Financing and Aid Effectiveness

What We’re Reading: From Donorship to Ownership

Domestic financing will be the most important source of funds to deliver on the post-2015 development agenda. That is one of the findings from the High Level Panel Report on post-2015, released last year. For those of you who work on reproductive health in aid dependent countries, the writing is on the wall: it is time to move beyond the heavy reliance on aid to fund reproductive health budgets.To use a cliché from aid effectiveness lingo, it is time to put governments in the driver’s seat.

kwakyeblog
A sample of Kwakye’s blog post, published on Post2015.org.

In a recent blog post and paper, John Kwakye, Senior Fellow at the Institute of Economic Affairs in Ghana reminds us of the common criticisms of aid: insufficient levels of funding; poor allocation across countries and sectors; and volatility, unpredictability, and uncertainty that retards budgets and planning. Aid should be a complement to domestic resources, not a country (or sector’s) primary source of funding. He goes as far as saying, “Aid can be addictive for a nation, which breeds complacency and lethargy in mobilizing recipients’ own resources.”

Does “complacency and lethargy” resonate with anyone? If not, here is an example our colleagues in Malawi are overcoming. The government of Malawi created a budget line for contraceptives a few years ago, but did not put any funding into it. Finally, in 2013/14 successful advocacy paid off and the government allocated $80,000 of its own funds to the budget line. But with donors filling all the country’s contraceptive funding needs, the government had no plans of placing the procurement order. According to in-country colleagues, the feeling was, “We already have the money, so why should we spend our own funds?” Thankfully, a Parliamentary inquiry earlier this year got the procurement order through. We’re excited to support civil society colleagues to stay engaged on Malawi’s contraceptive budget in a second next phase of our RH BudgetWatch project.

Many argue that government budgets are just too small to take leadership in reproductive health, particularly when donors are already happy in the driver seat. So where will the “new” domestic funding for reproductive health in aid dependent countries come from? Colleagues at a recent Advance Family Planning partners meeting strategy session shared some successful tactics, such as analyzing the health budget for wasteful spending, and making a strong case for how investments in family planning underpin progress in other sectors. We can also turn to Kwakye’s paper for ideas, like progressive tax reforms, strengthening capital markets, tapping the diaspora communities, and reversing capital flight. I’m not suggesting that we all need to become experts in taxation and capital markets. But it is time to create alliances with folks already working on creative fixes to domestic resource mobilization in Southern countries.

As folks in New York debate the post-2015 development agenda, let’s make sure those ambitious goals and targets can be fully implemented for reproductive health. Domestic resource mobilization is an essential piece, even in aid-dependent countries. It is time for governments to grab the steering wheel from donors, and get in the driver’s seat. And donors need to be ready to hand over the controls.

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