UK aid: allocation of resources: Government Response to the Committee’s Seventh Report of 2016–17

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Second Special Report

The former International Development Committee published its Seventh Report of Session 2016–17, UK aid: allocation of resources, on 28 March 2017 as HC 100. The response from the Department for International Development was received on 20 July and is appended below.

Appendix: Response from the Government

The UK development landscape

1.“We agree with our predecessor committee in supporting the 0.7% commitment. We acknowledge and understand concern that aid spending is protected whilst domestic spending is not. We have already set out that we think that aid spending is in the national interest. It is right that every penny of the 0.7% is spent as effectively as possible, to tackle the harshest examples of poverty, humanitarian need, and causes of instability, and we regard it as our primary function as a Committee to scrutinise spending to ensure it achieves maximum benefit for its beneficiaries and the UK taxpayer. The examples we have seen of less effective spending do not represent a considerable portion of, nor are they an inevitable consequence of, the 0.7% target. (Paragraph 12)

Taken with

2.“We have not seen evidence that poor or wasteful spending is any more of a problem for DFID than any other government department or other international donors; instead we would assess it to be effective in its spending. (Paragraph 13)

Taken with

3.“In addition, DFID is often accused of ‘dumping money’, including by some strong supporters of UK aid and the 0.7% target, through large multilateral organisations and multi-donor trust funds administered by the World Bank and European Development Fund, where it is alleged the money often sits unused with high charges for administration. In the Multilateral Development Review, both of these multilateral organisations were assessed to be very effective in achieving development results. It has been suggested to us that, rather than paying high charges for the administration of and having its money sit in trust funds run by multilaterals, DFID should set up its own fund. We think that DFID should explore the idea of creating a mechanism for carrying funds forward which could then support its work when the need arose.” (Paragraph 14)

DFID response: Partially agree

• We welcome the Committee’s confidence in DFID’s programming. The Department meets its duty to spend its budget in ways that deliver value for money. But we are always seeking to improve, to deliver more and better results for the world’s poorest and greater value for money for the British taxpayer.

4.“Aid and development spending must truly follow need, and we have no doubt that there is sufficient need in the world for the commitment to the 0.7% target to be necessary. If all countries were meeting this commitment the chances of ultimately eliminating development need would be much greater; the fact that the UK hits the target gives the Government leverage to convince other countries to do the same. The inaction of others does not dissipate the UK’s responsibility to meet the target. This is both morally right and in our national interest. The response to many of the criticisms of aid spending is for DFID to continue to strive to spend better, not for it to spend less. It is our challenge to the Secretary of State to lead the Department in a way which displays the value for money and impact of good UK aid spending.” (Paragraph 18)

Taken with

5.“We do not believe that abolishing DFID as an independent department would lead to any improvement in the quality of UK aid spending. The effect of merging DFID into another department would be to dilute its expertise as a specialist development department. The only outcome of such a move would be to diminish the focus placed on poverty reduction and development in UK aid spending, as the majority of ODA would become subject to more complex objectives in another department. This would heavily weaken its purpose and effectiveness, almost certainly outweighing any efficiencies or savings. We therefore strongly welcome the Secretary of State’s commitment to maintaining DFID as an independent department, and expect this to remain so in the long-term future. (Paragraph 23)

Taken with

6.“DFID works best when it works flexibly, especially in the fragile and conflict-affected states on which it now focuses. The strict rules and targets surrounding budget support, ‘non-fiscal’ spending, and Payment by Results can be damaging to effective development and can lead to perverse outcomes. While DFID may assess all of the targets and rules surrounding budget support, ‘non-fiscal’ spending, and Payment by Results to be correct right now, it should keep them under constant review and be willing to relax them when appropriate, in order to have the flexibility required to spend effectively.” (Paragraph 29)

