What should count as aid?
Australasian Aid and Development Workshop
Australian National University
13 February 2014
Jonathan Pickering
PhD candidate, Centre for Moral, Social and Political Theory
Australian National University
Jonathan.pickering@anu.edu.au
Outline
1. Why revisit aid eligibility?
2. The OECD definition and the question of
development intention
3. Current exclusions
4. Proposed exclusions
5. Recommendations and conclusion
2
1. Why revisit aid eligibility?
•
•
•
•
Changing geography of poverty
Broader flows of financing for development
Post-2015 goals
Policy contention in Australia over refugee
costs, climate finance
3
2. OECD work on measures of
development finance
• Develop new measure of Total Official
Support for Development (TOSD)
• Investigate whether to revise definition of
Official Development Assistance (ODA)
4
ODA: the current definition
• Donors: governments of OECD countries
• Recipients: on the DAC list of developing
countries
• Concessionality: grants or low-interest loans
• Development intention: “administered with the
promotion of the economic development and
welfare of developing countries as its main
objective”
5
Criteria for a definition of aid
• Integrity / credibility
– Maximise development-oriented funding
– Filter out incompatible interests (the “that’s
not aid!” test)
• Adaptiveness
– To changing development needs
– To understandings of good development
practice
6
3. Current exclusions: rationales and
examples
• Primary benefit to donor
– Counter-terrorism
– Carbon offsets
• Non-developmental benefits to recipient
– Military aid
– Peacekeeping
– Social and cultural programs
+ risk of adverse
impacts
7
4. Proposed exclusions: in-donor costs
• Reasons for exclusion:
– Primary benefit to donor / uncertain benefit to
recipient country (scholarships)
– Risk of adverse impacts (refugee costs)
• Reasons for inclusion:
– Budgetary effort for donors
8
Proposed exclusions: climate finance
• Reasons for exclusion:
– Diversion of funds from existing development
priorities
– Remedying harm (entitlement not aid)
– Global public good
• Reasons for inclusion:
– Adaptation and development closely linked
– Safe climate a precondition for development
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Climate finance: the problem of diversion
Source: Tomasi (2014).
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5. Recommendations
• In-donor costs: cut down on problematic
cases
• Include climate finance but safeguard
against diversion through:
– Eligibility caps
– Innovative financing sources
11
DAC scenarios for redefining ODA
Broad
‘Updated’
ODA
Current
ODA
(Gross
disbursement)
(Net disbursement)
$127 bn
Dev’t
intention
‘Focused’
ODA
‘New’ ODA
$138 bn
(Budgetary effort)
$129 bn
(Budgetary
expenditure)
$114 bn
Narrow
Source: OECD 2014 (using 2012 ODA data).
Concessionality
Broad
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Interactions between ODA and total
support: a scenario
Broad
Dev’t
intention
Total Official
Support for
Development
Current
ODA
Revised
ODA
Narrow
Concessionality
Broad
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