Allowances. Sigh.

This is the 3rd in a bunch of posts about money. It’s a big topic, so there will be more to come. You can also click through to see the first and second posts in the set.

 

Allowances are cash given to people to do things. Go to a meeting? Attend a training? Enter data? Get an allowance! Everyone likes cash. And allowances work across the whole spectrum of the population – rural villagers get allowances for learning how to maintain their waterpoint, senior government officials get allowances to show up and make a 2 minute speech at a meeting or conference. They do have a place – for those who do have jobs, salaries are low and aren’t enough to cover travel expenses for meetings. For those who rely on farming, attending meetings means time away from tending to crops for the next harvest. But allowances have gone beyond a basic compensation for costs incurred, and become an actual salary supplement that people use to make ends meet, and also a distraction from people’s “real” jobs.

There are two related problems with allowances, and I see one way out.

Allowances originated and are most associated with NGOs. If azungus have money, NGOs must have tons, since they fly people halfway across the world and then pay them to give things away for free. NGOs might as well be a money tree. Because many organizations have to work with international salary classifications, many NGO workers earn far more than is reasonable given the purchasing power of their money in Malawi, and far more money than government officials, perpetuating the idea. NGOs also need to show results. If they have told a donor that they will train 500 teachers on gender equality in the classroom, or sensitize 10,000 people on HIV AIDS transmission, they have to follow through. To do that, they sometimes need to pay people to attend. If I’m feeling cynical, people have figured out that NGOs need their participation so badly that they are willing to bribe participants, and so they refuse to come without the bribe. If I’m feeling slightly less cynical, it makes sense to pay people the same rate to do the same thing. If you’re paying one of your staff to attend a meeting, and you want others there as well, shouldn’t they also be paid, to be fair?

But this creates the first problem. Paying people to do a side job takes them away from their own job. If offered the opportunity to stay at the office and continue working for the same steady salary, or to skip out for an hour, a day, or a week, and be paid either significantly more or a nice extra bonus for doing so, it makes sense to leave work and get the allowance. Getting paid to leave work obviously creates all kinds of problems, and I’ll leave you to think about what effect that would have on your workplace. This also gets expensive, very quickly. If two meetings are on the same date, the one with higher allowances is likely to win – and if the NGO needs to report on “community engagement” and “participation” at the meeting, they need to offer enough to outbid the other meeting and make sure they have the attendance to put in their progress report to send to New York or Geneva or London.

Which leads into the second problem. Since people are then paid extra to do work for NGOs, if an employer wants to keep people around the office doing their job, they sometimes have to provide extra incentives. Your job description might include data entry, but to get you to actually do this, you might ask for an receive an allowance – to compensate, since you aren’t attending something else where you could get an allowance, or since its particularly dull work, or since an NGO paid you an allowance to do data entry last week, or … And suddenly, a whole system is running off extra payments. And it needs to, for NGO work and government work and all other work to happen.

It’s maddening.

So what is the way out? I wish I had a magic wand. If government and all NGOs stopped giving allowances, that would be the first step. Or switched to a system of absolute bare minimum compensation for costs incurred to attend a meeting. Lunch doesn’t cost 2,000 MWK, so don’t pay that as an allowance. Anyone can buy themselves quite a nice lunch for 500 MWK, so that can be the lunch allowance. Travel and accommodation allowances can be similarly adjusted. Then, to compensate for the low salaries people will be left with sans allowances, the extra cash from the NGOs can be put into a fund that pushes up the salaries a bit and keeps the whole system moving.

Sadly, I don’t have a magic wand (or the teleporter and time machine I’m also trying to figure out), so I don’t know. I don’t think anyone does. But we’re trying, and in the meantime trying to make the best of a bad situation and mitigate the awfulness and not contribute to making it worse and even more entrenched.

A meeting we managed to run and have attendance at without allowances. Much easier said than done, and to be determined whether it will be repeatable.

 

EWB is in the final days of it’s annual peer-to-peer fundraising campaign! I am really grateful to those wonderful folks who have helped me reach my goal of $1000 for EWB’s work. Its not too late though, if you would like to learn more or make a donation check out the links in the menu on the right side of the page.