DFID response: Agree

• We strongly welcome the IDC endorsement of the Government’s commitment to investing 0.7% of our national income as aid, and its strong support for our world-class Department for International Development.
• We welcome the finding that DFID is particularly effective when working flexibly. Through our Better Delivery reforms, DFID is seeking to strengthen further its capability to deliver flexible and adaptive programmes, to continue to drive impact and value for money. This is reflected, for example, in DFID’s recently published Economic Development Strategy.
• We agree that it is important to ensure our approach to different policy areas, including our support to partner governments, to Payment by Results and to delivery of non-fiscal spending, should continue to evolve as new evidence is developed.
• This is already DFID’s explicit policy in many areas: for example Sharpening incentives to perform, DFID’s 2014 Strategy for Payment by Results, commits DFID to expanding the evidence of what works, alongside improving our capability to deliver Payment by Results well.
• We note that the rules around ‘non-fiscal’ spending are set by HM Treasury.

7.“While there has been some improvement, we still do not believe that DFID is robust in its communications and managing reputational risk. The creation of its ‘DFID in the news’ page is a positive step in this regard but, without proactively advertising it, we think that it is unlikely to gain much exposure or traction with the general public. We urge DFID to continue improving its communications and to be more proactive in publicising when it is doing good work and achieving life-changing impact around the world, with the Secretary of State and ministers leading proactively in this regard.” (Paragraph 36)

DFID response: Partially agree

• DFID had already adopted a robust and proactive approach to our communications. DFID has a clear responsibility to show UK taxpayers what their money is being spent on and the tangible results of our work overseas.
• This year for example we ensured that UK aid was seen to be a high profile partner of the DEC emergency appeal for East Africa. The UK aid logo, promoting our aid match pledge, was prominently displayed on campaign material.
• Ministerial visits to Africa and the Middle East, as well high profile announcements on boosting trade and stopping neglected tropical diseases, have resulted in national and international print and broadcast coverage as well as a stream of digital content about the results of the department’s work. New support to end the deadly threat of landmines was recently announced at a high profile event in Kensington Palace by Prince Harry and DFID’s Secretary of State with widespread media and digital coverage of DFID’s leading role.
• The Communications Division is also working on new ways to reach increasingly segmented audiences in a modern media environment. The recent Family Planning summit saw not only significant coverage in traditional media but also increased profile on digital platforms in the UK. We used two recently-returned ICS volunteers to report on DFID’s Facebook live page, receiving 11,000 views, while #HerFuture was the second highest Twitter trend of the day in the UK.

8.“DFID’s decisions as to the allocation of resources should be based on evidence rather than media coverage. We are concerned that it does not have a clearly set reputational risk appetite, which leads it to avoid or close down innovative and effective programmes which might draw negative headlines. This is a particularly important issue as other government departments spend more of the aid budget, which creates additional reputational risks. We recommend that DFID produces clear guidance on how to manage reputational risk, the level of its reputational risk appetite, and how to respond to reputational risk issues in the aid budget across the Government. Part of this guidance should include how the performance of a programme should be reviewed if it receives negative media attention before any decision is taken as to its closure.” (Paragraph 37)

Taken with

9.“As we have laid out above, while we commend and support the Secretary of State’s focus on improving the quality of spending, we think that the level of wasteful spending in the Department is minimal. We would urge the Secretary of State to ensure that assessments of what is and is not wasteful spending are based on evidence and robust reviews.” (Paragraph 81)

DFID response: Partially agree

• The UK has rightly gained an excellent global reputation for its international development work. We will continue to be rigorous in ensuring that our resources are targeted in the most effective ways possible, to benefit those that need them most.
• DFID has explicit guidance in programme documentation (such as Business Cases, Annual Reviews, Due Diligence Assessments) to manage risk and to review performance which takes into consideration communication of results and performance.
• DFID is also helping other departments to defend their investment in international development. We have set up a cross government network of senior communication officers working on ODA so other departments can raise issues at an early stage and good practice can be shared.

