NZAID: the first year: Peter Adams backgrounds the setting up of the new New Zealand aid agency.

• Author: Adams, Peter

Foreign Affairs and ODA have distinctly different missions. ODA asks our partner governments: what are your needs and how can we help them? Foreign Affairs asks: what are our needs and how can we advance them? These two missions are not only fundamentally different, they can sometimes be in conflict. (1) I offer this quote at the outset because the report from which it comes laid the foundations for the establishment of NZAID. The story of the creation of NZAID began as a political commitment of both the Labour and Alliance parties in the lead up to the 1999 general election. After the formation of the Labour/Alliance government, the Associate Minister for Foreign Affairs and Trade, Matt Robson, with the support of the Minister, Phil Goff, commissioned a review in September 2000. Two development experts, Joseph Grossman (an economist and former Peace Corps volunteer in Samoa) and Annette Lees (a development and conservation expert) undertook the review, and their final report, entitled Towards Excellence in Aid Delivery, was presented in May 2001. NZODA (the acronym for New Zealand official development assistance, of the aid programme) had last been reviewed ten years earlier. There had however, been regular four-yearly peer reviews conducted by the OECD's Development Assistance Committee, the most recent being issued in April 2000.

The findings of the Ministerial and the DAC reviews, both undertaken between 1999-2001, were presented in rather different ways and very different tones of voice, though some of the key issues identified were common to both. The DAC review found that New Zealand had 'a serious and credible aid programme' but one which faced a number of challenges. The Ministerial review concluded that the administration of NZODA represented 'a failure of systems to support excellence in ODA'--not quite, but coming very close to, using the dreaded phrase 'systemic failure'.

How could New Zealand overseas development assistance be at one and the same time 'a serious and credible aid programme' and 'a systems failure'? Was it just in the eye of the beholder? Was it a question of whether the glass was half-full or half- empty? Were there other factors in play?

Common issues

As noted, there were some common issues identified by the two reviews. The DAC review recommended that the New Zealand government:

* sharpen the focus by making poverty reduction a clearer objective for the ODA programme; so did the Ministerial review, which recommended 'one unambiguous goal, the elimination of poverty';

* the DAC review recommended that more overseas development assistance should be allocated to programmes directly targeting the poor and addressing basic needs including basic education; the Ministerial review recommended a holistic approach to education support, by which they meant fewer scholarships and more emphasis on basic education;

* the DAC recommended that the organisational structure for administering NZODA should be examined in comparison to other possible structures, implying that it needed to be changed; the Ministerial review recommended that NZODA should be administered by an autonomous agency;

* the DAC recommended the building up of a core group of officials with both development experience and political skills who would follow a development career path; the Ministerial review noted that the high level of staff turnover due to the MFAT rotational system mitigated against the creation of a professional development agency;

* both reviews considered that NZODA was too dispersed over too many countries and recommended a sharper focus.

Following the completion of the Ministerial review, an inter-agency working party was established under the chairmanship of the Department of Prime Minister and Cabinet to consider its recommendations and prepare advice for Cabinet. The working party comprised representatives from the Department of Prime Minister and Cabinet, Ministry of Foreign Affairs and Trade, the State Services Commission...