Governance Challenges as a
Risk for Agricultural
Development
Regina Birner
Chair of Social and Institutional Change
in Agricultural Development
University of Hohenheim
• "Good governance is perhaps the single
most important factor in eradicating
poverty and promoting development."
Kofi Annan addressing the General Assembly of the United
Nations in 1998
World Development Report 2008:
Agriculture for Development
“Governance is essential to realize an
agriculture-for-development agenda.
In fact, governance problems are a major reason
why many recommendations in the 1982 World
Development Report on agriculture could not be
implemented.” (p. 246)
Agriculture is back on the international
development agenda!
• Events
– G8 L’Aquila Statement 2009
– Food price crisis of 2008
L’Aquila Meeting
– World Development Report 2008
– Comprehensive Africa Agriculture Development
Program (CAADP)
– Maputo Declaration of African Heads of State 2003
• After years of neglect - increased commitment of
governments and donor agencies to invest in
agriculture
• Need to overcome the governance challenges of
agricultural development
– ..to avoid that the world will turn its back on
agriculture again!
Contents
1. What types of governance challenges are
involved in agricultural development?
2. Why do they occur? And why do they
constitute a risk?
3. How to assess the governance risks in
agricultural programs?
– A case study from Uganda
4. Conclusions
Governance challenges: Some examples
Small reservoirs in Northern Ghana
Big hope for a sustainable agricultural development in Africa
But how to make them work?
Corruption in
infrastructure provision!
Small reservoirs for irrigation in Northern Ghana
Irrigation, by date of construction or rehabilitation of reservoir
60
Irrigate ‐
Catchment/Reservoir
13
50
7
40
Irrigate ‐ Irrigable
Area
30
20
10
39
1
3
4
4
14
2
2
3
10
0
Unknown
No Irrigation
3
<=1980
15
Problems in construction
6
1981‐1993 1994‐1999 2000‐2006
IFPRI survey
2006/07
Governance challenges: Some examples
Participatory irrigation management in India
Investment in rehabilitation of
canals, to be managed by water
user associations
Elite capture!
… some farmers break the lining
to divert water to their fields
Governance challenges: Some examples
Agricultural extension in Ghana
But most farmers, especially female ones,
do not have access to extension services
14%
12%
12%
12%
11%
10%
Absenteeism!
Exclusion!
8%
6%
4%
Important
service to
promote
innovation
1.8%
2%
0%
2.1%
1.4%
0.0%
Forest Zone
Male HH heads
0.0%
Transition Zone
Female HH heads
0.5%
Savannah Zone
Female Spouses
ISSER-IFPRI Survey 2008
Governance challenges: Some examples
Food and Nutrition Programs in India
Closed: Child Care Center
(Anganwadi) in Bihar
Mid-day meals: A promising
strategy to improve
nutrition
Absenteeism!
Leakages!
What are the reasons behind the governance
challenges in agricultural and rural programs?
