Canadian Aid: Budgeting for Results

As a leading international donor, Canada provides over CAD$5 billion per year in official development assistance (ODA) to reduce hunger and poverty and improve quality of life for the world’s poorest. Between 2001 and 2010 Canada doubled its spending on foreign aid. From 2004 to 2010, Canada doubled assistance to sub-Saharan Africa (albeit against an adjusted target) by CAD$802 million, to deliver a total of CAD$1.94 billion.

Delivering Results

For around 2% of the national budget, these investments last year provided food aid to 105 million people, and put 21 million children in school feeding programs. They have trained over 20,000 health care workers in developing countries. In Bangladesh, Canadian assistance provided polio vaccinations to 69,000 infants. And in Senegal, Canadian support improved over 2,500 schools and trained over 8,000 teachers. [1]  As host of the 2010 G8 Summit, Canada spearheaded the launch of the Muskoka Initiative on maternal, newborn and child health, which secured commitments from more than 16 donors to deliver $7.3 billion in new funding for these programs. These funding commitments are projected to prevent 1.3 million deaths of children under 5 and 64,000 maternal deaths, amongst other outcomes. [2]

Canada has recently streamlined its priority areas and target countries, focusing investments on food security, children and youth, and economic growth. Of Canada’s 20 focus countries, 7 are in sub-Saharan Africa. These priorities and objectives will help Canadian aid be more efficient and better focused to achieve results in some of the world’s poorest countries.

Improving Accountability

On November 28, 2011, the Minister of International Cooperation, the Honourable Bev Oda, announced that Canada would be joining the International Aid Transparency Initiative (IATI). Over time, this will help improve the transparent access to Canadian information on aid and accountability.  Canada has also emerged as an early champion of enhanced donor accountability, leading the production of the G8’s Muskoka Accountability Report in 2010 and co-chairing the UN Commission on Accountability and Transparency to monitor commitments to maternal, newborn and child health. Canada has also taken concrete steps to improve the effectiveness of its development assistance by introducing reforms to increase efficiency and impact. It has set clear targets for untying aid, using developing country systems, and increasing coordination with donors, including new private sector partnerships that further leverage public monies. [3]

Protecting Investments

In 2010, the Canadian government announced that it would be capping international assistance at CAD$5 billion annually for an undetermined length of time. While Canada’s ODA/GNI stood at 0.37% in 2010/2011, it is projected to fall in coming years as the economy grows but the freeze continues, to 0.30% in 2012/2013. [4] Following the national election in May 2011, the Government of Canada instructed each agency to develop options for significant budget cuts for 2012-2013. In the hypothetical scenario of a 10% budget cut next year, this could withdraw CAD $500 million or more from the international assistance envelope, slowing progress on Canada’s own development priorities and jeopardizing previous investments.

The Government of Canada is now internally preparing recommendations for its 2012 fiscal plan. If the budget for 2012-2013 is presented to Parliament according to traditional timelines, final political decisions on the budget will be taken in late February and March 2012.