Intervention Summary
Title: Voluntary Core Funding Support to the United Nations Children’s Fund
(UNICEF) 2011 – 2015
What support will the UK provide?
1. In 2011 DFID carried out an assessment of the effectiveness of 43 multilateral agencies
that receive funding from the UK. The Multilateral Aid Review (MAR) showed that UNICEF
performed very well against the review’s criteria and offered very good value for money for
UK aid funds. However, it also identified a number of reforms which are needed to further
strengthen the organisation. The Secretary of State has agreed that DFID should provide
£40m in annual voluntary core funding to UNICEF for the next 2 years, after which
decisions about funding will be based on progress against MAR reforms.
2. The provision of voluntary core funding allows UNICEF to operate globally and will cover
the cost of administering its work as well as investing in specific programmes and projects
at country level to deliver results for children. Providing voluntary core funds will also allow
the UK, through its position on UNICEF’s Executive Board, to support organisation-wide
reforms that need to occur at the same time as supporting UNICEF to deliver results in key
UK policy priority areas.
3. This business case provisionally allocates £160 million of voluntary core funding support
over the period of 2011- 2015 to UNICEF. For financial years (FYs) 2011/12 and 2012/13
voluntary core funding will be paid at £40m each year. In FY 2013/14 a mid-point review
will be undertaken to assess progress against key reforms in areas identified as weak by
the MAR, including UNICEF’s delivery in humanitarian emergencies and results reporting.
The outcome of the mid-point review will allow DFID to decide if voluntary core funding
should be maintained at £40 million per year, increased, decreased or whether voluntary
non-core funding should instead be provided to specific programmes. In the meantime,
indicative funding levels for FYs 2013/14 and 2014/15 remain at £40 million per year.
4. In addition to the voluntary core funding support that is covered in this business case, DFID
country offices will provide voluntary non-core funding for specific projects. Country offices
will prepare separate business cases but should take into account the organisational
weaknesses that were identified by the MAR. DFID’s Conflict, Humanitarian and Security
Department is also providing voluntary non-core funding support to UNICEF’s Office of
Emergency Operations (EMOPS). In 2010 the UK provided a total of $225.5 million of
voluntary non-core funding support through thematic or country level projects.
Why is UK support required?
5. Multilateral organisations are an essential part of the international system for humanitarian
and development aid. They have a global presence and the legitimacy to work even in
politically sensitive contexts where national governments are not welcome. This is
particularly true of UNICEF. It is the UN agency which is mandated to advocate for the
protection and promotion of the rights of the child, to meet children’s basic needs and to
expand their opportunities to reach their full potential. It has a strong poverty focus and
plays a critical role in meeting UK and international development objectives, including
delivery of the Millennium Development Goals.
6. UK core funding to UNICEF will contribute to the achievement of results which are
important to the UK, including improving child and maternal health, better nutrition, access
to water and sanitation, girls’ education, HIV / AIDS and child-sensitive social protection. It
will allow UNICEF to provide vital support and coordination in humanitarian emergency
situations where it is the cluster lead agency for nutrition, water and sanitation and
hygiene, and education (co-lead). UNICEF also has a substantive role in the health and
protection clusters.
What are the expected results?
Outputs
7. Through this voluntary core funding contribution DFID expects to see UNICEF continuing
to deliver results for poor people on the ground and making progress against the key
reform priorities identified through the MAR. In particular, the provision of this funding will
support UNICEF to:




Improve its leadership and delivery in rapid onset humanitarian emergencies and
protracted crises;
Strengthen its monitoring and reporting of results at the organisational level;
Maintain its performance in areas where the MAR identified it was performing
satisfactorily, particularly its programme delivery at a country level;
Demonstrate how it is driving down costs, achieving value for money and increasing
transparency.