The development reviews

10.“The numerous delays to the development reviews have undoubtedly had grave effects on a number of organisations and, we fear, on the quality of some programming. The low level of detail in the reviews does not justify such substantial delays. We understand that the effects of the EU referendum result and the different approach of a new Secretary of State necessitated some changes. However, uncertainty surrounding the EU referendum was potentially foreseeable and should have motivated DFID to do everything it could to publish the reviews prior to the referendum. The fact that it did not is deeply regrettable and caused problems for some civil society organisations. We have not seen any evidence that the delays after the referendum were related to any detailed thinking about the implications of the referendum result for the UK development agenda.” (Paragraph 42)

11.“We are concerned that, in the development reviews, DFID has not displayed whether it is thinking strategically in terms of allocations between bilateral and multilateral budgets. We are left to assume that this was done during the coherence phase, but in the absence of evidence to the contrary we can only conclude that the balance between bilateral and multilateral spending in DFID is arbitrary. We strongly reiterate our previous recommendation that we need much more detail from DFID as to how it strategically sets the balance between bilateral and multilateral spending. We would also like to see its assessment of the respective effectiveness of different methods of delivery and the criteria that it uses to make case-by-case judgements.” (Paragraph 45)

DFID response: Disagree

• The coherence phase was critical in bringing together teams across DFID to look at the best ways to achieve our intended results, including choices between bilateral and multilateral funding. We do not use a rigid assessment formula to choose between multilateral and bilateral funding because they are not directly comparable. The Multilateral Development Review sets out why and how DFID works through multilaterals, including the added value that they offer such as specialist skills, scale or financial leverage. As the MDR explains, some multilaterals work in ways or in places where DFID does not work, whereas others complement our bilateral work. DFID looks carefully at these trade-offs—for example in deciding how best to deliver on our objective to immunise millions of children against deadly diseases.

12.“The lack of detail in the Bilateral Development Review is disappointing. Even where DFID has committed to specific actions, it is unclear how it plans to take this forward. While DFID’s thematic priorities are now well-stated, it is difficult to come to a conclusion on how well it is making bilateral allocation decisions, without better information on how it is actually making those decisions. We are concerned that this displays a lack of strategy in how DFID is doing so and that DFID is now providing less information than it has in the past about its spending decisions, priorities and plans. (Paragraph 50)

13.“DFID should always tend towards complete openness and publication of as many documents as possible. The non-publication of new country operational plans, the country poverty reduction diagnostics, and inclusive growth diagnostics runs counter to this principle. DFID should publish as many of these documents as possible for its country programmes by the start of the summer parliamentary recess. If necessary, for confidentiality reasons, it should redact any sensitive material but produce substantial versions which can be published. DFID should also publish an updated list of its priority countries, with long-term spending plans for each.” (Paragraph 51)

Taken with

14.We expect the new country operational plans to include objectives for DFID’s work with the multilateral system in each country. (Paragraph 56)

DFID response: Partially agree

• DFID is recognised as one of the most transparent development agencies in the world, and we are committed to transparency on how public money is spent. Nonetheless, the effective conduct of international relations depends upon maintaining trust and confidence between governments. If the UK does not maintain this trust and confidence, its ability to protect and promote UK interests through international relations will be hampered, which will not be in the public interest.
• We have maintained this balance by publishing country profiles for each DFID Country Office.1 These set out future budgets, objectives for DFID’s work with multilaterals in that country, and reference—where appropriate and relevant—analysis from DFID’s Country Poverty Reduction Diagnostics, Inclusive Growth Diagnostics and other sources.

15.“We reiterate our previous recommendation that DFID should publish more complete details of its definition of fragility and specific information about how its list of fragile states and regions has been determined, including details of how the different categories of fragility will inform allocation decisions. We expect this information to be forthcoming and stress that a statement that DFID combines scores from a number of data sources is not a statement of methodology nor is it the information we are asking for and were promised. Considering the clear, publicly available and considered methodology behind the OECD’s fragility framework, we see no reason why DFID should not align with other donors and use it.” (Paragraph 53)

