Tuesday, February 15, 2022

'Waste Not, Want Not' - Annual vs Multi-Year Funding - Development Assistance Perspectives

 In-field assessment highlighting implications of Norad's annual funding on localization efforts - including collaboration, learning and adaptive management.

Text by Blogger 


This post asks critical questions around the efficacy of funding modalities (enduring and current) in a period of unprecedented change. It is very specific to one donor, one international non-governmental  organization implementing within the Sudan country context. However, since the Norwegian Agency for Development Cooperation (Norad) funds several INGOs globally, often across a dozen or more countries, aid effectiveness issues are compounded. My most recent experience was with Norwegian Church Aid (NCA) as Sudan's Country Program Manager spanning a period of two years (2019-2021). The 'world's apart' policy and institutional arrangement disconnect between Oslo-Norway and the field, including implementation realities and challenges, is argued. Similarly, lofty ODA principles and ideals, articulated in Norad strategies and on organizational websites are shown to be a contradiction in terms and to actively hamper sustainable development. A local, in-country partner perspective is offered as they grapple to take full ownership of projects within increasing fragility and instability. Finally, potential solutions are offered through a range of scenarios in order to respond, proactively, to very real and stifling implementation challenged. 

Funding and programming in times of unprecedented uncertainty

Aside from the ongoing COVID-19 pandemic, during my tenure in Sudan the country and its people endured the Revolution for Freedom and Change (2019) which toppled the dictatorial Bashir regime.  Barely a year later, a 100-year Nile flooding event inundated 17 of the country's 18 states causing widespread infrastructure damage and untold socio-economic misery. Subsequently, the country has endured several coup attempts which culminated in the telling October 2021 coup. This has seen the reversal of transitional democratic gains and further plunged the country into debilitating paralysis.  

Actual measures of aid effectives range from the traditional stalwarts of accountability, performance-spend, outcomes-impact, capacity development, sustainability to more recent indicators including collaboration-partnerships, learning and knowledge management, localization and adaptive management. Recent ODA trends are towards empowering and enabling local partners, NGO's and implementers to take full control (ownership) of their development destinies. In the case Sudan herein lies an anomaly and perhaps, a contradiction. Even so, there remains an argument for a departure from the same old, same old boilerplate, funding template. 

Siles (PM4DEV Blog, 2021) supports the notion of an adaptive project management approach in relation to development projects, citing several reasons that set ODA apart from 'traditional (or predictive) project management.' 

ODA takes place in complex, non-linear, and unpredictable environments:

  1. The ODA goal is not simply completion but rather about process, engagement and content - the HOW  in project delivery. Equally central are the ownership and satisfaction of various and diverse stakeholders; 
  2. The interconnectedness of elements in the project cycle where every project is a dynamic, learning environment;
  3. Initial and ongoing assumptions are never accurate hence a 'design and implement' methodology can introduce real time flexibility and responsiveness; 
  4. Change is inevitable, increasingly variable and is happening with greater regularity.  


Norad in a nutshell  

According to the Norad website, the agency’s primary purpose is to 'ensure that development aid funds are spent in the best possible way, and to report on what works and does not.’ The Agency is a directorate under the Norwegian Ministry of Foreign Affairs (MFA). Norad’s functions are laid down in the agency’s terms of references and annual letters of allocation issued by the Ministry of Foreign Affairs and the Ministry of Climate and Environment.

 In their new strategy, ‘Norad of the future’, the agency aligns itself scrupulously with the 2030 Sustainable Development Goals as strategic and operational foundations.

 'Norad will make every effort to ensure the goals are achieved!' In so doing: 

  1. The agency's main task is to invest strategically in cooperation with partners.
  2. Norad's work must be based on knowledge and insight – facts inform policy.
  3. Quality assurance (and monitoring) of Norwegian aid measures is one of the agency's most important responsibilities. 

As a comparative analysis, the USAID Framework for Collaborating, Learning, and Adapting (explicit in the Norad approach) is the State Department's way of incorporating cutting-edge and agile approaches into foreign assistance. The data-informed approach requires programs to proactively measure outputs; share good and bad practice with donors, and make rapid pivots to always enhance  outcomes - impact. The end result, hopefully, is effective aid.

 The Agile approach and associated software focuses on 'speeding up solution delivery and enabling earlier decision-making with incremental, iterative planning and execution, led by small teams that collaborate closely with stakeholders to respond rapidly to change.' A notable difference is that whereas Norad implements annually through a multi-year framework agreements, USAID provides  multi-year funding ranging between a 3-5 year period. USAID characterises its operating environments as 'some of the most chaotic and challenging on earth.' Norad operates within the very same environments.

