• Amount and predictability of funding

Amount and predictability of funding

Donor commitments to individual countries remain short-term and highly conditional and do not come close to reflecting the global promises of increased aid, while donor disbursement performance remains volatile and unreliable. This paper discusses options for addressing aid commitment, aid predictability, and budget management issues that are critical to tackling this problem.

It examines:

• What can be done to encourage governments to reflect donor promises of increased aid in their expenditure plans?
• How can longer-term commitments be reconciled with aid effectiveness?
• Should external aid support the government plan?
• How can the costs of aid volatility be reduced?
• How can countries insure against donor non-performance?
  

The paper details options for addressing these issues, and their benefits, constraints and disadvantages. For instance, in response to how countries can reduce the costs of aid volatility which disrupts the implementation of expenditure programmes, the paper suggests possible solutions including: improve aid monitoring; improve government absorptive capacity through capacity building, decentralised management, public expenditure management reforms; and donors use simpler, harmonised procedures to deliver aid based on those used by national governments

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