DFID response: Partially agree

• DFID’s fragile states list underpins our commitment under the UK Aid Strategy to spend at least 50% of its budget in fragile states and regions in every year of this Parliament. Our list is based on four different components: governance capacity, state authority, legitimacy and vulnerability to external shocks and stresses. These four components are combined into an overall fragility assessment for each country. Scores for the individual components are calculated using a range of objective, external data sources which DFID has previously provided to the Committee. Many, but not all, of these sources are the same as those used by the OECD in its fragility framework.
• Specifically, our fragile states scores are a weighted mean of the four components listed above for each country in the world, with the scores for each component given equal weighting in the calculation of overall country fragility. We create these individual component scores using the following data sources:

Governance Capacity

The World Bank’s Worldwide Governance Indicators’ score for ‘Government Effectiveness’

The World Bank’s Worldwide Governance Indicators’ score for ‘Control of Corruption’

The World Bank’s World Development Indicators’ score for ‘Inflation, consumer prices (annual %)’

State Authority

The World Bank’s Worldwide Governance Indicators’ score for ‘Political Stability’

The World Bank’s Worldwide Governance Indicators’ score for ‘Rule of Law’

The Institute for Economics and Peace’s ‘National Peacefulness’ Ranking

State Legitimacy

The World Bank’s Worldwide Governance Indicators’ score for ‘Voice and Accountability’

The Political Terror Scale’s Assessment of Human Rights Violations

Vulnerability to External Shocks or stresses

The UN High Commission for Refugees’ Annual Statistical Yearbook on Refugee and IDP (internally displaced person) Populations. This is considered as a proportion of the same country’s total population, taken from the World Bank’s World Development Indicators

The Inform Index’ Assessment of Natural Hazard Exposure

The Institute for Economics and Peace’s assessment of ‘Relations with Neighbouring Countries’

• The different categories of fragility do not inform allocation decisions. By combining these categorisations with the four components of fragility set out above, we can form a more sophisticated understanding of the nature and severity of fragility in each country—rather than a crude definition of countries as ‘fragile’ and ‘not fragile’. This information will help us to spot trends in future years: DFID and HMG colleagues will be better placed to understand the strengths and weaknesses of the countries that we work in, which in turn will benefit our programming decisions. Creating the list in this way also ensures that it remains objective: all countries in the world are included in these data sources, which removes the risk of DFID focusing solely on its priority countries or failing to spot fragility in areas of the world where it is less engaged.
• DFID does not rely solely on one definition of fragility and we are happy to also endorse the definition provided by the OECD in its framework. The UK is a member of the OECD and played a substantive role in formulating the organisation’s fragility framework. This is a useful complement to DFID’s fragile states list and helps to inform our teams’ perspectives on the causes and solutions of fragility. We do, however, feel that there is benefit in maintaining our own methodology which facilitates internal engagement on fragility and what DFID can do to support stability efforts, as is represented by our Building Stability Framework. If we relied solely on the OECD list then we would effectively be outsourcing this capability. We fund the OECD States of Fragility Report, so fully endorse their approach.

16.“We welcome the improvements that have been made to the multilateral review process after the 2011 Multilateral Aid Review, although we would have appreciated more detail on how the review will influence spending decisions. At present, we are not convinced that DFID is strategic in how it decides which multilaterals to use and how. We also remain concerned about whether the Multilateral Development Review is able to take full account of the standard-setting and more qualitative functions of multilateral partners. In its response to this Report, DFID should lay out in detail how it decides when and where to put money through multilaterals, including between different multilaterals, and how this process is informed by the results of the Multilateral Development Review.” (Paragraph 62)

DFID response: Partially Agree

• The Multilateral Development Review carefully considered the different types of multilaterals that we work with and the process looked across groups of agencies to ensure consistency—between humanitarian agencies for example and across specialised agencies.
• A range of considerations inform DFID’s funding decisions and the case for each multilateral agency is considered on its merits. Our overall objective is to maximise the development impact and the value for money of the UK’s aid investments. Beyond the MDR, we look at a range of factors including lessons from past programmes, the level of UK funding relative to other countries (‘burden share’) and the balance between core and voluntary funding that can achieve the best value for money for UK tax payers and the world’s poor. The early analytical work done on the MDR in late 2015 proved valuable to inform decisions taken during replenishment negotiations during 2016.
• As part of DFID’s commitment to transparency, new funding agreements and the results DFID expects to see from these are set out in publicly available business cases. Progress against these is tracked and published annually.