Outcomes and Impact
8. At the end of the 4 year period, DFID expects UNICEF to have achieved the outcome
targets set out in its own Medium-Term Strategic Plan results framework and to show
evidence of this. It is also expected that UNICEF will maintain its ‘very good’ MAR
assessment and improve on those areas assessed as ‘weak’. At the impact level, we
expect UNICEF to contribute towards the achievement of the Millennium Development
Goals.
9. UNICEF’s organisational results framework and reporting is currently weak and cannot be
used to assess how UNICEF is delivering on the ground. Addressing this issue is one of
DFID’s top reform priorities. For the first two years, the project’s logical framework
(logframe) will therefore principally track progress against MAR reform priorities. After the
mid-point review has been undertaken in 2013/14 DFID will revisit the logframe and, where
possible, update this to include more of UNICEF’s own indicators to monitor the
development results supported by DFID’s voluntary core funding.
Business Case for: United Nations Children’s Fund (UNICEF)
Strategic Case
A. Context and need for DFID intervention
Summary of Need
10. The UK’s Multilateral Aid Review found that UNICEF was providing very good value for
money for UK aid investment and that it has a critical role in making progress towards the
Millennium Development Goals, especially those relating to child and maternal health, girls
education and HIV / AIDS. UNICEF’s important role in ensuring children’s basic needs are
met and its clear links to DFID’s priorities demonstrate the need for the UK to continue to
provide voluntary core funding to support its essential work. However, there are a number
of organisational reforms that need to be addressed in the short term and DFID will work
closely with UNICEF to ensure that these are taken forward.
Background and International Response
11. Globally the under-five mortality rate has decreased from 89 deaths per 1,000 live births in
1990 to 60 in 20091. Yet over 8 million children under the age of five still died in 20092.
22% of children in developing countries are moderately or severely underweight 3, only 82%
of one year olds are immunised for DPT3 (diphtheria, pertussis and tetanus)4, 68 million
primary school aged children are not in school5 and an estimated 2.5m children (0-14
years) are living with HIV6.
12. The United Nations Children’s Fund (UNICEF) has a critical role within the multilateral
system in addressing these challenging issues. It is the UN agency mandated to advocate
for the protection and promotion of the rights of the child, to meet children’s basic needs
and expand their opportunities to reach their full potential. Its work on issues such as
improving child and maternal health (including through better nutrition and access to water
and sanitation), girls’ education, HIV / AIDS and child protection including child-sensitive
social protection are critical to the achievement of the Millennium Development Goals
overall.
UK Priorities and UNICEF
13. UNICEF is a critical partner in achieving many of the UK’s development and humanitarian
objectives. The UK government has placed particular emphasis on reducing the impact of
malaria; improving reproductive, maternal and newborn health; and improving girls’
education and UNICEF has an important role to play:
Malaria: The UK is committed to reducing the impact of malaria, as described in its
‘Framework for Results for Malaria in the Developing World’7. The framework highlights
1
http://www.childinfo.org/mortality.html
http://www.childinfo.org/mortality.html
3
http://www.childinfo.org/undernutrition_status.html
4
http://www.childinfo.org/immunization.html
5
http://www.childinfo.org/education.html
6
http://www.childinfo.org/hiv_aids.html
7
http://www.dfid.gov.uk/Documents/publications1/prd/malaria-framework-for-results.pdf. Published in December
2010.
2
UNICEF’s important role as an advocate for the health and well-being of children; its
procurement of insecticide treated bednets (ITNs) and long-lasting insecticidal bednets
(LLINs); and its support at the country level in implementing evidence-based malaria
policy and strengthening the integrated delivery of malaria interventions within wider
health care programmes.
Reproductive, Maternal and Newborn Health (RMNH). The UK Government is
committed to improving RMNH8. It is also important that multilateral agencies deliver
results more efficiently and effectively in this area. The UK expects to see UNICEF
provide strong technical and policy leadership on newborn health (especially at
community level), girls and maternal under-nutrition and breastfeeding, and adolescent
health more generally. UNICEF will also have an important role in developing and
testing new approaches for scaling-up integrated programmes, working closely with other
UN partners in the ‘H4+’9, and in championing a girl- and equity-focussed agenda at
global and country levels.
