POVERTY ALLIVATION OF BANGLADESH

Introduction

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Institutional framework of Poverty Alleviation: An Overview of Bangladesh Experiences

Institution building from development management perspective refers to a system that functions in relation to their environments in which organizational structures and procedures match the tasks, products, people, resources and the contexts it deals with. Institution building is intimately concerned with the exchange of resources where economic and political relationships intertwine to create varying patterns of implementation network and intervention packages (Gustafson, 1994; Brinkerhoff & Goldsmith, 1992; Ahmed 1992). Like many other developing countries, Bangladesh has undertaken various efforts for improving the socio-economic conditions of the poor through institution building approach. However, several issues like national and scrotal policies, inter-agency coordination, and structural requirements have hampered the institution building efforts geared to address poverty and under-development. This paper attempts to make an overview of different institutional frameworks and assess their managerial effectiveness to address poverty alleviation in Bangladesh. The paper is based on content analysis of different secondary sources of data and information. Observations are also drawn from several interview sessions. During the interview a number of Donors officials reminded this researcher that some reports should be treated as `confidential' and `sensitive' on the grounds that they have not been accepted by Government of Bangladesh (GOB). Due to the `confidential' nature of some of the materials, a number of documents cannot be referred to or quoted in this paper. Since the beginning of 1970s; Bangladesh has virtually become a laboratory for design and experimentation of different rural development models and approaches. Different agencies of Government of Bangladesh (GOB),international donors and the Non-government Organizations 1 (NGOs) have experimented with different model sand approaches of institution building for rural and local level development (Holtsberg, 1990). The goals, objectives and strategies for implementation of these experimental approaches, however, varied depending on the sponsor of the projects. But the alleviation of poverty has always been one of the core objectives of those experimental approaches. In spite of all these different institutional and experimental interventions over the years, alleviation of poverty still remains a major challenge for Bangladesh (Jahan, 1991). Given the present trends in population and economic growth and the absence of a concerted plan of action at poverty alleviation, experts fear that poverty scenario in Bangladesh would be even worse in the years to come (GOB 1991, SAARC,1992, BIDS, 1993).

Poverty in Bangladesh: A Profile

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Though different measurement techniques provide somewhat different data about the level and incidence of poverty, the general picture of poverty in Bangladesh is indeed critical (Khan, A.R 1990; Ravalli on, 1990; BIDS, 1993). In an assessment of statistics on poverty based on human development indicators, UN Human Development Report points out that 86% of the people of Bangladesh live below the poverty line (UNDP, 1993).Measurement of poverty in most studies have been based on the head-count ratio. This measure takes into consideration the concept of minimum consumption bundle2. The following table provides a summary of poverty trend of the last two decades. Though there has been a little long-term improvement in poverty situation, depending on the economic and environmental conditions, large fluctuations prevailed in the incidence of Poverty over time.

Most of the controversies concerning poverty and poverty related policy originate from difference in, what is perceived to be the major determinants and causes of poverty. What causes poverty in a typical third world country like Bangladesh? In fact there is no single cause of poverty; the plight of some poor could be due to several factors, each contributing to some degree of observed poverty. It is therefore very important to identify the Extent of the situation to which each of these factors contributes to observed poverty. Failure to isolate the real Causes of poverty may result in institutional and policy interventions that do not alleviate poverty rather could actually aggravate the cause to increase poverty. A comprehensive study undertaken by Hossain and Sen (1992) Attempted to identify the determinant of incomes of poor and non-poor households in rural Bangladesh. Based on The regression models, Sen and Hossain noted that:

1. The size of land-owned by the household is the most important determinant of rural income, but the

Elasticity of rural income is low in regard to land-ownership.

2. The adoption of new technology contributes significantly to the increase of rural incomes.

3. The contribution of labor to household incomes is high. The contribution of a female worker

Is about 60 percent lower than that of an average male worker, implying that female workers

Are employed in lower productive activities and /or are paid lower than agricultural workers.

4. Higher education contributes significantly to the increase of rural incomes. However, the

Effect of higher education on income is greater for households engaged in non-farm activities

Than for farm households.

5. The adoption of new agricultural technology increase income for both groups of household,

But the effect is greater for the poor households than for the non-poor.

6. In poor households, the income of the female workers is 52 percent lower than the income of

The male workers. But the incomes of workers engaged in non-farm activities is 13 percent

Higher than that of the average agricultural worker.

Sen and Hossain therefore argued that an important part of poverty alleviation strategy should be to identify and

Emphasize elements of growth policy, which are likely to have the strongest and most immediate favorable

Impact on rural poverty. They also noted that the development of rural infrastructure would positively affect the

Level of rural poverty; in fact, its poverty alleviation effect would be even greater than the impact of new

Agricultural technology. More access to non-agricultural employment would extend the scope for income mobility

For land-poor households in rural Bangladesh.

Poverty & Development Plans in Bangladesh

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Poverty and Development Plans in Bangladesh

Beginning from 1973, successive development plans in Bangladesh have highlighted the issue of poverty. The

Plans also suggested a number of strategies to face the challenge. The First Five Year Plan (1973-78), placed

Emphasis on a socialistic restructuring of the economy so that the benefits of development could be distributed

More equitably among the different groups of people. In a sense, the Plan was pre-occupied more with the task of

Post-independence economic reconstruction and the international economic crisis arising from the oil price hike,

Than with the poverty problem of the country. The Two Year Plan (1978-80) was expected to give the country a

Direction for future planning and development. However, it got bogged down with the task of rationalizing the

Portfolio of on-going projects in the face of acute resource shortage. The Second Five Year Plan (1980-85) made

A renewed effort for bringing in the poverty issue to the forefront through its emphasis on basic needs. In reality,

Its main concern became the reduction of the socialistic bias in the economy in favor of greater reliance on

Market economy and promotion of the private sector. The Third Five Year Plan (1985-90) brought forward the

Idea of group-based plan on the basis of a Social Accounting Matrix using an Applied General Equilibrium

Model. In practice its main pre-occupation was to face the new challenges like aid conditionality, which were

Thrust upon the nation while pursuing macro-economic stability and rapid structural reform. The Third Five Year

Plan noted that poverty, unemployment, rapid population growth, malnutrition, illiteracy all are interactive and

Needed to be addressed simultaneously in the macro plans with both short and long term perspectives. Against

The background of a rising trend in the number of landless, small and marginal holdings in Bangladesh, and the

Process of depeasantization and pauperization, the Fourth Five Year Plan announced a comprehensive approach

Towards poverty alleviation. The Fourth Five Year Plan (1990-95), emphasized on poverty alleviation through

Human resources development as its most important planning objective. The Fourth Five Ye
ar Plan recognized

The role of safety net projects of both the Governmental Organization (Goes) and NGOs, but insisted that the

Primary emphasis for poverty alleviation should be given through bringing the poor and the disadvantaged from

The periphery to the center of the development process.