 In countless animated discussions with NCA colleagues, in Sudan and Oslo, on the issue of annual funding limitations many dismiss, outright, the notion of any form of status quo change with a resigned shoulder shrug and this is the way its always done. Seemingly, a change requires parliamentary, constitutional and policy amendments - too hard to contemplate and do since it involves key, gatekeeper ministries in Foreign Affairs and Climate and Environment. Whatever happened to a living, flexible and responsive policy ODA  framework? 

Strikingly, according to Norad's 2020/2021 Annual Report (entitled Knowledge in a time of crisis  – Norad Evaluation department) an overriding principle in the evaluation and by implication, aid effectiveness of Norwegian development cooperation has been that 'the development assistance system must continue to learn from experience.' Whereas the report poses a key, recurring question of: How can we ensure that lessons learned from completed evaluations are incorporated into the ongoing work of improving Norwegian development cooperation, it seems rather light on 'learning by doing' answers.  A rapid scan of several evaluation reports commissioned by Norad in recent years reveals no mention of funding modalities (annual and multi-year) and how they may impact, big-picture, upon planning and program delivery.  

The report cites 3 key findings. 

  1. 'Better decision-making basis is needed in development assistance. Cooperation is risk-tolerant and flexible, but it also entails important challenges on how knowledge is applied' - a clear reference to the issue of agility and the willingness to make essential pivots or adaptive management;
  2. Development cooperation must strengthen its ability to collect data and perform analyses and evaluations as part of and during ongoing initiatives in order to improve results management (refer to contemporary aid effectiveness - measures and the perennial question of : What is the purpose of M&E'?;
  3. 'We do not work systematically enough with countries that advance from low-income to middle-income status.' 

The report's concluding comment is that the 'starting point for how the whole system must view - Knowledge in a time of crisis learning and is the responsibility of everyone who is involved in Norwegian development cooperation.' This implies that ALL, of the dozen or so Norwegian NGOs (receiving in total 15.12 % of Norad framework funding), have the responsibility too seek creative solutions and incorporate adaptive approaches especially in funding and project management iterations.  

Norwegian Church Aid (NCA) in partnership with Norad

The Norad-related graphics depicted in this section below are outdated but nevertheless useful in the portrayal of basic background information and general funding trends in recent years. Its questionable as to whether the same B.C. - before COVID-19 data and analysis is available at this point in time as the pandemic lingers into its third year.   

Fast Facts: Current NCA agreement with the Norwegian Ministry of Foreign Affairs (MFA)

  • NCA’s four-year Strategic Partnership Agreement (SPA) with the MFA is entitled NCA Saves Lives, Alleviates Suffering and Protects Human Dignity;
  • SPA is valid from January 1, 2020 to December 31, 2023. The total financial frame is NOK 840 000 000 (annual frame of NOK 210 000 000);
  • Twelve countries are included: Afghanistan, Bangladesh, DRC, Iraq, Lebanon, Mali, Nigeria, Palestine, Somalia, South Sudan, Sudan and Syria. Five countries, Lebanon, Nigeria, Somalia, South Sudan and Syria, are included for the entire agreement period;
  • Six global projects are also included and focus on six areas: Capacity and Response; Coordination and Advocacy; WASH; GBV; ASRH; and Protection. 

Fast Facts: Current NCA agreement with the Norwegian Agency for Development Cooperation (Norad)

  • NCA’s five-year Cooperation Agreement (CA) with Norad commits NOK 1.7 billion to its long-term development programmes and is valid from January 1, 2020 to December 31, 2024; 
  • The Cooperation Agreement comprises: - A global civil society grant entitled Leveraging Faith Towards Inclusive and Just Societies which consists of six thematic programmes (Gender-Based Violence, Climate Resilient WASH, Peacebuilding; Climate Smart Economic Empowerment; Faith-Based Climate Action and Fighting Inequality);
  • The grant is implemented in 17 countries and includes two regional programmes; one global programme and global projects. - Minorities of Faith and Belief; and - Regional grants in eight countries.

Funding Updates,  as at February 2022, according to Donor Tracker

  • Norway is the ninth-largest donor country, spending US$4.2 billion on ODA in 2020. It is second-largest donor in proportion to the size of its economy: ODA stood at 1.11% of the country's gross national income (GNI). There is a cross-party consensus to maintain ODA at around 1% of GNI. 
  • Norway’s commitment to spend 1% of its GNI on development cooperation means that increases in ODA are closely linked to Norway’s economic growth. In May of 2020, the government reiterated its intention to uphold this commitment, even in the wake of the COVID-19 crisis. The new government, in place since September of 2021, is also committed to spending 1% of its GNI on development cooperation. Due to the economic downturn caused by the pandemic, the ODA budget is marginally lower than 2020. 
  • In October of 2021 the government proposed the budget for 2022, which includes a development assistance budget of over NOK41.0 billion (US$ 4.7 billion ). This corresponds to 1% of Norway’s estimated GNI for 2022 and would mean an 8% increase in ODA over 2021. The proposed budget still needs to be approved by the parliament.

