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Africa: "Aid" Promises and Accountability
AfricaFocus Bulletin
Jun 1, 2011 (110601)
(Reposted from sources cited below)
Editor's Note
The G8 "accountability report" on increased aid spending "covers
up $18 billion aid shortfall by ignoring inflation," headlined a
Guardian article reporting critiques of the report by aid groups.
It should be no surprise that "donor" countries try to put the best possible spin on their
accomplishments. But the pressure is growing for more
transparent and independent reporting on international spending
classified as "aid."
For the Guardian report (see http://tinyurl.com/3k99aa9.
Whether one regards official development assistance (ODA) as
"aid" in the traditional sense, or as part of the shared
obligation for spending on global public goods, both critics and
proponents of aid should be able to agree on the need for more
transparent tracking of what is being spent where and with what
results. Since the Paris Declaration on Aid Effectiveness in
2005, the efforts to track such spending and improve
accountability have multiplied. The 4th High-Level Forum on Aid
Effectiveness will be held in Busan, Korea from 19 November to 1
December this year.
While much of the language of both official reports and of the
critiques is obscure, the availability of more detailed data
and analysis does have the potential to be used by both internal
and external critics to campaign for greater accountability.
Donor "spin" will without doubt continue, but it is increasingly
possible to go beyond abstract debates about "aid" to focus on
what works and what doesn't.
This AfricaFocus Bulletin contains a short article from the UN's
Integrated Regional Information Service (IRIN) citing recent
reports questioning the transparency of aid reports, and
excerpts from a new report by ActionAid, which has a critique of
the G8 Accountability Report with respect to the pledges made on
on food security at the 2009 G8 Summit, the L'Aquila Food
Security Initiative.
Other relevant resources include:
Deauville Summit G8 Accountability Report
http://www.g20-g8.com / http://tinyurl.com/3c7dfp3
Resources on aid transparency
http://www.publishwhatyoufund.org/resources/
Fourth High-Level Forum on Aid Effectiveness
Busan, Korea, 29 November to 1 December 2011
http://www.aideffectiveness.org/busanhlf4/
Selected recipient country and donor case-study evaluations
being prepared for the Busan Forum are available at
http://www.oecd.org / Direct url: http://tinyurl.com/3v4ezbl
African countries included to date are Benin, Cameroun, Ghana,
Malawi, Mali, Mozambique, Senegal, South Africa, Uganda, and
Zambia.
AidWatch on aid from EU and member states
http://aidwatch.concordeurope.org/
For previous AfricaFocus Bulletins on related issues, see
http://www.africafocus.org/aidexp.php and
http://www.africafocus.org/agexp.php
++++++++++++++++++++++end editor's note+++++++++++++++++
Aid Policy: What the numbers don't tell you
http://www.irinnews.org/report.aspx?reportid=92853
Dakar, 31 May 2011 (IRIN) - Poor-performing donors were
lambasted by UK Prime Minister David Cameron at this year's G8
leaders' meeting for failing to move towards meeting 0.7 percent
[of gross national income] aid targets; but most major donors
are to blame for tying aid to donor-based contractors, say aid
watchdogs, and for reporting money spent at home as aid.
AidWatch (http://aidwatch.concordeurope.org/), a group of
European aid experts representing 1,600 NGOs, estimates European
Union members reported US$7.4 billion (EU5.2 billion) in
inflated aid in 2010 - that is, the money was actually spent on
debt cancellation, on foreign students, and on refugees in donor
countries.
This is equivalent to almost 10 percent of the total aid
provided that year.
Donors may report the first year of housing costs for refugees,
and costs spent on foreign students, as part of official
development aid (ODA).
In 2009 - the most recent year for which data is available - the
US reported the highest volume of aid on refugees at home ($740
million), while Canada and France reported the highest
percentages of their overall aid (6 and 4 percent, respectively)
on refugees at home, according to Josh Lozman, chief of staff at
aid watchdog ONE.
France, Germany and Canada, the only G8 countries that report
foreign student costs as part of ODA, spend 14, 8 and 9 percent
respectively.
Consultants
A significant proportion of the rest is tied - that is, spent on
consultants and contractors from donor countries, said Karin
Christiansen, director of NGO Publish What You Fund )
http://www.publishwhatyoufund.org/).