An overview of the Five Year Plans and other policy documents of the GOB on rural development indicate that

Poverty alleviation has always been a core concern of the development programs. It also depicts a trend of

Priority attachment to poverty alleviation in terms of objectives and strategies. A follow-up review of this policy

Statements, however, manifests that, in effect, in most cases, no serious attempts have been made to translate

Such policies into concrete programs and projects within a coherent institutional framework. As a result the

Sect oral programs particularly in agriculture, health, social welfare, infrastructure development, water resource

Development etc. were designed in isolation without having considerable focus on poverty alleviation. Even with

The existing institutional framework there has been a noticeable lack of coordination in the management of the

Projects on poverty alleviation carried out by different agencies of the GOB as well as NGOs (Aminuzzaman and

Nunn E, 1993).

Empirical data also indicate the fact that the actual disbursement of resources to poverty alleviation programs

During the Second and Third Five Plan periods was far low compared to the actual allocations. Further more the

Rate of actual allocation to Poverty Alleviation Projects (Peps) 3 during the Third Five Year Plan also far less

Than its corresponding figure of the Second Five Year Plan period (Gaur, 1994). Consequently the employment

Targets set by the Five Year Plans (Fops) could not be achieved. In aggregate the Fops failed to generate about

3.9 million New jobs as against the target (PKSF, 1992).

An overview of the Annual Development Program (ADP) allocation also demonstrates a passive picture. In spite

Of all importance and priorities attached to poverty alleviation in the plan documents, over the years the actual

Allocation to Peps and other projects with poverty alleviation components never received more than 14 percent

Of total ADP allocation (Ghafur, 1994). The trend of PAP allocations in the ADPs is also not found to be

consistent. (Table:2). On average the ADPs over last ten years allocated about 10 percent resources to PAPs

ranging from 7.04 to 14.07 percent.

Table 2: ADP Allocations to PAPs 1985 - 1995 (in million Taka)

Year Total ADP Allocation for PAP % of PAP

Allocation

1985-86 3826 269.5 7.04

1986-87 4764 379.17 7.96

1987-88 5046 413.08 8.19

1989-90 5803 473.22 8.15

1990-91 5668 547.37 9.66

1991-92 7500 797.31 10.63

1992-93 8650 976.09 11.28

1993-94 9750 682.16 7.00


canal

1994-95 11000 1254.83 11.41

Source: Ghafur (1994)

Different Approaches to Poverty Alleviation

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Different Approaches to Poverty Alleviation

Bangladesh has a rich history of experimentation in rural development model building. In the mid 1960s, the

Comilla Model of cooperative received international fame as an alternative approach for rural development for

the resource poor countries (Aminuzzaman, 1985). However, in the post independent Bangladesh with the

changed socio-economic and political reality, the Comilla model virtually became redundant. Since then given

the high level of poverty and extreme dependence on foreign aid, Bangladesh practically became a veritable

laboratory for rural development and poverty alleviation interventions. As a matter of fact, in the absence of a

comprehensive transparent policy, rural development has become a patchwork of public and private initiatives

and interventions (Willmann, 1990; Siddiqui, 1985; Laxminarayan & Rahman (nd); Jones, 1982; DANIDA,

51988a; Holtsberg, 1992). Wide varietyof intervention packages have been developed by the GOB agencies as well

as the NGOs. These interventions have been mostly financed by the bilateral or multi-lateral donor agencies. All

such interventions can broadly be classified under three different project approaches: i. Direct Capability-Raising

projects; ii. Growth-oriented Projects with a strong immediate impact on poverty, and iii. Targeted Special

Employment Schemes for the poor.

Direct Capability-Raising Projects

These projects addressed poverty indirectly through enforcing higher investment in social sectors, such as health,

education, etc. leading to enhanced human capabilities and improved living standard indicators. These projects,

in effect, did not have any direct impact on employment or income generation.

Growth-oriented Projects with a Strong Immediate Impact on Poverty

The process of economic growth would in most circumstances bring about some reduction in poverty through the

trickle-down mechanism. This particular approach therefore is based on the assumption that poverty can be

addressed through fostering a higher growth process by way of complex interplay of macro-economic policy

instruments suitably attuned to sustain a reasonable growth in certain sectors which will have a `trickle down'

effect and thus increase the income of the rural poor.

Targeted Special Employment Schemes for the Poor

In 1984 the government of Bangladesh developed a new Strategy for Rural Development Projects. The strategy

emphasized the inclusion of Rural Poor Projects (RPP) as a component of all future rural and area development

programs. In line with the strategy, a number of new generation of Area Development Programs were negotiated

and launched, all with a RPP component. Under these Area Development Programs a targeted self-employment

scheme has been implemented with varying degrees of input support such as credit, training and extension

services. These schemes have been designed to promote collective ventures of the landless-poor through

formation of groups and cooperatives. Under these programs assets are transferred to the target groups on a

collective basis, e.g., joint cultivation of land, pisciculture, irrigation, power tiller schemes run by the landless

groups and cooperatives. In almost all cases Bangladesh Rural Development Board (BRDB) was assigned to

implement the program.

In addition to these approaches, GOB also took some special programs like Food For Works (FFW), Vulnerable

Groups Feeding etc. to address seasonal rural unemployment and the causes of destitute women.