Girls’ Education. In March 2011, the UK set out ‘A New Strategic Vision for Girls and
Women: Stopping Poverty Before it Starts’10. Getting girls through secondary school is
one of the key aims identified and requires a focus on all girls completing primary
education with good learning achievement so that they can progress to secondary level.
UNICEF’s emphasis on improving gender equality in education and targeting the world’s
most disadvantaged children will contribute to this aim. We would like to see UNICEF
ensure that its technical expertise and coordinating role in girls’ education at the country
level is consistently delivered across its programmes.
14. UNICEF also has a number of other critical roles in the international system, including in
relation to wider UK policy priorities:
 UNICEF has a global presence, delivering programmes in more than 150 countries
including those which the World Bank classifies as low income or lower middle income
and all those which the UK considers to be fragile. This allows it to deliver aid on a
large scale with the support of key NGO partners and national governments where
appropriate. Its mandate allows it to deliver on international agreements in relation to
the rights of the child in a way that individual countries cannot match. Its legitimacy,
authority and universality are a key strength and its neutrality allows it to play a unique
role in humanitarian crises.
 UNICEF is able to implement at scale packages of services aimed at maternal,
newborn and child survival, including nutrition and water and sanitation. UNICEF
delivers low-cost, low-technology and high impact interventions such as the provision
of vaccines, antibiotics, micronutrient supplementation, insecticide-treated bednets,
improved breastfeeding practices and the adoption of safe water, sanitation and
hygiene practices. In 2010, UNICEF assisted an estimated: 293m children with 2
doses of vitamin A supplement; 42m people with bednets; 7,700 health centres with
improved emergency obstetric care facilities; 3.8m households with access to
improved drinking water; and 2.1m households with improved sanitation facilities11.
8
Choices for Women: Planned Pregnancies, Safe Births and Healthy Newborns:
http://www.dfid.gov.uk/Documents/publications1/prd/RMNH-framework-for-results.pdf
9
H4+ refers to the UN Health 4 group (an intensified effort by WHO, UNFPA, UNICEF and World Bank to support
countries in improving maternal and newborn health and saving the lives of mothers and babies) plus UNAIDS.
10
http://www.dfid.gov.uk/Documents/publications1/strategic-vision-girls-women.pdf
11
Source: Annual Report of the Executive Director 2011, UNICEF
 UNICEF has an essential role in humanitarian emergencies and 28% of its income
was earmarked for this purpose in 2010. It is the cluster lead for nutrition, water and
sanitation and hygiene, and education (co-lead). It also has a substantive role in the
health and protection clusters. The scale of its operations cannot be delivered by
other multilateral organisations although there are some concerns that it could be
spread too thinly by taking a lead role in so many areas. The next two years are
therefore a vital opportunity for UNICEF to demonstrate its leadership of humanitarian
clusters and set a benchmark for others to follow.
 UNICEF has a unique role in advocating for children’s rights and protecting them from
violence, exploitation and abuse (for example, contributing towards the elimination of
female genital mutilation / cutting), including through social protection systems which it
aims to make more child sensitive.
 It puts a child focus on other issues such as HIV / AIDS where it works to prevent
mother to child transmission (PMTCT) of HIV, provide paediatric treatment, prevent
HIV infection among adolescents and to protect and support affected children.
 UNICEF is pioneering an equity approach to achieving the MDGs, emphasising the
need to identify the most vulnerable and poorest children and make them top priority.
Multilateral Aid Review Findings
15. The Multilateral Aid Review (MAR) was commissioned by DFID’s Secretary of State to
assess the value for money and impact provided by multilateral agencies that receive
funding from the UK. Overall it found UNICEF to be providing very good value for money
but also identified that UNICEF’s performance needs to improve in a number of areas.
