Aid Transparency

Aid Transparency

The Challenge

High quality development assistance works. Across the globe, investments are providing lifesaving results. Transparency and accountability can help to make sure that aid is as effective as possible. Despite some progress, too little information about development assistance is available. This lack of transparency leads to inefficiencies all around. Developing country governments that depend on aid flows to support their budgets do not always know how much aid is invested in their country, how that money is spent or what results it achieves. Donor governments rarely publish spending plans, which would allow developing country governments to implement long term programs with confidence. Donor governments rarely coordinate with each other, resulting in duplication (between donors and recipient governments) in some areas and underfunding in others. And more information about the results that aid achieves is sorely needed.

Increased aid transparency and coordination would ensure that scarce aid resources are used efficiently to deliver the biggest impact possible in terms of poverty reduction. The lack of transparency in aid makes it is much harder for civil society and citizens in developing countries to hold their governments to account for their use of development assistance. Similarly, a lack of transparency makes it hard for citizens in donor countries to see how effective aid is and to see the crucial role that aid plays in supporting progress on poverty reduction in many developing countries.

The Opportunity

In order for information about aid to be useful for developing countries, it needs to be published regularly in a standardized, comparable format. The International Aid Transparency Initiative (IATI) has created a common international standard for publishing information about aid spending. The list of signatories to IATI is growing, but the more countries that commit to IATI standards, the more effective aid will be. Working alongside IATI, initiatives such as the World Bank’s Open Aid Partnership are using technology to increase aid transparency. The Open Aid Partnership aims to increase information about aid, budgets, and service delivery through mapping technology, helping developing countries build mapping platforms that are accessible and allow direct citizen feedback.

The aid effectiveness agenda has evolved since the first meeting of the High Level Forum in Rome in 2003. In Paris in 2005, clear aid effectiveness principles were set out and a monitoring framework established. In Accra in 2008, increased attention was given to country ownership and the role of civil society. However, the evidence shows that while some progress has been made and more is possible, donors have failed to meet their existing aid effectiveness commitments. On average donors have met only 1 of the 13 commitments assessed under the survey to monitor progress against the Paris Declaration. At the Fourth High Level Forum on Aid Effectiveness in Busan, South Korea in 2011, the agenda was broadened, with aid effectiveness seen as part of a wider landscape of development effectiveness. This is a good thing; development is about much more than aid. But it carries risks too; development assistance continues to play an important role in nurturing development in many countries and continued efforts are needed to make it more effective.

The outcome document from the Fourth High Level Forum, the Busan Partnership for Effective Development Cooperation, was more inclusive than ever with the participation of China and India alongside other emerging donors in addition to civil society partners. The document maintained the Forum’s focus on transparency, accountability and results. In Busan, Canada and the United States committed to IATI. With their participation, more than 75% of global aid flows will be covered by IATI. Though many promising principles were espoused at Busan, clear and measurable targets are needed to hold participants accountable to these principles to ensure that development assistance is increasingly effective. ONE is working with partners including Publish What You Fund and Transparency International, to ensure that the agreements reached at Busan are monitored and implemented.