracking how it is ultimately spent. Instead, they reimburse the government as it produces “outputs,” such as schools constructed, rather than performance targets or “outcomes” such as increasing enrollment rates.

When asked why USAID does not work with them in education, KP’s Education Minister conjectured that, “The donors may have agreed that DFID will work in KP and USAID will work in Sindh. USAID has become too negative here. If you say DFID here, ninety-nine percent of people won’t know what that is. But if you say USAID in KP, people will say, ‘Who knows what kind of hamla [attack] they want to do on us.’”

DFID prefers not to brand or advertise its work at all.

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