5. The United Kingdom’s delivery modalities and partnerships

The United Kingdom makes good use of a diversity of financing and delivery instruments to leverage additional development finance and the comparative skills and advantages of other development partners, particularly multilaterals. For example, the United Kingdom engages in joint donor mechanisms as well as triangular co-operation1 and contributes to humanitarian pooled funds and multi-donor trust funds. In both Jordan and Kenya, the United Kingdom has engaged in delegated co-operation arrangements and European Union (EU) Joint Programming. The United Kingdom has significant influence and DFID thinking and evidence has shaped many international development debates, such as on using political economy analysis or addressing gender-based violence. There is nonetheless a perception that the United Kingdom prefers to support its own initiatives and programmes and that its funding approach – based on robust business cases requiring detailed information – incentivises this. More emphasis in the Smart Rules on favouring joint approaches would help the United Kingdom to further leverage the joint donor effort.

The 2015 Aid Strategy committed the United Kingdom to ensuring the value for money and transparency of all official development assistance (ODA); this commitment shapes the United Kingdom’s approach to funding partnerships and development effectiveness more broadly. Seeking value for public money with the aim of maximising the development impact of ODA is clearly to be commended. Partners across the board find that the interpretation of value for money can have downsides too. They note that the United Kingdom is a very engaged and well informed but demanding donor, with interactions focused on compliance and control to ensure delivery of the United Kingdom’s objectives rather than on strategic dialogue that might lead to joint problem solving and forging longer term partnerships. Where fund managers are used as intermediaries, dialogue between DFID and its partners is further constrained. Due diligence and reporting requirements (Chapter 4) exclude or discourage smaller, more local or non-traditional organisations who could be an important source of insight and inspiration but may not be able to meet all requirements for receiving funding from the United Kingdom.

DFID funding partnerships, and increasingly funding across the United Kingdom (UK) government, are based on a robust business case.2 The business case starts with the “what”: the development challenge to be addressed and the context. This is followed by the “how”: the rationale for the choice of intervention to address the challenge. The final element involves “who”: outlining parameters and evidence to guide the choice of implementing partner, often referred to as the “supplier”. This process is thoroughly vetted and ensures the relevance of programmes. It does not, however, necessarily take partners’ or ministries’ proposals and objectives as a starting point. In addition, partners feel that too much emphasis rests on the performance and sustainability of individual business cases and the outputs they deliver, rather than on building strategic partnerships to achieve longer-term change. The move towards a portfolio approach for results and evaluation (Chapter 6) is a helpful step towards addressing this imbalance.

Listening to the views and experiences of citizens and beneficiaries are a Smart Rules principle but there is no requirement for consultation or ownership when developing proposals. In Kenya, a youth panel is consulted on a regular basis in order to make the United Kingdom’s strategies and programmes more relevant to the 20% of the population aged 16 to 25. UK teams in Jordan and Kenya have actively convened partners working on similar themes in order to foster learning and identify areas for collaboration. In line with commitments to better integrate feedback mechanisms into programmes (DFID, 2018[1]), DFID has updated its internal guidance on beneficiary engagement. Another useful innovation has been early market engagement events which allow consultation with potential suppliers at concept note stage, before a business case is finalised, to draw in learning and to identify new suppliers or approaches.

In choosing interventions to support, the United Kingdom is guided by evidence (Chapter 6). In DFID, a compilation of Best Buys – interventions that have demonstrated value for money through randomised control trials and other tests – has been developed to guide programme managers in deciding what interventions to support to achieve a particular development outcome. In rolling these out, DFID is aware of the need to stress the importance of context in shaping decisions.

Funding for programmes, including core funding for multilateral agencies and global funds, tends to be multi-annual and predictable and the average length of programme is 6-7 years (HM Government, 2019[2]). With Treasury approval, commitments can be made beyond a spending review period – for example, a devolution programme in Kenya is designed with a seven-year horizon from the outset – and once approved, Smart Rules allow ample scope for course correction by programme managers based on annual review scores. This is exceptionally good practice and recognises the time taken to achieve change.

