DFID Annual Report 2008 - International Development Committee Contents


Memorandum submitted by RESULTS UK

  RESULTS UK has focused on two areas of analysis, arising from the work of RESULTS and the suggestions of the International Development Select Committee. The two areas are:

    —  The effectiveness of DFID's mechanisms for evaluating the impact of its aid.

    —  DFID's progress in meeting the Millennium Development Goals (MDGs), focusing on the targets associated with tuberculosis (TB), basic education and microfinance.

  The UK Department for International Development (DFID) states in its 2008 Annual Report that "DFID's aim is the reduction of poverty, in particular through the achievement of the MDGs by 2015. Everything that DFID does, through its country programmes and collaboration with international organisations, is guided by the MDGs". It is further stated that "DFID has a Public Service Agreement (PSA) which sets out the objectives and targets by which we measure our progress as monitored by HM Treasury. The current Public Service Agreement (PSA) runs for the three-year period from 2005 to 2008.We measure performance through targets that are based on the MDGs".

  In terms of the effectiveness of DFID's aid, we have concluded that DFID emphasises inputs to a greater extent than outcomes, and partly as a result DFID cannot adequately measure the effectiveness of its aid nor whether it has reached the intended beneficiaries. Moreover the current PSA targets are inadequate as a measurement of DFID's aid and inadequate as targets to assess progress towards achieving the MDGs.

  In terms of tuberculosis, there is a general lack of mention in the 2008 report of TB and global TB targets compared with HIV/AIDS. A further issue is DFID's focus on health systems strengthening and budget support at the expense of funding disease-specific programmes, rather than complementing them, as well as the lack of DFID's policy recommendations being implemented at country level.

  In terms of education, we focus on the need for long-term predictable funding, removing barriers to education such as user fees and teacher shortages, reaching those in greatest need such as children living in conflict affected states as well as the need for more qualitative indicators for measuring the success of aid dedicated to education.

  As regards microfinance we emphasise that it is an underutilised tool, but one that has a growing and substantial body of evidence attesting to its effectiveness in achieving several MDGs. We note the lack of mention of microfinance in DFID's 2008 report, and that there is a need to focus on targeting the poorest people.

1.  THE EFFECTIVENESS OF DFID'S MECHANISMS FOR EVALUATING THE IMPACT OF ITS AID

DFID emphasises inputs rather than outcomes

  1.0  The previous report (2007) by the International Development Select Committee (IDC) upon DFID, states that "DFID continues to emphasise inputs rather than outcomes—it focuses too much on how much it spends on aid rather than measuring the effects of its aid spending on poverty". This issue is the main theme that we would like to raise as a point of concern, considering the lack of detailed information in the 2008 report on the particulars of which DFID programmes and what funding are contributing to each MDG, as well as which programmes and what funding are not.

  1.1  In the 2008 report, Douglas Alexander sets out DFID's main priorities for achieving the MDGs: Peace and security, climate change, growth, and international reform. From the report it seems clear that DFID is increasingly focusing upon these macro-level priorities, through multilateral aid and through providing budget support to country governments, as opposed to increasing bilateral aid to vertical programming or through alternative funding streams. As a result, this makes measuring the effectiveness and impact of DFID's aid very difficult. Increases in funding to multilateral agencies and recent pledges such as £6 billion to support health systems strengthening are needed and welcome, but we are concerned that DFID cannot adequately measure the effectiveness of the outcomes of such support in contributing toward the MDGs.

  1.2  Whilst DFID's budget is increasing due to the need to meet the UN target of 0.7% of GNI allocated to Official Development Assistance by 2013, the previous IDC report noted that it is also obliged to reduce its administrative costs, "which in practice means cutting the number of staff it employs", furthermore that "one of the ways DFID deals with disbursing a growing aid budget with fewer staff is through poverty reduction budget support (PRBS)". We are concerned that DFID is giving preference to budget support and thus emphasising how much it spends as opposed to what it has specifically achieved, not because it is the most effective way to reduce poverty but because it is an easier way to disburse aid. A further issue that arises is whether DFID will be increasingly outsourcing its work to other agencies or consultants, if this trend continues.

DFID cannot adequately measure the effectiveness of its aid nor whether it has reached the intended beneficiaries

  1.3  Although the 2008 report is a target-oriented summary of DFID's work, and based around progress made towards the PSA 2005-08, this system does not provide an adequate and complete overview of DFID's support and expenditure. The previous IDC report noted that following the publication of DFID's HIV/AIDS Strategy Taking Action in 2007, DFID could only identify "potentially relevant" projects and programmes that benefitted from funding earmarked for children made vulnerable by HIV and AIDS.

