8 Conclusion
63. DFID's 2003 Departmental Report provides a reasonably
clear statement of the Department's objectives and how it plans
to set about meeting them. Significant improvements have been
made to the format and content of the Report since last year,
particularly in the provision of information about the Department's
organisation and how this is linked to delivery. There are still
some areas in which the Departmental Report could improve the
way it presents information on performance. It should report
on the full range of DFID activities and not just those relating
to meeting PSA targets. It would be useful if the Department Report
also gave information about how underperformance is being addressed.
Over the next few years, DFID's budget will grow by over £1
billion. DFID needs to demonstrate the links between what this
extra money is expected to deliver, and the performance which
it reports in the Departmental Report. Presentation of information
in the Departmental Report's financial tables could also be improved.
At present it is difficult to track how spending changes each
year; information is not presented consistently, and figures
are distorted by the unexplained inclusion or omission of large
sums. More information could also be given about DFID's risk management
and financial flexibility. DFID's impressive record in responding
to crises around the world would be emphasised if the Department
provided more information about its financial flexibility.
64. DFID is right to focus on poverty and on ensuring
that partner governments are the main drivers of measures to reduce
poverty. But difficult balances have to be struck between rewarding
good governance and helping the poorest nations, as well as between
emphasising recipient country ownership of policies and influencing
policy to ensure it is effective. DFID and other donors should
not shy away from being explicit about the donor-recipient relationship:
expectations and obligations on both sides should be clear. Memoranda
of Understanding provide a useful mechanism for such communication.
Donors inevitably seek to influence recipient governments and
in many cases this is entirely appropriate. It might occur, for
example, where a donor stresses the importance of gender or trade
capacity building for poverty reduction. Honesty and openness
in and about the donor-recipient relationship may better ensure
that legitimate influence is heard and fears of undue influence
or pressure are allayed.
65. We hope that the recent restructuring of the
Department's policy section will help in policy formation. In
this report we have flagged up some of the policy areas, which
we think are in need of attention. DFID has an excellent reputation
for its work on gender and must ensure that "mainstreaming"
does not imply dilution or neglect. We would also like to see
more information about how the department is working in the area
of Sexual and Reproductive Health, and in particular how it is
working towards Millennium Development Goal 5 to improve maternal
health. We have made a number of comments on DFID's approach to
agriculture and wish to see the department develop a strategy
for agriculture. DFID has recognised the importance of agriculture
to poverty reduction and does in practice support agriculture.
But it does not do so in a coherent way and this risks undermining
the work it and its predecessor have achieved over many years.
We hope that the new agricultural policy team will develop a strategy
that considers sustainability, private sector development and
the need for development coherence.
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