House of Commons - South Sudan: Prospects for Peace and Development

South Sudan: Prospects for Peace and Development - International Development Committee Contents

4 DFID's programme

26. The UK first established a development presence in Southern Sudan in 2005 as a member of a six country Joint Donor Office. It was the first country to appoint an Ambassador in the newly independent South Sudan.[43] DFID has now established a full office in Juba and issued an Operational Plan for South Sudan to cover the period 2011-2015. In this Chapter, we examine DFID's evolving aid programme, including its funding plans, confirmed and planned projects, and expected results. As discussed in Chapter 3, DFID has already decided to modify aspects of its development programme and focus to a greater extent on humanitarian assistance, as a result of the GRSS's decision to shut down oil production. We recognise that DFID may need to modify its programme further if the humanitarian situation continues to deteriorate (paragraph 24).

DFID's South Sudan Office

27. DFID opened its full Office in Juba in July 2011 following independence. For the previous nine months, DFID had operated a Sub-Office in Juba, which reported to DFID Sudan in Khartoum. There has been a rapid increase in staffing in Juba (from two staff in August 2010 to 30 by February 2012).[44] Unusually the South Sudan office is a joint office between DFID and the Foreign and Commonwealth Office (FCO), with the "platform" managed by DFID.[45] South Sudan is the first country in the world where DFID provides the platform for the work of other HMG departments. This is because the objectives for the UK's development assistance to South Sudan are "central to wider UK Government objectives of achieving peace, stability, inclusive and accountable governance, respect for human rights and more equitable growth in South Sudan".[46] DFID and FCO staff work together on issues such as corruption and defence transformation. We received positive evidence about the joint DFID-FCO unit.[47] We were impressed during our visit with how well the arrangement was working. The establishment of a joint DFID and Foreign and Commonwealth Office operation in South Sudan—with DFID in the lead—is a welcome innovation and an encouraging example of joined-up government. It is early days but the signs are that the joint office is working well. The Government should seek to adopt a similar model in overseas counties where development assistance is central to wider UK foreign policy objectives.

Funding

28. DFID expects to spend around £360 million in South Sudan between 2011 and 2015,[48] making South Sudan one of the largest recipients of UK bilateral aid. About £74 million will be spent in 2011-12,[49] and about £90 million in the following three years (Table 3). This compares to about £60 million expenditure in 2010-11.[50] Due to current uncertainties, these estimates remain provisional: DFID said in February 2012 that "the Government of South Sudan's decision to close the oil wells means that we cannot currently give firm figures for future expenditure."[51]

Table 3: UK assistance to South Sudan over the period of the Comprehensive Spending Review

2011/12 2012/13 2013/14 2014/15

£ 74 million £ 91 million £ 96 million £ 99 million

Source: DFID (Ev 92)

29. DFID does not currently channel any money through the Government of South Sudan (GRSS). It instead routes funds through Non-Governmental Organisations (NGOs), private sector firms and multilateral agencies, such as the UN or World Bank. Thus far, the bulk of DFID's programming has been through multi-donor trust funds and other pooled mechanisms, such as the Basic Services Fund (see Box 4).[52] We explore funding through multilateral institutions in Chapter 5.

Box 4: Basic Services Fund, 2005-12
DFID established the Basic Services Fund (BSF) in 2005. It is widely considered to be one of the most effective pooled funds in Southern Sudan over the past seven years. DFID is the lead donor to the BSF—other donors include the EU, Netherlands, Norway and Sweden— but the Fund is managed by a private contractor. DFID expects to spend more than £60 million on the BSF for the 2005 to 2012 period.[53] Since 2005 the BSF has funded NGOs to support government health services for 2.2 million people (or approximately 20% of the country) in 186 government health facilities. It has also funded NGOs to support school construction and pre-service and in-service teacher training. DFID estimates that almost 70,000 children have benefited from going to schools supported by the BSF. The BSF was scheduled to end in December 2011, but DFID decided to extend it for an additional year to address the needs of returnees from Sudan and to ensure there is no gap in service delivery while sector-specific funding mechanisms are put in place.[54] Witnesses were extremely positive about the BSF. NGOs cited the BSF as an example of best practice: it was described as "one of the few successes" seen in South Sudan.[55]