Food Assisted Development Projects

Food For Works (FFW) program in Bangladesh is sponsored by World Food Program (WFP) and United State

Agency for International Development (USAID)4. CARE - a leading international NGO monitors the program

on behalf of USAID. FFW project has been in operation in Bangladesh continuously since 1975. Food for

Works project consists of rural infrastructure works with its main objectives as: i. to improve the performance of

the agricultural sector, including fisheries and forestry, through the construction and maintenance of necessary

infrastructure for production and marketing of output; ii. to reduce physical and human losses due to floods and

other structural disasters through appropriate protective structures; and iii. to generate productive seasonal

employment for the rural poor.

The implementation of these activities are mainly carried out by five Government ministries namely: Ministry of

Flood Control and Irrigation, Ministry of Local Government, Rural Development and Cooperatives, Ministry of

Fisheries and Livestock, Ministry of Forestry and Environment, and Ministry of Relief and Rehabilitation. Apart

from these line ministries about 40 NGOs are also involved in the implementation of FFW program. The

6resources used for the FFW program are wheat and monetized wheat.

However, the longer-terms developmental impact of FFW was considered to have fallen short of expectations in

terms of infrastructure and creation of assets for the poor. There are still hot debates concerning labor-intensive

public works and the tension between short-term employment creation and the size and distribution of the longer

term income stream (BIDS-IFPRI, 1985). The usefulness of food as a wage good in rural works has also been

questioned. Issues like less satisfactory longer-term impact on income distribution and asset generation and

impact of FFW schemes have therefore become a "serious concern" (Clay, 1986). In recent years, however,

increasing emphasis is being placed on development and hence FFW has been shifting from its original

objectives to include more development objectives. It is now referred to as the Integrated Food For Work

Program (IFFW) and the program is further extended for five year as Integrated Food For Development Program

(IFFD).

During recent years NGOs have been playing a significant role in FFW projects. In the year 1992-93, out of a

total allocation of 520,000 Metric Ton (MT) wheat of FFW projects 26,500 MT have been allocated to the NGOs

(WFP, 1992a). The expansion of NGOs' involvement in FFW program has come about mainly because in

general they have been successful in combining operational flexibility with meaningful beneficiary participation.

NGOs have successfully mobilized human and material resources, raised consciousness of the target groups and

generally avoided conflict with local informal power groups as well as the power structures (Aminuzzaman,

1993).

The GOB in 1975 also launched a program called the Vulnerable Groups Feeding Program (VGF) to provide

relief to the destitute women. World Food Program (WFP) has been assisting the program since its inception in

1975. From the early 1980s the program has been progressively reoriented from relief towards development and

was renamed as Vulnerable Groups Development (VGD). The revised objectives of the VGD is to increase the

self-reliance of the disadvantaged women. To that end, package of development services consisting of savings,

credit, functional education, training in income generating activities and health and nutrition information has

been introduced. However, progress of VGD has been slow and far from satisfactory (Duthi, 1986). Only about

70,000 i.e. 15 percent of the VGD women who participated in the 1990-92 training cycle had access to all

elements of the package (WFP 1992, WPF 1992a).

Local Government and Poverty alleviation

Local Government in any setting of governance is an essential partner of development management. However in

case of Bangladesh, the role of local government in development management has all along been limited. Apart

from some delegated development functions of the national Government like FFW, local bodies are hardly

involved in organization and management development projects. All local government development projects in

general are being designed and funded by the Central Government. More precisely local bodies in Bangladesh

have never been directly involved in organizing poverty oriented programs.

Since independence Bangladesh has witnessed several experiments in local government institution building.

Different models/ approaches like Union Panchayet, Village Multi-purpose Cooperatives, District Governor

scheme, Swanirvar Gram, Own Village Development, Gram Sarkar, Thana Development Committee, District

Development Coordinator, Upgraded Thana, Union etc, have been experimented. Critics have however noted

that most of these models and reform packages were designed in line with the political mobilization process of

the party in power than that of genuine

local government institution building exercise (Blair, 1985, Aminuzzaman,l993a).

Due to such frequent changes and experimentation, the Local Government institutions have suffered and could

not take a permanent and viable shape. There is also a noticeable tendency towards building and expanding an

institution rather hurriedly without going through necessary stages of development and maturation. A UN

sponsored study thus concluded that "the past twenty years have seen a failure to maintain and strengthen local

Poverty Alleviation in Bangladesh

7bodies in Bangladesh"(UNDP, 1992).

Most damaging experimentation was the abolition of Upazila system. Empirical findings suggest that by the time

of its abolition, Upazila had become a well rooted machinery of the Local Government institution in the

peripheral Bangladesh. It created conditions whereby local level politics have become relatively more

accountable and representative in character. It also facilitated transmission of civic, social, cultural and political

core from the center to the peripheries (Aminuzzaman; 1995).

Different Institutional Approaches to Poverty Alleviation

This section of the paper presents an overview of different institutional frameworks/ models of poverty alleviation

projects in Bangladesh. The approaches and interventions for rural development and poverty alleviation have

been discussed under five different institutional models : I. BRDB model, II. Donor-Line Agency Collaboration,

III. Poverty Alleviation Projects (PAPs) of Large NGOs, IV. NGO-Government collaboration model, and V.

Small and Local NGO projects.

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Small and Local NGO projects.

I. Bangladesh Rural Development Board (BRDB)

Until the early seventies, rural development was largely conceived of as agricultural development. The two-tier

cooperative system of the Integrated Rural Development Program (IRDP), based on famous Comilla model, has

been the sole institutional framework to implement the rural development programs in Bangladesh. The IRDP

was later transformed into a national organization named Bangladesh Rural Development Board (BRDB)

through the ordinance LIII of 1982. BRDB was assigned to develop the cooperative system and implement

various rural development programs.

BRDB is the largest institutional set-up of the GOB which is directly engaged in organizing and managing rural

development and poverty alleviation program in Bangladesh. Eighty five percent of the BRDB efforts are carried

out in the form of projects in which 91% of the share is contributed by different multilateral and bilateral Donor

organizations (Interchain, 1990).

