Shah Testifies on FY11 Budget at Senate State Foreign Ops Hearing

Raj Shah

U.S. Agency for International Development (USAID) Administrator Rajiv Shah testified earlier this week before the Senate Appropriations Subcommittee on State and Foreign Operations on the FY2011 Budget request for USAID.   In his opening remarks, Chairman Patrick Leahy (D-VT) expressed his appreciation for Shah’s leadership at the beleaguered agency, which he characterized as a “formidable task.”  He continued, “USAID is in urgent need of reform… I don’t think USAID is living up to its potential.”  He went on to say, “I think that USAID has to change its culture, change the way it does business if it wants the kind of money that you’re here legitimately asking for… in this committee, in the Senate, Republicans and Democrats, you will not find stronger supporters of your mission among the men and women on this committee anywhere else in the Senate.  We want nothing more for you to tell us how you can change.”

Shah began his remarks by noting the “once-in-a-lifetime or a once-in-a-generation type of opportunity” we face on foreign assistance reform, saying, “the president, the secretary, members of this committee, yourself, members of Congress have all called for a more effective, a more transparent, and a more capable development enterprise.”  Shah listed specific areas that need reform at the agency:

“Before the end of this month, we hope to roll out a new policy-planning, evaluation and budget capability at AID that will allow us to be more accountable and make smarter decisions and real resource trade-offs so that we’re not just chasing every need in an environment where needs are endless…In June, I hope to launch a series of procurement reforms… And we will take that further in having really specific, detailed guidelines for procurement reform that are fundamentally based on the premise that we should be doing much more work in-house, especially related to program design and oversight.  And, finally, we will focus on H.R. and evaluation in a very substantive way over the course of the summer and the fall.”

Senator Leahy

During the Q&A, Chairman Leahy asked Shah about the number of positions still vacant at USAID, to which Shah replied they are waiting on 62 names recently submitted to the White House.   “Of the Senate-confirmed,” said Shah, “roughly half of them are through an initial vetting process, but that only gets concluded when the White House, of course, announces the formal appointments.”

Shah also spoke about Haiti and how the team there had an ongoing dialogue about what was working and what was not working – allowing them to be flexible in their policy.  Ranking Member Judd Gregg (R-NH) asked how, given the difficult budget environment, resources will match up to numerous programs to ensure effectiveness; Shah noted that USAID is looking to sharpen its focus, “especially country-by-country narrowing the number of sectors we might work in so that in each of those sectors we can build real technical excellence, stay committed for five or 10 years, and see the kind of big, transformative outcomes we hope to see.”

Senator Mary Landrieu (D-LA) brought up the issue of coordination at USAID – internally and among partners and multilateral organizations, particularly in Haiti.  Shah mentioned how the small grant awarded to MFAN partner InterAction to serve as a hub for coordinating NGOs working on disaster relief “was a good first step and it made a big difference…and it gave us someone to engage with when we wanted to address the NGO community specifically.”

In response to a question from Chairman Leahy on whether USAID should follow the Millennium Challenge Corporation (MCC) model with respect to meeting certain criteria in order to receive U.S. aid, Shah said, “I think in general efforts to have long-term effective sustainable development that’s broad enough that it reaches a large percentage of a population in-country does require some significant degree of country ownership.”  He went on to discuss similarities between the MCC model and what he believes is the Administration’s new perspective on assistance:  “…country ownership is a precondition to long-term success.”

Chairman Leahy closed by reiterating to Administrator Shah his support for the mission of USAID:

“I hope you understand when I ask these questions I think that you are and will be an inspiration to the people at USAID.  There are some superb men and women working at USAID.  There are many who worry about the mission being overwhelmed by bureaucracy.  They want you to give them the direction.  They want to break through. They want to do the things that inspired them to come to USAID in the first place.  And so we’re putting in your lap years and years and years of neglect and problems and saying please fix it…”

Watch the full hearing here.

What are your views on the current state of USAID?  How much reform is needed, and where?  Post your comments below!

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