  1.4  The 2008 report notes the creation of the Results Action Plan, as well as the Independent Advisory Committee on Development Impact. Within the Action Plan one of the key priorities is to achieve "strengthened performance and results frameworks for country programmes", a priority which is also included in the 2005 Paris Declaration on Aid Effectiveness. If implemented effectively this priority should lead to a greater capacity for DFID to report on the outcomes and effectiveness of its aid. We believe that this Action Plan and other such measures should be given greater priority by DFID, as measuring the outcomes of specific pledges and how effectively policy has been implemented is a major challenge for DFID.

  1.5  Within the 2008 report DFID states that its policies are based on "evidence of what works". We are concerned that there is not enough evidence to justify DFID's increasing use of general budget support (GBS) or sector budget support (SBS, eg health) at the expense of, instead of in complement to, more targeted aid to reach the poorest of the poor. Although we commend DFID's achievements and commitments to-date, we believe that there is not enough evidence to show that DFID's current approach to monitoring its aid "works", as the 2008 report does not provide specific details on how promoting GBS or SBS are meeting the MDGs.

The PSA targets are inadequate as a measurement of aid

  1.6  DFID has stated that its raison d'être is to achieve the MDGs, the monitoring of which occurs through assessing progress towards achieving the current PSA objectives and targets. However, DFID has different targets for different regions within its PSA 2005-08 objectives, whilst the MDGs are universal. No explanation is given to the allocation of these targets. In the targets associated with MDG6, there is no tuberculosis (TB) target for Africa, whilst there are two for Asia, yet DFID acknowledges in its report and in its AIDS Strategy that TB is a pandemic of poverty in Africa that merits urgent attention.

  1.7  The IDC reported that the proposed PSA Delivery Agreement 29, which will replace previous PSAs, will focus monitoring on 22 countries in which DFID considers it can "make the most impact in measuring progress", as well as having fewer targets. That DFID necessarily has to prioritise key countries and key development topics relative to its strengths is understandable, however we believe that the focus should not be on where the most progress can be measured but on where the most progress is needed.

  1.8  We are concerned that DFID is not comprehensively addressing the MDGs, due to the inadequacy of the PSA objectives and targets as a system of measurement to report on the effectiveness of the programmes and support DFID is providing to reduce poverty. We are also concerned by the observation of the previous IDC report, which noted that "some PSA targets were eased in the current Spending Review period (2005-08)". If DFID is to obtain an adequate measure of the impact of its aid, whether it has reached its beneficiaries and what impact DFID is having in progress toward the MDGs, a more detailed and comprehensive evidence-based results-oriented assessment strategy is needed.

2.  DFID'S PROGRESS IN MEETING THE MILLENNIUM DEVELOPMENT GOALS, FOCUSING ON THE TARGETS ASSOCIATED WITH TUBERCULOSIS (TB), BASIC EDUCATION AND MICROFINANCE

3.  MDG 6: FOCUSING ON TUBERCULOSIS (TB)

The general lack of mention of TB and global TB targets compared with HIV/AIDS in the PSA targets related to MDG 6

  3.1  DFID's 2008 report noted that the UK will commit up to £1 billion up to 2015 to the Global Fund to Fight AIDS, TB and Malaria, with £360 million for the period 2008-11, as well as noting the launch of the International Health Partnership (IHP) in 2007. We applaud these commitments as well as the mention of the global co-epidemic of TB/HIV in DFID's recently revised AIDS Strategy; "stronger links must ... be forged between TB, malaria and HIV services|in hyper-endemic countries, TB and HIV are fuelling each other, and the need for integration is made more urgent by the steep rise in drug resistant TB infections".

  3.2  Despite DFID's acknowledgement of the severity of TB as a disease of poverty, there is little mention of TB or TB/HIV in the 2008 report. Although the report is structured around DFID's progress in achieving the MDGs, the MDG target for TB is rarely mentioned. Perhaps the most important observation is that there is no PSA TB target for Africa and insufficient ones for elsewhere, as such the report does not state, for example, what DFID is doing to support TB/HIV co-ordinated activities in hyper-endemic countries.

