7 Global partnerships
Relationships with multilaterals
85. We have noted in previous Chapters
that different multilaterals use a wide range of finance instruments,
and have specialist skills and experience of using these in different
countries and sectors. One option open to DFID would be to channel
more of its finance through multilaterals, rather than attempt
to replicate this diversity in its bilateral programmes. DFID
delivered 43% of its total programme expenditure in 2012-13 through
central funding to multilateral organisations, and 38% of its
bilateral spending was also delivered through multilateral organisations.[173]
86. Some witnesses pointed to the relative
strengths of multilateral organisations. Oxfam GB suggested that
DFID should wherever possible fill any funding gaps via multilaterals,
because "aid delivered via multilateral organisations can
have cumulative lower transaction costs, reduce fragmentation,
tackle global problems, and provide support for global public
goods that cannot be addressed by bilateral aid".[174]
Professor Dercon commented that action on global public goods,
almost by definition, was often best addressed through multilaterals
and partnerships.[175]
Owen Barder suggested that the case for multilateral support was
becoming ever stronger in the changing development world:
in the world we will see in 30 years'
time, there is a stronger case for multilateralism, but there
is also a stronger case for multilateralism right now. It is not
just that because the world is changing we should be doing more
multilaterally, but there are strong biases towards bilateralism
that I think are unhelpful, and we should be, in any case, looking
to spend more money through the multilateral system.[176]
87. However, bilateral programmes have
the advantages of giving DFID greater choice in the focus, delivery
and monitoring of outcomes, and DFID notes that it has more control
over the types of programmes administered through its bilateral
spend.[177] DFID country
teams running bilateral programmes are in a good position to influence
multilateral programmes in that country. There are also concerns
that administration costs are higher for multilaterals.[178]
We have noted in other Reports, the imperative of ensuring that
any spending through multilaterals achieves value for money, and
a key challenge for DFID is how to assess the performance of multilaterals
in countries where DFID has no bilateral programme. We recommended
in our recent report on the Multilateral Aid Review (MAR) that
DFID should compare each multilateral organisation with bilateral
alternatives as an integral part of the 2015 MAR. We also recommended
that DFID put pressure on multilaterals to reduce their administration
costs.[179] The Secretary
of State told us that DFID had been looking at this over recent
months in order to "try to get much more clarity around how
you drive value for money and the comparative effectiveness of
these different channels".[180]
Professor Dercon explained that, in order to monitor the effectiveness
of multilaterals, DFID's approach was to get "very strong
representation" within multilaterals, rather than trying
to have a presence in the countries where projects were delivered.[181]
88. One option open to DFID would
be to channel more of its finance through multilaterals, and to
make use of their wide range of specialist skills and expertise,
rather than attempt to replicate all of these in its bilateral
programmes. In order to determine the appropriate balance of bilateral
and multilateral spending, DFID must be able to compare the relative
outcomes and value for money of these different channels, both
in countries where it has a bilateral presence and those where
it does not. We reiterate the recommendation that we made in
our recent report on the Multilateral Aid Review, that DFID develop
mechanisms for comparing the relative effectiveness of bilateral
and multilateral aid.
89. Whilst we recognize the strengths
of multilaterals in some areas, we firmly believe that DFID must
continue to maintain a strong bilateral presence in order to maintain
the UK's influence in individual countries, and to monitor the
performance of multilaterals which the UK finances. DFID must
also maintain sufficient influence within multilaterals in order
to monitor and influence their spending priorities. We recommend
that DFID explore the potential for embedding more DFID staff
within key multilaterals, and for increasing the opportunities
for sharing learning and experience with its partners.
Partnerships with emerging economies
90. DFID has identified the strengthening
of its relationships with emerging powers on global development
as one of its strategic priorities. Through this collaboration,
it aims to make development assistance more effective and to enhance
the development impact of investment in poorer countries. It lists
its priority countries/regions as China, Brazil, India, South
Africa and the Gulf.[182]
During our visit to Brazil, we were told that Brazil was keen
to develop South-South cooperation,[183]
using Brazilian experience and expertise to address development
challenges in developing countries, and that there was great demand
for this. Brazil currently uses bilateral, trilateral and multilateral
arrangements to share and transfer technical expertise in policy
areas where it has already achieved domestic success and international
recognition. This includes expertise in agriculture, food security,
social protection, health and other sectors. Its structures and
policy for international development cooperation are still under
development, but it currently cooperates with more than 80 countries,
mostly in Latin America and Africa, and there is the potential
for DFID to work with Brazil so as to facilitate and strengthen
its spread of development expertise, and to increase its impact
on LICs.
91. As Brazil's wealth has grown, DFID's
role in Brazil has changed. Its bilateral programme with Brazil
was closed in 2004 and the current role of the small DFID team
in Brazil is to work with Brazil on promoting poverty reduction
in developing countries elsewhere. This is an integral part of
DFID's Global Partnership agenda which seeks to cooperate with
key emerging powers to tackle poverty globally. During our visit
to Brazil, we heard about a number of innovative projects and
policy developments which could potentially be used as models
elsewhere, and could in particular be of assistance to LICs. Some
of these are summarised in Annex 3, to illustrate the potential
for shared learning.
92. The Secretary of State told us that
DFID had developed a very good working relationship with both
Brazil and China, and that she co-chaired the Global Partnership
for Effective Development Cooperation which was one of the mechanisms
which had been established to improve the sharing of knowledge
and to promote South-South cooperation.[184]
She said that DFID's Brazil office had been "extremely good
for broadening out our relationship with the Brazilian Government
and for transitioning our relationship on development with Brazil.[185]
93. We welcome DFID's work on promoting
South-South cooperation, as a complement to development finance
efforts. Emerging economies, such as Brazil, have much to contribute
to developing countries. DFID has only a limited presence in
Latin America, and we recommend that it explores the potential
for small DFID teams to work closely with multilaterals on specific
projects, so as to benefit from their specialist knowledge and
to contribute to its learning from emerging economies. We recommend
that DFID establish an innovation and knowledge transfer unit
which would be responsible for identifying good development practice
and transferring relevant knowledge and experience to other projects
and country programmes. We would expect the unit to be based in
the UK, but to have sufficient capacity to deploy a few people
to participate in and learn from country programmes, and to cooperate
with the FCO where necessary. We also recommend that DFID explore
ways of helping low income countries to share their knowledge
and experience with each other.
173 DFID Annual Report 2012-13, p 85 Back
174
Ev w5 Back
175
Q 255 Back
176
Q 42 Back
177
DFID Statistics 2013, p24 Back
178
International Development Committee, Ninth Report of Session 2012-13,
DFID's Annual Report and Accounts 2011-12, HC 751, para 28 Back
179
International Development Committee, Multilateral Aid Review,
Fourth Report of Session 2013-14, HC 349, para 16 Back
180
Q 256 Back
181
Q 258 Back
182
DFID Global Partnerships Department, Operational Plan 2011-2015,
Section 3 Back
183
South-South cooperation is the sharing of knowledge and experience
between South America and developing countries, particularly in
Africa Back
184
Qq 262,263 Back
185
Q 264 Back
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