The cross-government Prosperity Fund
The Prosperity Fund needs to continue to improve its systems and processes to support the pace and scale of delivery.
ICAI examined the recently established cross-government Prosperity Fund, which promotes economic reform and development needed for growth in developing countries.
The review – which focused on the likelihood of future effectiveness, as the Prosperity Fund has not yet begun implementing major programmes – recognised the significant progress which had been made in a short time frame and noted that the Fund’s systems and processes were still being refined.
However it said the Fund was likely to face challenges in meeting both its primary purpose of poverty reduction and its secondary aim of creating opportunities for international business, including UK firms.
The review said the Fund had made improvements in its governance structure, in the short period since it was established. But raised concerns over the speed at which government departments were expected to scale up their aid spending, and said they will need to work hard to design and deliver programmes capable of achieving results.
The review called on the government to look again at the planned rate of expenditure, including considering extending the time period over which the £1.3 billion is due to be spent. It also calls on the Fund to improve its transparency, saying there was too little public information available about its work.
ICAI made a series of recommendations for strengthening the Prosperity Fund:
- The government should reconsider the Prosperity Fund’s rate of expenditure, including spending resources over a longer period if necessary.
- The Prosperity Fund should refine its strategic objectives, and develop Fund-level results indicators to maximise overall impact, and avoid fragmentation.
- The Prosperity Fund should ensure its processes for adhering to international rules on aid are explicit and challenging.
- The Prosperity Fund should be more open about its engagement with UK and international companies, ensuring it avoids potential conflict of interests and secures value for money.
- The Prosperity Fund should ensure it is fully transparent about its procedures and progress in line with the government’s stance on this issue.