  3.3  The All-Party Parliamentary Group on Global Tuberculosis released in 2007 the report Agenda for Action, which included concrete recommendations on how the UK should continue its vital support to TB control and scale-up its response. It is impossible to answer, based on the report, what specific activities DFID is supporting to implement the APPG report, as well as the World Health Organisation's Stop TB Partnership's Global Plan to Stop TB; the MDR-TB and XDR-TB Global Response Plan, and any funding provided to these plans in the period covered by the 2008 report.

  3.4  The PSA Delivery Agreement 29 which replaces the current PSA 2005-08 has fewer targets than the previous PSAs and has only one indicator for MDG 6: HIV prevalence among 15-49 year olds. The lack of mention of TB and malaria compared with HIV/AIDS, and the focus on health system strengthening raises a worry that progress will not be properly monitored concerning the confrontation of TB, and the appropriate action may not materialise in order to address the health emergencies of drug-resistant TB and the co-epidemic of TB/HIV in areas such as sub-Saharan Africa.

DFID's focus on health systems strengthening and budget support at the expense of funding disease-specific programmes

  3.5  Of the evidence concerning MDG6 in DFID's report, much concerns prioritising support to health systems strengthening and health sector budget support. We understand that DFID is increasing health sector budget support, whilst at the same time reducing disease-specific bilateral aid. We believe however that targeted investments are important for addressing priority diseases as part of a broader health systems approach. The recent report "Healthy Aid" by Action for Global Health, cited with evidence the case of Zambia, in which the introduction of GBS and a sector-wide approach (SWA) to health led to "the collapse of the Zambian TB programme". The report concluded that GSB "only helps the Government deal with regular health problems and not extraordinary problems such as HIV, AIDS and TB".

Reflecting policy recommendations at country level

  3.6  In 2007 RESULTS UK produced a report on the response of the UK Government and civil society to the TB/HIV co-epidemic. One important finding of the report was that although DFID recommends integration of TB and HIV services at policy level, a survey of DFID country offices revealed that these policies are not being implemented. This raises a significant issue about the lack of co-ordination within DFID and whether other policy areas have experienced a lack of implementation. Secondly, due to the fact that DFID does not disaggregate its TB, TB/HIV or even HIV funding, it was impossible for DFID to state how much it had spent on combating TB, and therefore difficult for DFID to evaluate the effectiveness and impact of its aid to confront TB.

  3.7  According to DFID's 2008 report there has been some welcome progress in South Asia on the two PSA TB targets for Asia concerning TB cure and detection rates, but the same cannot be said for Central and East Asia or sub-Saharan Africa. DFID states, "In many countries progress is slowed by health systems that do not have the capacity to deliver services". Whilst this is an important issue, we are concerned, due to the reasons given above that DFID is not able to adequately monitor progress in achieving MDG 6, nor is it addressing it adequately at country level. The implications for the issues that have been discussed raises a significant point that was noted by the previous IDC report: DFID cannot adequately state to a sufficient level whether its aid is reaching the intended beneficiaries.

4.  MDG 2: COMMITMENT TO EDUCATION FOR ALL

Funding education

  4.1  DFID should be commended for making generous commitments to funding basic education which is vital if the world is to meet its MDG commitment of ensuring universal access to education. The pledge of £8.5 billion over a 10 year period, made in April 2006 was a most welcome development. However, despite this pledge being made over two years ago DFID has yet to release details of how and where they intend to spend this money.

  4.2  Long term and predictable funding is vital for developing countries if they are to be able to develop and implement comprehensive long term education plans with a view to meeting the MDG 2 target. We welcome the knowledge that 11 African PSA countries have been able to develop such long term plans with DFID's financial support, but DFID should seek to encourage and provide assistance to all PSA countries to develop such long term plans in the near future.

  4.3  The Education For All Fast Tack Initiative (FTI) is an effective and important multi donor funding mechanism to which DFID is now the second largest contributor, but it is a mechanism which is unexplainably absent from the 2008 report. With the UK now at the end of its three year funding cycle to the FTI we would encourage DFID to make a significant and long term commitment to the fund and push for a speeding up of the funds disbursements to allay the one major criticism that is often directed at the FTI.

Removing barriers

  4.4  One of the greatest barriers to education remains the charging of tuition fees. The 2008 report highlights the enormous impact that their removal can have on school enrolment and on achieving gender parity in schools. Despite significant progress in recent years it is estimated that out of 94 poor countries, 77 still have some type of education user fee, including several DFID partner countries. Though DFID have a policy of seeking to dissuade partner countries from charging such fees and encouraging them to include plans for their abolition in their education plans, DFID need to provide greater clarity on which of their partner countries still charge fees and what, if any, concrete plans are in place for their abolition.