BRDB has been undertaking group-based loan operations through cooperatives. This is perhaps the largest

institutional effort in the country to address the socio-economic needs of the rural people. Initially set up for the

agricultural sector, BRDB later diversified its services to incorporate the asset less men and women as well. With

a two-tier cooperative structure, there are primary societies at the field level which have three-fold divisions:

Bittahin Samabay Samity (BSS), for the landless and poorest of the poor, Krishak Samabay Samity (KSS) for the

farmers, and Mahila Bittahin Samabay Samity (MBSS) for the destitute women. The coordination of activities of

the above three types of societies in an area is done at the Thana 5 level by the respective Thana level Central

Cooperative Society. Starting with only 33 Thanas in 1971-72, BRDB now has practically covered whole

Bangladesh. BRDB's membership exceeds 2.4 million, of which almost four hundred thousand are asset less and

three hundred thousand are poor women. So far, BRDB has disbursed loans amounting to Taka 7000 million

(cumulative) and has collected savings amounting to Taka 440 million. It may be mentioned that the

cooperatives control 45% and 70% of all the sunken shallow and deep-tube wells respectively, which reflects

their important contributions to the agricultural sector and rural employment (BRDB,1994).

Empirical data generated by Center for Integrated Rural Development in Asia and Pacific (Momin, 1987) reveal

that introduction of IRDP has been very much successful in boosting agricultural production but social equity has

not been addressed adequately. Powerful village groups, primarily large farmers, continue to maintain control

over facilities and economic advantage. On the other hand landlessness, unemployment, and level and incidence

of poverty increased significantly (Rahman, H.S, 1992; Aminuzzaman, 2000).

8In order to respond to the undesirable trend, in 1982-83 BRDB introduced a package of intervention called Rural

Poor Project (RPP) to facilitate participation of the rural poor in socio-economic and infrastructural development

projects. Under the RPP project, until 1991-92 a total of Tk. 15.07 million has been distributed as credit to the

rural poor, of which only Tk.5.4 million has been recovered. The overall recovery rate as computed by BRDB is

as low as 7.72 % (BRDB, 1993).

Since the beginning of 1980s BRDB designed some special rural development projects under the brand name of

RD-5, RD-9 and RD-12. These projects were designed to cater the need of non-farm rural poor target groups.

Funded largely by foreign Donors these projects came into operation in parallel to the regular projects of BRDB.

These RD projects however differ from one another, and from the regular BRDB programs, in terms of the target

groups, geographical area covered, services provided, duration and funding and the adoption of formal vs.

informal cooperative societies. Moreover each of these RD projects has its unique institutional and organizational

set-up depending on the preferences of different Donors (CIDA, 1993). Though the feed back from the

operational levels and different evaluation studies have time and again noted the need for a unified

implementation framework for such RD projects, BRDB until now has failed to put forward its own proposals for

a unified structure for the RD projects.

Lack of a unified structure has therefore resulted in the `projectization' of BRDB as each of these projects has

superimposed different types of management approaches. As a result each of these projects has operated in

virtual isolation from the rest of BRDB. This has led inevitably to duplication of functions among various project

cells and the main organizational structure of BRDB. Successive evaluation missions have therefore deplored that

BRDB itself has gained very little in terms of transference and cross-fertilization of project experiences. In other

words, the professed secondary objective of all these projects, i.e. BRDB institution building has not been

achieved.

Donor agencies however are not satisfied with the BRDB's performance and institutional capabilities. Different

studies have summarized the donors assessment about the BRDB:

BRDB is a highly bureaucratic and sluggish organization. It does not suit the project management style

that originally brought success to the proven model. Instead of being a task based organization BRDB

has somehow slipped into bureaucratic form of organization and follows rigid bureaucratic procedures.

The rules, procedures and task targets seem to have become the end in themselves. The organizational

set-up over the period of time has become extremely complicated with different dimensions consisting

of projects, functions and geographical set-up and intersecting each other causing diffusion of

responsibility and non-clarity of authority and almost completely lost accountability. The total

monitoring and evaluation efforts starting from reporting from the field levels and projects is not well

coordinated... Evaluation as an important management function is not scientifically resorted to by

BRDB... BRDB lacks a clearly defined institutional arrangement to absorb the outstanding activities of

terminated projects (Interchain, 1990).

The bureaucratic nature of the organization has resulted in the development of lengthy procedures, rigid

controls and management styles that inhibits the realization of potential. Interminable delays, poor

quality of implementation, non-attainment of targets, loss of staff commitment and motivation have

resulted from these practices... (CLEAR/ Plunkett, 1992).

Some donors, being so frustrated with BRDB have substantively withdrawn their support and opted for the NGOs

and other alternatives institutions. While others have devoted considerable efforts to the upgrading of the BRDB's

organization structure and management systems in order to eliminate its institutional incapacity to effectively

carry out the tasks of rural development and poverty alleviation.

Lead Agency Projects

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II. Donor/GOB Line Agency - Lead Agency Projects

In this approach, poverty alleviation projects are designed at least on paper by the GOB and selected Donor

agency. However in reality most of these projects have been the products of different mission reports

commissioned by the donor. In fact, on the whole, these projects are manifestations of the Donors' disbelief in

the capability of GOB agencies.Under this model a specific GOB line agency is formally assigned to run the

project while the Donors provide a Project Advisory Team. The Donors usually impose an elaborate project

specific institutional arrangements. The project is managed by an international project management firm with

highly salaried expatriate resident advisers and consultants.

There are many different variations in project design regarding the distribution of actual decision making and

management responsibilities between the donor appointed Chief Technical Advisor (CTA)/ Chief Project

Coordinator (CPC) and the Line agency appointed Project Director (PD). In most projects the final decision

making authority lied in the hand of the CTA/ CPC. Some projects have developed a system of "dual authority"

between the CTA/CPC and the PD (Raquib, 1992). The line between advisory and decision making functions in

this arrangement has created severe management crisis 6.

Noakhali Rural Development Project -II is one of such projects worked through a number of different line

agencies 7 as implementers of different components while BRDB acted as the lead agency. The combination of

BRDB as lead agency and other line agencies proved to be problematic. In the light of the operational

experiences and to make the project more responsive and effective, the donor at one point insisted on the

inclusion of the NGOs in the project. All participating agencies especially BRDB resisted the inclusion of the

NGOs. Consequently a review mission sponsored by the Donor recommended to remove BRDB as the lead

agency of the project (DANIDA,1989).