17.“The use of Performance Agreements has the great potential to drive improvements in DFID’s multilateral partners and the multilateral system as a whole. Performance Agreements need to be used carefully, though, so as not to impose practices like Payment by Results, which might create perverse outcomes, on multilateral agencies. In particular, DFID should not require multilateral partners to implement or increase their usage of Payment by Results without a stronger evidence base that it leads to better development outcomes.” (Paragraph 63)

DFID response: Disagree

• We welcome the IDC’s support of DFID’s approach to driving reform to increase performance of our multilateral partners, including through the use of Performance Agreements.
• All organisations, no matter how successful they are, must continue to improve to achieve even greater impact. Performance agreements help to drive value for money through focusing our multilateral partners on the delivery of key reform priorities.
• In the right circumstances, payment by results can be a powerful instrument that can drive reform and results on the ground for the worlds poorest and we believe that it is an appropriate part of performance agreements for some—though not all—multilaterals. The design of each performance arrangement will be tailored to achieve best results in each multilateral organisation and modified as appropriate.

18.“We welcome DFID’s announcement of a Small Charities Challenge Fund, following previous recommendations by this Committee. We look forward to seeing how it goes about providing further support to small charities. We also support the approach that DFID is taking through the Amplify programme, and strongly urge it to consider how it might adapt and use this model to support smaller local CSOs for programming at country office level.” (Paragraph 65)

DFID response: Agree

• DFID recognises the critical role small civil society organisations play in providing services and holding decision makers to account, and we recognise the Committee’s consistent championing of this issue. DFID has several mechanisms through which we currently fund these types of organisations both centrally and at a country level. As a donor agency we often route our support through intermediary organisations which are better placed to provide technical and mentoring support to smaller civil society organisations (CSOs) and operate through a range of models.
• In addition to Amplify Change DFID funds a range of organisations that operate similar models routing funding to small local CSOs:
  • The UN Trust Fund to end Violence Against Women, which specialises in providing small grants for women’s rights organisations and other human rights activists directly. Through this programme we are supporting 111 initiatives around the world, many of which are run by grassroots organisations. In 2015 this programme reached over one million people to help end violence against women and girls.
  • Creating Opportunities for Poor and Excluded People in Bangladesh, works with community organisations to make them aware of their rights, and provide advice and advocacy support to claim those rights in practice.
  • The Disability Rights Fund provides the technical and financial resources to enable organisations in the developing world to participate in the achievement of their rights.

19.“The lack of detail in the Civil Society Partnership Review (CSPR) is very disappointing, and particularly surprising given the numerous delays to its publication. As a result, whether it translates into an improved relationship between DFID and civil society cannot be judged from this document. The CSPR acknowledges the unique role and diversity of civil society in development. It is therefore important for DFID to take this forward into its day-to-day relationship with civil society and avoid allowing that relationship to become one of a consumer and suppliers; this would lose a lot of the nuance in the relationship and therefore the value that civil society brings in its diversity. (Paragraph 68)

20.“The omission of any explicit mention of the Sustainable Development Goals (SDGs) from the Civil Society Partnership Review is a serious one. It risks creating an impression that DFID is not focused on the SDGs; given that the Goals are still at an early stage of implementation, the Department’s commitment to them cannot be restated enough. As the framework for development post-2015, the SDGs should have been used to frame both the CSPR and DFID’s relationship with civil society organisations.” (Paragraph 69)

Taken with

21.“Programme Partnership Arrangements (PPAs) were strategic, flexible and encouraged innovation; there is plenty of evidence of their effectiveness including a positive ICAI review. We have still not heard a compelling explanation from DFID as to why it has chosen to end PPAs entirely and to not replace them with any alternative mechanism for unrestricted core funding. We are convinced that smaller civil society organisations can still be engaged by DFID alongside the provision of unrestricted core funding to others. The loss of PPAs is likely to stifle innovation and to simply cause CSOs to cover their overheads through their bids to other funding streams. While we do not have the detail at this time to make a complete judgement, it is of the utmost importance that DFID’s other funding streams, whilst maintaining accountability, are able to cover the sorts of activities which PPAs allowed and encouraged. DFID must provide a clear and detailed explanation of why it feels that unrestricted core funding, and PPAs more specifically, is no longer an effective means of development. While it is doing that, we would strongly urge it to reconsider its decision on this matter.” (Paragraph 76)

