Conditionality

In March 2005, the Secretary of State launched a new policy paper, Partnerships for poverty reduction: rethinking conditionality(146 kb) committing the UK to fundamental change in its relationship with developing countries.

The policy sets out a new approach to enable developing countries to have more room to determine their own policies for achieving the Millennium Development Goals rather than be bound by donor conditions.

The new policy outlines key changes in our approach to conditionality:

• Shared commitments - The UK Government believes that an effective aid partnership is based on shared commitment to poverty reduction, human rights and strong financial management. The UK will only consider reducing or interrupting aid if countries significantly veer away from these or from the agreed objectives of a particular aid commitment.
• Developing country ownership - The UK will support countries' own poverty reduction plans that take account of the views and concerns of poor people - based on solid evidence and wide consultation. It will not use its own conditions to impose specific policy choices on partner countries
• Predictability - The UK will seek to make more aid more predictable by being clear in advance about how much aid will be given and the basis on which funds will be reduced or interrupted. We will only cut aid within a country's financial year in exceptional circumstances.
• Accountability and Transparency- Both partners - donors and governments - should be committed to transparency. The UK will make its own aid conditions more transparent by publishing them on DFID's website.
• Harmonisation - The UK will press the World Bank and the International Monetary Fund (IMF) to monitor and streamline their combined terms and conditions, and will work with donors to limit the overall burden of conditions. 
• Participatory and Evidence-based policy making - To improve the quality and effectiveness of policy-making the UK will encourage participation by poor people and by parliaments in decision-making and policy making. We also encourage policy reforms to be based on sound evidence and an open policy dialogue through the use of Poverty and Social Analysis (PSIA). Civil society can also play an important role as can the media.

Implementing DFID’s conditionality policy

A draft how to note (214 kb) that will support DFID staff in implementing the conditionality policy has been published on our website to allow for a period of testing, comment and reflection. This conditionality guidance draft how-to note is currently being reviewed and discussions are being held with DFID Country Offices, our partners and other external stakeholders. The review will be used to strengthen the guidance which will be ready in early 2007. We have set up the e-mail address conditionality@dfid.gov.uk to receive comments from the public during the review period.

Publishing conditions

The conditionality policy paper included an important commitment to publish our conditions on the website. This is part of broader moves to increase our openness and improve transparency. To publish conditions we will post CAPs and project documents on the DFID website. Where a country office records its country-level relationship in jointly shared text with partner governments that documents will be published subject to joint agreement.

Recent examples of Development Partnership Agreements (DPAs) signed with partner governments:

• Afghanistan(189 kb) - January 2006
• Rwanda(326 kb) - February 2006

Further information on the conditions and benchmarks relating to our budget support programmes:

• Ethiopia Budget Support 2003/04 Project Memorandum(217 kb)
• Ethiopia Budget Support 2003/04 Annex 3 -  Indicators and targets(109 kb)
• Ghana Poverty Reduction Budget Support (PRBS) 2006-08 (edited version)(265 kb)
• Malawi PRBS 2004/05 - 2005/06 Project Memorandum(120 kb)
• Malawi PRBS 2004/05 - 2005/06 Performance Assessment Framework(143 kb)
• Mozambique Multi-donor Budget Support 2007-2011 (158 kb)
• Mozambique Multi-donor Budget Support 2007-2011 Memorandum(260 kb)
• Nicaragua Multi-donor Budget Support 2005(145 kb)
• Rwanda PRBS 2006-08 Project Memorandum(312 kb)
• Rwanda Development Partnership Agreement(326 kb)
• Sierra Leone PRBS 2004-05(262 kb)
• Tanzania PRBS 2006-09 Project Memorandum(177 kb)
• Tanzania PRBS 2006-09 Partnership Framework Memorandum(247 kb)
• Uganda PRBS 2004-05 Programme Memorandum(265 kb)
• Uganda PRBS 2004-05 Annex 4 Political Governance Indicators(48 kb)
• Vietnam PRBS Programme Memorandum(145 kb)
• Zambia PRBS 2006-08 Memorandum of Understanding(127 kb)
• Zambia PRBS Performance Assessment Framework(54 kb)

In January 2006 DFID implemented changes to its internal procedures so that project documents for funding to government now include a section on conditionality. If a project has any specific conditions, as well as the three partnership commitments, they should be detailed under section 5 of the project document. Some project documents are available on individual country pages of this website, or alternatively you can do a search for DFID project documents on the AiDA database.

While we are working towards ever greater transparency around our conditions, we do recognise that the information on the website is not yet comprehensive. There will be significant improvements in the breadth and accessibility of information on conditions early in 2007.

Last updated: 20 December 2006