Like other RD-Projects, NRDP was highly staff intensive with a considerable TA 8 competent. Dualism of

authority, lack of motivation of the local staff and the salary differential between TA staff and GOB staff posed

serious problem to the project (Wood, 1988; Norby & Ali,1992). The NRDP was ultimately terminated resulting

in large-scale redundancies and the loss of valuable staff experienced in rural development, as the line agencies

could not absorb most of the additional staff who had been funded by the Project.

The original intention of this model as an integrated collaborative effort was not achieved. Neither at the level of

integration of function nor in terms of service delivery mechanisms the project could show any sign of success.

Various coordination committees at different levels intended to bring integration proved to be highly ineffective

(DANIDA, 1989). Management system sometimes was "chaotic" and "counter-productive". Thus the model of

Donor- GOB collaboration could not show any promise as an alternative institutional model of PAP

management.

Poverty Alleviation Projects of Large NGOs

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The Poverty Alleviation Projects of the Large NGOs

The history of NGOs in Bangladesh can be traced way back to the British colonial period. Since the British era,

NGOs in its traditional form have been working in Bangladesh as different religious trust-based schools,

hospitals and orphanages. However, NGOs in Bangladesh got a radical transformation and turned into agents of

development in the post-independence era.

GOB had to face a Herculean task of renewal and reconstruction of the war torn economy immediately after its

war of independence. The GOB had neither the capacity nor had the appropriate institutional mechanism to

address the volume and diversity of such enormous problems single handed. At that point of time, a number of

international NGOs and voluntary organizations extended their helping hands to assist Bangladesh in its striving

efforts to rebuild the infrastructure and the economy. Thus, the decade of 1970s witnessed the emergence of

several local NGOs and also the arrival of several International NGOs in Bangladesh.

Since 1970s NGOs therefore become a part of the institutional framework of poverty alleviation in Bangladesh.

The NGOs, especially the large ones in effect, have infiltrated into an operational arena which has traditionally

been the `exclusive domain' of the government. Donors have played a significant role in advocating for the

NGOs as an active partner in poverty alleviation projects in Bangladesh (Sobhan and Bhattacharya,1990).

Though GOB does not have a clear and comprehensive policy framework on the role of NGOs but different

bilateral as well as multi-lateral donors somehow very strongly have made it more or less obligatory to

Bangladesh to opt for NGOs as a second channel for organization and management of PAPs. As a result several

donors are channelling substantially higher amount of resources through the NGOs. The proportion of total

foreign aid to Bangladesh disbursed through NGOs was about 1 per cent only in 1972-73 which by the end of FY

1986-87, reached to 17.4 per cent (Abed, 1984; Alam, 1988; Alam 1993).

The donors, frustrated and disillusioned by their attempts to work with conventional line agencies of the

government, have supported the NGOs at the risk of displeasing the Government with assumption that the NGOs

are efficient and committed, deliver services through targeted programs with transparency and accountability

(World Bank, 1990). This redirection of donor funds has resulted in considerable expansion of the programs of

the large NGOs as well as of their organizational capacity. In fact by the middle of the 1980s it was estimated

that the staff of NGOs would have exceeded more than three times of that of Bangladesh Rural Development

Board - the sole governmental body specifically assigned to address rural development and poverty alleviation

program in Bangladesh. By the end of the 1980s the constituency of BRAC, Proshika and Grameen Bank , three

leading national NGOs/ non-government rural credit institutions , accounted to around one million members. An

estimate made by the Association of Development Agencies of Bangladesh (ADAB), claims that the leading

NGOs have already been able to serve one-tenth of the country's 120 million people (ADAB, 1993).

Some leading NGOs by now have developed into large professional organizations and acquired the capacity to

provide more effective services. Their role in development is primarily advocated for five considerations

(Streefland, 1993): their ability and effectiveness to act as brokers between the needs of the rural poor and the

objectives of donor policies; their efficiency in reaching the poor; their innovative potential; their reliability and

efficiency in providing emergency aid to people afflicted by natural disasters; and their ability to provide

sufficient organizational support to the needy and poor.

Most of the NGOs in Bangladesh at the beginning focussed their attention on `consciousness raising' aspect at

the grassroots levels through mobilizing and forming groups among the poor, initiating a process of people's

collective analysis on their present situation, helping them to see the strength in their numbers and gradually

inspiring the poor to undertake continuous social and economic actions in order to change the existing dominantdependent

relationship between them and the rich. By multiplying such grass-roots groups and developing

networks among those multiplied groups, it was argued by the NGOs that the poor would emerge as a

Poverty Alleviation in Bangladesh

11countervailing power to the wealthy, with necessary strength for future social transformation.

Later during the late 1970s the pure conscientization approach has been largely abandoned. A new set of

assumptions were drawn by some leading NGOs. These are: (ADB,1993)

1. The absorptive capacity and self-reliance of the poor can be developed only progressively.

2. As result of combination of general scarcity of government resources and the capacity of the existing elite

to capture the major share of government services, "the barriers to entry" as faced by the poor are much

greater than what originally believed.

3. Provided certain precautions are taken, it is possible to render essential services to the poor without

jeopardizing their sense of self-reliance.

Thus from early 1980s most NGOs have opted for multi-sectoral projects primarily emphasizing the rural

employment and income generating activities for the disadvantaged and poor. Empirical evidence indicate that a

good number of NGOs have set standards of efficient delivery systems with substantial legitimacy from the

community (Aminuzzaman; 1993).

Some significant factors can be identified which may have been responsible for relative success of the NGOs

(Khan,1986; Rahman, 1985; Alam, 1988; Alam, 1993):

1. NGOs have been able to effectively organize the rural poor with similar socio-economic background

and made them more conscious of their own potentials that the local power elites do not take advantage

of them.

2. NGOs have also shown that the poor people are bankable if properly organized. There has to be a

strong saving component in the credit program for the poor. It is the "group pressure" which has been

used for both "motivation" as well as "self-discipline".

3. The NGOs have complemented credit program with conscientization as well as training. It is the

change in attitude which ensures high repayment of loans and group cohesiveness.

