Roundtable Topic 2: Alignment

This page comprises information on background resources for Roundtable 2, compiled by the United Nations Development Programme. It does not necesserily represent the views of the Third High Level Forum organizers.

To access detailed information on the background resources for Predictability of aid listed below, please visit the UNDP Aid Effectiveness Portal.

Background Resources: Predictability of aid

Mokoro Ltd, “Putting aid on budget: draft literature review”, November 2007
This literature review of good practice guidance and donor policies notes that the term ‘putting aid on budget’ is ambiguous, and can mean inclusion of aid in budget plans, parliamentary appropriations, treasury systems, accounting processes or financial reporting. Developing standard definitions and indicators has been problematic. The contemporary approach to management budgets stresses that they should be comprehensive – that is, include all revenue and expenditure in a single, central fund.  This increases allocative efficiency, while improving external transparency and accountability. Placing aid on the budget results both in improved aid management and a stronger budget processes, ensuring that donor and recipients share common priorities. The report notes that this is a mutual commitment, and that reasons for poor aid capture can include poor supply of information by donors, weak demand for information by partner countries, and lack of realism in information provided by donors (usually in the form of over-estimates of the speed of project implementation). The treatment of non-cash aid in the budget emerges as particularly problematic, with some partner countries lacking budget categories for recording technical assistance and other in-kind support. 

OECD-DAC, “Donor practices on forward planning of aid expenditures”, 11 December 2007
This paper presents the results of a survey of DAC donors carried in 2007.  Most DAC donors have annual aid budgets, supported by 3-4 years indicative budget planning.  There are one-page descriptions of the budget procedures for each of the DAC bilateral donors.