A strong supporter of the United Nations, the United Kingdom is appreciated for its contributions to pooled funds and its significant levels of core funding to key UN agencies (United Nations MPTF Office and Dag Hammarskjöld Foundation, 2019[3]) (Chapter 3). However, some of its funding approaches work against its commitment to reform of the UN development system. A commitment to transparency and accountability for all public funds leads the United Kingdom to advocate for better results and reporting but also to request additional tailored reporting. Conditions attached to a proportion of core funding are explicitly linked to a subset of UN development system reform objectives and have high transaction costs on both sides (Box 5.1). Agencies contend that the time and resources needed to manage funding from the United Kingdom impacts on their ability to deliver programmes and to engage with other partners.

In partner countries, the United Kingdom tends to treat UN agencies as its implementing partners. In Kenya, DFID funding was provided to UN agencies to implement tightly earmarked projects, designed without reference to the agencies’ own strategic plan or the UN Sustainable Development Country Framework priorities that had been negotiated with the partner government. In several countries, DFID teams have requested additional information, audits and reporting on top of standard due diligence requirements agreed at headquarters level. In addition, where the United Kingdom’s partnership principles (DFID, 2014[4]) rule out direct support to a government, DFID may require UN agencies to state in writing that they will give no direct support to government using the United Kingdom’s resources, thus undermining their mandates, relationship with the host government and their capacity to strengthen national systems.

Although DFID and Foreign and Commonwealth Office (FCO) teams in the United Kingdom and partner countries actively advocate for an enabling environment, including space and political freedoms, for civil society, the majority of the United Kingdom’s funding is not provided to support civil society organisations as independent actors with their own mandates.

Following a civil society partnership review in 2016 (DFID, 2016[8]), headquarters funding for civil society underwent a reform. A previous scheme providing core funding to selected civil society organisations was discontinued and four funding instruments were introduced, with the intention of building a broader base of civil society partners and encouraging alliances and innovation, in addition to building more public ownership of ODA funding3. Most civil society funding – which averaged USD 2.3 billion per year 2014-2017 (Annex B, Table B.1) – is delivered through country programmes, however, and overall levels of core funding to non-governmental organisations (NGOs) have not significantly dropped, representing approximately a fifth of total support through NGOs (Annex B, Table B.2). Recognising the need to support organisational capacity, DFID has adopted a progressive approach to overhead and administrative costs for its project funding (DFID, 2019[9]) which was developed in close consultation with civil society and is recognised as good practice among Development Assistance Committee (DAC) members (TaskTeam, 2019[10]). The concern remains that civil society grants are increasingly awarded to implement projects linked to the United Kingdom’s objectives and results and there are further opportunities to support civil society organisations’ own agendas and plans.

As noted in the 2014 peer review (OECD[11]), the United Kingdom invests heavily in research, both as a public good and to inform its own work. Most work is carried out by research agencies based in the United Kingdom and the research agenda is largely set by the United Kingdom. Broadening out beyond institutions based in the EU and the United Kingdom presents an opportunity to build the capacity of a broader range of local actors who could make an important contribution to shaping, and achieving, the United Kingdom’s objectives. The increased involvement of other government departments opens up a new pool of knowledge partners for the United Kingdom’s development co-operation system. However, although most domestic-facing departments recognise the need to diversify, it will take time for them to develop networks and partnerships in developing countries. In encouraging other departments to develop more local partnerships, DFID will need to lead by example, drawing on the experience of other DAC members4.

The United Kingdom recognises the EU as an important ally in seeking to eradicate extreme poverty and help build prosperity, peace, stability and resilience in developing countries (HM Government, 2018[12]). Over the years, it has invested diplomatic, technical and financial resources to strengthen the poverty and fragility focus of EU funding instruments. At country level, the United Kingdom has joined a number of EU Joint Programming agreements and contributed to joint country analysis, and this will still be possible as a third country. While the financial implications are unclear, the United Kingdom’s departure from the EU leaves an important gap as over 100 UK secondments were terminated in 2019. A government decision that officials should only attend EU meetings if there was fiduciary responsibility has led to an abrupt drop in communication and engagement with a number of the United Kingdom’s allies. As the terms of its departure from the EU become clearer, it will be important for the United Kingdom to rebuild these relationships and reassess its own comparative advantage in the donor landscape.

