Chapter 5. Sweden’s delivery modalities and partnerships

Sweden is a flexible and responsive partner

Sweden has flexible budgeting, approval and programming processes, as is evidenced in Liberia. It provides dedicated funding for implementation of each strategy for the period of three to five years. Sweden’s processes allow Sida and FBA to move funds within a budget line and adjust the total budget for each strategy of the assigned appropriation plus or minus 10%. These enable Sweden to respond and adjust its programming to changing contexts, allowing it to compensate for overspending in some areas by absorbing underspending in others.

In many countries, Sweden delegates financial authority to the Heads of Missions for projects under USD 8.5 million and for transferring funding across different areas within a country strategy (30 of 35 embassies with development co-operation staff have full financial delegation). This allows Sweden to adapt modalities and the direction of its development co-operation, and to respond to the changing needs of partners and countries, including in fragile situations (Government Offices of Sweden, 2017a). According to data from the Global Partnership for Effective Development Co-operation monitoring exercise, Sweden rates as excellent in the OECD Survey on forward spending plans (OECD/UNDP, 2016).

Joint approaches and complementarity with other donors are sought

Sweden works actively to support donor co-ordination and Sida participates in joint approaches. As is evidenced in Liberia, Sweden often leads donor co-ordination processes and also facilitates dialogue among the civil society organisations (CSOs) that it funds (Annex C). Sweden aims to play an active role in the joint programming of the European Union (EU), and Sida currently manages EU-delegated funds in six countries. Sweden also funds the United Nations (UN) Resident Coordinator office in many countries to help to strengthen the UN’s co-ordination role (Government Offices of Sweden, 2018a).

Sweden is also strategic in its approach to programming, and takes account of what other donors are supporting in order to decide where it can add the most value. Following the 2015 review of its country strategy to Liberia, for example, Sweden took the constructive decision to not engage in the health or education sectors, given that it was already supported by several other donors active in the country (University of Bradford, Saferworld and Stockholm Policy Group, 2015). Instead, Sweden added the new priority area of human security in its 2016-22 Liberia country strategy. This allowed Sweden to support issues, such as gender-based violence, that were receiving limited attention from other donors.

Sweden has a strong commitment to transparency

Sweden has a strong government culture of transparency and a long-standing commitment, via its 2010 Transparency Guarantee, to making development co-operation data available to the public. Its website - www.openaid.se - allows the public access to financial, project and evaluation information.

Since the last peer review, Sweden has published detailed humanitarian data, in accordance with its Grand Bargain commitments. It has also sought to promote the benefits of more transparent reporting within climate finance funding (Government Offices of Sweden, 2018b) and is currently piloting the International Aid Transparency Initiative (IATI) reporting of its major CSO partners, in line with the 2013 peer review recommendation to improve data of non-state Swedish actors.

Sida was ranked 14th out of 45 assessed aid organisations the 2018 Aid Transparency Index, based on the IATI system. It has consistently been in the “good” or “very good” category for the last five years, but could provide, among other things, more sub-national location data for project information (Publish What You Fund, 2018).

In Liberia, the embassy of Sweden reports quarterly to the Liberian government on planned disbursements. However, it is challenging for country offices to provide information to governments about all Swedish official development assistance (ODA) that reaches a particular country; this is due to the complex setup featuring several layers of strategies with attached funding that may reach any given country (Chapter 2). More systematic information sharing among different strategy holders on the programmes and partners that they fund in each country, would be helpful to both embassies and partner countries.

A highly-valued partner to well-established civil society organisations but with a multitude of funding channels

Sweden is highly appreciated by its civil society partners as a trusted, long-term and predictable donor, as is evidenced in Liberia (Annex C). For Sweden, civil society has an important role to play in poverty reduction and for democratic governance in developing countries. Sida currently has multiannual framework agreements with 15 Swedish CSOs,1 which enable CSOs to fund their own programme priorities under the overarching guidelines set by Sida. This is good practice.

In 2017, Sweden channelled almost one-third of ODA to and through civil society, with most of this going to non-Swedish CSOs (Sida, 2018c). This share has increased over the past years (Chapter 3). Sweden favours core support and long-term partnerships, and tends to focus on larger, well-established CSOs able to absorb considerable amounts of funding. These provide support for a diversity of small and large local and national organisations. It has reduced direct grants to small, local organisations at the country level.

As is the case for other implementation channels, Sida is able to provide funding for CSOs, including for the framework organisations, by way of several different strategies that lack clear interconnections. As a result, some framework organisations have agreements with several different parts of Sida and country-level staff do not always have an overview of total funding for each CSO partner in that country, which limits development effectiveness. Sida is reviewing implementation of the civil society strategy, including opportunities for delegating funds for any one CSO from different strategies to one single strategy (Sida, 2018a). This would help increase clarity and effectiveness of CSO support.

Sweden could also consider opportunities for providing small- to medium-sized quick grants to local organisations, including feminist movements, as a complement to its long-term funding for larger CSOs. Sweden is already doing this in Turkey, although not in Liberia (Eldén and Levin, 2018). This would ensure that Sweden is able to respond to urgent funding needs, including for human rights defenders under threat. It would further support Sweden’s objective of fostering a vibrant civil society in developing countries which it sees as a prerequisite for functioning democratic processes (Government Offices of Sweden, 2016).

Clearer instructions to and information about expectations on partners would be helpful to the organisations applying for funding, as noted by Eldén and Levin (2018) in a report for the Expert Group for Aid Studies (EBA). It is therefore welcome that Sida is currently developing information material for partners and potential future partners about mandatory assessment areas and policy objectives for its aid interventions.