Much progress has been made to untie aid: several large donors
have stopped formal aid-tying, including the UK, Canada,
Denmark, Australia, Norway and Switzerland; while bilateral
untied aid grew from 46 percent to 76 percent as a proportion of
all aid between 2001 and 2007, according to the Organisation for
Economic Cooperation and Development's Development Assistance
Committee (OECD DAC).
But these figures exclude food aid and 'technical assistance'.
When these sectors are included, 17 percent of all OECD aid was
tied in 2009, according to ONE; the biggest offenders being
Italy at 38 percent; the US at almost a third; and Germany at 27
percent.
Even when aid-tying is banned, contracts can still easily end up
in the coffers of companies from donor countries, according to
Christiansen. A study of UK contracts awarded in 2009 said 65
percent were awarded to UK companies.
Aid-tying makes the aid 30 percent more expensive, said
Christiansen. "Tied aid is like a form of subsidy. Even if
you're less efficient, you'll get the contract," she told IRIN.
"Untying aid is about allowing greater efficiency and
flexibility to aid recipients, increasing country ownership over
development," said Lozman. "It is also more cost-effective."
Debt relief, inflation
Analysts also take issue with debt relief being included as part
of official development aid figures, said Franz Berger,
coordinator at AidWatch.
Many donors include past, current and future interest payments
in their aid figures, which distorts reality, he said. "ODA is
presented as money to lift the poor and marginalized out of
poverty, but debt relief is not a transfer of resources to a
developing country - so it should not be included."
In the end, aid figures vary wildly depending on who is
reporting them and how. In the pre-G8 accountability report,
leaders claim to have fallen short of 2005 Gleneagles aid
commitments by just $1 billion per year; while the OECD DAC
estimates they were $22 billion short - the difference, says
Berger, is that donors did not take into account inflation.
Spending aid at home, and aid-tying are unlikely to disappear
soon, said Christiansen, but more open reporting of aid figures
would at least enable a more honest debate, and less quibbling
over numbers. "This is why we need transparency - so we can have
a genuine conversation about the numbers"; We can't influence
decision-making around spending, if all the information is based
on hunch and rhetoric."
Donors pledged to improve transparency as part of a wider agenda
to improve aid quality when they signed up to the Paris
declaration on aid effectiveness in 2005, and the follow-up
Accra Agenda for Action in 2008.
In the future, she hopes to see links between donor aid spend on
projects and procurement databases, so people can examine
exactly where the money is going; how much is tied; and how
efficient the procurement is. "We can then shift from endlessly
arguing over which numbers are accurate, to having a far more
interesting conversation: Is the aid actually working?" she
said.
Progress, with caveats
There has been progress, said ONE's Lozman. Donors now report on
'country programming aid' (CPA) - or aid that can be programmed
in-country; and as a proportion of total G7 official aid CPA has
increased from a third in 2005 to 61 percent in 2009.
G8 leaders stressed aid transparency and accountability at this
year's summit, stating in a communiqué "We will improve
transparency of our aid information. In particular, we will make
further efforts on publishing information on allocations,
expenditure and results."
ONE and Publish What You Fund welcome these commitments. But
Luca De Fraia, global governance expert and NGO ActionAid's
deputy director in Italy, stresses donor accountability must
focus as much on recipients as on taxpayers at home.
Donor rhetoric over recent months has emphasized accountability
to taxpayers - as evidenced, for example, by several statements
by European Development Commissioner Andris Piebalgs; and a preG
8 communiquéfrom President Barack Obama and UK Prime Minister
David Cameron.
What is lacking, according to Da Fraia, is a process by which
donors are held accountable when they fail on their promises.
"The system now is very unbalanced," he said, calling for
sanctions on donors whose aid projects cannot be accounted for.
These questions and others will be debated at the fourth high
level forum on aid effectiveness to be held in Busan, South
Korea, at the end of 2011.
Two Years On: Is the G8 Delivering on its L'Aquila Hunger
Pledge?
May 2011
Executive Summary
Following the 2007-08 food crises, donors made an important
'Hunger Pledge' to the worlds poor. At the 2009 G8 Summit in
L'Aquila, Italy, donors launched the L'Aquila Food Security
Initiative, backed by 27 countries and 14 international
agencies. Within this, donors pledged to mobilise US $22 billion
over three years in support of country-led plans for
agriculture, with a 'coordinated, comprehensive strategy'.
