n.V2-6.08| THE CONTRACT
01| Governments largely do not deliver services to the poor with their own staff. They contract, and the organisations they contract with are the visible face of the state in most barrios — the clinic run by a foundation, the training programme run by an NGO, the youth centre run by a church body. Understanding a government's relationship with poverty therefore means understanding its relationship with the organisations it pays, which is one of the most documented and least discussed parts of the whole system. It is also the relationship we would ourselves be entering, which is why this chapter matters more to us than any other in the part.
02| The scale is not marginal. In the US human services sector — the best-measured case anywhere — roughly 30,000 nonprofits held government contracts and grants in 2012, about 53 percent of those surveyed, holding an average of seven contracts each. Thirty percent of them drew more than 60 percent of their total revenue from government, and a further 24 percent drew between 35 and 60 percent [Urban Institute, National Survey of Nonprofit-Government Contracting, 2013, p. ??]. Over half of the sector is majority- or near-majority government-funded, which is a fact about what these organisations structurally are.
03| That single figure reframes the whole NGO question. An organisation drawing 60 percent of its revenue from the state is not an independent civil-society actor negotiating with government from outside; it is a delivery arm with a separate legal personality, subject to the ordinary incentives of a contractor. This is not an accusation of bad faith, and most such organisations do work nobody else will do. It is a statement about where the money comes from, and money determines which relationship an organisation cannot afford to lose.
04| The reported terms of the relationship are equally well documented and uniformly unfavourable. Nearly half of these organisations reported late payment as a problem, with state governments owing an average of $190,633 per organisation. Just over half reported that government payments did not cover the full cost of the services they had contracted to deliver. More than 70 percent found application processes complex and time-consuming, around 72 percent cited inconsistent reporting formats, and about 40 percent had contracts altered mid-stream [ibid.].
05| Read together, the arrangement is clear enough: the state buys services below cost, pays late, and imposes the compliance load on the seller. The gap between contract price and actual cost has to be closed by the contractor, out of philanthropy, volunteer labour, reserves, or the quality of the service itself. Charitable money is therefore subsidising government programmes, which is the exact reverse of how the relationship is usually described in public by both parties. Anyone entering this market should price on that basis rather than on the stated contract value.
06| Four consequences follow for the poor person at the end of the chain, and the first is that accountability becomes ambiguous. When a service fails, the department points at the provider and the provider points at the contract terms, and the claimant is left holding a grievance against a body that did not select itself, cannot be voted out, and did not write the terms it is operating under. The ordinary democratic remedy — remove the people responsible — has no target. Something has been delivered to the barrio, and nothing has been made answerable to it.
07| The second consequence is that the provider's real client is the funder, not the served. Reporting flows upward, renewal depends on the department's assessment, and the people receiving the service supply neither revenue nor renewal — so they hold no leverage in the only relationship that determines whether the provider survives. This is the structural point of the chapter on the door, with the money now made visible. Satisfaction in the barrio is a nice-to-have; a clean report to the department is existential.
rle// being judged by anonymous people is the way teh system protects itself (read the people running the system)
08| The third consequence is the one that matters most for how residents should approach government at all. An organisation dependent on government contracts is very poorly placed to campaign against government policy, and the dependency requires nobody to be silenced — it simply makes speaking expensive, and the silence is produced without anyone giving an instruction. The organisation best positioned to know what is wrong is thereby the organisation least able to say so. This is the bind of this chapter and it does not have a clever way out: the money that funds the work funds the silence about the work's conditions.
rle//it is an abusive relationship with a system with no accountability pretending to be there for accountability? the question is : is it the political layer of the bureacratic layer that makes things like this?
09| The fourth consequence is that capacity ends when the contract ends. A provider that has built relationships, local knowledge and trained staff over five years disperses all three at contract close, and none of it was ever held by the state, which bought output rather than capability. The barrio then watches the same problem be re-tendered to somebody starting from nothing. From inside, this is indistinguishable from the impact evaporation that afflicts the whole sector, and from outside it is simply procurement working normally.
10| There are better arrangements, and they are rarer than they should be. Long-horizon block funding with light output specification and multi-year terms produces something closer to a partner than a vendor, and is measurably less common than short competitive procurement because it looks worse on a procurement scorecard. Government acting as insurer rather than purchaser — paying a per-person entitlement that follows the individual instead of a contract awarded to an organisation — weakens provider capture and gives the recipient some choice, while introducing its own documented failure modes in cream-skimming and marketing. Direct state delivery, where it exists and is competent, removes the intermediary altogether, and is unfashionable rather than demonstrably worse.
rle: vague closed langage
11| The counter-case is real and should not be waved past. Contractors frequently deliver what the state genuinely cannot: reach into places officials do not go, trust that a uniform does not command, and speed that no procurement cycle permits. The critique here is of the terms of the relationship and not of the existence of the sector. What the terms produce, though, is a chain in which the money flows down from a department, the reporting flows back up to it, and the people at the bottom are the only party with no instrument of their own — and that is the terrain any resident-led approach to government has to be designed against.
rle: Maybe later but the real question is : how many NFGO apply for grants: how many get it, what is the system that allots grants, what are the basic rules> How do the procedures change from groups of countries ? can we create “ persona governments” that resemble specific approaches as a rough average of approaches