DFID's Operational Plan 2011-15

30. DFID published its South Sudan Operational Plan in July 2011. It sets out DFID's priorities for South Sudan up to 2015, including targets on health, education, governance, girls and women and humanitarian work (see Appendix). Witnesses were generally complimentary about the Operational Plan.[56] Tearfund, however, said it was "disappointing" that the plan did not include objectives related to water and sanitation (WASH). There was a "potential vacuum" if DFID did not successfully pass its "significant experience, expertise and reputation" in the WASH sector to other donors.[57] International HIV/AIDS Alliance also noted that the Plan allocated no specific funding to HIV/AIDS.[58] The Minister argued that DFID could not cover every sector in detail, but it would continue to provide some WASH activities as part of its humanitarian work (Germany was now the lead donor on WASH activities). He considered the targets in the Operational Plan to be "stretching and ambitious".[59]

31. DFID is developing more than thirty projects to achieve its strategic objectives for South Sudan. Some projects are already being implemented, whilst others are at the design or concept phase. We asked DFID for specific information about its current and planned projects, including their cost. The five most costly projects are listed in Table 4.

Table 4: DFID's planned five most expensive projects

Sector/title Summary of purpose Estimated duration Funding contribution

Food Security & Livelihood* Target beneficiaries are farmers, youth and returnees. May involve: increased production and marketing of agricultural products in count towns; vocational training in county towns to support market chain; and social protection for those without labour in three states. 5 years Up to £100m

Health Pooled Fund* To increase overall access to regular health services in South Sudan from the current 40% to 60% and build capacity in the Ministry of Health and other institutions. Will focus on six states. 4-5 years £82 million from DFID plus funds from other donors to reach a target of £156 million

South Sudan Service Delivery (Basic Services Fund) DFID created the BSF in 2005. It is now the largest single source for the provision of primary health care in South Sudan. The current interim arrangement phase has helped to expand coverage and use of health, education and water and sanitation across Southern Sudan. 7 years
(2005-2012)
£60.2 million

Girls' Education* To accelerate girls' enrolment, retention and completion at primary and secondary levels of education. Approximately 200,000 girls will benefit. 6 years £52.3 million

Feeder Roads* Contribution, probably via the UN World Food Programme, to build 550km of rural feeder roads.[60] 4 years £50.2 million

*project still at the concept or design phase, as of January 2012

Source: DFID (Ev 92)

EDUCATION

32. DFID notes that South Sudan started at the "bottom of the world league table" for education. Only 23% of South Sudanese people are literate. The net enrolment rate at primary level is only 44%, and it is slightly over 9% at the secondary level. As we saw during our visit, school infrastructure and staffing are inadequate. Only 23% of existing classrooms are of permanent construction; fewer than 5% of teachers have pre-service training, and 9% have in-service training.^.[61] The average pupil to classroom ratio is 134:1 and the pupil to teacher ratio is 194:1.[62] Textbooks are in short supply, with one textbook available for every four pupils.[63]

33. DFID intends to spend about £11 million to print and distribute 12.5 million textbooks by 2013. In evidence, Save the Children told us that DFID's textbook target was "not the most effective means of measuring outcomes" in the education sector.[64] The Minister argued, however, that research showed that textbook availability was the single most positive factor in increasing learning outcomes for children. Textbook provision, he said, also proved successful in DFID's Zimbabwe education programme.[65] English is also the new official language of South Sudan so there is clearly a need for English language textbooks.