Two years on, with food prices reaching record levels, the world
stands on the precipice of another food crisis. With only one
year left to deliver, the G8 and other L'Aquila donors have
launched their accountability report with a focus on progress
towards goals set in L'Aquila on food security and on global
health. This is the report where the G8 and other donors are to
account for progress on their 'Hunger Pledge'. At face value,
the report says that the G8 is broadly on track. However, an
analysis of the data reveals that this is extremely difficult to
justify with any certainty: because it is nearly impossible to
rate countries' relative performance due to inconsistent and
erratic reporting methods.
ActionAid believes that the accountability process is severely
undermined by a lack of transparency on how much countries have
spent and a lack of consistency in measuring progress and
timelines. A few donors -- the EU, Germany and Japan -- are not
even able to account on their expenditure to date and are still
only reporting on what they have committed to doing. Moreover,
the accountability report shows that around two-thirds through
the pledge only 22 percent has actually been spent.
Meanwhile, some countries, such as Italy and Germany, are
reporting against progress on projects and items which were
outside of their original pledge. This suggests that governments
are re-categorising commitments, in order to mask their lack of
progress. Moving the goalposts halfway through the game is not
fair play.
Accountability also involves transparency and reflection on
failures, as well as on achievements. Few donors are openly
admitting shortcomings. The US government is one of the few
exceptions: not only is the US being clear in its reporting but
they are also being transparent about their disbursement delays.
France, who this year is hosting the G8 and G20, appears to be
trying to mask their poor performance behind some bad reporting.
Following their moderately good L'Aquila pledge to agriculture,
they are now failing to deliver it, with less than 50 percent of
their commitments being spent two-thirds of the way into the
pledge timeline. Not meeting these hunger commitments could
undermine President Sarkozy's credibility in championing G20
action on food price volatility and food security this year.
But perhaps of greatest concern is the lack of concrete evidence
of progress towards achieving several of the core components of
the pledge: increasing aid to agriculture, through support of
country-led agriculture plans that target the needs of small
holder farmers. Progress on the pledges of aid to agriculture
are by far the most off-track; with delivery being particularly
slow compared to spending on other categories of aid for food
security. For instance, Italy has actually had a cut of 56
percent in their agricultural aid spending since L'Aquila.
With the world just one bad harvest away from another food
crisis, we need urgent injections of funding and donors to make
good on their promises, not clever accounting.
Moreover, the effects of increasing food prices on poverty are
extremely alarming. The World Bank estimates that high food
prices have pushed 44 million people into extreme poverty in
low- and-middle income countries, and warns that food prices are
at 'dangerous levels'.
Indeed, the investment that donors have delivered on -- while far
from sufficient -- is helping to mitigate the impacts of the
crisis.The evidence that increased investment in agriculture
over the last few years has helped to minimise Africa's exposure
to the recent surge in global food prices should spur greater
action and ambition from donors. Countries such as Rwanda and
Malawi, which have recently increased government support to
smallholder-based agriculture, are reporting stable local food
prices and abundant supplies.
Sadly, donor aid to agriculture is still woefully short of what
is needed to meaningfully reduce hunger. And in spite of African
countries' stepping up in response to the food crisis and
drafting ambitious country plans through the Comprehensive
Africa Agriculture Development Programme (CAADP) process, donors
are not living up to their end of the bargain. African countries
have developed costed and peer reviewed plans, but donors are
not keeping up through support to fund them. Huge gaps exist in
the money needed. For just the 20 African countries that are an
advanced stage of the CAADP process, there is a funding gap of
$36.3 billion that needs to be filled.
With the world teetering on the edge of another food crisis, the
G8 must keep to their 'Hunger Pledge'. ActionAid is also urging
the G8 and all donors to channel their aid behind country plans.
Recommendations
- The lack of full and transparent accounting for progress on
the L'Aquila Food Security Initiative by donors to date must be
addressed
-
It is vital that donors ensure their L'Aquila
pledges are delivered within the 3 year timeframe, with
shortfalls in commitments and disbursements of agricultural aid
addressed as a matter of urgency by all donors.
-
In light of
the food crisis and needs identified by the CAADP process,
donors must increase overall agricultural aid beyond the
L'Aquila Pledge, and they must align most of their aid in
support of country-led plans. Specifically:
- Donors should channel more money through GAFSP, which is
delivering new money, transparently, in support of country led
plans.
- Donors need to take the next step and go beyond L'Aquila and
ensure that all CAADP investment plans are fully funded.
...
Section 3. Moving forward: What needs to happen?