16. The MAR found that UNICEF’s strengths included:




its strong poverty focus and critical role in meeting UK and international development
objectives;
the good results it achieves at the country level through its development-focused
programmes;
its partnerships with governments and civil society in-country and emphasis on building
the capacity of local partners;
its good progress on gender, including its significant advocacy role for girls’ education
and promoting sex-disaggregated data.
17. Areas where UNICEF’s performance needs to significantly improve are:


Better humanitarian delivery. UNICEF has a vital operational and leadership role in
delivering international humanitarian objectives but its performance has been
chronically inconsistent, particularly in terms of its leadership of clusters (globally and
on the ground). Concerns remain about UNICEF’s ability to recruit and deploy the right
staff to lead clusters, cluster coordination, effectiveness in working with NGOs and its
timeliness and predictability in transferring funds to implementing partners.
Improve its monitoring and reporting of results. UNICEF was assessed as having weak
strategic and performance management by the MAR. Its organisational development
results framework contains limited information on outputs, its corporate reporting
doesn’t systematically report against the framework, and there is too often a focus on
activities rather than results. UNICEF needs to strengthen its monitoring and reporting


of the expected and actual results (outputs and outcomes) of its interventions at the
organisational level in order to build its organisational effectiveness and to demonstrate
impact, attribution, and value for money.
Greater leadership and more strategic partnerships in the UN system. The MAR
identified concerns about UNICEF’s inconsistent approach to working effectively with
other UN agencies. We would like to see UNICEF providing strong leadership to
realise a more efficient, effective and coherent UN.
Improvements in cost control and transparency. Whilst UNICEF has been taking
positive steps to improve cost control, including reducing its administration to
programme ratio, it does not comprehensively report on the cost efficiency of its
operations. Although it publishes some programme information, its transparency does
not yet meet the highest standards.
18. The MAR also identified weaknesses in other areas of UNICEF’s performance, including
climate change and environmental sustainability. The UK is clear that it does not want to
see UNICEF broadening its mandate. However, we do want to see UNICEF addressing
environmental sustainability issues in its programming and mainstreaming climate change
within its projects where appropriate. Examples could be utilising its education
programmes to increase awareness about the value of environmental and natural
resources to society, planning for climate resilience and environmental sustainability in its
water and sanitation programmes, or disposal of project supplies following humanitarian
emergencies.
Likelihood of Positive Change
19. UNICEF’s Executive Director and senior management have committed to reform. The
Executive Director has also specifically acknowledged the reform priorities that were
highlighted in the Multilateral Aid Review. Previously the pace of change within UNICEF
has been slow and it is hoped that the Executive Director, who has only been in post for
just over a year, will be able to push reform throughout the organisation at a faster pace.
Support from UNICEF’s Executive Board will also be essential to achieving reform.
However, in the past there appears to have been some resistance from the Board to major
reforms around humanitarian issues and UN reform. The UK must therefore undertake
ongoing engagement with members around our priorities.
Humanitarian Emergency Response Review (HERR) Findings
20. The findings of the HERR, an independent review into how the UK responds to
humanitarian emergencies, were released in March 2011. The UK Government’s detailed
response was presented by the Secretary of State in June 2011. The HERR gave as an
example UNICEF’s successful role in supplying infant nutrition in Niger but identified
failures of leadership and response in other cases, notably Haiti, as vital areas of concern.
This chimes with the findings of the MAR and highlights that in recent large scale disasters
shortcomings have been identified in the international systems’ humanitarian response.
The review highlights leadership as one of seven key themes to be addressed.
