Governance describes the way countries and societies manage their affairs politically and the way power and authority are exercised. For the poorest and most vulnerable, the difference that good, or particularly bad, governance, makes to their lives is profound: the inability of government institutions to prevent conflict, provide basic security, or basic services can have life-or-death consequences; lack of opportunity can prevent generations of poor families from lifting themselves out of poverty; and the inability to grow economically and collect taxes can keep countries trapped in a cycle of aid-dependency. Understanding governance, therefore, is central to achieving development and ending conflict.
During the 1990s donors came to realise that development required better 'governance', and DFID recognised early on the need to work with the research community to identify ways of improving governance for better development outcomes.
The Centre for Future States and the Citizenship, Accountability and Participation Programmes (Institute of Development Studies, Sussex); the Crisis States Research Centre (London School of Economics); and the Centre for Research on Inequality and Ethnicity (CRISE, Oxford University) have been funded by DFID over the past ten years. This paper provides a brief overview of what these different programmes have told us about governance, fragility and conflict in the developing world.
The key message from all four research programmes is that to understand development we must understand the politics that shape it. Ultimately it is political decisions that will shape whether or not the Millennium Development Goals are reached, revenues are raised to fund investment, and growth occurs.
The research argues that the political settlement is central to all development; and one that does not exclude powerful players is more likely to prevent conflict. But settlements also need to work at the grass roots level, representing the interests of social groups. Security is a precondition for development; this is a matter of survival and must be prioritised in countries recovering from conflict. Evidence presented here shows that in countries where cultural or ethnic groups feel there is economic, political and social inequality, wars are more likely. The future face of insecurity is not restricted to civil wars - more and more people are dying in social violence, particularly in cities [Chapters 2, 3 and 4].
The research looks at how governments can become more inclusive, and therefore more stable. States that are accountable only to some groups or that do not regard some members of society as 'citizens' create inequalities that can fuel conflict. When citizens actively participate in society through local associations and movements outside the state, there are benefits to both state and society [Chapters 5 and 6].
The poor, more than any other group, rely on basic public services. For vulnerable families, access to education and healthcare are important routes out of poverty. The politics matters: services work better for the poor when poor citizens participate in reform of service delivery and the research looks at how this can be most effectively achieved. In conflict affected states the provision of services is very sensitive. Service delivery targeting excluded groups can reduce political tensions and improved security [Chapter 7].
DFID-funded research has made a key contribution in drawing attention to the importance of taxation in building effective states. Taxes, raised in ways that encourage economic growth and promote political accountability, build the political legitimacy of the state and offer the eventual 'exit strategy from aid'. Tax revenues allow states to provide security and public services while prioritising their own (rather than donor) policy concerns. Tax reforms can encourage interest groups in society to mobilise politically - an important bargaining process between state and citizen-taxpayers who perceive they may have a genuine stake in better government [Chapter 8].
Economic growth allows people to escape cycles of poverty and countries to end dependency on aid. But the findings shown here question some of the blueprints donors recommend for achieving growth. Some of the most successful examples of rapid economic growth in the developing world, such as China and Vietnam, have certainly not followed the 'investment climate' prescription. Donors may need to acknowledge the political dynamics of growth, including that some forms of informal relationships between business and state in developing countries can succeed in generating and sustaining high levels of growth [Chapter 9].
The report concludes [Chapter 10] with a proposal to improve how the international community commissions and uses governance research, indicates why further governance research is needed, and how DFID plans to respond.
This research adds depth to our understanding of development as a political process, provides rich evidence based on country experience, and points to the questions which aid agencies must address in order to be effective - including in more fragile countries. It demonstrates that durable reforms need to be constructed, nationally and locally, in a way that fits each political context and it challenges donors to build the capacity to contribute to this effectively.
DFID, London, UK, 97 pp.