The Attack on Canadian Foreign Aid Programs

Little more than a year ago, the Canadian government reversed its longstanding commitment to increase funding of progressive development projects in the Third World. Despite a string of promises that it would maintain its generous foreign aid budget, Canada slashed its Official Development Assistance (ODA) by C$ 360 million (Canadian dollars) in April 1989. After the April reduction, Canadian non-governmental organizations (NGOs) launched the biggest campaign in their history in an effort to save foreign aid. After decades of working quietly and discreetly to provide help to the Third World and to educate Canadians, NGOs transformed themselves into a powerful lobbying voice.

Their success became evident when the content of the February 1990 budget was revealed. ODA's budget was spared another blow; in fact, its funding was increased 5 percent. The year's expenditure, however, still falls far short of promises the Canadian government has made and Canada is spending less on foreign aid than it did in 1988.

A jolt to NGOs--and the Third World

Until 1989, the Canadian government maintained a progressive relationship with NGOs; its foreign aid policies contrasted sharply with those of the United States, which have been designed, in large part, to serve imperial interests. The Canadian government had come to finance a significant portion of the budgets of NGOs which attempt to address the root causes of Third World poverty.

For programs like Canadian Crossroads International, which sends volunteers to Third World countries to participate in development projects, the budget cut sounded a death knell. The government had funded, for example, several youth initiatives and training programs in recent years, emphasizing the importance of human resource development. The federal Canadian International Development Agency (CIDA) encouraged Crossroads to develop a training program for volunteers, and Crossroads relied heavily on matching grants from CIDA. The 1989 budget cut forced the closure of the project.

"We were just numb," said Michael Cooke, executive director of Canadian Crossroads International. "The budget cut shook up our whole program and left us scrambling to make adjustments."

Foreign aid was reduced 12.2 percent from the previous year, amounting to .43 percent of GNP. The Conservative government of Brian Mulroney said the cuts were part of a "belt-tightening" measure to bring Canada's huge deficits under control. But the economizing measures were not evenly distributed. Reductions in foreign aid, which accounts for only 2.8 percent of government spending, made up 23 percent of the C$1.5 billion cut from all federal spending in 1989-90. Minister for External Relations and International Trade Monique Landry told a group of Ottawa businessmen, "We're putting Canada's financial house in order, and we've had to make some hard choices."

As a result, the NGOs were faced with some hard choices of their own. The cuts forced them to cancel many projects in the Third World, to lay off staff and cut the number of volunteers they send abroad. Grants to the voluntary sector, including NGOs, churches, labor unions and universities working in international development, were slashed by 8 percent from C$263 million in 1988 to C$242 million in 1989-90. USC Canada's nutrition project in Mali was severely reduced, for example. The NGO had been supporting a Malian-established loan system which enabled villagers to buy goats and cows, as well as seeds, fertilizers and basic farm tools. Pueblito Canada, another NGO, was forced to withdraw its support for a women's organization near Lima, Peru which was running a "Glass of Milk" program for 14,000 children. With Pueblito's support, the women were going beyond milk distribution and learning primary health care, nutrition and hygiene, as well as organization and leadership skills, such as how to run a meeting, keep books and administer co-operative projects. Most organizations tried to pare down administrative costs, and cancelled programs only as a last resort. Nonetheless, the impact on the Third World was considerable.

NGO-government relations

The 22-year relationship between the Canadian government and NGOs always contained a degree of dynamic tension. NGOs tried to influence government aid policy and obtain more funds for their activities while the Canadian government maintained the power to decide which NGO endeavors to support.

The Canadian government administers most of its ODA budget through CIDA, which was established in 1968. From the beginning, CIDA had an NGO division which matched the donations of private citizens to NGOs, making Canada one of the first Western aid- giving countries to have such a program.

