New review – ICAI follow-up review of 2018-19 reports

23 Jul 2020

  • Independent Commission for Aid Impact (ICAI) publishes annual follow-up report assessing UK government’s progress against nine earlier reviews.
  • Report – scored for the first time – finds adequate progress made in implementing recommendations of five ICAI reviews, despite challenging climate of uncertainty and disruption.
  • But government made inadequate progress in four aid areas – ICAI intends to re-visit these, and other outstanding issues, in the next year.

The government is making “steady” progress in improving how it spends aid despite difficult external challenges – but a number of areas remain a concern, according to a new report from the Independent Commission for Aid Impact (ICAI).

The aid watchdog’s annual follow-up looks back at nine previous ICAI reviews, and assesses the government’s progress in implementing ICAI’s recommendations. For the first time, ICAI has awarded a score against each review it followed up, finding progress to be adequate in five of the nine reviews assessed – including in the UK’s funding of the UN humanitarian system, and DFID’s transport and urban infrastructure investments.

But ICAI warned that in four review areas – including the Newton Fund, where questions about tied aid and the fund’s primary purpose remained a concern – progress had been inadequate, and said that this could not be attributed solely to external disruption caused by events such as the 2019 general election, ministerial changes, Brexit preparations, and the Covid-19 pandemic.

ICAI chief commissioner Dr Tamsyn Barton said: “Making sure UK aid effectively reaches those who need it most, while delivering value for money for the UK taxpayer, is at the heart of everything ICAI does.

“We are pleased to see that our scrutiny continues to drive forward real improvements in how aid is spent, and the steady – if reduced – progress departments have made is notable considering the disruption they have faced this year.

“However, these challenges do not excuse the lack of adequate progress in other areas, and we urge the government to step up its efforts to implement our recommendations in these cases.”

The dedicated scoring system for the follow-up report was developed following an ICAI public consultation last year. ICAI rated the progress made in each review as either “adequate” or “inadequate”, with an inadequate rating resulting from a combination of too little being done to address ICAI’s recommendations, the response not being sufficiently relevant, and/or the implementation being too slow.

ICAI said it was pleased to see DFID respond “swiftly” to concerns in its 2018 maternal health review over the use of flawed modelling to estimate the number of ‘maternal lives saved’, with “significant” changes implemented to improve its approach to results data. DFID has also placed more emphasis on good quality care for women and their babies, and an increased focus on adolescents and poorer women within new family planning programmes.

ICAI also commended DFID for a “quick, rigorous and ambitious” response to its recommendations designed to make UK aid a more reliable and supportive partner of civil society organisations – something it noted would be crucial in light of the COVID-19 pandemic.

The follow-up also found that ICAI’s recommendations had led to adequate improvements in DFID’s approach to its supplier market, the UK’s approach to funding the humanitarian system, and DFID’s transport and urban infrastructure investments.

ICAI found evidence of improvements in all of the reviews it rated as inadequate – for example, following its 2019 amber-red review of the Newton Fund, ICAI said there had been improvements in governance, oversight, gender equality, diversity and inclusion. However, it added that BEIS – which is responsible for the £735 million research partnerships fund – had not addressed ICAI’s fundamental concerns in relation to tied aid and whether the primary purpose of the fund was in line with poverty reduction objectives.

The UK’s progress in International Climate Finance (ICF) was also rated as inadequate. ICAI found that despite improvements to transparency and information sharing, there had been delays in publishing a new cross-departmental strategy, limited progress in developing a more structured approach to mainstreaming low-carbon development across DFID beyond energy, and a clear public narrative about ICF’s work was still required. ICAI noted that urgency in this area had increased given the UK’s commitment to double spending on climate finance and its preparations for hosting COP26 in 2021.

In addition, ICAI rated the response to its 2019 review of CDC’s investments in low-income and fragile states as inadequate. Although there had been notable improvements in how CDC assesses development impact, ICAI said it was not yet clear that this was sufficiently shaping its investment practices. It also said its country expansion plans were unambitious, and that CDC had made limited progress on communicating the rationale behind its investment approach for the Growth Portfolio. The fourth review to be rated as inadequate – DFID’s approach to value for money through tendering and contract management – warned of a lack of progress in instituting a formal contract management regime and staff training.

ICAI intends to follow up the progress of the Newton Fund, CDC and UK aid’s approach to tendering and contract management in next year’s exercise, while International Climate Finance will be considered as part of ICAI’s forthcoming review on the use of UK aid to tackle biodiversity and deforestation. Depending on the government’s progress on publishing long-awaited documents about ending preventable maternal deaths and health system strengthening, ICAI may also return to the maternal health review next year.

This year’s follow up report also revisited three issues identified as outstanding from last year’s exercise – the Global Challenges Research Fund (GCRF), in which ICAI said it remained concerned about issues relating to tied aid; the UK’s aid response to irregular migration in the Central Mediterranean; and DFID’s governance work in Nepal and Uganda.

This report covered eight ICAI reviews published between July 2018 to June 2019 and one from November 2017.

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