January 2012

Independent research & practical ideas for global prosperity 

Cash on Delivery Aid | January 2012  

Seen and Heard

During the Fourth High Level Forum on Aid Effectiveness in Busan, CGD, in collaboration with a group of donor agencies, organized a side event about results-based approaches to aid. Nancy Birdsall moderated the event and presented examples of various approaches being explored, and a distinguished group of speakers spoke about their experiences with pilot programs. The event featured Andrew Mitchell, Secretary of State for International Development, UK; Erik Solheim, Minister for Environment and Development Cooperation, Norway; Charlotte Petri Gornitzka, the director general of the Swedish International Development Agency; and Andris Piebalgs, the European Commissioner for Development, with additional contributions by Mamadou Biteye of Oxfam Great Britain, Joachim von Amsberg of the World Bank, and Owen Barder of CGD. Speakers emphasized that results-based aid allows recipient country governments to define the results they want to achieve, and also offers advantages for donor country taxpayers. Questions from participants related to the level of risk borne by recipient countries, as well as the need for efforts to ensure that a results-based approach does not mean a focus on those things that are easiest to measure.

CGD released a working paper by Bill Savedoff and Katherine Douglas Martel that examines the challenges of applying COD Aid to health. The paper considers 10 indicators related to reducing child mortality, maternal mortality, and the prevalence of malaria and HIV/AIDS. It discusses how each indicator could be used in a COD Aid agreement.

A new CGD working paper by David Wheeler, Dan Hammer, and Robin Kraft illustrates how an incentive system could rapidly reduce forest clearing in tropical countries. The paper proposes a Tropical Forest Protection Fund that would take advantage of the FORMA (Forest Monitoring for Action) database to provide independent verification of results, upon which payments would be made, following the COD Aid model.

Foreign Policy ranked Nancy Birdsall as one of the top 100 global thinkers of 2011, for offering an answer to complaints about the foreign aid system. In claiming that COD ‘now has a chance to deliver’ they outline how COD Aid works and mention pilot programs in Ethiopia and India, sponsored by Britain’s Department for International Development.

COD Aid in the Media

Reflecting on Bill Gates’ Innovation with Impact report, aimed at G20 leaders and focusing on creative methods to source more development financing, the Clinton Health Access Initiative has detailed benefits of adopting a COD approach to aid. In a blog post written for Malaria No More UK, CHAI provides a clear account of COD Aid and its key advantages, with emphasis on potential benefits for health priorities, specifically malaria and maternal mortality.

On the Horizon

The Clinton Health Access Initiative is currently developing proposals for COD Aid for sustaining malaria control and reducing maternal mortality.

The UK Department for International Development is moving forward with a nationwide COD Aid pilot in the education sector in Ethiopia. Payments will be based on each student above a baseline that takes a grade 10 exam, with additional payments for students that pass the exam, and higher payments for girls than boys, and for students in emerging regions. DFID is in the process of working with groups that will conduct the independent verification of reported results, and an evaluation of the pilot program.

Team Update

Over the course of last year, the COD Aid team watched enthusiasm grow for the idea of testing results-based aid – an innovative approach that seeks to focus on outcomes and improve the existing relationships between donors and recipient country governments, and recipient country governments and their citizens.  We saw at the High Level Forum in Busan that there is a serious focus on quality measures of results, which we heavily emphasize whenever we talk about Cash on Delivery. A number of organizations, with whom we continue to collaborate, are exploring how they can use the COD Aid model to increase their focus on achieving and measuring sustainable results. We look forward to seeing the implementation and evaluation of their pilot programs throughout 2012.

Best wishes for the New Year!

Rita Perakis
Research Associate
Center for Global Development