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The proposals in the Department for International Development's (DFID's) White Paper published in July 2009 change the emphasis of the Department's activities. It will focus more of its work in fragile states. This is a necessary step if global poverty reduction goals are to be met. Some of the poorest people in the world live in conflict-affected countries and those where governments are unable or unwilling to deliver basic services.
DFID's commitment to assist these countries is therefore welcome. However, the 2008-09 Annual Report and Resource Accounts reveal a number of performance issues for the Department. It needs to address these if it is to meet its own objectives for efficient and effective operations in the face of the additional demands on resources which operating in insecure environments imposes.
We are unsure whether DFID will have sufficient trained and experienced staff willing and available to work in more fragile regions, given the requirement to make further efficiency savings in its administrative budget, including reducing the number of staff employed.
Other concerns include DFID's capacity to identify and tackle fraud and the robustness of its procurement processes. More evidence is needed that the necessary steps are being taken to strengthen monitoring and implementation mechanisms in both these areas.
The White Paper makes clear that DFID intends to work more closely with multilateral bodies such as the UN, the European Commission and the World Bank, through which it already channels 41% of its funds. This offers the prospect of better coordinated aid delivery, but DFID's own assessments show that the effectiveness of these agencies is patchy. More DFID funding for these organisations must be accompanied by reform of their governance structures, particularly the World Bank and the IMF. DFID has started linking the allocation of funds to better performance, particularly in the case of UN agencies, and this strategy should be rigorously pursued.
The international community, including the UK, acted quickly to provide a safety net for developing countries hit by the economic recession. This additional support will need to be sustained over many years to come if more people are not to suffer the impact of increased poverty. Alert systems to monitor the specific effects of the recession on different countries have been put in place. The responsibility now lies with donors to ensure that identified needs are met. The World Bank has a key role to play here and DFID should continue to press for its response to be swifter and appropriately tailored to developing country needs.
The greatest challenge the world faces, along with tackling poverty, is dealing with the impact of climate change. The Copenhagen Climate Change Conference represented a collective failure by the international community to address emissions reductions and the need for increased climate change funding in a meaningful way. Climate change will hit poor countries first and hardest. DFID's White Paper gives a clear commitment to support vulnerable countries to adapt to and mitigate its impact. We strongly believe that funding for climate change must be additional to development funding. The UK must continue to show leadership on this issue, including exploring the potential of a global tax on financial transactions to raise additional funding for climate change measures.
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