The break-up of Sweden’s civil society funding system, as seen from abroad

Sida recently announced dramatic changes to its longstanding civil society funding arrangements, in which 17 Swedish “strategic partner” organisations had come to rely on five-year government funding framework agreements. Instead, funding will now be offered on an open competitive basis to tendering civil society organisations (CSOs) worldwide. Swedish organisations will be free to bid but will no longer have the favoured status they once enjoyed. Unfortunately, many now face the dilemma of being forced to terminate their own partnerships with organisations in the Global South since they are no longer assured of Sida funding. Sida’s decision came largely out of the blue, with little consultation or warning, and as might be expected, it has led to much anger and soul searching.

The change is happening at a time when debate is raging over how to decolonise CSO aid and provide more direct support to local organisations. There are ongoing efforts to “reimagine” international NGOs via initiatives such as the RINGO project, while in the humanitarian field, there is much talk about “localisation”. Reactions in Sweden have focused mainly on the disruption to the Swedish recipients of these funds, the uncertainty, and the chaotic situation likely to ensue for their partners in developing countries. From outside of Sweden, reactions to the news on social media seem to focus more on whether this might lead to more direct funding for Global South organisations.

These debates are far from new and have reminded me of a much earlier time. In 1994, I was part of a research study – with Babar Sobhan and Göran Jonsson – that Sida commissioned to compare direct and indirect funding of civil society organisations in Bangladesh. “Indirect” referred to funding channelled through Swedish civil society organisations, while “direct” referred to new and emerging in-country arrangements for Bangladeshi organisations funded through the Swedish Embassy in Dhaka. 

Sida wanted to know whether channelling funds via Swedish CSOs was a good way to support civil society in countries like Bangladesh. At the time, a system of direct funding was emerging, where some of Sida’s money was bypassing Swedish organisations and going directly to Bangladeshi NGOs and civil society groups via the embassy. Our job was to assess the pros and cons of these two ways of funding civil society. Our conclusion was that they generally complemented each other, but putting money through Swedish civil society to then pass on to their partners in Global South countries was not a particularly efficient way of working. It risked perpetuating paternalist aid relationships. I recall that some Swedish civil society groups were not particularly happy with these conclusions at the time.

We observed that the benefits of working through Swedish civil society organisations were (i) where they were able to bring new development ideas and approaches to the table (which a few definitely did, but opportunities to do this were comparatively few, since this was a time when Bangladesh’s civil society was already world-leading); and (ii) where they were working to raise solidarity and awareness about development issues among Swedish citizens based on their overseas engagement.

We saw this latter role as their main – or perhaps only – area of comparative advantage. In some cases, Northern NGOs may provide expertise, technology transfer, knowhow, but we argued that in many countries these were increasingly available.

So this news from Sida HQ three decades later struck me as very interesting. Were they now going back to this debate and putting a direct civil society funding approach at the centre of their work? Or is something else going on?

There seem to be two different ways of understanding the process currently unfolding at Sida. One is that it reflects a progressive approach; a recognition that it is inefficient to continue to fund civil society in the traditional way. It is challenging vested interests and is in step with calls for the decolonisation of the aid system and the so-called localisation trend. What Sida is doing is basically offering up these funds to the best organisations out there, where hopefully many of the successful bids will be from Global South organisations who will tender for this money. This would be good news.

The other, perhaps more realistic view, is that this is really about the neoliberal imperative to cut budgets and reduce overheads, and is therefore just a new form of subcontracting. It may not broaden the funding very far in practice. The Swedish CSOs are hoping to reinstate their agreements with Sida through the tendering process. They might well successfully recapture a lot of that money. Swedish organisations are the best positioned to compete in this new Sida civil society free-for-all because they have the relationships, the inside knowledge and the history of exactly how Sida works.

From Sida’s point of view, the cost of that work will be pushed down. By out-sourcing, they force Swedish civil society to put in lower costs. This might be good for Swedish taxpayers, but only if the quality of the work that is done is maintained. Good development work is costly, and cutting corners could lead to a fall in standards. It may also favour certain kinds of easily measured types of work at the expense of other more innovative or risky kinds. The new system will almost certainly be good for consultants who could gain opportunities from offering training in the new guidelines and assisting applicants with preparing tenders.

The suddenness of the decision may also reflect a wider problem, in which policy decisions are increasingly taken quickly and without consultation based on ideology rather than evidence. The UK government’s decision in 2020 to close its Department for International Development (DFID) and move development cooperation into the Foreign Office, leading to several years of uncertainty and disruption, is one example of this. This policy hyperactivity is part of a wider trend where governments, particularly those on the right, have become frustrated by what they see as the slowing down of reforms by bureaucratic inertia, whether among civil servants or civil society. It has made governments more aggressive in trying to overcome what they see as resistance to any kind of change.

This trend also reflects a particular kind of private sector mentality reflected in the slogan of “move fast and break things” used by entrepreneurs like Mark Zuckerberg, reflecting narratives of disruption and creative destruction. In this worldview, there is no need to worry too much or care about what the consequences are, because although things may get damaged in the short term, something useful will eventually emerge.

It is difficult to determine yet which of these two ways of understanding the situation is the more accurate one. It is of course entirely possible that a combination of both impulses may be at work. One result could be that more direct funding to Global South CSOs is achieved. Another is that the impossible deadlines that are being imposed by the government are in fact designed to break the existing system and enable long term cuts to civil society funding.

There is a strong sense that, as with the closure of DFID, this decision was rushed and not well thought through. Effective policy decisions depend on the ability of decision makers to access good information and ideas, including knowledge of the history of past policy lessons. Across many societies there is a trend towards “policy amnesia” in which past experiences are ignored in an increasingly speeded up, ahistorical world of policy making. To what extent do the current changes in Swedish civil society funding reflect knowledge of the fact that Sida is asking exactly the same questions it did 30 years ago? There has never been a more important time to make sure we go back to study past policies and their effects if we are to avoid repeating past mistakes or reinventing the wheel.

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David Lewis is Professor of Anthropology and Development at the London School of Economics and Political Science in the United Kingdom