DFID’s use of contractors to deliver aid programmes

Review

We awarded a green-amber score and made five recommendations after finding that the Department for International Development (DFID) selected contractors that delivered positive results at competitive fee rates, but DFID’s poor end-to-end programme management led to delays and learning has not been captured or used to inform future programming.

Findings

Our findings show that in the case studies we examined contractors are an effective option for delivering aid. DFID has selected contractors that have delivered positive results at competitive fee rates. DFID’s poor end-to-end programme management, however, has led to delays. In the case studies that we examined, this has had the greatest impact during the mobilisation phase and is exacerbated by a lack of ‘whole life’ individual responsibility for programmes. In addition, learning is not being captured from contractors or used to inform future programming.

The reform of DFID’s central procurement group has improved processes but is too slow and lacks prioritisation. As a result, decisions to use contractors are not guided by a strategic plan to deploy the right contractors, including major, niche and innovative new entrant organisations, to best effect.

Recommendations

1. DFID should support its devolved delivery model with strategic guidance, informed by its sectoral experts, on when and how contractors of different sizes and specialisms can deliver most effectively. This should include a strategic partnering model for how best to use its major and SME contractors.
2. DFID should prioritise its commercial reforms, so that PrG can support more strategic decision-making on the use of contractors and develop more productive relationships with them.
3. DFID should update its bid evaluation process, strengthening the role of the programme’s designers during procurement, to enable a more sophisticated and balanced assessment of costs, timings, risks and results.
4. DFID should develop a resourced plan for improving its programme management capability, to ensure end-to-end accountability for programme delivery and minimise disruption from staff rotations.
5. DFID should strengthen learning from contractor-delivered programmes, to feed into the design, procurement and delivery of other programmes.