• Market failure (Binswanger & McIntire, 1987)
– Transaction costs; risks; information asymmetries; public
goods; externalities
• Government failure
 Neglect of agriculture – urban bias (Lipton, 1977)
 Political capture of agriculture (Bates, 1981)
– Nature of agricultural services (Birner & von Braun, 2007)
 transaction-intensive in terms of space & time
 require discretion (Woolcock & Pritchett, 2004)
 Scope for corruption – may be linked to party financing
 Community failure
 Collective action problems (Hardin, 1968; Ostrom, 1990)
 Elite capture; exclusion (Agrawal & Gibson, 1999)
Three types of governance challenges
1. Human resource management challenge
– Major problem in agencies that employ relatively large
numbers of frontline service providers (e.g., agricultural
extension agents, veterinary assistants, nutrition advisors)
– Problems of supervision and creation of incentives
– Resulting in absenteeism and low performance
2. Targeting challenge
– Major problem in programs that provide private goods
(e.g., food, fertilizer subsidies, cash)
– targeted to poor households or household members
3. Leakage and procurement challenge
– Major problem in programs that involve contracting
between public and private sector
(e.g., infrastructure, grain procurement)
Risks for different types of programs
caused by governance challenges
Human resource management
challenge
Targeting challenge
Leakage and procurement challenge
Agricultural research
Agricultural extension
Irrigation and other infrastructure investment
Public food grain procurement and buffer stocks
Food‐ or cash based safety nets
Nutrition‐education programs
Major risk
Intermediate risk
Risks for different types of programs
caused by governance challenges
Human resource management
challenge
Targeting challenge
Leakage and procurement challenge
Agricultural research
Agricultural extension
Irrigation and other infrastructure investment
Public food grain procurement and buffer stocks
Food‐ or cash based safety nets
Nutrition‐education programs
Major risk
Intermediate risk
Risks for different types of programs
caused by governance challenges
Human resource management
challenge
Targeting challenge
Leakage and procurement challenge
Agricultural research
Agricultural extension
Irrigation and other infrastructure investment
Public food grain procurement and buffer stocks
Food‐ or cash based safety nets
Nutrition‐education programs
Major risk
Intermediate risk
Risks caused by governance problems
- A regional perspective -
The World Bank’s Aggregate
Control of Corruption Indicator (2010)
http://info.worldbank.org/governance/wgi/sc_country.asp
The World Bank’s Aggregate
Governance Effectiveness Indicator (2010)
http://info.worldbank.org/governance/wgi/sc_country.asp
Remnants of an
agricultural development
project in DR Congo
The governance-dilemma of
agriculture-based countries
• “Agriculture-based countries”
– have the largest potential to use agriculture as an engine
of pro-poor growth,
– have the highest risk of governance failures.
• Problems
– Investments in agriculture have limited effect.
• Returns to agricultural investment lower than in sectors
that face fewer governance challenges.
– Donor fatigue – underinvestment in agriculture
• Donors prefer “easier” sectors, e.g., primary education
• Agriculture’s potential for pro-poor development remains
underutilized.
 Negative downward spiral.
How to assess the
governance risks in postconflict projects?
A Case Study from
post-conflict projects
in Uganda
Northern Uganda
Specific governance challenges in
post-conflict situations
• Need to ensure food security and help farmers rebuild
agricultural livelihoods
– Need to provide access to food, seeds, fertilizer, tools,
etc. (all private goods)
• on a large-scale
– need to reach entire population, not just pilot project
sites
• in a situation where
– public sector institutions are weak or absent and
– social capital may have been destroyed by the conflict,
limiting the prospects of community-based solutions.
Implementation Mechanisms used
by Different Agricultural Projects
• Procurement and distribution of agricultural assets by
implementing agency
– Government:
• Restocking Program under Prime Minister’s Office
(district-level procurement);
• National Livestock Productivity Improvement Project under
the agricultural ministry (national-level procurement)
– NGOs: Heifer International (US NGO); GOAL (Irish NGO)
• Procurement and distribution of agricultural assets by
farmers’ groups/community-based organizations
– Funds channeled through public accounts: NAADS
– Funds channeled through group’s private accounts: NUSAF
