Bill and Melinda Gates are philanthropic royalty—their foundation is worth £37.2bn and Bill Gates is the most admired man on the planet. Unlike the Queen’s annual message, enjoyed with a snooze and a sherry, the Gates’ annual letter makes those interested in international giving sit up and listen.

Last week’s letter strikes a cheerful note—‘by almost any measure, the world is better that it has ever been.’ It aims to tackle three myths: poor countries are doomed to stay poor; aid doesn’t work; and saving lives will lead to population crisis.

Some of the letter’s lessons can be applied closer to home—but perhaps our favourite philanthropist could also learn a thing or two from our experience of the UK voluntary sector.

Prove it

Gates argues that aid works: failed aid stories are ‘big generalizations based on small examples’. Gates is right—aid has experienced success, tackling issues like smallpox and polio—but in other areas, impact is harder to quantify.

The rise of a strong ‘effectiveness’ agenda in international development has seen agencies and NGOs increasingly measuring impact, improving processes and demonstrating results. The domestic voluntary sector should learn from this, but not without caution. The letter claims 2.5bn children have been immunised against polio since 1998—an impressive statistic, but an approach that gives only half the picture. Effectiveness in areas like female empowerment and education isn’t about the number of women in a work programme or children in school, but the change those interventions make to people’s prospects and quality of life.

The Gates know this—the impact of contraception on life choices is discussed later in the letter. But by putting the big numbers front and centre in their case for aid, they propagate another myth—that a meaty statistic necessarily equals significant impact. Both international and UK organisations should resist the lure of impact-by-numbers at the cost of overlooking outcomes that are harder to measure, recognising that some impact must be shown in more nuanced ways. Good impact measurement isn’t just big results—it’s understanding the process of change, embracing shortcomings and improving programmes as a result.

Wasting away

The letter focuses on a second myth—that aid money is largely wasted or spent on bribing officials. But another aspect of the debate draws our attention to aid workers on high salaries coasting around in Land Cruisers. The idea of perks for ‘doing good’ echoes the UK debate around charity CEO pay. The take-home message for charities is transparency: if your expenditure is worth it, explain why. Development organisations are moving towards this through initiatives such as the International Aid Transparency Initiative (IATI), and William Shawcross made a similar point at our Impact Leadership conference last week—charities must be bolder and be willing to stand up to legitimate scrutiny.

Politics matters

Gates touches on another big issue, but fails to address it fully. He claims ’the horror stories—where aid just helps a dictator build a new palace—mostly come from a time when aid was designed to win allies for the Cold War rather than to improve people’s lives.’ But political aid isn’t a historical relic—with DfID’s focus shifting to jobs and growth, the political motive of building new trading partners and cementing Britain’s international role is clearer than ever. The government’s support of the voluntary sector in the UK can also be seen as political—rolling back public services and asking the ‘big society’ to fill the gap puts pressures on charity capacity and funding. Gates brushes off the sceptic’s view that aid is political—but as the UK voluntary sector knows, the impact of politics is hardly a myth.

Gates’ letter  is a brilliant example of the kind of results philanthropy can achieve when done well. The UK voluntary sector could learn a lot from these international examples—being transparent about pay, gathering evidence for what you do and not letting political side shows distract you from your core mission. These are all issues NPC will be focusing on in the next year—continuing our work on impact measurement and debunking commonly heard charity myths. So if you’re interested in the issues that Gates has highlighted, keep up to date on our upcoming  research and events.

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