21. The UK Government in its response to the HERR makes a key commitment to work with
other donors to support the Inter-Agency Standing Committee (IASC, the main mechanism
for coordination of humanitarian assistance) and the Emergency Relief Coordinator (ERC)
in their efforts to improve humanitarian leadership at an operational and humanitarian level,
including in relation to humanitarian clusters. The UK, with Norway, USA, Sweden and
Japan, has already written (in early 2011) to the IASC to set out some key issues for
improving leadership and management of clusters12. In response, IASC principals13,
including UNICEF’s Executive Director, have highlighted their commitment to making the
changes necessary to deliver quantifiable improvements in humanitarian outcomes.
22. The actions agreed by the IASC principals include:
 Leverage the Humanitarian Coordination Pool better and increase support to
Humanitarian Coordinators on Country Team management and strategy development.
 Form a high-level task team to make recommendations to refocus the responsibilities
of cluster leads and partners on coordinating the response for results, address issues
of mutual accountability, define minimum criteria for cluster participation and clarify the
definition of provider of last resort.
 Provide guidelines for improving cluster coordination within national structures.
 Pilot a peer review system to enhance accountability for performance.
23. It is essential that UNICEF delivers against these actions and focuses not only on
strengthening performance in rapid onset emergencies but also in complex humanitarian
emergencies and protracted crises14. It is also important that UNICEF contributes to
developing appropriate measures for assessing humanitarian cluster performance.
UNICEF’s Funding
Table 1: Income (millions of US$)15
Voluntary core income
Voluntary non-core income (regular)
Voluntary non-core income (emergency)
Total
% voluntary core
2007
1,106
1,379
528
3,013
37%
2008
1,085
1,570
735
3,390
32%
2009
1,066
1,527
663
3,256
33%
2010
965
1,694
1,023
3,682
26%
24. In 2010, UNICEF’s total expenditure was $3,651m of which $3,355m was used for
programme assistance and $276m (8%) covered administrative costs16. The UK’s
voluntary core funding represented 3% of UNICEF’s total voluntary core funding income
and 13% of total UK Government support to the agency. UNICEF’s voluntary core funding
income has declined in recent years, falling from $1,106m (37% of total income) in 2007 to
$965m (26%) in 2010.
12
Identified through Cluster Approach Evaluation 2 Synthesis Report (April 2010).
The Heads of IASC member agencies.
14
Rapid onset disasters are humanitarian crises such as tsunamis, floods, earthquakes or hurricanes where
immediate intervention is required for up to 3-6 months. Complex emergencies are humanitarian crises where there
is a total or considerable breakdown of authority resulting from internal or external conflict which may require a
humanitarian international response. A protracted crisis may cover situations such as long-term displacement or
chronic food insecurity. A slow onset emergency occurs gradually over time, often based on a confluence of different
events such as drought or deterioration of political stability.
15
Source: Annual Report of the Executive Director 2011 and Report on Regular Resources 2009, UNICEF
16
The remaining $22m (less than 1%) was spent on write-offs ($3m, primarily related to uncollectible receivables
from old expired contributions) and support budget transfers ($19m, income taxes paid by UNICEF on behalf of the
citizens of a government that contributes to UNICEF regular resources).
13
Table 2: Top 10 donors in 2010 (millions of US$, rounded to one decimal place)17
Country
Donor Type
Voluntary
Voluntary
Voluntary
Voluntary
Total
Core ($)
Core
Non-Core Non-Core
(% total)
($)
(% total)
USA
Government
132.3
13.7%
208.4
7.7%
340.7
UK
Government
32.6
3.4%
225.5
8.3%
258.1
Norway
Government
70.2
7.3%
134.7
5.0%
205.0
Japan
National
148.2
15.4%
45.4
1.7%
193.6
Committee
Japan
Government
15.2
1.6%
159.9
5.9%
175.0
Netherlands Government
42.7
4.4%
116.0
4.3%
158.8
European
Inter145.6
5.4%
145.7
Commission Governmental
Canada
Government
17.4
1.8%
117.2
4.3%
134.6
US Fund for National
12.7
1.3%
116.0
4.3%
128.8
UNICEF
Committee
Spain
Government
29.2
3.0%
98.2
3.6%
127.5
B. Impact and Outcome
Impact
25. At the impact level DFID expects its core funding to support UNICEF to contribute towards
the achievement of the Millennium Development Goals (MDGs), particularly those relating
to education, gender equality, child and maternal health, combating HIV / AIDS and
malaria, and water and sanitation. UNICEF's Medium Term Strategic Plan states that 'the
Millennium Declaration and Millennium Development Goals provide a set of shared
international priorities with worldwide consensus and a 2015 horizon. Their commitments
and targets are directly supported by UNICEF as a matter of priority.'