• Input voucher programs
– Vouchers for work: RALNUC/DAR; without work: Caritas
• Cash for work programs: Int’l. Committee of the Red Cross
Research Objectives and Approach
• Project
– Funded by German Ministry for Economic Cooperation and
Development (BMZ)
– Implemented by IFPRI, Oxfam (Marc Cohen) and DIW
• Goal
– Develop a tool for assessing the governance risks of postconflict projects that aim to help farm families rebuild their
agricultural livelihoods
• Approach
– Comparison of projects that use different implementation
mechanisms
– Use of a participatory qualitative research tool called “Process
Netmap” for risk assessment
• Idea: Mapping the implementation process step-by-step to
identify “entry points” for governance problems
Process Net‐Map
Participatory Mapping Method
http://netmap.ifpriblog.org/
Phase 1: Ask the respondent how the process started
* Mark actors with stickers on paper
* Draw arrows between the actors
* Number the arrow and note down the process
Phase 1: Ask the respondents for the next steps
* Continue to add actors and arrows
* A process can involve more than two actors
Phase 1: Continue until the process is completed
(e.g., agricultural assets delivered to group members;
accounting completed; vouchers reimbursed)
Phase 2: Ask respondent how much influence actors
had on the outcome
* Use checkers game pieces to visualize
influence on a scale from 0-8
* Discuss reasons for influence levels
Phase 3: Discuss “problem areas” and possible
solutions
* Refer to cases that the respondent has heard
about (e.g., in other sub-counties/districts)
* Critical areas: fund flows; signatures for
authorization; procurement decisions
National Agricultural Advisory Services
(NAADS)
Features:
- Contracts with service providers
- Distribution of agricultural inputs
11
Bids
10
10
District Agricultural
Officer
Sub-County Chief
17
Forum Chair
12
7
LC3 Chair &
Councilors
District
Internal
Auditor
16
SC Farmers’ Forum
Secretary of
Production
Subject Matter
Specialist
SC NAADS Coordinator
8, 13, 15
Procurement
Committee
14
5
Input
suppliers
SC Sub-Accountant
17
2
9
18
17
1, 5,6
Private
service
providers
Parish Chiefs
Farmers’ groups
Parish Coordination
Committee
5
1. Facilitate group formation
2. Collects and submits farmers’ co-funding
3. Identify and appoint CBF
4. Provide allowance and bicycle
5. Select enterprise
6. Train farmers, establish demo plots
7. Has meeting, decides on bidding
8. Invites bids
9. Send bids
3
Group’s chairman
5
4
Community-based
facilitator (CBF)
10. Open and evaluate bids
11. Shortlist 3 bidders
12. Can veto shortlisted bidders, based on experience
13. Negotiates with input suppliers
14. Award contract; issue Local Purchase Order
15. Provides inputs to sub-county office
16. Advises on quality of inputs; can reject
17. Issues check (with signatures / approval)
18. Distributes inputs to farmers
District Agricultural
Officer
11
Bids
3
10
10
LC3 Chair &
Councilors
7
17
SC NAADS Coordinator
7
8
Procurement
Committee
7
8, 13, 15
14
5
18
Parish Chiefs
5
Input
suppliers
Parish Coordination
Committee
x
5
4
Perceived influence level
on outcome (Scale 0-8)
2
9
5
3
Group’s chairman
6
5
3
SC Sub-Accountant
17
17
1, 5,6
Farmers’ groups
2
District
Internal
Auditor
Sub-County Chief
7
Forum Chair
12
3
3
16
SC Farmers’ Forum
Secretary of
Production
Subject Matter
Specialist
Private
service
providers
4
4
Community-based
facilitator (CBF)
8
11
Bids
10
10
District Agricultural
Officer
Sub-County Chief
17
Forum Chair
12
7
LC3 Chair &
Councilors
District
Internal
Auditor
16
SC Farmers’ Forum
Secretary of
Production
Subject Matter
Specialist
SC NAADS Coordinator
SC Sub-Accountant
8, 13, 15 17
Procurement
Committee
14
Input
suppliers
5
2
9
18
17
1, 5,6
Private
service
providers
Parish Chiefs
Farmers’ groups
Parish Coordination
Committee
Flow of funds
Sign on checks / control
5
3
Group’s chairman
5
4
Community-based
facilitator (CBF)
Entry points for leakages /
bribery
Entry points for
influencing procurement
Northern Uganda Social Action Fund
(NUSAF)
Office of the
Prime Minister
Regional Office
NUMU
Chief
Administrative
Officer CAO
NUSAF
Accountant
NUSAF District
Technical
Officer (NDTO)
District
Executive
Committee
District
Technical
Officers
LC5 Chair &
Councilors
Community
Development
Officer
LC3 Chair &
Councilors
Service
Providers
NUSAF
Facilitators
Stanbic
Bank
Input
sellers
Group leaders
Contractor
Fund flows
in NUSAF
Procurement
Committee
Authorization
Group members
LC1 Chair &
Councilors
District
Office of the
Prime Minister
Regional Office
NUMU
Chief
Administrative
Officer CAO
NUSAF
Accountant
NUSAF District
