”Intermediating agencies” – what does Civil society think?

A few of the issues that I am coming across, I will try to summarise in the blog.
The first such issue concerns the increased use of intermediating agencies in civil society support. This is part of the donor strategies to direct more funding directly to be allocated in receiving countries, as opposed to e.g. funding through northern partners. This is already being done in Tanzania to a large extend, and more will come in the future, and both donors and CSOs (Civil Society Organisations) need to consider how we see the.

In Tanzania the Foundation for Civil Society (FCS) has been in existence since 2002. It is a classic example of an “intermediating agency”, which means an agency that a donor or a group of donors has selected for administering part of their funding. In Denmark PATC is also an “intermediating agency”, since we also administer ‘Projektpuljen’.
Due to the increased use of indirect funding mechanisms (e.g. basket funding) by donors, it becomes an increasingly important strategic question for donors and for the CS to ask themselves: “What is an appropriate intermediating agency”?
For the Danish Embassy/Danida this is a question they are currently raising in relation to the next phase of the ongoing Governance programme. The governance programme already includes collaboration with a number of CSOs on a direct project basis, but Danida are considering that project-funding will be replaced by a more programmatic approach, which would imply using an intermediating agency. So, what is an appropriate intermediating agency for such a task?

There are essentially there types of intermediating agencies:
1. A national rooted (Tanzanian) network or umbrella organisation (example: FCS)
2. An international NGO/CSO operating a country office
3. An international consultancy firm (example: KPMG)

Combinations of these are also possible. In Tanzania there is the “Rapid Envelope Fund”, which is a support mechanism for CSO activities in HIV/Aids. It is being jointly administered by ‘Deloitte & Touche’ (for accountancy) and the international organisation ‘Management Science for Health’ (for technical oversight).

If ownership is part of the motivation for donors to use intermediating agencies, then the national rooted networks seem the obvious solution. However, capacity, transparency and good relations to membership base should be core criteria’s, and the big challenge in Tanzania is, however, that only few such networks or organisations with such capacities exist.

However, it seem that donors sees it as a quite urgent agenda to do more indirect funding (and thereby reduce transaction costs), and in the hurry to implement more indirect funding, it has to make use of the other – less nationally rooted – options. Thus, in Tanzanian DIFD is currently introducing a very big Civil society support programme to encourage good governance (the AcT programme), and this is going to be administered by KPMG.

I can not offer a ready made answer to the question of intermediating agencies, but only emphasise that this is one of the strategic questions that Danida shall consider in Tanzania, and that northern and southern CSOs should also try to dialogue on the issue, so that CS can give influence the process.