4. NGOs have also successfully blended the credit components with appropriate technology.

Empirical evidence also indicates that NGOs are more innovative than government agencies when it comes to

assisting the rural poor. Moreover: i. NGOs are more flexible in their approaches; ii. usually have better and

intimate knowledge of local conditions which shape the outcome of a development activity; iii. NGOs have a

higher degree of capacity to reach the intended target groups and tend to maintain close contact with the poor;

and iv. NGOs in general are committed as well as willing to spend more time experimenting to the extent that

they are not under pressure to disburse credit funds and are committed to a long-term involvement.

Limitations of the NGOs

NGOs in Bangladesh have increasingly become subject to questions and criticisms. Their roles, functions and

long-term objectives have been questioned by the Government, political parties, intellectuals and public in

general (Sobhan, 1982). Most NGOs with increasing availability of donor funds, tend to undertake programs

which are determined by, and devoted with, donors' demand and expectation. Such programs may have only

"little relevance to the critical needs and aspirations of the beneficiaries and may be far drawn away from their

stated long-term objectives and strategies" (Task Force,1991: 379). Some left-leaning political parties criticize

the NGOs for taking funds from western donors and serve their interests in a way to fulfill their objectives of

subverting the process of politicization and social revolution. Due to the lack of planning and or institutional

framework and support, some NGOs especially the smaller ones, in effect, addressed the problems of poverty

mostly on "adhoc" basis and developed a condition of perpetual dependency. Studies have also shown that some

NGOs are found to be inefficient managers of resources and are trying to implement a diverse set of programs

requiring a managerial competence for integration beyond their existing capacities (ADB, 1993).

Evaluation reports of some NGO sponsored programs indicate that they do not have comprehensive plans for

sustainability of their projects. This leads to the main criticism against the NGOs is that they tend to become

"paternalist" about their clients by continuously investing in the same beneficiaries instead of setting time targets

for their graduation from poverty. The sustainability and replicability of NGO programs on a long-term basis

become difficult for the high unit operation costs. Available data suggest that major (large) national and

international NGOs usually have a larger operating cost per group member than its comparable government

administered poverty alleviation programs (UNDP,1988).

A UNDP sponsored study has made a thorough analysis of the NGO sponsored development programs in rural

Bangladesh. The study noted that some of the NGOs have gross institutional limitations and have not been costeffective.

Major observations drawn by the UNDP study are as follows (UNDP;1988):

1. The credit policy pursued by the NGOs comes only as a complementary component of a wider

consciousness raising program. It is said that the credit is given only after some time has elapsed and

that, too, is of small amounts. While NGOs argue that too much dependence on credit may distract the

poor from their human development, it can also be argued that people can not survive on

"consciousness" alone. They have abundant labor and if that can be matched by capital, they can be selfemployed.

So NGOs, in fact, slow down the pace of the development of the poor by withholding credit

for longer periods of time.

2. NGOs are heavily dependent on foreign resources. In the absence of accountability, too much money

from outside can make the NGOs corrupt, controversial and bureaucratic.

3. NGOs, despite a decade of their existence, have not made much dent. It is easy to show remarkable

success in a village or two with small projects, but it may not be possible to replicate these successes

throughout the country.

4. NGOs lack legitimacy and political leverage, hence they are ineffective in running big projects that

would affect significant number of rural poor.

Another study has summarized the critical issues related to NGOs in Bangladesh ( Aminuzzaman, 1994):

i. There is no clear-cut GOB policy on the role and functional coverage of the NGOs in Bangladesh.

Whatever guidelines are there, these seem to be ambiguous and contradictory;

ii. There is a general feeling of mistrust among the members of the public bureaucracy towards the

NGOs;

iii. Most of the NGOs alleged to have no long term plan which results in designing projects that

generates temporary benefits than tangible long term impacts.

iv. There is a noticeable lack of coordination among the NGO projects resulting in duplication and

wastage of NGO resources and efforts.

v. There are reports of lack of coordination between the NGOs and the local government bodies as well

as the field level bureaucracy of the national government;

vi. In many cases NGOs have faced resistance from the local interest groups.

vii. NGOs in general have become more and more dependent on donor support and have failed to

mobilize local resources. A number of the NGOs have to abandon their projects due to lack of

Continuous donor support.

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Continuous donor support.

viii. Most national NGOs are poorly staffed and fail to retain professionals for longer period.

What ever the case may be, NGOs have become a strong institutional framework of development management in

Bangladesh. The donors time and again emphasized the importance of the extended role of the NGOs in

Bangladesh. Major Donors particularly the World Bank suggest that an expansion of the existing Government

program to generate employment for the landless and rural poor is unlikely to provide a solution due to the

institutional constraints particularly that of the BRDB. World Bank and other donors strongly suggested that

successful NGOs who have gained much experience in assisting the rural poor through employment and income

generation activities should be encouraged to expand as a supplement to the Government's own efforts in poverty

alleviation.

The main question which needs to be examined in this context is that of the future role of the large successful

NGOs. They are all providing essential social services which traditionally fall within the purview of services

provided by Government. From this point of view, the NGOs have setup operations parallel to the Government.

In some cases there are reports that at the field level GOB functionaries have become hostile towards the NGOs

and maintain an ambivalent attitude towards the NGOs. NGOs also cautiously avoided institutional interactions

with the Local Government bodies (Aminuzzaman, 1993). This may create a situation of `no government' at local

level which in the long run would inevitably affect the already weak local bodies in rural Bangladesh

(Aminuzzaman, 1993a).

The NGOs in Bangladesh are caught up in the tension between their role as mere humanitarian service providers

and their social objective to bring about mobilization of the target group against existing oppressive and

exploitative socio-political power relations (RDRS; 1991). The choice they are facing at present is not an easy

one. The GOB has not made sufficient progress in terms of becoming a provider of essential social services.

Given the enormous expansion of their operations and the greater need of the masses of the poor for their

services, the option of enlisting NGOs as authorized Government contractors for the delivery of social services

(e.g. education, health) has become pressing. From discussions with the leading national NGOs this researcher

gathered that some of the NGOs have chosen to follow this option. It remains to be seen how the large NGOs can

reconcile such a strategy with their second objective of politically mobilizing the masses of the poor.