22.“The manner in which the ending of Programme Partnership Arrangements (PPAs) was carried out by DFID was poor, characterised by uncertainty and evasiveness. The fact that no additional cover or support was provided to civil society when severe and unjustified delays to the CSPR occurred has caused problems for civil society organisations.” (Paragraph 77)

DFID response: Partially Agree

• We agree that civil society has a unique role and that working with a diverse civil society is critical. The CSPR clearly sets this out. The CSPR was never intended to provide all details but to set the strategic direction for DFID’s work with civil society in the future, including in setting out, for the first time, DFID’s objectives for working with civil society. These objectives have been universally welcomed. Many civil society organisations bid for and hold contracts as well as grants with DFID and are therefore explicitly and rightly a supplier in that regard.
• We do not plan to change the decision on PPA funding. We agree the PPA programme was effective and worked hard to ensure this was the case. PPAs have contributed to building capacity and capability in larger CSO and been transformational for some medium sized CSOs. This is demonstrated in DFID’s Annual Reviews and Project Completion Reports. As such, that small set of organisations is now well placed to compete for other funding and it is legitimate that we seek to broaden out engagement and opportunities.
• The Committee asks that DFID’s other funding streams cover the sort of activities that PPAs encouraged. With the exception of unrestricted core investment to some of the UK’s largest development organisations, DFID does indeed cover these activities. This includes: innovation—as provided for in DFID’s Global Innovation Fund; providing goods and services to reduce poverty—as provided by numerous DFID funding streams at central and country level, including UK Aid Match and UK Aid Direct; lesson learning—as provided for explicitly by UK Aid Connect and as a component of a wide range of financing; working in coalition—as provided for by UK Aid Connect and the Braced programme. All of these add to development effectiveness.
• We do not agree that the lack of explicit mention of the SDGs in the CSPR suggests that DFID is not focused on the goals. A key objective set by the CSPR for DFID’s work with civil society is to Leave No One Behind, a central plank of the SDG agreement. The CSPR is one of a set of complimentary and coordinated reviews, including the Bilateral Development Review and within the framework of the UK Aid Strategy. Read together it is clear that DFID is focused on the SDGs and elimination of extreme poverty.

The direction of UK aid

23.“We strongly reiterate our recommendation that poverty reduction should always be the primary purpose of any UK aid spending, and that this should be made explicit in all ODA programming.” (Paragraph 79)

DFID response: Agree

• We welcome the Committee’s emphasis on poverty reduction, which is at the heart of everything DFID does.

24.“We welcome a strong focus on economic development from DFID, which is an important aspect of a comprehensive approach to poverty reduction. While UK aid undoubtedly gives the UK a global leadership role and creates mutually beneficial partnerships which are in the national interest, it is important that UK aid spending continues to be completely untied, whether explicitly or implicitly. While it remains to be seen how it works in practice, language surrounding leveraging aid for trade and creating opportunities for UK companies and the City of London needs to be used cautiously, so as not to create an impression that aid is being given conditionally. We ask that DFID provides us with a full assessment of the current risk of UK aid becoming implicitly tied, and how it is mitigating those risks.” (Paragraph 85)

DFID response: Partially agree

• We welcome the Committee’s support for the economic development agenda. UK aid is untied, and we do not foresee any risks of it becoming “implicitly tied”.