DFID’s long-treasured and commended country-led model is reinforced by a fully delegated budget and well-staffed country offices (Chapter 4). Comprehensive country development diagnostics are used by all departments and kept updated. As a result, and as evidenced in Jordan and Kenya, UK programmes reflect context and the United Kingdom can use its convening power, knowledge and influence to shape relevant policy discussions (Annex C).

There has been a rapid expansion in centrally-managed programmes (CMPs) in recent years. In part, this is helpful for managing spending targets while leaving countries free to respond to priority needs in their specific context. In part however, it reflects a fragmented effort across government. Efforts are now focused on whittling these CMPs down to those that add value when centralised (e.g. vaccines, insurance, multi-country research, private sector instruments) and ensuring they are designed to complement UK efforts at country level. These efforts have been successful: in Kenya the number of CMPs has dropped from 230 to 102 over one year and the High Commission is now familiar with, and values, most of them. A proposed system requiring sign-off by country offices, combined with good communication to ensure new proposals are viewed with an open mind, will help ensure that CMPs are relevant, strategic and achievable while protecting country office time for priority engagements.

The United Kingdom takes a long-term perspective towards sustainable development in its country diagnostics, which are comprehensive and risk-informed (Chapters 2 and 7). Flexibility within an overall budget envelope allows for holistic programming in rapidly changing contexts – important for adaptive management and for spending 50% of DFID’s budget in fragile states. The current move to rebalance a focus on short-term results is intended to reinforce this longer-term perspective (Chapter 6).

However, the United Kingdom would benefit from doing more to tailor its range of funding instruments to context (e.g. low or middle-income, fragile and conflict-affected), and ensuring that staff in partner countries have this range of tailor-made and innovative instruments at their disposal. While CMPs allow for multi-country programmes, and some global initiatives address regional trade and security issues, it is not clear that the combination of CMPs and country programmes allows the United Kingdom to take a coherent and comprehensive approach to regional challenges and opportunities, including those that materially affect relevant bilateral programs. The United Kingdom could study regional platform models used by other DAC members5 and consider the merit of establishing similar platforms.

The United Kingdom recognises that it needs to work politically and ensure that ownership of development processes is broad-based in order to ensure that they support inclusive prosperity, human development, resilience and stability. As set out previously, support to a range of partners from civil society, business and the research community could do more to support their roles as independent actors, consistent with DFID’s 2019 Governance Position Paper (DFID[13]).

Officials in the United Kingdom tend to erroneously associate country ownership with using partner country systems, for which there is low public support and political appetite. With the exception of support through the World Bank and other lenders, the United Kingdom’s incentive structure encourages working in parallel to country systems – using its own planning cycles, statistics, results, and monitoring, procurement and financial systems. This is intended to distance UK funding from sources of corruption, speed up the time taken to deliver results and make a clear link between taxpayer’s money and concrete development results.

In the 2018 Monitoring Round of the Global Partnership for Effective Development Co-operation (GPEDC) (OECD/UNDP, 2019[14]), the United Kingdom scored below the DAC member average on most of the survey’s indicators, with a negative trend since the 2016 monitoring round. While this can partly be explained by the United Kingdom’s increasing work in fragile states and on sensitive issues, performance has worsened even in countries with relatively strong and stable institutions such as Ethiopia and Nepal.

The United Kingdom recognises that many of its partner countries need stronger systems to unblock domestic and international financial resources. It has positive examples to draw upon that are consistent with the Busan development effectiveness principles and consistent with the Smart Rules and other guidance. As seen in Jordan, when there is sufficient political backing at the highest level of the UK government, and a well-calibrated risk appetite, the United Kingdom is able and willing to champion partner government strategies, fund new instruments to support national development ambitions, channel support through national financial systems and use national statistics and program-based monitoring and evaluation. Authorities in Jordan described the United Kingdom as a “thought partner” and confirmed that the United Kingdom’s portfolio and the London Initiative had been shaped through close dialogue. The Embassy’s approach in Jordan stands in contrast to the general approach – it is not clear where the entry points for systems strengthening and political dialogue lie in countries such as Kenya, where the United Kingdom avoids working with government, either directly or through partners. This is also discussed in Chapter 7.

The United Kingdom advocates for transparency, value for money and accountability in its engagement with multilaterals and other partners. Given its long-term perspective and multi-year budget envelope, the United Kingdom could be a leader among development partners for the predictability and transparency of its own development co-operation.

