Jennifer Brass makes the case in the "Governance" journal [gated] that international NGOs operating in Kenya have contributed to improved democratic governance and accountability. This contrasts with the Bauer/Easterly/Moyo-ish lines that external aid undermines governance, but resonates with my recent limited experience looking at NGO programmes in Kenya which comes across as pretty positive interaction with government, and also with something Paul Collier has hypothesised, that the difference between aid and oil (and thus the explanation for better outcomes on average from aid than oil) is the added value of the technical assistance.
"Governance is no longer the purview of only public government actors; it is increasingly seen as a shared or networked process among several types of organizations.
Government and NGOs learn from each other to improve what they do. In particular, many government agencies notice the successes achieved by NGOs and, whether intentionally or not, mimic their actions, recalling DiMaggio and Powell’s (1983) mimetic isomorphism. This is most obvious in their attempts at participatory approaches, in which opinions from the village to the city are solicited (if not always actually listened to). As a result, governance in Kenya has slowly begun to more democratic, moving away from its hierarchical, authoritarian past."She also reports broad individual support for NGOs in Uganda and Kenya (perhaps not a surprising result that people report to surveyors that they like people who give out free stuff);
"in a survey of NGOs in Uganda, 90% of organizations reported involving host communities in the delivery of services, and nearly 60% of beneficiaries of these NGOs agreed that the NGOs seek community participation (Barr, Fafchamps, and Owens 2005). While NGOs claimed more participatory involvement than the respective communities saw, 60% participation rates are significant. Relative to the Kenyan government and its public administration over the past 40 years, NGOs unquestionably try to be more participatory and accountable.
Kenyan citizens agree, viewing NGOs as looking after the interests of the common man. When asked, “To what extent do you think NGOs have the interests of the people in mind?” in a survey, the author conducted on service provision and service providers with 501 Kenyans, 70% of respondents answered positively, and only 20% responded negatively."Finally, a separate paper finds that NGOs on average choose to locate themselves where need is great, but also in convenient locations (close to roads and towns - which isn't necessarily the worst thing for cost effectiveness), and best of all not due to political factors.