34. DFID also has a target to support 240,000 children (including 180,000 girls) in primary education in South Sudan. This will be partly be achieved through DFID's £37m South Sudan Education Project, which will construct 33 primary schools and four secondary schools in four states. Representatives of the Episcopal Church of Sudan (ECS), including Archbishop Deng whom we met in Juba and Rebecca Coleman who gave evidence, were disappointed that DFID had overlooked the ECS for the new school construction contract, awarding it instead to UNICEF and UNOPS (United Nations Office for Project Services). They told us that the ECS had a good record of constructing schools cheaply and to a high standard.[66] The Minister told us that DFID selected the UN "given the scale of the project and the need for rapid completion, on time and with value for money": he said the ECS had constructed 90 classrooms in 22 schools over five years whereas DFID required 200 classrooms in about 25 schools in one year. The costs between the two bids were also said to be broadly similar. However, the Minister emphasised that the Church would continue to play a "very critical" role in the education sector, for instance in DFID's Girls' Education programme.[67] We note that DFID has decided to delay plans to construct teacher training centres as a result of the oil crisis.[68] When allocating funds for its development projects, DFID should as far as possible seek to strengthen and complement the limited internal capacity that already exists within South Sudan. We have some concerns that DFID's decision to fund the United Nations rather than the Episcopal Church of Sudan to deliver its school construction programme misses an opportunity to do so.

HEALTH

35. Decades of war have left South Sudan's health system extremely weak. There are only 37 hospitals in South Sudan.[69] It is estimated that fewer than 40% of the population have access to basic primary health care services in South Sudan, and that about 70% of health facilities are reliant on NGOs for operational support.[70] South Sudan's health outcomes reflect this weak capacity and infrastructure. It has the highest maternal mortality rates in the world with more than one in fifty women dying during pregnancy or delivery.[71] Immunisation rates are still low, with only 20% of one-year olds immunised against measles.[72] Sudan as a whole ranks fourth globally for malaria deaths with an estimated 44,000 per year.[73]

36. DFID's Operational Plan sets a target to reach 762,000 people with malaria prevention or treatment interventions by 2015. DFID also aims to provide couples with 143,000 cumulative years of protection from unintended pregnancy.[74] One of DFID's major projects over the next four years is the Health Pooled Fund (HPF). DFID expects to contribute £82 million to the HPF, and hopes funds from other donors (Canada, Australia, Sweden and the European Commission) will reach a total of £156 million. The aim of the HPF is to increase overall access to regular health services in South Sudan from the current 40% to 60% and intends to focus on capacity building in the Ministry of Health and other institutions (see paragraph 48). The Minister agreed with us that the success of DFID's South Sudan 2011-15 programme would, to a large extent, hinge on the performance of the Health Pooled Fund.[75] Given its cost and importance, we recommend that the Independent Commission for Aid Impact (ICAI) review the effectiveness and value-for-money of the Health Pooled Fund at a suitable moment in the future.

37. Neglected tropical diseases (NTDs) are a major public health problem in South Sudan. 12 NTDs, including trachoma, lymphatic filariasis, onchocerciasis, schistosomiasis, and soil-transmitted helminthiasis, are endemic.[76] The Minister told us that South Sudan was the "nursery of every NTD".[77] DFID expects to spend about £4.7m on a NTD Programme in South Sudan over three years, which aims to improve the Ministry of Health's capacity to handle treatment and prevention of NTDs.[78] The immediate focus will be on eradication of lymphatic filariasis.[79] In January 2012, DFID announced a five-fold increase in funding to tackle NTDs across the developing world between 2011 and 2015 (from £50m to £245m). It has not yet been decided how much will be allocated to South Sudan. We welcome DFID's commitment to significantly increase funds to tackle neglected tropical diseases (NTDs) in the developing world. Given that several NTDs are endemic in South Sudan, DFID must ensure that South Sudan receives an adequate share of this money.

