DFID merger causes 'serious transparency challenge' for UK aid

Photo by: Howard Lake on Flickr / CC BY-SA

LONDON — Research shows a vast discrepancy in the transparency of aid spending by the U.K.’s Foreign & Commonwealth Office and Department for International Development.

The “2020 Aid Transparency Index,” published Wednesday by the Publish What You Fund campaign, found that DFID — which spends the bulk of U.K. official development assistance — is one of the world’s most transparent donors, rating it as “very good.”

7 out of 10 UK government departments failing to meet aid transparency targets

Research commissioned by the U.K. government has found that seven out of 10 departments are not spending aid transparently enough to meet its own targets.

But FCO — currently the U.K. government's third-largest ODA-spending department, with an aid budget of £633 million ($792 million at current conversion rates) in 2018 — languished near the bottom of the index, with a rating of “fair.”

The report comes just a week after Prime Minister Boris Johnson announced that DFID would be folded into FCO, a move PWYF described as causing a “serious transparency challenge” for U.K. aid. The research was carried out before the merger was announced.

“It is difficult to see how the new office will reconcile the competing mandates of poverty reduction and U.K. foreign policy interests, both at the global level but also in the field, given the newly expanded roles of ambassadors to manage ODA,” said Gary Forster, CEO of PWYF, which promotes transparency in development.

The news also means that the government has failed to meet its target of all aid-spending departments being rated “good” or “very good” by the index by 2020.

The U.K.’s reputation is boosted by transparency, which ensures aid is spent effectively to reduce poverty rather than for “political or commercial gain,” according to Forster.

“To protect the poverty focus of U.K. aid, it is vital that ODA spending not only maintains the world-class transparency standard set by DFID, but indeed becomes more transparent to protect against accusations of mismanagement or underhand dealings,” he added.

The potential deterioration of aid-spending transparency is a key concern of critics of the departmental merger, along with worries about the poverty reduction focus of aid and the potential loss of expertise.

Although FCO has improved on its index rating of “poor” from 2018, it is “still one of the least transparent aid-spending institutions globally, and the British taxpayer should be concerned about this,” said Simon Starling, director of policy, advocacy, and research at Bond, the U.K. network for aid NGOs.

“It is difficult to see how the new office will reconcile the competing mandates of poverty reduction and U.K. foreign policy interests.”

— Gary Forster, CEO, Publish What You Fund

Starling added: “All aid-spending departments must adhere to the highest standards of reporting and transparency for its aid spending. The government must also urgently recommit to its previous target of all aid-spending departments receiving a grading of ‘good’ or above on aid transparency."

The top-three scorers were the Asian Development Bank’s sovereign portfolio, the World Bank’s International Development Association, and the United Nations Development Programme. The worst, from the bottom, were China’s Ministry of Commerce, the Turkish Cooperation and Coordination Agency, and Japan’s Ministry of Foreign Affairs.

FCO, ranked 38th out of 47 donors evaluated, received an especially poor appraisal in the index’s “performance” section — which examines documents that assess project progress, such as baseline surveys, mid-term reviews, and end-of-project evaluations — failing to score any points at all out of 20 possible. Meanwhile, some documents published by FCO failed to meet the quality standards required by PWYF.

Forster said: “While DFID historically spent the majority of U.K. aid and continued to be a leader in its class, there is no getting away from the fact that the FCO consistently failed to adopt the same practices. The FCO’s failure to publish evidence as to the impact of its activities bears testament to this.”

The report recommended that FCO improve the quality of its key datasets, publish its strategies for countries and sectors, and improve the documents that failed PWYF’s quality checks, such as those related to project performance, budgets, and contracts.

Meanwhile, DFID was ranked ninth overall, the second-highest bilateral donor on the index. The department could have done better by publishing more contracts, tenders, and more detailed locations of its activities, according to PWYF.

In a statement, a U.K. government spokesperson said: “The UK and DFID is globally recognised for its expertise and transparency in aid spending. The new Foreign, Commonwealth and Development Office will put that expertise and commitment to transparency at the heart of its work to deliver aid to some of the world’s poorest people.”

U.S. aid agencies had mixed results, with the Millennium Challenge Corporation moving up to become the most transparent of the bilateral agencies in the 2020 index and the Department of Defense being downgraded to the “poor” category. Meanwhile, the U.S. Agency for International Development improved its transparency, scoring 15th in the index, which PWYF attributed to more frequent data publishing.

But the President’s Emergency Plan for AIDS Relief — another U.S. agency that often touts its data-driven approach — didn’t do as well, dropping down into the “fair” category as its score slipped.

Update, June 25: This story was updated to include an additional comment

Devex Associate Editor Adva Saldinger contributed reporting from Washington.

About the author

  • William Worley

    William Worley is the U.K. Correspondent for Devex, covering DFID and British aid. Previously, he reported on international affairs, policy, and development. He also worked as a reporter for the U.K. national press, including the Times, Guardian, Independent, and i Paper. His reportage has included work on the Rohingya refugee crisis in Bangladesh, drought in Madagascar, the "migrant caravan" in Mexico, and Colombia’s peace process. He can be reached at william.worley@devex.com.