UK ‘gets good value’ for £1bn-a-year World Bank aid, review says

But watchdog urges FCDO to put ‘stronger focus’ on climate action
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By Jim Dunton

01 Jun 2022

The UK’s recent £1bn-a-year support to the World Bank’s International Development Association “provides good value for money”, according to a just-published review by the Independent Commission for Aid Impact.

UK official development assistance funded via the World Bank has made up around one-quarter of the UK’s multilateral ODA in recent years. Contributions as a proportion of total UK ODA ranged from 7.4% to 13.2% between 2015 and 2019, when the UK’s total ODA was £15.2bn.

The ICAI said the UK had been the largest donor to the World Bank’s IDA for more than a decade, channelling roughly £1 in every £12 of the UK’s aid to the association, which provides favourable finance to low-income countries and fragile states.

Its review on the six years from 2015-2021 said the IDA had performed well and was aligned to UK development priorities, demonstrating the effectiveness of the UK’s influencing approach.

The ICAI acknowledged the UK government’s controversial decision to row back on prime minister David Cameron’s commitment to provide 0.7% of gross-national income in ODA, “temporarily” reducing the proportion to 0.5% because of the financial impact of the Coronavirus pandemic.

However it said stakeholders believed the UK could remain influential, provided it does not reduce the engagement and technical expertise that it invests in its relationship with IDA, and suggested areas where the Foreign, Commonwealth and Development Office could exercise leverage.

ICAI chief commissioner Tamsyn Barton said the IDA was an important source of concessional finance for low-income countries and that its ability to move at scale has proved itself in times of crisis. 

“Our review found that the UK’s significant contributions to it provides good value for money,” she said.

“But there’s still room for improvement. FCDO needs to make use of its strong influencing skills to drive change, pressing for measures to address climate change, broaden inclusion of disadvantaged people, consult affected citizens and ensure programmes do no harm.

“While there’s a risk that the recent decision to reduce the UK’s financial contribution to IDA lessens the UK’s ability to influence and advocate for change, stakeholders told us this wouldn’t necessarily be the case as long as FCDO continues to use its technical expertise and strong network.”

ICAI said the UK should push for a stronger focus on climate action if it wants IDA to meet its own climate ambitions.

The review said FCDO could “do more” to push for the implementation of strict environmental and social safeguards that aim to ensure aid programmes do no harm but rather benefit communities and the environment.

The FCDO was also urged to set strategic objectives for the UK’s country-level engagement with IDA; to hold IDA accountable for meeting its “leaving no one behind” commitment; and to strengthen partnerships to improve public financial management and anti-corruption programmes.

Civil Service World asked the FCDO for its response to the ICAI review. It had not provided one at the time of publication.

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