Sweden partners with the private sector to mobilise its expertise but could seek further opportunities

Sweden aims to mobilise the private sector for its expertise, innovation capacity, networks and financial resources for sustainable development. It sees co-operation with international and Swedish business actors as an effective tool for development and a complement to ODA. Sida works with the private sector through multiple tools and mechanisms. Among these are Challenge Funds, whereby Sida invites companies to compete for support (financial and non-financial support such as technical assistance) for innovative solutions to address development challenges/issues, and Public Private Development Partnerships, through which Sida and actors from the private sector jointly finance a development project implemented by a third party (such as a CSO or a multilateral organisation organisation) (Chapter 3). Sida has institutionalised its partnership with the Swedish private sector through two networks:

• The Swedish Investors for Sustainable Development network was established in 2016 with 18 institutional investors, pension companies and investment companies. This is a platform for learning, sharing of experiences and stimulating new projects.

• The Swedish Leadership for Sustainable Development network, made up of 26 Swedish companies and institutions, is a forum for knowledge exchange and collaboration established in 2013.

Sweden does not have a specific strategy for private sector engagement and has no dedicated budget for this, which means there are incentives for government institutions to work with the private sector only when it is the most effective partner for realising desired development results. Sweden considers private sector engagement to be a cross-cutting approach (OECD, 2016). While this approach enables flexibility, Sweden could more actively seek out opportunities for partnering with private actors in line with its Addis Ababa Action Agenda commitments.

A focus on ownership and capacity building

Sweden is committed to country ownership and aligns its strategies with the country’s priorities, while consistently raising its policy priorities of gender equality, rights and environment in dialogue with its partners. When developing a new country strategy, the Ministry for Foreign Affairs (MFA) instructs its relevant agencies to prepare a proposal in consultation with relevant country stakeholders. The strategy is then formulated by the MFA.

Sweden sees dialogue and capacity development of both public institutions and other actors in society as important components of effective partnerships, and as means for strengthening countries’ own systems and local ownership and improving preconditions for sustainable results. This approach is supported by Sweden’s new strategy for capacity development, partnership and methods, which is to be implemented by Sida and the Swedish Institute (Government Offices of Sweden, 2018b). In Liberia, for example, the government greatly appreciates Sweden for contributing to strengthening its capacity and modernising its public sector. Sweden is helping to reform and strengthen Liberia’s public financial management processes through its Public Finance Management programme. Sweden also provides technical assistance to the Ministry of Finance and Development Planning and the Liberia Revenue Authority to bolster its capacity (Sida, 2018b).

Sweden, however, delivers most of its aid through channels that are not directly to country governments. The shares of aid implemented through multilateral organisations and civil society are higher than the DAC average, and Sweden has not delivered general budget support since 2016 (Chapter 3). This approach to delivery means that it sometimes misses out on strategic discussions and information sharing in budget support co-ordination groups at the country level, as is evidenced in Liberia.

Sweden is committed to the development effectiveness principles, but struggles with performance against some indicators

Sweden’s development co-operation rests on internationally agreed principles of effective development co-operation and, where relevant, the New Deal for Engagement in Fragile States (Government Offices of Sweden, 2017a) and there is a strong commitment to delivering on the principles as evidenced in its approach to ownership, capacity building, partnerships and donor co-ordination. However, Sweden struggles with performance against some of the internationally agreed indicators for assessing progress in delivering on these principles. According to the Global Partnership for Effective Development Co-operation’s preliminary data for 2018, while Sweden has significantly increased the annual predictability of its ODA in assessed countries since 2010 (Table 5.1), its performance on providing bilateral ODA through partner countries’ public financial management and procurement systems has stagnated since 2010 (falling marginally). In addition, the share of aid recorded on partner countries’ budget, medium term predictability and use of country-led results frameworks have all decreased between 2010 to 2018.

Sweden explains its declining performance against some indicators as a consequence of its increased engagement in fragile situations on the one hand, and, on the other hand, the shrinking democratic space and growing human rights violations, which have made collaboration with government increasingly more challenging. Sweden has also noted concerns that its multilateral core and multi-bi ODA is not directly reflected within the methodology used by GPEDC.2

However, Sweden could make further efforts to do more to partner directly with and work through country governments’ systems, where appropriate, in order to ensure the sustainable development results it is seeking. While Sweden’s approach to selecting partners enables flexibility, it also puts a lot of responsibility on country-level staff. Sweden could consider establishing criteria to encourage staff to know when it is appropriate to work directly with or through partner countries systems and it should consider putting more of its aid on budget.

A new way of programming in fragile contexts can now be systematised

Using a theory of change as a programmatic tool, Sweden increasingly looks for the best ways to contribute to common development and stabilisation objectives, rather than focusing on expected quantitative results (Chapter 6). This approach is particularly relevant for engaging in fragile contexts, which require quick adaptation to evolving risks.

This new way of programming can make the best of Sweden’s flexible development funds. Embassies have independence to adapt programming and select the best instrument to meet the partner country’s needs. For example, the FBA and Sida are aiming at doing joint analysis and aligning the agencies’ separate programming accordingly, which can only increase Sweden’s coherence in contexts experiencing fragility and/or crisis. As seen in Liberia, Sida’s Help Desk for human security can be used for support in making context analysis, including a fragility and conflict analysis, before the themes and instruments to be mobilised are selected (Chapter 2).

Through a co-ordination mechanism set up in Stockholm, the MFA, Sida and the FBA are meeting regularly to exchange and meet with the geographic departments. This is good practice and should result in coherent programming that includes the peace element and the conflict dimensions in the forthcoming country strategies. Going forward, the co-ordination mechanism could also include the UN Policy Department at the MFA. This department is in charge of the UN Peacebuilding Fund, to which Sweden is the largest contributor.3