Humanitarian and International Development NGOs

The private giving numbers cited in the Brookings report of the last post come from an essay by Homi Kharas, The New Reality of Aid.  Kharas sifts through the published data to estimate just how much money given as “development assistance” is actually reaching the poor.

By his estimation, once debt relief (which is really a transfer between one branch of a donor government to another), emergency and technical assistance, and administrative overhead are discounted, only about 37% of the total aid given by the 22 traditional Western government donors can be considered “net development aid.”  Thus, out of the more than $100 billion that these governments publicized as aid in 2005, only about $38 billion was left over to be put to use in poor communities. 

In similiar fashion, Kharas tries to assess how much in private contributions is reaching the ground.  He groups together private foundations like Gates and Rockefeller with international development NGOs like Oxfam and CARE.  While in doing so, he admits to trying to avoid double-counting grants from the private foundations that go to the NGOs in question, but doesn’t elaborate on the methods used.   It’s also unclear if his analysis subtracts out the government support that NGOs receive (government funds made up 61% of CARE USA’s budget for FY 2005-2006, for example).  And where is embedded giving - i.e., funds collected by (Product) RED and other point-of-sale fund raisers - which is notoriously hard to track?

The Index of Global Philanthropy 2008, published by the Center for Global Prosperity at the Hudson Institute, arrives at similar figures, at least for U.S. private philanthropy (though no hint either how they avoid double-counting among foundations, NGOs, and faith-based groups).   It’s probably safe to say that the trend is unmistakable: private giving is gaining on and maybe even outstripping official government assistance.   How much of either is really reaching the poor is still a guess at best.

Earlier this year Brookings released Making Poverty History? How Activists, Philanthropists, and the Public are Changing Global Development, a report based on the Brookings Blum Roundtable 2007.  While it contains much of interest, one item immediately catches the eye: in 2005, private philanthropic giving for international causes was roughly equal to official development assistance (ODA) from “traditional” donors (i.e., governments).

Certainly the Gates Foundation, with its enormous asset base and focus on global health and development, has played a role in boosting the private giving numbers.  But as the report so ably highlights, reducing global poverty has become “hot,” capturing the attention of many new philanthropists and celebrities, and igniting a mass of talent eager to “make poverty history.” 

What do all this attention and newly varied capital environment mean for NGOs?  What are the challenges of balancing an ever-varying donor base and the expectations of these new actors?  Might it change the ability of NGOs to give voice to the poor?  Interesting questions.  More to come.