GIRLS AND WOMEN

38. DFID's Operational Plan states that improving women's and girls' access to basic services, economic opportunities and human rights in South Sudan is a "top priority".[80] Only seven girls for ten boys attend school at the primary level; five girls for ten boys at the secondary level. Only 9% of girls who enrol at grade one complete primary education.[81] Several of the girls we spoke to in South Sudan wanted a good education and a profession. However, we heard how some customs and traditions, particularly in rural areas, could act as a barrier. Teenage pregnancy is common and 41% of girls are married before their eighteenth birthday.[82] We heard how marriages are often arranged by parents in order to collect the bridal dowry—typically several cows. Women and girls also carry and collect most of the household water, with adult women carrying 60% of the burden and girls 8%. The average time spent collecting water can be up to eight hours in areas without water and sanitation, meaning that girls do not participate fully in education.[83] Schools also did not have separate toilets for girls and boys.

39. DFID aims to promote the equality of girls and women through a planned six-year £52 million Girls' Education project to help tackle the economic, social and cultural barriers that prevent girls from going to school and to support 150,000 girls through primary school and 50,000 through secondary school.[84] In the health sector, DFID plans to strengthen family planning and support for pregnant women, so that 21,000 women have the help of a trained birth attendant when giving birth.[85] DFID has also set a target to improve access to justice services for 250,000 women by 2014. We note that there have been some positive indicators of success to promote equality: for example, women police officers represent 50% of the police force in some of South Sudan's states.[86]

40. We asked the Minister how much impact DFID and the wider international community could make to improve women and girls' equality, given that some barriers related to cultural traditions and practices such as the bride-price system. He accepted that it was a challenge but said there was "now a recognition that we do need to address some of these cultural barriers".[87]

41. The improvement of equality of girls and women is crucial if South Sudan is to prosper, socially and economically, over the next generation. We strongly endorse the emphasis that DFID has placed on girls and women in its programme. While we recognise the current pressures and uncertainties surrounding DFID's programme, we urge the Department to maintain these programmes as a priority.

DISARMAMENT, DEMOBILISATION AND REINTEGRATION

42. South Sudan currently spends around 40% of its budget on "defence", largely due to the high number of soldiers on the government payroll (estimated to be between 180,000 to 220,000 soldiers).[88] This compares to 7% and 4% allocations to the education and health sectors respectively.[89] We were told during our visit that the army was currently the only welfare system in South Sudan. A sustainable reduction in the size of the armed forces is essential to release resources for investment in development. The GRSS, with support from the UN Development Programme (UNDP) and UNMISS, is currently developing a programme to put 150,000 ex-combatants through a Disarmament, Demobilisation and Reintegration (DDR) process over the next eight years.DFID has been involved in the development of this strategy. It expects to spend about £20 million on DDR, with a particular focus on the reintegration of former soldiers back into communities (although this programme has been delayed due to the oil crisis).[90]

43. DFID notes that there are likely to be "huge" challenges in reintegrating ex-soldiers into the community. An estimated 80% of ex-combatants are illiterate with poor numeracy. There are limited private sector job opportunities available and South Sudan is affected by widespread insecurity.[91] On our visit we heard that it could be difficult to encourage ex-soldiers into other fields of work which they considered to be "beneath" them. On the other hand, many ex-soldiers already have a sense of discipline instilled in them and, with appropriate training, could form part of South Sudan's much-needed reformed security sector (we discuss security sector reform in Chapter 6).

44. It is unsustainable for 40% of the Government of South Sudan (GRSS)'s budget to be spent on defence. Once the economic situation in South Sudan has become more stable, DFID should re-prioritise its support to reduce the size of the South Sudanese army and reintegrate ex-soldiers back into the community. This presents a considerable challenge given the high levels of unemployment and soldiers' lack of skills, but is important if the GRSS is to begin providing basic services for the population.

GOVERNANCE

45. Government capacity in South Sudan is extremely limited. Although basic structures have been established, delivery systems across all sectors are either absent or dysfunctional. There is a significant shortage of skilled people in the civil service and trained police. Nearly half of all civil servants in South Sudan only have a primary education.[92] Many have poor literacy and IT skills. Michael Ryder, UK Special Representative to Sudan, said there is a "lot of talent" in the Juba Government—particularly at the ministerial level—but "very limited depth of capacity".[93] But we were told during our visit that GRSS ministers had to spend too much time in meetings with international donors. Public financial management capacity is also very low, meaning that the GRSS lacks control over its finances. Formal government institutions at the county and local level are limited.

