DFID’s Approach to Delivering Impact

11 Jun 2015

The Independent Commission for Aid Impact (ICAI) has published a report today on the Department For International Development’s Approach to Delivering Impact. UK aid, at its best, makes a real and positive difference to the lives and livelihoods of poor people around the world. Ensuring the best possible performance across a large and multifaceted aid programme is, however, a complex management challenge. This report reviews ICAI’s 43 reports over four years and looks at how well DFID ensures positive, long-term, transformative change across its work.

Strengthening results management has been a key priority for DFID in recent years. The department has recognised the importance of demonstrating its results to parliament and the public and has worked to ensure that value for money and accountability are built into its business processes. This focus has become known as the results agenda.

We found that the results agenda has helped to bring greater discipline in the measurement of results and greater accountability for the delivery of UK aid. These achievements have, however, involved some important trade-offs. Some of DFID’s tools and processes for measuring results have had the unintended effect of focussing attention on quantity of results over their quality.

DFID’s programmes have an average programme length of just three years. Transformational impact will, however, often be possible only over several programme cycles and this should be recognised explicitly in programme design. This is particularly the case in conflict-affected and fragile states.

Development programmes rarely achieve results in isolation. Coherence across programming is a key condition for maximising impact. DFID is still relatively weak at managing complex portfolios at the country or sector level where impact on the ground needs to be aligned better with institutional progress and top-down policy change.  We see this as an important area for improvement, in order to achieve mutually reinforcing results.

In order to maximise and make sustainable the impact which DFID aims to achieve, it also needs to ensure high quality engagement with the intended beneficiaries and manage risk more proactively and transparently.

Graham Ward, ICAI Chief Commissioner, said: “The results agenda has certainly pushed DFID and its partners to focus more consistently and rigorously on the delivery of results. We are concerned, however, that the emphasis is on short-term, measurable results, over the more complex challenge of achieving long-term, transformative impact. We are in favour of rigorous approaches to results management and clear lines of accountability but we believe that more can be done in DFID’s tools and processes to incentivise the right priorities and behaviours.”

Lead Commissioner Diana Good, said, “At our encouragement, DFID has increased its interaction and we welcome that approach. But this needs to be enhanced throughout the programme process. Even when working with central governments on policies and institutions, DFID should keep a clear line of sight to the intended beneficiaries. DFID and its government counterparts are a means to the end of serving the poor and should not presume to know their best interests and needs. Integrating the poor and their community structures into programming and wider governance systems is vital.”

ICAI has made seven recommendations to strengthen its results management processes:

Recommendation 1: At the departmental level, DFID should develop a Results Framework that better reflects the range of impacts it seeks to achieve, capturing not just the breadth of its engagement but also its transformative impact, including successes in institution building and policy influence. To do so, it will need to look beyond quantitative indicators towards other ways of capturing the impact of UK aid.

Recommendation 2: At the country portfolio level, DFID’s Country Poverty Reduction Diagnostic should pay more attention to longer-term change processes, both looking backwards to understand the trajectory of achievements and forward towards potential long-term paths out of poverty and fragility. Its operational plans should contain stronger links between the analysis and programming choices, with more emphasis on how different programmes and sectors interact to produce wider impact.

Recommendation 3: At the programme level, DFID’s business cases should be more explicit about the route towards long-term impact, including policy and institutional change, setting out the building blocks and pathways required to achieve transformative impact over time. This includes looking beyond the life of the programme to the follow-up actions required and exploring how to work with other programmes and initiatives to achieve mutually reinforcing results.

Recommendation 4: Annual reviews should include an assessment of the assumptions and risks set out in the logframe and theory of change. DFID should work to tighten feedback and learning loops, to enable real-time adjustment of programmes.

Recommendation 5: DFID should engage with intended beneficiaries throughout the programme cycle, in design, delivery and monitoring. DFID should anchor its interventions in sustainable community structures that are integrated into wider governance systems.

Recommendation 6: In its ongoing review of its risk management processes, DFID should explore how to achieve an explicit and balanced risk profile in its country programmes, including high-risk programming with the potential for transformative impact. High-risk interventions should be identified as such from the outset, with the rationale for action clearly stated, and then be subject to appropriate risk management arrangements.

Recommendation 7: In its procurement processes, DFID should carefully consider both the merits of transferring outcome risk to implementers, particularly in high-risk environments, and the likely impact on its objectives, its supplier base and its overall costs. It should work towards clear guidance on what forms of results-based contracting to use in which circumstances, so as to avoid needless rigidity in programming and unhelpful incentives that do not enhance actual impact.