25.“We look forward to seeing further the Government’s plans for implementation of the Sustainable Development Goals both domestically and abroad, which should be published well in advance of the next High Level Political Forum in July, and to the recognition of the Goals in the new single departmental plans. We urge DFID to explicitly link its work to achievement of the Goals wherever possible.” (Paragraph 86)

DFID response: Agree

• The UK Government is firmly committed to delivering the Sustainable Development Goals both at home and around the world. On 28 March, we published a report setting out the UK’s approach to delivering the SDGs. The underlying aims of the Goals are reflected in the UK Government’s programme of work, and as such the next round of Single Departmental Plans (SDP) will include how departments will contribute to the achievement of the SDGs. DFID has put the SDGs at the heart of its work—our recent Annual Report sets out how DFID’s work is contributing towards the delivery of the SDGs—and we are working with our partners to achieve them.

26.“DFID should be clear in how it aims to address human rights issues through its development work, especially in the difficult context of fragile and conflict-affected states. We urge it to include a greater focus on human rights in future strategy documents.” (Paragraph 87)

DFID response: Agree

• Respect for human rights underpins sustainable development. DFID has a strong commitment to enabling poor people to enjoy the rights and freedoms defined in the Universal Declaration of Human Rights and core treaties of international human rights law. The Sustainable Development Goals sit at the heart of the UK Aid Strategy and represent a commitment to achieve substantive, measurable improvements on economic, social and political human rights. This includes the overarching commitment to ‘leave no one behind’, an expression of the human rights agenda, which the UK played a key role in securing in negotiations. In the Bilateral Development Review, we set out that we are injecting new urgency and energy in tackling some vital human rights issues that have been neglected for too long, including modern slavery and child exploitation, whilst also prioritising results in areas like health, education, water and sanitation, and boosting global efforts on family planning and nutrition.
• Commitment to respecting human rights is one of four Partnership Principles DFID considers when providing financial support to governments. In our partner countries, DFID monitors and assesses the government’s commitment to human rights. We work closely with the Foreign & Commonwealth Office (FCO) to raise concerns with governments at the appropriate level, including in the fragile and conflict affected countries assessed as priority in the FCO Annual Human Rights Report.
• DFID programmes support the protection and promotion of human rights across a range of areas such as health, education, peace and security. Other programmes target specific groups, for example, promoting the rights of girls and women continues to be a top priority. At the World Humanitarian Summit in 2016 the UK’s call to put gender equality at the heart of 21st century humanitarian action was echoed by many, with strong agreement on the need to go beyond protection to ensure empowerment of women and girls in emergencies. DFID’s Economic Development Strategy sets out a commitment to tackle gender discrimination across all DFID’s economic development work.
• DFID is concerned about the about the increasing restrictions on civil society activism, media freedom, and human rights in many countries. The DFID Civil Society Partnership Review set out clearly that the UK Government will robustly defend the rights of civil society and as part of its commitment to freedom of thought, association and expression stand alongside it in the face of encroachments to its operating space. The new UK Aid Connect programme will include a theme on open societies to promote core civic freedoms in developing countries.

27.“Taking all the evidence together, we remain concerned about the lack of strategic direction and management within the Department. While DFID is generally doing good work, it is not necessarily doing so in a consistent and coherent manner due to the lack of strategic guidance provided at an operational level. We understand that there is a fine line between prescription and the flexibility which DFID needs to work effectively, but believe that DFID should be doing better in this regard. We urge DFID to set a clear strategic direction in all of its policy areas based on its evidence on what works and its objectives in that policy area. Such strategies should be short and flexible, to allow teams to adapt them to specific circumstances and to allow them to be easily updated as the evidence evolves, and should be published to allow scrutiny against DFID’s objectives.” (Paragraph 90)

