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Will money matter for the future of development? When much of the wider discourse is focused on how to raise more money, the 2014 CAPE conference will ask what sort of difference that money can make in practice
On 23 October 1984, the BBC aired a landmark report on the famine in Ethiopia Describing the crisis as a ‘biblical famine’, the report galvanised the public, spurred the UK government into action and prompted the creation of the infamous Live Aid concert. Join us at The Frontline Club as we examine the current state of conflict and disaster reporting and how humanitarian agencies can work with the media to raise awareness and much-needed funds.
The Future Agricultures Consortium (FAC) is an Africa-based alliance of research organisations that provides independent advice and evidence to improve agricultural policy and practice in Sub-Saharan Africa.
The aim of this Policy Dialogue event is to present key findings and policy insights emerging from a range of Future Agricultures Consortium’s recent research activities.
Through this event, the Climate and Development Knowledge Network intends to explore the linkages between climate change and the post-2015 development framework The event brings together experts and practitioners in climate change and sustainable development to present and discuss the views of developing countries. The outcomes will be shared with the Executive Office of the UN Secretary-General in advance of the Leaders’ Summit on climate change in New York in September.
Development agencies are increasingly interested in making aid more transparent, stakeholder-led, and effective by expanding the use of payment by results (PbR) — rewarding those implementing projects on the basis of results delivered instead of paying for inputs For payment by results to work, you have to get a lot of things right. It has to be for the right kind of programme targeting the right results, properly measured and rewarded in the right way. These issues, and more, are laid out in Stefan Dercon and Paul Clist’s 12 principles for payment by results (PDF).
We agree with much of what they have to say, but their suggested principles would be most appropriate if development cooperation were characterized by stable and predictable relationships between inputs such as teachers hired and outcomes such as basic literacy, albeit subject to unexpected shocks and principal-agent constraints. (Their analysis is set out in more depth in a previous paper co-authored by Clist). Some of their principles would make sense if the comparison were between payment by results and the hypothetical administration of inputs by aid agency staff who have perfect information about the ‘production function’ that mediates the relationship between inputs and outcomes.
We don’t think development cooperation works this way. Below, we set out an alternative 12 principles for payment by results in the real world alongside the corresponding principles proposed by Clist & Dercon.
In our view, development and service delivery are usually the outcomes of complex relationships between inputs, outputs, and outcomes that are not completely known in advance, but discovered through a process of experimentation, learning, and adaptation. We take the view that the advantages and disadvantages of PbR should be judged in comparison to existing input-based aid programmes, which can have serious shortcomings.
Where We Agree
There are significant points of agreement between our principles and the corresponding ones proposed by Clist & Dercon, and we have also benefited from a useful exchange with them about these points. We agree that:
Where We Disagree
In other important respects our principles differ from those of Clist & Dercon, as a consequence of a different view about development cooperation in practice, particularly the challenge of managing complexity:
Finally, we agree with a point made by Paul Clist in the longer paper from which their principles are drawn: donors need to consider the contracts they use for PbR and, where appropriate, make sure that they create sufficient opportunity for implementing agencies to experiment, fail, learn, and adapt. On average, payment by results requires that the payments for successful outcomes must also cover the costs of failures along the way, but this logic is not meaningful if project horizons are so short or working capital so scarce that implementers only have one chance at getting it right. PbR may create circumstances in which experimentation and adaptation are feasible; but this does not mean that all problems can be tackled this way, nor can every implementing partner take advantage of the freedoms that PbR should offer.
We contend that our 12 principles for payment by results are more relevant in the real world, which is characterised by high levels of ambiguity, uncertainty, and unexpected change.
When the US. made its first foray into the International Aid Transparency Initiative (IATI), it adopted a “whole of government”...