NCA Sudan: typical annual funding and project management cycle dictated by MFA-Norad.

A significant portion of NCA Sudan's programming is implemented 'indirectly' through local partners or NGO's (also referred to as accompanied partners). They are a mix of long to short-standing relationships, ranging from highly to less competent implementers. Some, thanks for NCA's ongoing support, have diversified their funding base and receive multi-year contributions from other donors beyond the NCA: MFA and Norad pool. Others, less experienced and innovative rely wholly on NCA: MFA and Norad funding. This single source funding dependency is problematic and contrary to localization and sustainable development. 

Within the over-arching framework agreements (both SPA-MFA and CA-Norad) budgets and workplans are prepared, in-country by both NCA: Sudan and local partners, for the upcoming calendar usually in the final quarter of the preceding year. The Norwegian Parliament approves aid budget appropriations in February/March and several weeks later (roughly March/April) Norwegian INGOs receive approved funding which could differ from the framework agreements and rarely match or are aligned with in-field budgets and workplans. Workplan and budget revisions are then required to achieve an annual funding match. This translates to revisions at local partner level too. The propensity for and preoccupation with over-planning and budgeting reduces this to an often senseless, repetitive, mind-numbing tick-box exercise.  Local implementing partners finally receive funding (May/June) to kick off operations for the year usually in 2-3 tranches. Several implementation months are already lost. Typically in Sudan, the arrival of MFA-Norad funding coincides with that of the wet - rainy season which, with increasing climate change-driven variability, extends from June through to October. During this period large parts of the rural countryside are inaccessible and hard - infrastructure activities have to be postponed to the drier, final quarter of the year. Soft activities centred around community mobilization, education and training at accessible towns and villages are possible.

  1. Local partners are only able to retain core Khartoum staff -  due to cash flow issues between successive years. Field staff located at strategic state locations have to be recruited annually once funding becomes available in the new calendar year (most project staff are unemployed between January-June). 
  2. In some instances, salaries only are advanced to local partners to retain staff but then activity - operational funding only follows several months later with the result that project staff are being paid for little or no work effort. 
  3. In the absence of operational funding, there is the perpetuation of planning - planning to plan - going through the motions - reactive. 
  4. Broken, insecure and inconsistent tenure impacts upon loyalty and motivation. 
  5. Competent staff with high demand - required skills, knowledge and attitudes (SKAs) are lured across to other NGOs and UN agencies as more stable and long-term tenure is almost guaranteed ie annual or multi-year contracts as opposed to 6 months.
  6. Key environmental factors and a short 4-6 month implementation period means that standards and quality implementation are often comprised in the mad dash to spend operational funding by December 15th. 
  7. Unspent funds have to be returned with no option of roll or carry-overs - there is the possibility that funding can be squandered or irresponsibly spent in order to clear the books.
  8. Localization and ownership is stymied and instead of setting good development assistance examples/practice, local partners are frustrated by systems, procedures and funding idiosyncrasies beyond their control. 
  9. Local partner innovation and creativity is removed from the Triple Nexus equation resorting to a default same same principle without any form of flexibility or acknowledgement of the local, in-country context and challenges. 
  10. The concept and practice of complexity awareness monitoring, particularly in fragile and conflict awareness countries such as Sudan, is largely redundant and ignored. There is little or no opportunity for application of learning - adaptive management - AUTOREPEAT is the  normative practice. 
  11. Sustainable development becomes the casualty with desperate beneficiaries being short-changed. 

Scenario planning - Learning from Lessons

Practise what is preached -  Pause, Reflect and Adapt

High Road Scenario 
Introduce multi-year funding modelled on other donor experiences - methodology commencing with a 3-year funding period initially and then moving to 5-years with effect from the new Norad-MFA funding framework agreement in 2026.

Mid Road Scenario 
Pilot, across a minimum of 50% of Norwegian INGOs, 2-multi year funding commencing in 2024 for the remaining 2 years of the Norad funding framework agreement Yrs 2024/2025

Low Road Scenario
Pilot, across a minimum of 25% of Norwegian INGOs, 2-multi year funding commencing in 2024 for the remaining 2 years of the Norad funding framework agreement Yrs 2024/2025.

1 comment:

  1. HI Barry. Hope you well. I enjoyed reading this, thanks. It's seems like a no-brainer to me that annual allocations are counterproductive in these contexts and I would imagine result in a reporting and planning paralysis - a year being such a short time. Surely, there must be some justification for this approach from the Norwegian govt. What is it? Stay well and keep safe. Myles