Changing Funding Landscape

PAI is working to assess the impacts of changes in the global aid architecture on funding for reproductive health and family planning and achieving the related ICPD and MDG goals.  While aid as a system is constantly evolving, the Paris Declaration on Aid Effectiveness and Accra Agenda for Action—endorsed  by ministers, heads of agencies and other senior officials in 2005 and 2008, respectively—helped consolidate the momentum to reform the ways that aid is managed and delivered, and is therefore a focus of PAI’s financing work. 

Aid effectiveness is a process that seeks to increase the impact of aid through improving:

• Country ownership over development priority setting and decision making about aid allocations
• Donor alignment of aid funding with these priorities
• Donor harmonization to reduce duplication of efforts and burden on aid recipient countries
• Aid recipient country public financial management, procurement and safeguard systems
• Donor and aid recipient country accountability

For more information on aid effectiveness, see PAI’s 2009 Working Paper, Making Aid Effectiveness Work for Family Planning and Reproductive Health.

Evolving Aid Architecture

Aid effectiveness is changing how countries plan and prioritize spending, as well as management of procurement, logistics, public financial management, monitoring, and reporting to donors.  Aid effectiveness is also changing relationships between donors and aid recipient countries, with the goal to put aid recipient countries more in the “driver seat” of their own development.  Relatively new ways of delivering aid such as budget support—or aid deposited into a government’s bank accounts—and pooled donor funds are making it more difficult to track investments in family planning and reproductive health at the global and country levels. 

The new aid modalities—or ways of delivering aid—are shifting ownership of the development agenda and priority-setting increasingly to the country level.  Poverty Reduction Strategy Papers (PRSPs) and other national development and sector plans, often developed with inputs from civil society and other stakeholders including donor agencies, are the primary way that aid recipient governments prioritize development interventions including family planning and reproductive health services.  Donors are then supposed to align their funding with priority areas identified in PRSPs and sector plans. 

It is important for practitioners working to increase access to family planning and reproductive health services to understand the challenges and opportunities created by these changes. 

Country Ownership

Given this new reality, it is imperative that all developing country governments create an enabling environment for sexual and reproductive health and rights and strengthen civil society advocacy and participation in decision-making.  In line with demand, Southern governments must ensure that interventions identified in PRSPs and sector plans are followed up with dedicated lines within the national budget to fund the provision of reproductive health services and supplies, including contraceptives.  Resources in that budget line must be protected, and spent as planned.  Civil society groups and the public should be able to fully participate in consultative and decision-making processes around the national budget and policy decisions at the national and sub national levels. 

Budget Support and Pooled Funding

As part of harmonization, donors are increasingly moving from funding particular family planning or reproductive health projects to budget support often used to fund PRSPs and sector plans.  Since budget support is deposited into a country’s bank account, it is subject to government budget-making, procurement, monitoring, evaluation and reporting systems.  Basket funds are another way that donors harmonize aid by placing funds for a particular project or program into an account that pools other donor funds.  Basket funds can be used for budget or sector support, or to fund a specific project.  Budget support and basket funds are only as sensitive to reproductive health and family planning as the project or program that they support, and they can make tracking donor funding to specific areas difficult.  Using reproductive health indicators such as contraceptive prevalence rate to monitor the performance of basket funds, budget and sector support is one way to ensure that they benefit reproductive health.

The Need to Strengthen Country Systems

Changing funding mechanisms have brought new challenges to providing quality reproductive health and family planning supplies.  Evidence from Tanzania and Malawi suggests that the transition from in-kind donor contributions to budget or health sector support, where aid recipient countries are responsible for distribution of family planning and reproductive health supplies, can lead to delays that jeopardize people’s ability to obtain contraceptives.  It is important to build the capacity of aid recipient governments to manage procurement, logistics and distribution of quality reproductive health supplies.  Donors should continue to use a mix of funding mechanisms depending on the country context and needs, and be ready to provide emergency in-kind donations when necessary.