IV. Collaboration between NGOs and GOB line agencies

Another emerging model in PAP is the collaboration between the GOB line agencies and the NGOs, which one

study notes as a "promising alternative institutional approach to poverty alleviation" (Hossain, A, 1995). This

approach seeks to combine the extensive experience of NGOs in group formation, awareness raising, human

resource development and income generating activities with the large scale capacity of GOB line agencies to

deliver inputs of technical expertise and resources. In contrast to institution and capacity building efforts from

within GOB agencies, the expected benefits from this arrangement is that, the capacity would be injected from

outside and below. In other words, the local knowledge, human resource development expertise, motivation and

enthusiasm of NGO staff are expected to have a `demonstration effect' on GOB staff by way of their interaction

with each other. And, more important perhaps, the insistent and articulate demands from well organized groups

mobilized by the NGOs are also expected to stimulate the responsiveness and commitment of local GOB staff,

who are used to being faced with mostly a non-challenging and passive target group.

Model Collaborative Projects

By now some collaborative projects between different ministries/ directorates (like Health, Relief and Livestock)

with leading NGOs like CARE International and BRAC have produced notable demonstration effect. In 1985,

BRAC entered into an agreement with the Ministry of Relief and became an implementing partner of the VGD

program. On an experimental basis, BRAC took the responsibility of distributing the food and other logistic

supports to the destitute women. BRAC also assumed the responsibility of imparting skill based training to the

women groups in four different functional skills i.e.: poultry, vegetable cultivation, sericulture and embroidery.

Based on the initial positive impact of the collaboration, BRAC further designed a new program called Income

Generation for Vulnerable Group Development Program (IGVGDP). IGVGDP in effect was a collaboration

project of the World Food Program (WFP), Department of Relief and Rehabilitation (DRR), Department of

Livestock (DLS) and BRAC to improve the income earning potential of destitute women who are VGD members.

The program aimed at providing skills training and other support over a period of two years when the VGD

women are supported by the wheat ration supplied by WFP. Under the extended program BRAC has been

responsible for motivation, group formation, training and supply of inputs to the VGD members. DRR, through

BRAC staff, provided administrative support. WFP assisted in monitoring and liaising with various departments.

DLS was responsible for training and supply of necessary inputs.

IGVGDP was a test case of success. The project made significant contribution in raising the income level of the

rural disadvantaged women who would otherwise be left out of work. They were able to enter the active workforce.

Though their income was not much but it helped them to augment the meager earnings of the family as

well as improving the quality of life (BRAC; 1992).

Another example of GOB-NGO collaboration is CARE-TICA project. It is a technical training and systems

development project. It focuses on developing and strengthening the skills and capabilities of the field level staff

of the Ministry of Health and Family Welfare (MOHFW) through various need-based, continuous and systematic

training. CARE International provided the training and other logistics support for the MOHFW field staff

involved in the mass immunization program at the rural level. CARE was also involved in the monitoring of the

project. An evaluation of the project noted that the systems introduced by CARE-TICA have been widely

accepted and used by MOHFW workers. MOHFW workers stated that these systems made their day-to-day work

more "structured" and "systematic" and which ultimately enhanced their efficiency and productivity. TICA has

also made a significant impact on improving the knowledge of MOHFW workers and community members. This

achievement is particularly striking when compared with the overall knowledge of the same topics in control

areas (Thompson, 1992).

In principle, GOB have time and again mentioned the need and importance of NGOs as partner of development.

Nevertheless, there seems to be a noticeable ambiguity in the policies of the GOB on the role and scope of the

involvement of the NGOs in development management in Bangladesh. Different GOB plan documents have

vaguely indicated the possible use of the NGOs but could not identify any specific packages of intervention

strategy. Though there have been some success cases, due to in-built bureaucratic inertia and institutional

jealousy, GOB agencies are not much interested to go for such collaborative projects. The overall tone of the

GOB plan documents (FFYP) emphasizes the "use" and "coordination of NGOs" by the government agencies

rather than any positive attempt for institutional collaboration.

V. Small and Local NGOs

This institutional arrangement aims at upgrading the capacity of small local NGOs for implementing poverty

alleviation projects. Palli Karma Sahayak Foundation (PKSF) established in 1990 by the GOB, is the lead

agency in such approach. PKSF's broad goal is to implement income and employment generating programs for

alleviation of poverty for the landless and the assestless people in the rural areas through various NGOs, local

level organizations. PKSF calls these as the Partner Organizations (POs). The Foundation, during the financial

year 1992-93, through its 79 POs, has distributed a sum of Tk.100 million. The total sum of the direct loans as

well as of the revolving loan provided by the POs have so far rendered credit support to over 70,000 landlessassetless

people in rural Bangladesh of which 83 percent are women (PKSF;1992). As this is a fairly new

direction in institutional experimentation for poverty alleviation, there is as yet little by way of evaluation studies

Poverty Alleviation in Bangladesh

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Assessing the effectiveness of this approach.

Factors that affect PAPs

PAPs, like other development projects in Bangladesh suffer from numerous institutional and functional

dilemmas. Different evaluation reports, review mission and studies have identified some built-in institutional,

functional and structural limitations of such projects (Interchain, 1990, RESP, 1993; Aminuzzaman, 1994a) .

Following is a summary list of the problems identified by different studies:

" Most of these projects suffered from having too many objectives, weak management structure, unclear

division of responsibilities and two and even three lines of command.

" The project performance has been severely hampered by faulty project designs. Most projects did not have

any in-built monitoring system.

" Project interventions with respect to selection of specific activities, technology, skills development and

marketing network have been generally inadequate or disintegrated.

" Some projects also failed to achieve their target due to poor coordination/ performance of the participating

agencies and to a large extent, due to the absence of a well designed Project Operation Manual (POM).

" There have always been considerable delays in the flow of funds both from the donor as well as GOB

channels.

There is also a growing concern about the sustainability of the PAPs. Despite contending perceptions about

project viability and organizational roles in design and implementation, the institutional actors (GOB, NGOs and

the donor agencies) continue to collaborate in implementing more of the same type of projects. This paradoxical

outcome of what Sanyal (1991) calls "antagonistic cooperation" can be better explained by varying and

converging institutional interests than by the theory of comparative advantage.

Both GOB as well as NGOs seem to have no comprehensive plan for sustainability of the project impact on the

beneficiaries. The large NGOs have addressed this issue by defining withdrawal policies. While some NGOs

experimented with the formation of different forms of federation of groups and a gradual withdrawal of project

staff and by maintaining a loose follow-up links with the groups.

