When the Organization for Economic Development and Co-operation released new figures on global foreign aid spending earlier this week, development advocates in Canada cringed.
The OECD data shows that the amount of foreign aid Canada gives to low- and medium- income countries in 2013 had shrunk by more than 11 per cent compared with the previous year – the second biggest drop of any single donor country. Only Portugal, which was forced to slash government expenditures as part of an economic bailout package, reduced foreign aid spending by a greater proportion.
And while Canada's and Portugal's aid declined significantly, a majority of other donor countries increased their foreign aid, bringing overall spending on development assistance to the highest level ever recorded. The United Kingdom, at the top of the pack, increased its total aid spending by 27.8 per cent, while Italy boosted aid by 13.4 per cent.
So what's behind last year's decline in Canadian foreign aid? Canada's explanation to the OECD notes that the year over year decline was connected to budget cuts and to exceptional payments that were made for climate change and debt relief in 2012.
But there is good reason to believe that a slowdown in project approvals at the ministerial level played a significant– if not dominant – role in the decline.
Government financial records show the Canadian International Development Agency allowed more than $290-million in funding that was allocated for aid programs and organizations to go unspent in the fiscal year ending in April 2013– about 9 per cent of the agency's total grants and contributions budget for that year. When the fiscal year expired, that unspent money was returned to government coffers.
The spending lapse wasn't revealed in government figures until after the fiscal year had ended. But months in advance, aid groups were publicly worrying that a lapse would occur, noting that many of their projects appeared to be languishing on the Minister's desk.
When non-governmental organizations complained about the delays, they were publicly admonished for believing that CIDA "only exists to keep NGOs afloat," as then- International Co-operation Minister Julian Fantino put it during a conference call in November 2012.
Pressed on the matter during a committee meeting the following month, Mr. Fantino said he doesn't keep track of the number of projects he approves. "I don't keep score. I do my work diligently day in, day out. I approve projects as they come forward, but I don't think that what matters is how many I have approved; rather, what I've approved in terms of results that we're attempting to achieve for Canadians," he said.
Aside from concerns about individual programs, development advocates worries the spending lapse was a backdoor scheme to cut the budget for international development spending. However, there are reasons to believe the lapse had more to do with workload pressures than a deliberate attempt to reduce Canada's overall foreign aid spending.
In recent years, the minister's office began insisting that every project – regardless of its size or relative importance – receive direct ministerial approval. (In the past, the President of CIDA, then Margaret Biggs, had the authority to approve or deny certain, less-costly proposals).
The requirement for direct approval contributed to a bottleneck of unapproved projects. It also added to a sense of animosity and distrust between the minister's office and CIDA bureaucrats. But with a merger between CIDA and the Department of Foreign Affairs and International Trade just around the corner at the close of the 2012-2013 fiscal year, Mr. Fantino's office appeared to be in no rush to speed through project approvals.
Facing similar questions about the spending lapse during another committee meeting last week, Foreign Affairs Minister John Baird responded that there is no "big red approve stamp" to put on everything that comes through the door, adding, "I'm accountable to taxpayers." He added that preliminary figures for the 2013-2014 fiscal year suggest most of the budgeted programming money for that year was spent.
One year after the merger was announced, there is hope in Canada's international development community that the spending lapse won't be repeated. The approval of the International Youth Internship Program – which was renewed last month after a long period of uncertainty – was met with relief, not just because it means the project itself will continue, but because it was viewed as a sign that development funding may be flowing once again.