dfid s aid policy and instruments the orchestrated version nel druce hlsp dfid n.
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DFID’s aid policy and instruments (the orchestrated version) Nel Druce HLSP/DFID. Source: OECD/DAC 2005. Population assistance % 2004. Source: UNFPA/UNAIDS 2004. The orchestra….

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population assistance 2004
Population assistance % 2004

Source: UNFPA/UNAIDS 2004

the orchestra
The orchestra…

“Aid instruments are like musical instruments. To say that one instrument is better than another is like saying that an oboe is better than a banjo. It depends on the context (are you an orchestra or a folk band?), the purpose (what music are you playing?), and the way it is played (is it better to play a ‘bad’ instrument well than a ‘good’ instrument badly?)”

DFID financial instruments guidance, 2005

conceptual framework
Conceptual Framework


Promote country ownership

Encourage adoption of appropriate (pro poor) policies/addressing issues of exclusion

Stronger incentives and capacity to implement (both Govt/non Govt)

Greater predictability (for Government)

Acceptable risk (for donors)

Improved accountability (to the population

Minimise transactions costs

Financial Aid Instruments

General Budget Support

Sector Budget Support

Sub Sector Budget Support

Other Programme Based Approaches (debt relief, balance of payments support, food aid)

Integrated Project

Stand Alone Project

Global Funds

Challenge Funds


Design Features



Disbursement Channel


Time Frame

Interdependence with other instruments

policy choices trade offs
Policy choices: trade-offs
  • balance short term improvements in service delivery and longer term improvements in sustainable capacity
  • make effective transition between instruments; conditionalities?
  • balance support to government systems with support to non state actors
  • balance equity with efficiency
  • manage country wishes and broader organisational policy objectives
leading budget supporter
Leading ‘budget supporter’

DFID accounts for 25% of all PRBS (04/05)

Poverty reduction budget support (PRBS)

General budget support (GBS)

Sector budget support (SBS)

Key features: supports government policy and plans, and uses government finance systems

Continuum between GBS and SBS (degrees of ‘earmarking’ and conditionalities)

facts and figures
Facts and figures
  • PRBS – £401m in 16 countries in 2004/05
  • PRBS accounts for 60% of DFID’s bilateral support in Africa; 23% in Asia
  • Most GBS is in Africa, most SBS in Asia
  • SBS tends to be used in less aid dependent countries, where fiduciary risk lower at sector level, often coupled with TA
  • Most SBS is for health and education – includes earmarked poverty funds, sub sector and sub national support
the health orchestra
The health orchestra…
  • Bilateral assistance on health = £415m (17% of UK ODA)
  • Sector support – £54m (only 13%)
  • Health programmes - £65m
  • Technical co-operation - £107
  • Grants (NGOs etc) - £157m
  • PLUS estimated £50m from PRBS
a place for projects
A place for projects…
  • Clear role for stand alone and integrated projects with government/non government providers
  • where government unwilling or unable…fragile states
  • where UK does not support government policy eg Zimbabwe, Burma
  • tackling bottlenecks and introducing new approaches
  • advocacy, TA, support to service delivery for marginalised groups and issues eg safe abortion in Cambodia
  • demonstration projects; sustainability and scale up considered from start (eg IDUs, sex workers in China)
  • advocacy/policy dialogue for pro-poor policy and reform; support to civil society for improving accountability etc

- non state sector (especially commercial providers) eg social marketing

mix of ais in nepal
Mix of AIs in Nepal
  • Health Sector budget support – DFID, World Bank (includes TA, 16%)
  • DFID support to safe motherhood programme (earmarked funds on budget, TA 40%)
  • Funding to UN to provide TA for safe motherhood
  • Funding to NGOs for advocacy etc
and in ethiopia
And in Ethiopia…
  • PRBS suspended 2005
  • New Protection of Basic Services Grant, managed with World Bank trust fund, earmarked funds using existing finance systems
  • Includes commodities window
  • MOUs with UNFPA and UNICEF
  • Other funding includes Population Council/young women
other key instruments
Other key instruments…
  • Multilaterals and trust funds (central and bilateral contributions)
  • Global partnerships – GFATM and GAVI
  • Challenge funds
  • Regional/international Africa Enterprise Challenge Fund, Governance and Transparency Fund, Safe Abortion Action Fund
  • National eg India, Tanzania, Zambia
implications for srh and supplies
Implications for SRH and supplies
  • Role for conditionalities/earmarks in PRBS eg commodity budget lines?
  • Continued support to SRH programmes (incl. TA and commodities) likely in fragile states eg Sierra Leone, Burundi, Ethiopia
  • UN (UNFPA, UNICEF, WB) roles in channelling support/ ‘shadow alignment’ strategies
  • SBS in less aid dependent states includes sub sector and project support to RH (Pakistan, India, Nepal, B’desh)
key challenges
Key challenges
  • Stable low income states with PRBS, but where government failing to prioritise SRH
  • Mainstreaming support to non state providers into sector plan
  • Financing scale up of commercial sector activities
  • Financing for activities that are ‘non-state’ eg advocacy, marginalised issues
  • Multilateral capacity to provide appropriate inputs ie advocacy, policy dialogue, support to scale up
  • GFATM and GAVI advocacy (national and global levels)