  4.5  It is clear that the world cannot reach its education goals by 2015 unless it urgently deals with the current chronic lack of teachers. It is estimated that an additional 18 million teachers are needed if MDG 2 stands any chance of being met, yet policies imposed by the IMF continue to prevent many poor countries from employing the teachers that they so desperately need. DFID point out in their report that "the main role of the IMF is to provide stability in the world economy", but true lasting stability can only be achieved if all the worlds children are offered the chance of a quality education so that they have the opportunity to contribute to that economy and help lift themselves out of poverty.

Reaching those in greatest need

  4.6  It is thought that up to 37 million of the 72 million children out of school in the world live in conflict affected fragile states. If MDG 2 is to be met by 2015 far greater emphasis must be placed on reaching these children. DFIDs 2008 report fails to directly address this issue. We believe that DFID should use its experience in fragile states to expand its education programmes to all fragile states it has a presence in so that they too can hope to achieve universal primary education for their children.

  4.7  Up to 26 million, or one third of all out of school children worldwide are thought to be disabled, and in Africa it is thought that only 10% of disabled children receive an education. DFID should encourage its partner countries to make specific provisions in their education plans for increasing access to children with disabilities.

Measuring success

  4.8  DFID's PSA targets for both South Asia and India use enrolment rates as the measure of DFID's success in the education sector. The picture painted by such indicators is very rough and at times deceiving as factors such as high drop-out rates, poor learning outcomes, pupil-teacher ratios far above the recommended 40:1 target and chronic absenteeism can be underplayed. DFID should measure the quality as well as the quantity of education provided in assessing the effectiveness of its aid.

5.  MICROFINANCE AND THE MDG'S

An underutilised tool

  5.1  There is a mounting body of evidence which shows that microfinance is a proven and effective tool for poverty alleviation with a strong impact on the achievement of the MDGs including but not limited to poverty alleviation, promoting children's education, improving health outcomes for women and children and empowering women. Microfinance is unique among development interventions in that it can deliver social benefits on an ongoing, permanent basis and on a large scale.

  5.2  Despite the great potential for microfinance to help attain the MDGs, DFID barely mentions microfinance in its 2008 report, with only a fleeting mention in the "Reducing Poverty in South Asia" section. To its credit DFID has committed at least £70 million to microfinance schemes in 6 different countries over the last three years. However such investment in Microfinance Institutions (MFI's) appears to be the exception rather than the rule and far greater investment is needed in more DFID partner countries if they are to harness the full potential of microfinance and make progress towards the MDGs.

Targeting the poorest

  5.3  In recent years DFID has moved towards investing almost exclusively in the strengthening and widening of the financial sector in developing countries in preference to providing direct financial support to MFI's. Whilst financial widening and strengthening is an important process in the development of a countries economy it can have the adverse effect of taking the focus away from reaching the very poorest. If the MDGs are to be met by 2015 it is these people who DFID should be targeting.

  5.4  DFID provides no reliable data to show whether their funding for MFI's benefits the very poor (those living on less than $1 a day or the bottom half of those living below the national poverty line). DFID should provide information on what, if any, mechanisms it has in place to measure the income/poverty level of MFI'S incoming or current clients. Such data is crucial if DFID is to be able to state with confidence that the aid it is providing is having the greatest possible impact.

  5.5  With many MDGs still off track, microfinance could help provide a much needed boost to DFIDs effort to alleviate poverty and meet the MDGs. DFID should increase funding for microfinance programmes, increase its involvement in capacity building in respect of MFI's and should work to ensure that at least 50 percent of its resources reach those living below the poverty line.

6.  CONCLUSION

  DFID's main priorities as outlined by Douglas Alexander are indisputably essential and worthwhile areas to focus upon. There is also evidence that DFID is adopting a more results-oriented approach to development, attested to by the adoption of the Results Action Plan and other such measures. DFID has made major contributions to reducing poverty worldwide, but there are several challenges and major issues concerning the inadequacy of the PSA targets and the method in which DFID disburses its aid. Too much focus on macro-level issues and sector budget support misses the essential focus of what development should be about; human beings. We are concerned that DFID is focusing too much on the means of development and not enough on the ends.





 
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