NGO links to government were further strengthened with the formation of umbrella organizations, such as the Canadian Council for International Cooperation (CCIC) in 1968 and provincial councils in the 1970s. These agencies monitor government policies, advocate on behalf of their members, and facilitate interagency cooperation. CCIC, which represents 126 NGOs, has successfully lobbied for such causes as the granting of aid to Indochina (1990) and the prevention of legislation that would have imposed countervailing duties on Tanzanian sisal (1979).

There are now more than 220 NGOs in Canada with about 500 Canadian staff and thousands of volunteers working overseas.

Over the years, the government increased its support of NGOs to the point where a large proportion of NGOs received more than half their income from government sources. Despite this dependency on government funds, most NGOs, when surveyed by the North-South Institute in 1987, said their autonomy was not jeopardized by their reliance on government financing. "Up until the mid-1980s, the relationship between NGOs and the Canadian government was largely defined by CIDA's 'responsive' program [which funds NGO proposals]; ... within broad parameters the NGOs were in the driver's seat," said Tim Broadhead, executive director of the CCIC.

There are, however, guidelines governing ClDA's support of NGOs' development projects (as opposed to relief efforts). According to CIDA documents, the project must "be developmental rather than welfare or relief-oriented; deal with the causes rather than the symptoms; and respond to the expressed needs of the local people who should normally be involved in its planning, implementation and support through the supply of funds or goods or services in kind." The project must also conform to the government's "Development Priorities" and "Development Principles" as set out in the ODA Charter. Some countries, including Cuba, Iraq, North Korea, Iran and Libya, are ineligible for Canadian aid.

Recognizing that NGOs have the political freedom to work directly with people in the Third World and are relatively unencumbered by the policies of the Canadian government and the host country government, CIDA steadily increased its support to NGOs between 1968 and 1989. By 1988, NGOs were allotted 9 percent of the total aid budget (C$263 million). Canada's percentage of ODA channelled to NGOs in 1985 ranked second in the industrialized countries, behind Switzerland. Canada's foreign aid budget was reduced slightly in 1986 and decreased sharply again in 1989; therefore, despite the Canadian government's promises to increase foreign aid, NGOs are receiving approximately the same percentage of ODA that they did in 1985 and the overall foreign aid budget is much lower.

The Canadian government and NGOs had been working toward partnership and away from a donor/recipient relationship. This association peaked in 1985, when the government provided funds to match Canadian donations to NGOs in response to the emergency in Africa. More than one million Canadians contributed C$35 million, and the Canadian government added C$55 million to the effort.

With Canada's growing aid budget and the close contact between NGOs and government, the development community was shocked at the drastic foreign aid reduction in the 1989 budget. Just two years earlier, the government had accepted most of the recommendations on Canada's ODA policies and programs contained in a report of the Standing Committee on External Affairs and International Trade. The Committee, comprised of Members of Parliament (MPs) from the three major political parties, recommended that funding for projects proposed by NGOs "continue to increase significantly." The government responded in its paper "To Benefit a Better World," saying it would "gradually increase funding levels to NGOs and other voluntary sector organizations. We will provide these organizations with multi- year program funding wherever possible."

The Canadian government's policy document, "Sharing Our Future" (1987), which outlined ClDA's foreign aid strategy into the next century, was even more encouraging for NGOs. Calling NGOs "as Canadian as hockey and older than Confederation," Minister Monique Landry touted the successes of NGOs in working with people in developing countries and asserted that "the partnership with NGOs is therefore more important than ever before."

"Sharing Our Future" also stated that Canada would maintain its ODA budget at .5 percent of the Gross National Product (GNP) until 1990-91; the ODA/GNP ratio would then be raised in gradual increments to .7 percent by the year 2000, bringing Canada closer to the contribution levels of Scandinavian countries, which presently contribute between .7 and 1.1 percent of GNP. (The United States, which gives .21 percent of GNP, only ranks ahead of Ireland among Organization for Economic Cooperation and Development members.) Prime Minister Brian Mulroney confirmed Canada's commitment in a statement to the United Nations in September 1988.