46. DFID states that it is "crucial" to strengthen capacity at all levels of government, and public finance management, if South Sudan is to prosper and be stable. The Department provides direct support to the central executive, through high level mentoring to key personnel within the Ministry of Cabinet Affairs, the Office of the President and the Ministry of Information and Broadcasting. It has employed technical consultants, such as Adam Smith International, to undertake this role. DFID is also supporting work to strengthen South Sudan's management of its public finances, including a £1.5m contribution to an Overseas Development Institute (ODI) programme to create more effective, transparent and accountable budget processes and systems. DFID also helps to fund the secondment of ODI Fellows to key ministries such as the Ministry of Finance and Economic Planning—which is generally regarded to be one of the better ministries in Juba. It was clear that the ministers we spoke to highly valued this technical expertise. At the state level, DFID provides about £5 million to a UNDP-led project to improve the functioning of state administrations to allow, for example, enhanced interaction between the capital and state administrations.[94]

47. More broadly, DFID incorporates government capacity-building measures within development projects in other sectors.[95] The Health Pooled Fund, for example, intends to build the capacity of the Ministry of Health and other institutions, in order to gradually take over responsibility from NGOs for health care.[96] This would likely take the form of technical assistance; there are no plans to provide budget support at this stage.[97] The NGO Tearfund said that there had already been "notable successes" in handing over basic service provision for some elements of the health sector to the government. It planned to exit the health sector within the next 18 months.[98] In March 2012, the Secretary of State told us that the plans to move from NGO-led to government led-approaches in the health sector had been "put on hold", with immediate effect, as a result of the GRSS decision to halt oil production.

48. South Sudan is currently a society built on the work of NGOs and international donors. This cannot be sustainable. Building the capacity of the administration in South Sudan—at all levels—will take time but is essential if the new country is to become less dependent on others. DFID's capacity-building support to date has been largely focussed on Ministries and personnel in Juba. This work appears to have been effective and is highly valued by the GRSS. Given that basic services are primarily delivered at the state or local level, DFID must ensure that it strikes a balance between supporting governance in Juba and other levels of administration.

49. We welcome the intention within some DFID's projects, such as the Health Pooled Fund, to build the capacity of the South Sudanese Government, so that the government can gradually take primary responsibility for the delivery of basic services. Although the oil shut-down has disrupted some of these plans, DFID must ensure it resumes them once the economic situation in South Sudan becomes more stable. DFID should use its leverage and influence to persuade other key donors to integrate capacity-building support within their own development projects.

50. It should not only be the responsibility of the key international donors to build the capacity of the South Sudanese Government. Neighbouring countries in the region, such as Uganda, Kenya and Ethiopia, can also play a valuable role, for instance through providing training to civil servants. DFID, alongside other donors, should seek to engage South Sudan's neighbours in this important work.

PRIVATE SECTOR DEVELOPMENT

51. The private sector is still very small in South Sudan; there are only just more than 7,000 registered businesses in the country. The expansion of South Sudan's private sector will be important to diversify its economy and reduce dependence on oil. DFID particularly notes that the development of agricultural and livestock potential is the "best engine" to diversify South Sudan's economy in the medium term.[99]Large fertile areas of South Sudan remain untouched—only about 4% of potential agricultural land is presently utilised.[100]

52. DFID contributes to several funds that aim to encourage private sector development. It will contribute £6m over four years to the Africa Enterprise Challenge Fund (AECF)—a USA-led private sector fund—which aims to catalyse private sector investment in agriculture.[101] DFID also expects to provide £6m to Trade Mark East Africa (TMEA), which will assist the GRSS establish a customs service. We met representatives from both AECF and TMEA on our visit. About £5m will be spent on the Global Small and Medium Enterprise (SME) Financing Programme, a programme of support for SME development channelled through the International Finance Corporation.[102]