Technical
Officer (NDTO)
District
Executive
Committee
District
Technical
Officers
LC5 Chair &
Councilors
Community
Development
Officer
District
LC3 Chair &
Councilors
Service
Providers
NUSAF
Facilitators
Stanbic
Bank
Input
sellers
LC1 Chair &
Councilors
Group leaders
Contractor
Fund flows
in NUSAF
Procurement
Committee
Authorization
Group members
Entry points for leakages /
bribery
Challenges and Opportunities in NUSAF
•
•
Opportunities
– Placing funds directly into the hands of farmers’ groups
• Avoiding sub-standard inputs
– Evidence from case study that system can work
• Reducing opportunities for leakages at sub-county level
Challenges
– Group leaders may take advantage of group members
• Especially if only group leaders are literature
• Funds provided for other purposes than inputs problematic
– “Ghost groups” and “ghost projects”
– Challenges of accounting (e.g., sellers of oxen just sign in a
book)
– Efforts to control this problem created new leakage opportunities
– Parallel structure to local government may reduce accountability
• Even though it also reduces opportunities for leakages
Seed Voucher Program
Caritas
Catholic Relief
Services
Financial Manager
Program coordinator
10
7
2
Centenary
Bank
9
9
6
9
5
Extension
supervisor
Facilitators /
Specialists
Community
Resource
Person
Escort
Accountant
6
Program Manager
Seed fair
Army commanders
10
Executive Director
1
Archbishop
Landlords
8
Stockists
Seed suppliers
3
Farmers
Groups
4
Volunteers
11
Elected
District
Leaders
Church
Government
authorities
District Agric.
Officer
9. Attend meeting at Bank
1. Print vouchers; deliver against receipt
10. Sign checks; keep documents in store
2. Assesses number of vouchers needed and
passes them on with receipt book
11. Receive cash or checks; sign receipt
3. Hands out vouchers at seed fair
4. Use vouchers to buy seeds after collective bargaining
5. Collects vouchers; gives receipt
6. Passes on vouchers against receipt
7. Confirms vouchers; enters data; stores them.
8. Bring receipts to meeting held at Bank
Catholic Relief
Services
Financial Manager
Program coordinator
10
7
2
Centenary
Bank
9
9
9
5
6
Extension
supervisor
Facilitators /
Specialists
Community
Resource
Person
Escort
Accountant
6
Program Manager
Seed fair
Army commanders
10
Executive Director
1
Archbishop
Landlords
8
Stockists
Seed suppliers
3
Farmers
Groups
4
Volunteers
11
Church
Elected
District
Leaders
Government
authorities
District Agric.
Officer
Entry points for leakages /
bribery
DANIDA programs
•
•
•
•
Restoration of Agricultural Livelihoods Northern Uganda (RALNUC)
Danish Support to Development Assistance to Refugee Hosting
Areas – Agricultural Related Activities Component (DAR)
Mechanism: Agricultural input vouchers for public works
• Advantages: Self-targeting; creation of infrastructure
Experience (according to Impact Monitoring Survey 2008)
• Substantial positive impact on agricultural productivity and income
• Requires awareness creation
• Extensive mobilisation coupled with radio campaigns effective in:
• Empowering communities to deal with dishonest Project
Management Committees
• Minimizing household sale of vouchers (7% DAR, 26%
RALNUC)
• Enhancing participation in public works
Other insights
• Cash for land preparation
• Payment of wage to farmers for preparing their own land
(implemented by Int’l. Committee of the Red Cross)
• Replaced input voucher program after management was
convinced that participants would also use cash for inputs
• Advantages
• Easier to implement than voucher program
• Transparent: easy to inform participants (e.g., by radio)
what they are entitled to
• Farmers have high incentives to use wage for farm inputs
as they have already prepared their land
• Problems involved in managing public infrastructure
construction avoided, but no infrastructure created
Summary Risk Assessment
of Governance Challenges
Mechanism
Selftargeting
Procurement by
implementing agency
Meeting
SubCapture
farmers’
standard by group
preferences material leaders







Kickbacks
by staff
Complexity



















Procurement by
groups, funds
channeled through:
public accounts
(NAADS)
groups’ private
accounts (NUSAF)
Input vouchers
with public works
(RALNUC)

without public works
(seed fairs)
Cash for work

Policy Implications
 Assess ex-ante which mechanism is most appropriate
 Capacity of the implementing agency
 Type of farmers’ needs (need for differentiation/ targeting)
 Possibility to judge quality of inputs
 Empower farmers to hold providers accountable
 Increase transparency (sensitization; radio campaigns)
 Farmers need to know what they are entitled to!
