ICAI review raises concerns over DFID’s partnership with charities

ICAI review raises concerns over DFID’s partnership with charities

The Independent Commission for Aid Impact recently released a review of DFID’s partnership with civil society organisations, finding that ‘DFID values civil society organisations, but its funding and partnership practices do not fully support the long-term health of the civil society sector’. The report released in April 2019 covered the period from May 2015 until December 2018.

The report gave DFID an Amber/Red rating overall, which is translated as ‘unsatisfactory achievement in most area, with some positive elements. An area where improvements are required for UK aid to make a positive contribution’. The review addressed three questions:

1.       How well does DFID’s approach to partnership with CSOs reflect its CSO objectives and commitments?

2.       How well does DFID’s funding for CSOs and related influencing work contribute to better development results and a more effective civil society sector?

3.       How well does DFID promote learning and innovation in its partnerships with CSOs?

All three questions received an individual amber/red rating. The review focused on three central funding mechanisms, UK Aid Direct, UK Aid Match and UK Aid Connect.

Effectiveness findings

A change in the way that DFID disburses its funds to CSOs, from unrestricted core funding to competitive project based funding, meant that there is now a ‘high investment cost required to develop proposals, combined with a low success rate for winning grants, [which] pose challenges…’. ICAI also noted the recent move to enhanced due diligence processes, prompted by the safeguarding scandals in 2018, which are time consuming for CSOs. Problematically, ‘While DFID has identified the need to provide a guiding framework on how to analyse and respond to closing civic space in its focus countries, it has not yet begun to develop this.’

A positive finding was that once funding had been obtained by CSOs, DFID and its intermediaries were deemed to be ‘supportive’. Country offices in both Bangladesh and Ethiopia were also praised for providing ‘practical support to CSOs on civic space’. Moreover, the funding support to CSOs was reported to have ‘positive results’. However, underlying these positive findings was the theme that CSOs are not empowered and that project results were often affected by delays to funding awards and short project cycles. Unfortunately, delays were cited as a ‘norm rather than an exception’.

Learning and innovation findings

DFID’s approach to innovation and learning was critiqued, with little research conducted on the topic in the review timeframe and due to funding mechanisms which do not enable rapid fund disbursement for low-scale emergencies or up-scaling innovation. The review noted positive shifts in programming around disability inclusion and accountability, but these positive elements were set against ‘insufficient sharing and uptake of learning and innovations’.

What next?

ICAI have made five recommendations for DFID about improving the knowledge gaps, the procurement pipeline, focusing on long term results, encouraging innovation and developing a framework for responding to closing civic space. DFID have published an initial press release on the ICAI report, stating that CSO projects are delivering ‘effective development’ and highlighting how ‘since 2017 we have reduced the time it takes for small charities to be awarded grants through the Small Charities Challenge Fund (SCCF) from 254 working days to 115.’ DFID will publish a full management response, likely in May.

In response to the review, BOND has called for a review of DFID’s approach and highlighted the findings of its recent report on civil society engagement by DFID. The Sun picked up on the ICAI report with the headline ‘Foreign Aid Blast: Government slammed over way £1.3bn aid budget is being spent through charities’. The International Development Committee (IDC) will debate the findings of the ICAI report in due course.

Input your views

DFID contacted the Alliance after the publication of the ICAI review and have offered to attend a meeting with Alliance members to discuss its recommendations and to expand the debate about CSO engagement. If you are a CSO grantee of DFID or have previously applied for any of the aforementioned central funds and would like to express your interest in attending a meeting, please email us.

ICAI are currently running a consultation to inform its next four-year phase beginning in July 2019. Input your views into the public consultation and answer questions like: what areas of UK aid spending should ICAI be looking at; And how should it conduct this scrutiny? The consultation closes on 23 April 2019.