Outcome
26. At the outcome level, DFID expects to see a more efficient and effective UNICEF in the
delivery of its development and humanitarian programmes. UNICEF should be delivering
results for poor people in development and humanitarian contexts and achieving its own
outcome level targets, as set out in the Results Framework for its Strategic Plan. In
particular, we would like to see results in the policy areas of greatest importance to the UK.
UNICEF should also strengthen its organisational effectiveness for delivering these results.
We would like UNICEF to maintain its ‘very good’ overall rating in the MAR and improve its
score against key areas of the MAR assessment where it was found to be weak (Strategic
and Performance Management) and against areas where it was found to be satisfactory
but within which there were particular issues of concern (Contribution to Results in
humanitarian situations and Partnership Behaviour with other UN agencies).
Outputs
27. At the output level the UK focus is on achieving specific reform priorities identified by the
MAR and ensuring that UNICEF continues to deliver development results on the ground:
28. Output 1. UNICEF improves its leadership and delivery in rapid onset humanitarian
emergencies and protracted crises. We want to see UNICEF:
17
UNICEF Compendium of Contributions by Main Donors, 2010.
 strengthen its leadership and strategic management of clusters (globally and on the
ground), including by ensuring that better qualified and experienced personnel are
rapidly deployed at the outset of an emergency; clearly delineating responsibilities with
partners based on comparative advantage; and adhering to the terms of reference for
cluster leads.
 deliver the key activities to which it has committed in order to achieve the IASC
commitment of quantifiable improvements in humanitarian outcomes;
 mainstream its humanitarian work in its new Strategic Plan (to be implemented from
2014) and allocate to it an appropriate package of funding from regular resources;
 make timely, predictable disbursements of funding to its implementing partners in
emergencies.
These reforms would enable UNICEF to significantly improve its delivery of life saving
interventions and protection and to work in support of a more strategic, accountable
humanitarian system.
29. Output 2. UNICEF strengthens its monitoring and reporting of results at the organisational
level.
We want to see UNICEF develop a robust results framework for its next Strategic Plan (to
be implemented from 2014) which demonstrates a clear results chain from inputs to
outputs to outcomes to impact and contains measurable monitoring indicators with
baselines, milestones and targets which can be reported against annually. UNICEF should
also be able to demonstrate a clear link between its budget and development results. In
addition we expect to see UNICEF strengthen its annual reporting to the Executive Board,
systematically demonstrating the results it has achieved against the targets contained in its
strategic plan. To achieve these reforms, it will be important to ensure appropriate internal
results based management processes are in place. For example, UNICEF is currently
rolling out a new ‘Enterprise Resource Planning’ system (VISION) which is expected to
drive improvements in its results monitoring and reporting.
30. Output 3. UNICEF maintains its performance in areas identified as satisfactory or strong in
the MAR, particularly its development programme delivery at a country level.
It will be important that we find no evidence of slippage in the areas where UNICEF is
currently doing well. UNICEF is critical to the achievement of many of the UK’s
development objectives and the MAR found evidence of it delivering good results at the
country level. We will therefore review UNICEF’s own reporting documents to assess
delivery at the output level in the key UK policy areas of child and maternal health,
nutrition, girls’ education, HIV / AIDS, malaria, water and sanitation and social protection.