Sustainablility of PAPs to a great extent depends on project design and deployment of soft skills. In fact nonavailability

of professional staff soon after the formal completion of projects and consequent handing over to

GOB have caused considerable damage to some selected projects (RESP; 1992). Projects, in most cases get

disintegrated with the withdrawal of external support 9. Due to the strict recruitment rules and shortage of

revenue budget whatever technical competence is built by the project, these professional staff can not be

absorbed in the regular GOB operations.

Lessons Learned

What is the overall impact of the PAPs in Bangladesh ? What lesson have we learned so far? It is very difficult to

have precise answers to such questions. The impact of the entire gamut of poverty alleviation projects of both the

Government and NGOs, in fact, have still remained rather poorly documented. Moreover, on account of the

diversity in the focus of various projects, it has become rather difficult to arrive at a common denomination of

poverty alleviation, more specifically with regard to their impact on income, wages, employment and nutrition.

Notwithstanding some studies have even indicated some danger signals and noted that a number of these projects

have resulted in "a decline in the overall quality of village life and increased rural differentiation" (Hossain,

1984).

Findings of the available research indicate that institution building for grass root level development and poverty

alleviation in Bangladesh has suffered due to the lack of political committement. During the last two decades, all

successive regimes in Bangladesh followed a `populist' approach to set up different structures for local

participation and development. Each regime felt that it had to reach out beyond the political support of the rural

elite. The military regimes also became active and moved beyond the role of "maintaining stability" to initiate

"real development"(Blair, 1985) . As a result several parallel structures and institutions have been developed.

With the generous support from the Donor agencies, NGOs have become an active partner in rural development

projects. Though there are some reports of lack of coordination in conception and management of these projects,

some selected NGOs are doing well and have brought about significant changes in the socio-economic modes of

the lives of the target beneficiaries. Some NGO projects, on the other hand, have however developed a condition

of perpetual dependency. Due to the lack of planning and institutional framework and support, these NGOs, in

effect, addressed the problems of poverty mostly on "ad-hoc" basis.

All poverty alleviation projects depend heavily on foreign resources. Most of the background studies and design

works of the PAPs in the public sector appear to be controlled by donor appointed consultants. The Government

usually gets involved during fund negotiation and approval of the project. On the one hand, the donors make

much less of an attempt to influence the course of project formulation, design and implementation of poverty

alleviation projects of the NGOs (Aminuzzaman, 1994).

Recent experience indicates the emergence of two institutional development approaches in the domain of poverty

alleviation that need to be reviewed and examined. The first, is the collaborative ventures between large NGOs

and GOB line agencies which seeks to combine the extensive experience of NGOs with large scale capacity of

GOB line-agencies. The second approach, depicts the possibility and willingness on the part of leading Donors,

some GOB line agencies and large NGOs to strengthen and support small local NGOs for the purpose of creating

a more extensive network of development service delivery to the rural poor.

The process of institution building becomes smoother if the functional and strategic goals of the organization are

clearly spelled and understood by the participants. Chances of institutional development again improve

significantly in proportion to the effective linkages it can build with major client systems it intend to serve. The

stronger the degree of critical self-awareness that the institution can develop the better are its chances of selfrenewing

growth. The stronger the process of bottom-up planning, the better the chances of viable institutional

growth.

Based on the above framework one may argue that most PAPs could not emerge as an effective institutional

approach to address poverty in Bangladesh. All major poverty alleviation projects in Bangladesh are found to be

very loosely coordinated and lack clear and pragmatic goals, and effective linkages with the clientele is also

missing. Due to the lack of macro level coordination, poverty alleviation projects have been designed in

segmented sectoral lines. The projectization of rural development has also led to a fragmentation of efforts and

diversification of institutional arrangements.

Policy Implications

It is clear that PAPs have suffered sufficiently due to overlapping and parallel approaches. It is therefore

imperative to develop a coordinated institutional mechanism. Success of the PAPs appears to depend

Poverty Alleviation in Bangladesh

considerably on the degree of flexibility in project design, institutional mechanism and management. The future

design of PAPs should seriously consider the institutional aspects, keeping in view the needs of the poor and

incorporating comprehensive packages of economic and social interventions. PAPs should also be flexible to

incorporate infrastructural components to create additional demand for unskilled labor. PAPs should contain

elements that empower landless and marginal farmers to participate in the non agriculture sector. Therefore the

scope and coverage of the PAPs should be reexamined.

An effective framework of poverty alleviation program should be centred around the following institutional

interventions : a. enhanced institutional capabilities of the GOB agencies, the local government bodies and the

NGOs ; b. effective and direct involvement of local government bodies; c. strengthening the planning and

implementation capabilities at the local level; and d. developing and strengthening the relationship among the

GOB agencies, local bodies and the NGOs.

As the lead GOB agency, role and functions of BRDB needs to be examined. BRDB should undergo strategic

institutional reforms in the following lines:

Broadening and redefining the role and scope to include non-cooperative groups and non conventional

programmes geared to income generation and employment for the rural population.

Reorganization of the structure of the BRDB is needed to make necessary adjustments consistent with its

responsibilities in the management of rural development programmes with an aim to create non-agricultural,

non-farm employment in the rural areas.

Keeping in view the institutional and management strengths of the NGOs to reach the poor and disadvantaged

clientele, there should be greater collaborative projects between GOB and large and regional NGOs. Thus,

there is a need to examine the institutional network of poverty alleviation projects of the NGOs, and to review as

to how these projects could be coordinated with the related projects of the GOB and the local government bodies.

Most important consideration to develop such collaboration will be to get the attention of policy-makers and

convince them of the usefulness, practicality, affordability and replicability of the approach.

PAPs are still based on top-bottom approach of planning and therefore not adequately responding the needs of

the clientele. There is a need to devise innovative measures to ensure the participation of the poor men and

women in the identification, planning and implementation of the projects.

Development can not be imposed from above and outside agencies. In order to broaden the institutional base at

the local level, there is a need to improve the capacity of local bodies. Institutional reforms should be made to

extend local responsibility for formulating and implementing poverty oriented projects.