53. During our visit we also met representatives from some of the few businesses operating in South Sudan, such as SAB Miller (who opened a brewery in 2009) and Equity Bank (one of the few licensed commercial banks). Our meetings with private sector representatives highlighted various barriers that prevented businesses from operating effectively in South Sudan. These barriers included:

Conflict and insecurity was a major impediment to private sector growth;
Poor road infrastructure and market access particularly constrained agricultural development;
An incomplete legal and regulatory framework (several important laws for the private sector had not been enacted);
A lack of licensed banks and common customs procedures;
There were no cement-production facilities in the country, which significantly increased infrastructure costs; and
UK Trade & Investment[103] did not have a presence in South Sudan.

54. The expansion of the private sector in South Sudan—particularly in agriculture—will be crucial if the country is to diversify its economy and reduce dependence on oil in the medium term. We welcome DFID's emphasis in its 2011-15 programme to encourage the growth of the private sector. We urge it to continue to do so, with a particular focus on agriculture and the provision of basic infrastructure. The current oil crisis demonstrates that South Sudan's overwhelming economic reliance on oil is unsustainable.

55. CDC, the UK's development finance institution, does not currently invest in South Sudan (or Sudan).[104] We note, however, that CDC intends to place greater emphasis on "frontier" markets—that is, markets at an early stage of economic and financial development.[105] Private sector investment in South Sudan is complicated by legal, land access and security issues. But we believe the country also presents real commercial opportunities. We recommend that CDC explore the potential for investment opportunities in South Sudan. This would tally with its broader aim of seeking greater involvement in frontier markets.

Conclusion

56. DFID has been operating in Southern Sudan since 2005. It was clear from our visit that the Department is regarded as a highly effective donor in South Sudan. Many people we met—government ministers and officials, at the national and local levels, as well as other key donors and NGOs—were complimentary about the Department. The BSF is widely regarded as one of the more successful pooled funds in South Sudan. Dr Sara Pantuliano—who co-authored an evaluation of donor support from 2005-2010— told us that DFID had demonstrated it was a "better donor than many others" and had dealt "creatively" with some challenges.[106] This should not be downplayed. South Sudan is an extremely difficult environment for international donors to operate in. As was made apparent from our visit, the development challenges are so numerous it can be difficult to know where to begin.

57. Since independence, DFID has acted positively and swiftly by scaling up its office in Juba, issuing a four-year Operational Plan and developing and implementing its aid programme. We commend DFID's speed and determination to establish and scale up its operation—and to put together a good team—in such a difficult working environment. DFID's actions over the past year have demonstrated that the UK is an enthusiastic and committed ally of the new independent South Sudan.

58. DFID's anticipated programme for South Sudan for the next four years is diverse and challenging, and it is clearly too early to judge its success. It could also be completely compromised if the oil shutdown persists for any length of time. We recommend that the Department provide us with an annual update, for the remainder of the Parliament, on progress in delivering its South Sudan programme. This should include an analysis of DFID's work to build the capacity of government structures to enable the handover of basic service provision.

43 Q 83 Back

44 Q 71 Back

45 This means that DFID is the department that manages the operation. Back

46 Ev 60 Back

47 For example, World Vision UK [Ev w55]. Back

48 Including £69 million capital expenditure. Back

49 DFID initially expected to spend £90.6 million in 2011-12. The Minister explained that the under-spend was due to difficulties in DFID becoming established in such a challenging environment (Q 86). Back

50 There are no official OECD DAC figures for donor spend in Southern Sudan in 2010. This is a DFID estimate. Overall the UK spent £125.7 million in Sudan in 2010-11. Ev 102. Back

51 Ev 102 Back

52 DFID visit briefing to the Committee Back

53 Ev 93 Back

54 Ev 68 Back