We expect UNICEF to continue providing strong technical and policy leadership in these
areas and to continue to demonstrate effective delivery of results on the ground. We will
also seek evidence of UNICEF’s progress in supporting measures to reduce female genital
mutilation / cutting. In addition to UNICEF’s own reporting, we will seek feedback on
delivery at a country level, including on the effectiveness of UNICEF’s partnerships with
other UN agencies.
31. Output 4. UNICEF demonstrates how it is driving down costs, achieving value for money
and increasing transparency.
We would like to see UNICEF demonstrate how it is continuing to reduce its administrative
costs in its Biennial Support Budgets and more systematically report on the cost efficiency
of its operations and the value of savings achieved. DFID will encourage UNICEF to
achieve the highest standards of transparency (e.g. by joining the International Aid
Transparency Initiative) including publishing in full project information on its website.
Appraisal Case
A. Determining Critical Success Criteria (CSC)
Each CSC is weighted 1 to 5, where 1 is least important and 5 most important based on the relative
importance of each criteria to the success of the intervention.
CSC
Description
for
Results
/
Reform
Executive Board backing for reform priorities.
1
UNICEF Executive Director and senior management team support and
2
3
4
5
implement reforms identified in the MAR
UNICEF is able to recruit and deploy the right staff to cluster
leadership positions and to undertake key cluster tasks, including
common needs assessments, strategies, information management,
accountability / reporting and inter-cluster coordination.
Organisational reforms (particularly strengthened results frameworks)
are enacted to allow UNICEF to be seen as an effective organisation.
UNICEF delivers the results set out in its Strategic Plan, particularly in
key UK policy areas (child and maternal health, nutrition, girls’
education, HIV / AIDS, social protection, water and sanitation).
Weighting (1-5)
3
4
5
5
5
B. Feasible options
32. The MAR has identified key areas in which UNICEF delivers effectively as well as other
areas where it is operationally and organisationally weak. This has defined our reform
agenda. Whilst there are other areas which need reform and on which the UK could
engage, the selected areas have been prioritised as those which we judge would result in
the greatest improvements in organisational effectiveness and delivery on the ground.
33. DFID should use its funding to maximise the delivery of results and to support reform.
Two financing options for achieving this are discussed below.
Option 1 - Voluntary Core Funding
34. This type of funding is allocated to an institution (such as UNICEF) but is not tied to a
particular theme or project. It can be spent against any activity that relates to UNICEF’s
mandate as well as on UNICEF’s administration costs.
Option 2: Voluntary Non-Core / Thematic Funding
35. This type of funding can be allocated against specific projects in country (for example, a
nutrition project in Sierra Leone) or by a particular theme (such as young child survival
and development). Once allocated it can not be spent on other issues beyond the scope
of the original project or theme. For example, the UK has been providing voluntary noncore funding support to UNICEF’s Office of Emergency Programmes (£4m in 2011/12) in
order to build capacity to improve the effectiveness of its humanitarian response since
2000. DFID has recently announced a further package of £18m over the period 2012/13
to 2014/15.
C. Appraisal of options
Option 1: Voluntary Core Funding
36. The benefits of this option are:
 It will enhance UNICEF’s ability to deliver results across its full mandate including in
areas of importance to UK development objectives: child and maternal health,
gender equality, education, HIV / AIDS and humanitarian emergencies (CSC 5).
 The UK’s role on UNICEF’s Executive Board will be strengthened, allowing us to
continue to have leverage with the agency and Board members on key reforms. In
2010 the UK was the second largest donor to UNICEF. Overall, voluntary core
funding to UNICEF is declining, now representing 26% of total resources compared
to 33% the previous year. UNICEF needs to achieve an optimal balance between
voluntary core funding and voluntary non-core funding resources to be
organisationally effective. Reductions in voluntary core funding resources could
affect UNICEF’s operations. The provision of UK voluntary core funding at a time
when others’ contributions are decreasing therefore puts us in a strong position to
leverage reform (CSC 1 and 2).