The NGOs fight back

Coming in the midst of a solidifying government-NGO relationship, the government's reversal of its commitment to funding development work in the Third World stunned the NGOs. Many were unfamiliar with methods for attracting media attention and communicating their concern to legislators. Furthermore, they found that their contact with the public had not extended beyond fundraising and development education. Yet now they needed to convey a new message to Canadians: that the government's curtailment of the foreign aid budget was inappropriate in an increasingly interdependent world, where the problems of the Third World affect North Americans.

Maureen O'Neil, executive director of the North-South Institute, explained this connection: "Differences between rich and poor are now accelerating at a depressing rate--it is wrong to ignore them. [Additionally,] it may not be healthy. We all suffer the consequences of environmental poisoning, and there is no way to have serious discussions about the environment without at some point coming up against poverty in the South."

NGOs initiated the Save ODA Campaign through the CCIC. Collectively, NGOs raised C$100,000 and hired a professional lobbyist and campaign staff.

Letter-writing and postcard campaigns followed, deluging Parliament Hill with thousands of letters. Meetings and workshops were held across the country to raise citizen awareness of the importance of foreign aid. At a dinner meeting in Ottawa, Robert Stanfield, former leader of the Conservative Party, urged a select audience of Conservative MPs and senators to prevent further ODA cuts. Representatives of 30 NGOs came to Ottawa for a day in January to meet with MPs from the three political parties and the ministers responsible for Canada's foreign aid program.

The weeks leading up to Budget Day (February 20, 1990) were tense. Conflicting reports were heard daily. While the media sounded the alarm, calling foreign aid one of the areas most vulnerable to cuts, Marcel Masse, President of CIDA, told a gathering of NGOs that he thought the ODA budget would either remain constant or increase this year. There were rumors that Minister of State for External Affairs Joe Clark, a strong advocate of foreign aid, had threatened to quit his cabinet post if the government decreased ODA again.

The outcome was mixed. The government gave official development assistance a marginal increase of 5 percent. The campaign significantly influenced the outcome of the budget (especially in demonstrating that Clark is supported by a dedicated and vocal community), but NGOs are still not receiving as much money for their work overseas as they did in 1988. Development activities remain curbed and NGOs are having difficulty planning for the future since the government has not renewed its commitment to restoring previous levels of assistance and increasing foreign aid.

What remains to be determined is the extent to which the cuts in Canadian foreign aid reflect the government's abandonment of its historical commitment to help alter the relations which perpetuate Third World poverty. "The government and NGOs share a concern to build public support for Canada's aid program, but between them there is a growing gap over the purpose and priorities of development assistance-to shift power decisively toward the poor, or to reinforce existing structures and the injustice they embody," said Broadhead.

Canada's Official Development Assistance Charter Development Principles Putting poverty first - the primary purpose of Canadian development assistance is to the help the poorest countries and people of the world. Helping people to help themselves - Canadian development assistance aims to strengthen the ability of people and institutions in developing countries to solve their own problems in harmony with the natural environment. Development priorities must prevail - in setting objectives for the aid program. As long as these priorities are met, aid objectives may take into account other foreign policy goals. Partnership is the key - to fostering and strengthening the links between Canada's people and institutions and those of the Third World. Development Priorities Poverty alleviation - in rural and urban areas, including improved access to health, family planning, nutrition, education, employment and decision-making; Structural adjustment - helping economies cope with debt and reduced export earnings and to improve economic management (while being sensitive to the social an economic effects of this adjustment); Increased participation of women - programs and projects to promote generalized economic growth and social change, as well as programs aimed specifically at women; Environmentally sound development - ecologically sustainable development, environmental impact assessment of all capital projects, support for environmental strategies; Food security - agricultural research, production, extention, post-harvest technology, transportation and marketing; Energy availability - development of existing resources, research and development of sustainable alternatives

Jennifer White is a journalist currently employed as Communications Officer at the Canadian Council for International Cooperation.