DfID oversight of EU aid spending in poor countries gets ‘amber-red’ rating

The Department for International Development needs to better engage with the European Union to ensure the effectiveness and impact of the regional bloc’s aid programs, to which the United Kingdom contributes billions of pounds annually.

That’s according to the Independent Commission for Aid Impact, which gave DfID’s oversight of U.K. contributions to the EU’s aid budget in low-income countries an amber-red rating on its “traffic light” system of assessing various aspect of the country’s development program. This rating means DfID’s oversight has been relatively poor and needs significant improvement.

DfID contributes approximately 1.4 billion pounds ($2.2 billion) per year to the EU aid budget, which includes the development cooperation instrument and the European Development Fund, among other facilities. This accounts for almost 16 percent of DfID’s average annual spending.

Overall, the ICAI audit found that while DfID has a “clear focus” on the policy level in terms of how it wants to engage with the European Union, it has limited influence over how EU aid is delivered.

ICAI said that a major factor preventing DfID from properly overseeing and ensuring the impact of U.K. contributions to EU aid programs is the regional bloc’s “complex” and “time-consuming” processes. It further criticized the European Union’s performance management and results framework as weak.

“Limitations to the EU’s risk management approach, as well as overambitious project plans, are a significant obstacle to improving the performance of its [programs] and projects,” the review notes.

ICAI did identify some weaknesses on the part of DfID. In particular, the report said the department does not offer clear guidance to DfID country offices on how to engage with EU offices on specific issues. DfID country offices often treat the European Union as another donor instead of an alternative route for achieving the United Kingdom’s international development goals.

To improve DfID’s oversight of the United Kingdom’s contributions to EU aid programs, ICAI urged the department to:

• Identify clear action points — and a timeline — on how the United Kingdom can get the same level of assurance from the European Union as it gets from other multilateral aid channels. The action points should include ways to improve EU aid performance and results as well as better access to EU aid information.

• Give better guidance to country offices on how to engage with their EU counterparts.

• Ensure that the European Union solicits input from intended beneficiaries to inform dialogue with recipient governments.

• Be more actively engaged in the European Union’s plan to improve its risk management processes.

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