Aid to agriculture is still woefully insufficient to
signficantly reduce hunger. African countries are increasingly
meeting their side of the bargain via the CAADP progress, and
and have developed costed and peer reviewed plans, but donors
are not keeping up.
The individual performance of L'Aquila donors in increasing aid
over the period from 2002-2009 to agriculture does show some
progress but almost all this progress is a consequence of
significant advances by a handful of donors. Among the largest
donors, best performers include the USA, the EU and Japan. All
these three donors have more than doubled aid to agriculture
since 2002. France, however, has made significant cuts in aid to
agriculture in the last couple of years and the aid provided by
Germany remains fairly stable. Among smaller donors, Spain has
made remarkable progress. Canada has also managed to double aid
to agriculture since 2002.
Mind the funding gap: how African countries are being let down
by donors
The Comprehensive African Agricultural Development Programme
(CAADP) aims to revitalise African farming in order to reduce
rural poverty and hunger. CAADP was conceived by the African
Union in 2003 as an ambitious and comprehensive attempt to help
African countries reach higher economic growth through
agriculture-led development, with the ultimate goal of
eliminating hunger and reducing poverty. Since then, CAADP can
be credited with changing the way in which national governments
and donors approach agricultural development, while shifting
focus back onto African agriculture as a key development
pathway. Signatory countries also made important commitments
through CAADP to increase spending on agriculture to 10 percent
of their overall budget and reach an agriculture growth rate of
6 percent per annum.
...
To date, 23 countries have completed the CAADP roundtable
process - a country-led process that defines a strategy for
reducing hunger and improving agricultural productivity through
policy reform, as well as more and better investment in public
resources. The aim is that these country-level processes lead to
national compacts and ultimately to investment plans that are
jointly owned by governments, donors, civil society
organizations, the private sector and regional economic
communities.
Despite African countries stepping up in response to the food
crisis, donors are not living up to their end of the bargain.
Huge gaps exist in the money needed (see table two below [in
full report]). For just the 20 African countries that are an
advanced stage of the CAADP process, there is a funding gap of
$36.3 billion that needs to be filled [67% of the $54.8 billion
estimated cost].
Section 4. Conclusions and recommendations
With the world teetering on the edge of another food crisis, the
G8 must keep to their 'Hunger Pledge'. It is simply not
acceptable that they are unable to give a full and transparent
account of progress to date. In so doing, the G8 is severely
undermining the 'accountability' process by a lack of
transparency.
The figures suggest, despite some outstanding exceptions, that
there is a lag in progress on the key elements of the pledge:
aid to agriculture, and in support for country-led plans and
small holder farmers.
ActionAid is urging the G8 and all donors to channel their aid
behind country plans. This is particularly important in light of
evidence which shows that increased African government support
to agriculture is helping to cushion countries and poor
communities against the current global price spikes.
In particular, investments channeled via the GAFSP are proving
to be an effective and transparent vehicle for moving funds to
support country led plans, but not enough donors are supporting
it. All details about country plans, financial disbursements and
commitments about GAFSP are available publicly on the web -- all
L'Aquila bilateral donors should follow this model.
Recommendations
- The lack of full and transparent accounting for progress on
the L'Aquila Food Security Initiative by donors to date must be
addressed. Key issues to be addressed by donors in order to
improve accountability and transparency include:
- Ensure that all available data is published and that donors
report on their disbursements to developing countries on a
country-by country basis
- Ensure that the underlying data on 2010 disbursements is
publicly released by all donors and is reported on according to
the original commitments made, with no re-classification of
funds.
- It is vital that donors ensure that their L'Aquila Pledges
are delivered within the 3 year timeframe:
- Ensure the full delivery of the L'Aquila pledge and
transparently spell out how and when the money will be
delivered.
- It is important that the shortfalls in the progress on
commitments and disbursements of aid to agriculture are
addressed as a matter of urgency by all donors.
- In light of the food crisis and needs identified by the CAADP
process, donors must increase overall agricultural aid beyond
the L'Aquila Pledge, and they must align most of their aid in
support of country-led plans. Specifically:
- Donors should channel more money through GAFSP, which is
delivering new money, transparently, in support of country led
plans.
- Donors need to take next step and go beyond L'Aquila and
ensure that all CAADP investment plans are fully funded.
AfricaFocus Bulletin is an independent electronic publication
providing reposted commentary and analysis on African issues,
with a particular focus on U.S. and international policies.
AfricaFocus Bulletin is edited by William Minter.
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