DFID response: Disagree

• DFID is taking a strategic approach to development that gets behind delivery of the SDGs, applies every tool we have to defeating poverty and employs innovative approaches. This strategic direction involves showing UK leadership to confront global challenges head-on, leading international reform, and collaborating effectively across Government to deliver maximum impact.
• Our strategic direction is articulated through the UK Aid Strategy, the Bilateral Development Review, Multilateral Development Review, Civil Society Partnership Review, Research Review, and through DFID’s first Economic Development Strategy. In addition, DFID, FCO, MoD and other key UK Government agencies work closely together, including through the National Security Council on implementation of the National Security Strategy and Strategic Defense and Security Reviews.
• This comprehensive suite of strategies draw on the most recent evidence of what works to set our ambition and objectives in each policy area—to ensure consistency, coherence and strategic impact in delivering the UK Government’s objectives overseas. Front and centre of these are to reduce absolute poverty, instability and the root causes of conflict, and in doing so promote sustainable and inclusive economic development. These objectives are, and will continue to be, squarely in the UK’s national interest.
• A selection of recent examples of this leadership include:
  • In September 2016, and in line with our commitment to drive reform in the international aid system, DFID struck an innovative and ambitious Performance Agreement with the Global Fund—to ensure the UK’s investment achieves the maximum possible impact. Since this time, the UK has negotiated performance agreements with 11 other multilateral agencies;
  • In December 2016 DFID launched a far-reaching review into how we manage our suppliers, to shape the markets we buy from and to drive the highest standards of accountability, integrity and staff skills;
  • In May 2017, the Prime Minister hosted the London Somalia conference— achieving a new Security Pact and Partnership Agreement between Somalia and the international community. UN President Antonio Gutteres noted that the London Conference had created an opportunity to take Somalia out of “decades of conflict, of poverty and of terrible suffering”.
  • In July, the UK hosted the Family Planning Summit, demonstrating global leadership on supporting sexual and reproductive health and women’s rights to ensure more women and girls can plan their families and futures. The summit won new commitments towards our shared family planning goal of enabling an additional 120 million women and girls to use voluntary modern contraception by 2020. Over 37 governments made new commitments at the Summit, as did 16 private companies and 11 civil society organisations and private foundations.

28.“DFID’s administrative capacity appears to have fallen below what is required to manage its increasing budget optimally. The result of this has been that DFID has become more reliant on larger external organisations, including big multilaterals and private contractors, to the exclusion of smaller organisations and DFID being able to properly oversee its own spending. As we noted earlier in this Report, this is also a factor in the pressures related to spending to reach the 0.7% target. DFID would be more effective if it rebalanced its budget more towards administration. This would allow it to better manage its own budget and make better use of small, and often more effective, organisations and programmes. We recommend that DFID spends more of its budget on its own administration and increases its staffing capacity. If this requires a relaxation of Treasury rules, we would strongly urge the Treasury to do so, considering DFID’s unique budgetary position.” (Paragraph 94)

DFID response: Partially agree

• We regularly review our resourcing requirements through a formal workforce planning exercise which aims to ensure that we have the right people with the necessary capability to ensure that the Department is well managed and controlled.

29.“The spending of ODA across government departments needs to be coherent and collaborative, with consistent scrutiny, in order to be effective in achieving their aims. Allocations should be based firstly on effectiveness in reducing poverty, with the objectives in the UK aid strategy forming the secondary considerations. We will be exploring these issues in more detail in our inquiry into UK aid: other government departments, including looking at options for how UK aid could best be allocated between departments. In order to ensure coherence across UK aid spending, and a focus on poverty reduction, DFID should have a formal oversight and coordination role for of all UK aid spending.” (Paragraph 98)

DFID response: Disagree

• We agree that all government spending should be coherent and collaborative. Since July 2016 DFID has increased our support to departments on a range of areas and seconds staff to ensure that departments have access to the right expertise. DFID and HMT have established the Senior Official Group and corresponding Ministerial meetings on ODA to provide senior level governance to how ODA is managed across Government.
• This recommendation is not consistent with managing public money guidance. Each department has an Accounting Officer who is accountable to Parliament for the spending of their own department. The Secretary of State for International Development does have a responsibility to make arrangements for the independent evaluation of the extent to which ODA provided by the United Kingdom represents value for money in relation to the purposes for which it is provided, and ICAI was established to deliver this function.

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1 Text of original response: “We will maintain this balance by publishing country profiles for each DFID Country Office” (amended as requested by DFID, 18 September 2017, to reflect events between submission and publication of the response).

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15 September 2017