 Establish functioning complaint mechanisms
 Invest in group formation and internal accountability
(e.g., social audit meetings)
Policy implications
 Strengthen internal accountability mechanisms in
implementing agencies
 Effective use of incentives and sanctions, especially
in public sector agencies
 Foster professionalism
 Use opportunities of external evaluation
 Consider trade-offs in institutional design
 Autonomous institutions versus strengthening local
governments and ministries
Conclusions
• Governance challenges
– pose a major risk to agricultural development;
– arise from the characteristics of the agricultural sector;
– are especially prevalent in agriculture-based economies;
– constitute a particular threat to agricultural programs in
post-emergency situations.
• Strategies to overcome the governance challenges of
agricultural development
– need to apply a “best-fit” approach – there is “no free
lunch in reforming governance,”
– can be informed by risk assessment tools,
– need to rely on experimentation and learning.
Thank you for your attention!
References
• Agarwal, A. and C.C. Gibson 1999. Enchantment and
Disenchantment: The Role of Community in Natural Resource
Conservation. World Development 27:629-49.
• Bates,R.H. 1981. Markets and States in Tropical Africa-The
Political Basis of Agricultural Policies. Berkeley: University of
California Press.
• Binswanger,H. and J.McIntire 1987. "Behavioral and Material
Determinants of Production Relations in Land-Abundant
Tropical Agriculture." Journal of Economic Development and
Cultural Change 36(1):73-99.
• Birner, R., M. Cohen, and J. Ilukor, 2011. “Rebuilding
Agricultural Livelihoods in Post-Conflict Situations: What are the
Governance Challenges? The Case of Northern Uganda.”
Kampala: USSP Working Paper 07, Uganda Strategy Support
Program (USSP), International Food Policy Research Institute.
http://www.ifpri.org/sites/default/files/publications/usspwp07.pdf
References
• Birner, R., A. Quisumbing, and A. Nazneen, 2010. “Crosscutting Issues: Governance and Gender.” Dhaka: Paper
Presented at the Bangladesh Food Security Investment
Forum, 26–27 May 2010, Dhaka http://bids.org.bd/ifpri/crosscutting2.pdf
• Birner, R. and J. von Braun, 2009. Decentralization and Public
Service Provision—A Framework for Pro-Poor Institutional
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Decentralization Enhance Poverty Reduction and Service
Delivery? Edward Elgar, Cheltenham, UK, pp. 287-315.
• Hardin, G., 1968. "The Tragedy of the Commons." Science
162:1243-8.
• Kaufmann,D., A.Kraay, and M.Mastruzzi, 2010. “The
Worldwide Governance Indicators: Methodology and
Analytical Issues.” Washington, DC: World Bank Policy
Research Working Paper No. 5430, World Bank.
References
• Lipton, M., 1977. Why Poor People Stay Poor: A Study of
Urban Bias in World Development. London: Temple
Smith.
• Ostrom, E., 1990. Governing the Commons: The
Evolution of Institutions for Collective Action. New York:
Cambridge University Press.
• Pritchett, L. and M. Woolcock 2004, "Solutions When the
Solution is the Problem: Arraying the Disarray in
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• World Bank (2007). Strengthening governance, from
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