UK international development has seen many changes in recent years, and the UK’s reputation as a global leader in transparency has been pulled into question.
As UK agencies renew commitments to improve transparency in Official Development Assistance (ODA), here’s why transparency in ODA is important and why it should remain at the forefront of the UK’s international development work.
What is ODA?
ODA is defined by the Organisation for Economic Cooperation and Development (OECD) as “resource flows, grants, and loans to developing countries and multilateral organisations, which are provided by official agencies to promote economic development and welfare of developing countries”. The list of countries eligible to receive ODA is set by the Development Assistance Committee (DAC) which is made up of 32 donor countries. Of the 32 DAC member countries, the UK is currently ranked 12th on the amount of ODA it spends as a percentage of its income. The UK also has a long-standing commitment to be transparent with its ODA spend.
The Foreign, Commonwealth and Development Office (FCDO), which holds the majority of ODA spend, publishes monthly data and further reports twice a year. These publications tell us their ODA spending for the previous year, projected spending over the next two years, and their overall annual statistics. They contain details such as how much was spent in certain countries, sectors and low- versus middle-income countries.
The FCDO is not the only government department that spends the ODA budget, however, it is currently the only department to publish its projected spending in its annual reports and not just its previous spending in annual statistics. This lack of reporting from other departments causes a transparency issue, as it makes it harder for civil society organisations (CSOs) to understand the government’s decision-making and the full context in which they are operating.
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Why transparency matters
Transparency in ODA spending is key for several reasons. Not only does it strengthen public trust and inform civil society on government decisions, but it is also essential for accountability and ensuring effectiveness in aid spending. When data is readily available, it allows CSOs and data users to pick up on key changes in government spending and reductions in aid budgets. It also shows how government agencies spend money that is set aside for countries and programmes that need it, enabling other development actors to complement and strengthen the work of the UK government.
Transparency is also key for being accountable to people in low- and middle-income countries. If the UK is serious about shifting power, then being open about decision-making and spending is crucial. If the UK government gatekeeps how development decisions are being made and where the money is going, then it is not an equal partnership and does not allow those with lived experience and expertise to lead and inform UK international development decisions.
Before 2020, the Department for International Development (DFID), the UK’s previous bilateral aid agency, had established itself as a global leader in ODA transparency and had consistently received a ‘very good’ rating on the Aid Transparency Index (ATI). Since DFID and the Foreign and Commonwealth Office (FCO) merged to form the FCDO in 2020, challenges in ODA transparency have led to the FCDO being ranked lower on the index. This follows a lack of transparency with ODA budget cuts, and more recently in-country refugee spending and a lack of data being published to the International Aid Transparency Initiative (IATI) during the FCDO’s ‘pause period’ while they merged government systems. The FCDO has now committed to being rated ‘very good’ again in the next edition of the ATI.
Current ODA transparency
The UK currently has some improvements to make before moving back up the Aid Transparency Index from ‘good’ to ‘very good’. Government departments appear to be making attempts to repair their reputations. The FCDO has begun publishing data on IATI again and has stated that they hope to have all data from the pause period publicly available soon. They have also welcomed feedback from civil society and data users to improve dialogue. They also recently improved their transparency in their Annual Reports and Accounts, including breaking down the budget by country. However, there is still a way to go and the FCDO and other government departments have more work to do to improve transparency on ODA spending. Over the next year, we hope to see the UK government work more with civil society in the UK and globally to implement these improvements.