As a former contractor for USAID I can definitely testify to the increase in red tape. This is mostly in the form of congressional earmarks.
Many people don't realize that just "getting money out the door" is an incredibly difficult task when you have the burden of so much bureaucracy. Most of this bureaucracy is well intentioned (e.g. vetting partner organizations for terrorist or narcotics connections), but taken as a whole it is stifling.
In fact, the USAID Mission in Kenya (USAID's largest in Africa) turned down increased funding in 2012 because they simply had too much cash and not enough staff to obligate it to organizations on time.
This ends up creating a heavily calcified aid "system" where older organizations with the ability to cope with legal/bureaucratic issues are the only ones who can survive. The average wait-time for a USAID payment is something around 9 months, so small start-up organizations are de-facto ineligible if they need immediate funding.
Obviously this is just anecdotal. However, the ultimate result that I have observed is that aid typically gets distributed to organizations (contractors) who are heavily entrenched and will generally take around a 50% overhead fee.
USAID has attempted to alleviate this problem through the USAID Forward initiative (which requires Missions to have a certain percentage of "locally owned" organizations ). However, once again entrenched aid contractors are best suited to jump through bureaucratic loopholes. For example, by incorporating country-based subsidiaries in locations where they are pursuing contracts.
Just my own take on why money isn't always the problem when it comes to assisting developing countries.
Many people don't realize that just "getting money out the door" is an incredibly difficult task when you have the burden of so much bureaucracy. Most of this bureaucracy is well intentioned (e.g. vetting partner organizations for terrorist or narcotics connections), but taken as a whole it is stifling.
In fact, the USAID Mission in Kenya (USAID's largest in Africa) turned down increased funding in 2012 because they simply had too much cash and not enough staff to obligate it to organizations on time.
This ends up creating a heavily calcified aid "system" where older organizations with the ability to cope with legal/bureaucratic issues are the only ones who can survive. The average wait-time for a USAID payment is something around 9 months, so small start-up organizations are de-facto ineligible if they need immediate funding.
Obviously this is just anecdotal. However, the ultimate result that I have observed is that aid typically gets distributed to organizations (contractors) who are heavily entrenched and will generally take around a 50% overhead fee.
USAID has attempted to alleviate this problem through the USAID Forward initiative (which requires Missions to have a certain percentage of "locally owned" organizations ). However, once again entrenched aid contractors are best suited to jump through bureaucratic loopholes. For example, by incorporating country-based subsidiaries in locations where they are pursuing contracts.
Just my own take on why money isn't always the problem when it comes to assisting developing countries.