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Forum for the Future of Aid

Southern Voices for Change in the International Aid System Project

The Forum on the Future of Aid is an online community dedicated to research and opinions about how the international aid system currently works and where it should go next

organised by ODI

Scaling up: Aid Fragmentation, Aid Allocation and Aid predictability

Author: OECD Development Assistance Committee

As part of monitoring the delivery of the Development Assistance Committee (DAC) commitments to increase Official Development Assistance (ODA), this report examines the existing patterns of aid fragmentation and concentration, showing the degree to which 33 donors are operating in 153 partner countries. It also looks into the delivery of commitments on future aid levels in total and where aid is likely to be scaled up or scaled back as well as into donors’ country allocation and budgetary procedures and practices.
It constitutes a key stimulus to improving the medium term predictability of aid, as called for in the Paris Declaration and by the UN Secretary General’s MDG Africa Steering Group. It is intended to inform discussion at major development events in 2008, especially on predictability and division of labour at the Third High Level Forum on Aid Effectiveness (Accra, September) and on ODA financing at the Follow-up International Conference on Financing for Development (Doha, November/ December).

To read the full report, click here

National Consultative Workshop on Civil Society and Aid Effectiveness

Source: CSPR

A lot of issues concerning aid effectiveness were discussed by representatives from civil society, government, and the cooperating partners. This dialogue formed a crucial platform to foster coordinated efforts from the three quarters of development stakeholders to ensure that aid becomes more effective. It is also important to note that the workshop signified the recognised valuable role played by civil society in managing and accounting for the aid.

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Stock taking paper on aid management

Source: Daima Associates

This report is one of three planned outputs of phase 1 of a 2 phase project commissioned by the Capacity Building Working Group, one of the three groups conducting the technical work under the SPA 7 programme. The project aims to improve the quality and quantity of aid in support of nationally owned capacity development approaches. Phase one of the project is the stocktake phase, which is the subject of this report and the second phase will draw from the findings and conclusions of the first phase. This report categorises aid recipient countries according to the level of aid management systems and effectiveness. Criteria that were considered when grouping countries included: aid policy documentation/clear aid strategy; aid management systems and procedures; Development Partner actions and expected requirements; aid harmonisation and alignment to country systems; the capacity in aid management; and capacity constraints identified and documented. The grouping exercise resulted in four categories. Group one included coutries that were rated highlu such as Botswana, Tanzania, Ghana, Uganda and Vietnam; Group two included coutnries that are doing fairl well but could still do better such as Burkino Fas, Cape Verde, Rwanda, Zambia, Ethiopia and Mozambique; group three included countries trying to improve but in fragile situations, thus with still many capacity gaps such as Cameroon; and group four included countries with critical situations largely due to recent internal conflict such as Burundi, Sierra Leone and Haiti. The report also considers to what extent the Paris Declaration has been implemented, if, and to what extent coutnries have developed explicit aid policies, how effective are aid management systems and procedures, emerging lessons in aid management with implicaitons for capacity development, expectations from the Development Partners, Development partner support to Capacity development, best practices. Finally the report provides a comparison of Capacity Development for Aid management.

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Should Donors Deliver Aid Through Developing Country Government Budgets? The Case of Ghana

By E. Gyimah-Boadi, Executive Director, Ghana Centre for Democratic Development (CDD)

OECD donor countries channel about US$ 5 billion – some 5% of their aid – directly to the budgets of developing country governments. The OECD in their report - "An Evaluation of General Budget Support (1994-2004)", showed that this system of delivering aid was an effective way to strengthen the management of public financial systems in developing countries, and also helped to improve access to services like healthcare and education.

Recently, an evaluation of Multi Donor Budget Support (MDBS)to Ghana was carried out jointly by the Overseas Development Institute in London and the Ghana Center for Democratic Development (CDD) in Accra. The main findings are presented in an ODI briefing paper. Professor Gyimah-Boadi, the Executive Director of CDD and a prominent member of the MDBS Evaluation team tells the Forum on the Future of Aid (FFA) what he thinks of MDBS in Ghana...

"I like the concept of MDBS. I support it in principle because it aims to provide much needed resources for a democratically elected government to fulfil pledges and promises made in its election campaign and which constitute part of its mandate. Moreover, MDBS has the potential to stimulate domestic accountability processes - as more resources are channelled through the budgetary process.

Indeed, there is evidence to suggest that Ghana’s MDBS has helped to reduce domestic debt stock and contributed to increased public spending in poverty-reducing sectors such as education and health. MDBS has helped to orient the “Christian democratic” NPP administration towards poverty reduction and somewhat away from its initial focus on “wealth creation.” In addition, participation of non state actors and of civil society and independent research and advocacy organizations in the budget process has begun to grow over the period of MDBS.

However, I remain concerned about other aspects of the MDBS. It is irresponsible for donors to write a cheque to a government and then look the other way. There is substantial risk that rather than empower, MDBS resources would be abused by government. This imposes a difficult-to-enforce obligation on donors to ensure that recipient governments are not only democratically elected but that that there are adequate mechanisms for domestic civil society to hold government accountable.

In the absence of official transparency and effective domestic accountability mechanisms (which remain the case in Ghana today), MDBS resources are subject to capture by personal and private networks in control of the state and resources may be allocated in partisan ways to kin/ethnic groups and cronies. Despite credible elections and given the weak involvement of parliament in the budgetary process, there is a real risk that MDBS resources would be diverted principally to serve the interests of NPP administration and the individuals that control the executive arm of the government."

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Other relevant resources
Evaluation of General Budget Support.
OECD DAC Network on Development Evaluation.

A review of Multi Donor Budget Support

How MDBS works in Ghana

Multi-Donor Budget Support and Capacity Development: Emerging Lessons from Ghana

Multi Donor Direct Budget Support in Ghana. The implications for Aid Delivery and Aid effectiveness
Centre for Policy Analysis, Ghana

The GPRS and Multi Donor Budget Support (MDBS): Strengthening the Links of Accountability – the Role of Parliament
World Bank

The GPRS and Multi Donor Budget Support (MDBS): Strengthening the Links of Accountability – the Role of the Media
World Bank

From earmarked sector support to general budget support: development partners experience - Analysis of Norwegian donor budget support

General budget support evaluation study phase 1: final synthesis report Projects to programmes: does budget support improve the quality of governance in developing country contexts?

Effects of budget support: a discussion of early evidence: Review of General Budget Support programmes

Does general budget support work? Evidence from Tanzania"

Money can’t buy you love: Partnership prospects for donor budget support

Further GBS related resources on the Gerster Consulting homepage

Impossible Architecture: Why the financial structure is not working for the poor and how to redesign it

Author: Social Watch Report 2006

The Social Watch report is published yearly since 1996 and is unique amongst reports focussing on social development and gender equality in its “bottom up” approach. This is not a commissioned report published from a centralised international organisation, but a compilation of the findings of civil society organisations working on social issues, on how their authorities are implementing the programs that they have committed themselves to in international fora like the Social Summit, the Beijing Conference on Women and the Millennium Summit.

Those findings by citizen groups are complemented with statistics and innovative indexes developed by Social Watch researchers, such as the Basic Capabilities Index and the Gender Equity Index.

The main theme of this year’s Social Watch report is the international financial architecture and how it needs to be reformed in order to create an enabling environment for the achievement of the internationally agreed development goals

Click here to view the full report

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