However, while the United Kingdom performed well on annual predictability in the 2018 GPEDC Monitoring Round, medium-term predictability was low and substantially below the DAC average (OECD/UNDP, 2019[14]). Only half (48%) of the United Kingdom’s partner countries participating in the survey indicated that they had received forward-looking expenditure plans and less than a quarter (22%) reported receiving plans that projected spending for three years or more.

For individual programmes, the United Kingdom is at the cutting edge of transparency, publishing its business cases together with comprehensive and frank annual reviews through Devtracker and the International Aid Transparency Initiative (IATI). At a strategic level, however, there is much less transparency in terms of information available to partner governments and other development partners.

Although the United Kingdom invests in political and sectoral dialogue with partner governments at all levels, feedback through the 2018 monitoring survey indicates that it does not systematically consult partner governments, civil society and private sector representatives when developing strategic plans (OECD/UNDP, 2019[14]). A two-page summary of the United Kingdom’s work at country level targeted at the public is available on the Devtracker6 website but this does not serve the planning needs of partner countries or clearly set out the rationale for, and full scale of, the United Kingdom’s activities in partner countries. Furthermore, the United Kingdom’s commitment to improving partner countries’ data systems and increasing the availability of aggregated data (Chapter 6) has not yet resulted in consistent use of, or reporting into, national statistics and indicators. One important consequence is that partners do not feel empowered to help shape the United Kingdom’s strategies or to hold the United Kingdom to account for its commitments.

The Busan principles for development effectiveness are referred to in the Smart Rules and the International Development Act (2006) requires DFID to include information on development effectiveness in its Annual Report. No further guidance is available to UK spending departments however and, as set out in its peer review Memorandum, the United Kingdom considers that current international standards for development effectiveness need to be updated (HM Government, 2019[16]).

Recent evidence points to more sustainable development outcomes when the Busan principles are applied (GPEDC, 2019[17]). In light of this, the United Kingdom could consider a more deliberate approach to broad country ownership and accountability in order to achieve longer-term change in a variety of contexts. This may include a more calibrated approach that identifies flexibility in its rules and practices to tailor its engagements to the capacity of each partner country, taking into account transactions costs for itself and its partners. In view of the gap between the development effectiveness principles that the United Kingdom endorsed and the view of effectiveness that underpins its partnership approach, it would be timely for the United Kingdom to help shape an updated set of standards and incentives for effective partnerships, with a view to leveraging development resources across the system towards sustainable results.

References

[13] DFID (2019), Governance for Growth, Stability and Inclusive Development, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/786751/Governance-Position-Paper2a.pdf.

[9] DFID (2019), Programme Expenditure: Eligible Cost Guidance for Accountable Grant Arrangements, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/851965/Eligible-Cost-Guidance-Accountable-Grant-Arrangements-Dec2019.pdf.

[1] DFID (2018), Open aid, open societies: A vision for a transparent world, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/682143/Open-Aid-Open-Societies.pdf.

[5] DFID (2017), Business Case for DFID 2017/20 Investment in the UN Development System to Achieve Agenda 2030, https://devtracker.dfid.gov.uk/projects/GB-GOV-1-300396/documents (accessed on 23 March 2020).

[6] DFID (2017), What Works for Payment by Results Mechanisms in DFID Programmes - DFID Cover Note, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/684278/full-report-UEA2-merged.pdf.

[8] DFID (2016), Civil Society Partnership Review, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/565368/Civil-Society-Partnership-Review-3Nov2016.pdf.

[4] DFID (2014), DFID guidance note: The partnership principles, Department for International Development, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/358341/how-to-partnership-principles-march2014a.pdf.

[7] DFID (2014), Payment by Results Strategy: Sharpening incentives to perform, Department for International Development, https://www.gov.uk/government/publications/dfids-strategy-for-payment-by-results-sharpening-incentives-to-perform/payment-by-results-strategy-sharpening-incentives-to-perform.

[17] GPEDC (2019), Effectiveness to Impact – Study on the application of the effectiveness principles | Global Partnership for Effective Development Co-operation, https://knowledge.effectivecooperation.org/content/effectiveness-impact-study-application-effectiveness-principles (accessed on 1 February 2020).

[16] HM Government (2019), DAC Peer Review Memorandum (unpublished), Her Majesty’s Government.

[2] HM Government (2019), UK aid for combating climate change: Government Response to the Committee’s Eleventh Report, https://publications.parliament.uk/pa/cm201719/cmselect/cmintdev/2589/258902.htm (accessed on 2 March 2020).

[12] HM Government (2018), National Security Capability Review Including the second annual report on implementation of the National Security Strategy and Strategic Defence and Security Review 2015, Cabinet Office, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/705347/6.4391_CO_National-Security-Review_web.pdf.

[11] OECD (2014), OECD DAC Peer Review of the United Kingdom, https://www.oecd.org/dac/peer-reviews/UK%20peer%20review%202014.pdf (accessed on 23 December 2019).

[14] OECD/UNDP (2019), Making Development Co-operation More Effective: 2019 Progress Report, OECD Publishing, Paris, https://dx.doi.org/10.1787/26f2638f-en.

[15] OECD/UNDP (2016), Making Development Co-operation More Effective: 2016 Progress Report, OECD Publishing, Paris, https://dx.doi.org/10.1787/9789264266261-en.

[10] TaskTeam (2019), Guidance and good practice on CSO development effectiveness and enabling environment, Task team - CSO Development Effectiveness and Enabling Environment, https://taskteamcso.com/wp-content/uploads/2019/04/TSKTM-01C-Guidance.pdf.

[3] United Nations MPTF Office and Dag Hammarskjöld Foundation (2019), Financing the UN Development System - Time for Hard Choices, https://www.undp.org/content/undp/en/home/librarypage/time-for-hard-choices.html (accessed on 5 March 2020).

Notes

← 1. For example, the United Kingdom uses triangular co-operation in its government-wide Emerging Powers Initiative as well as DFID’s Global Development Partners Programme. A mapping exercise in November 2019 identified potential for a UK-Brazil Global Development Partnership focussed on Africa. See Devtracker for more details https://devtracker.dfid.gov.uk/projects/GB-GOV-1-300616/documents.

← 2. In an effort to streamline its development programme management process, DFID introduced Smart Rules in 2014. These 36 rules – reduced from over 200 – are now referred to by most ODA-spending departments. The Smart Rules are reviewed and if necessary revised every six months. Since 2011, DFID uses a standard template business case for all funding proposals, regardless of the level of spend. The template covers the strategic case, appraisal case, commercial case, financial case and management case for the intervention applying the DFID Smart Rules. See https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/840802/Smart-Rules-External-Oct19.pdf. Once approved, business cases are typically published on the United Kingdom Development Tracker website https://devtracker.dfid.gov.uk. Business cases are increasingly used by other government departments managing ODA budgets.

← 3. The four funding instruments introduced under the 2016 Civil Society Partnership Review are: 1) UK Aid Match which links ODA allocations to private donations to charity appeals; 2) UK Aid Direct directed at small and medium sized civil society organisations in the United Kingdom and in developing countries; 3) UK Aid Connect to support innovation and collaboration between civil society organisations, think tanks and the public and private sector; and 4) UK Aid Volunteers to support global volunteering programmes.

← 4. For example, Sweden’s Strategy for research co-operation and research in development co-operation 2015-2021 at www.sida.se/contentassets/0488486f262c4d5eaaaa6adc0cc0b359/swedens-strategy-for-research-cooperation-2015-2021.pdf and 2019 Guiding principles for Sida’s engagement with and support to civil society at http://www.sida.se/contentassets/86933109610e48929d76764121b63fc6/10202931_guiding_principle_2019_no_examples_web.pdf contain useful reference points and principles.

← 5. For example, the United States Agency for International Development has an East Africa Regional Program (www.usaid.gov/east-africa-regional) which illustrates both working with regional entities and cross-border programming; Mexico and Central America Regional Program (www.usaid.gov/news-information/fact-sheets/mexico-and-central-america-regional-program) and West Africa Regional Peace and Governance Program (www.usaid.gov/west-africa-regional/democracy-human-rights-governance). (All webpages accessed on 05 March 2020).

← 6. See the Kenya country profile at www.gov.uk/government/publications/dfid-kenya-profile-july-2018 (accessed on 23 March 2020).

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