 UNICEF can use DFID’s funding to make organisational changes to address MAR
reforms, building up its operational capacity to enable it to become more efficient
and effective (CSC 3 and 4).
 It will allow UNICEF to remain financially viable and maintain a global presence,
working in countries where DFID cannot but which still have a high need for support
(CSC 5).
 UNICEF’s programme work will be more sustainable as UNICEF country offices can
use voluntary core funding resources to ensure programme priorities are funded. It
will also allow UNICEF to react quickly to changing circumstances without having to
wait to raise voluntary non-core funds (CSC 5).
 DFID’s voluntary core funding to UNICEF represented 13% of total UK government
support to the organisation in 2010. This demonstrates that supporting UNICEF’s
organisational effectiveness by providing voluntary core funding allows UNICEF to
be an important partner for other types of DFID support (CSC 5).
37. The costs of this option are:
 in the absence of a robust organisational result framework, DFID’s funding cannot be
directly attributed to progress against specific development results (CSC 5).
 DFID will need to maintain significant policy engagement with UNICEF to ensure the
funds are well spent.
Option 2 – Voluntary Non-Core funding
38. The benefits of this option are:
 DFID can control more precisely where and how its funding is used by targeting
specific programmes or themes which are important to UK development objectives
and more robustly measure results (CSC 5).
 It would potentially allow DFID to reduce its central engagement with UNICEF and
focus only on specific funded priorities (CSC 5).
39. The costs are:
 DFID would lose influence in the governing board of UNICEF and have reduced
leverage over the key reforms that we need to see (CSC 1 and 4).
 Voluntary non-core funding is less flexible than voluntary core funding. It would only
allow UNICEF to operate in those sectors or locations where donors provide
adequate support. UNICEF would not be able to use the resources for programmes
in other sectors or other countries which need support. This would reduce the
effectiveness of UNICEF in reaching those most in need (CSC 5).
 Each grant would generate its own administrative burden for both DFID and UNICEF
and impact on efficiency.
 None of this funding could be used to support administrative changes to address the
areas identified as weak by the MAR (CSC 4).
Consequences of Decreasing or Not Funding
40. Based on 2010 data, it is expected that UK voluntary core funding of £40 million will
provide 6% of UNICEF’s total voluntary core resources in 2011. Significantly reducing or
stopping DFID’s voluntary core funding would result in UNICEF reducing the number of
programmes it was able to carry out on the ground. This would affect the achievement of
UK development objectives, particularly where UNICEF has a critical role.
41. UNICEF would also have fewer resources to allocate flexibly to deliver organisational
reforms. In addition, DFID’s influence with UNICEF and the Executive Board would be
lessened, particularly on areas which speak to MAR priorities. On the other hand if DFID
and other donors sharply reduced voluntary core funding this could create a strong
momentum for change. DFID should assess progress on our reform agenda in two years’
time and then adjust its voluntary core funding levels accordingly.
D. Comparison of options
The same weighting is used as for CSC above. The score ranges from 1-5, where 1 is low
contribution and 5 is high contribution, based on the relative contribution to the success of the
intervention.
Analysis of options against Critical Success Criteria
Option 1
CSC
Weight (1-5)
Score (1-5)
Weighted Score
1
3
5
15
2
4
5
20
3
5
3
15
4
5
5
25
5
5
3
15
Totals
90
Option 2
Score
2
2
5
1
5
-
Weighted Score
6
8
25
5
25
69
Conclusion on options
42. DFID’s overall funding to UNICEF has traditionally included voluntary core funding (13%
in 2010) combined with significant voluntary non-core funding by DFID country offices
and DFID HQ policy teams. This combination of approaches represents a good balance.
The voluntary core funding helps UNICEF to deliver development results across its
mandate whilst the voluntary non-core funding ensures a clear line of sight between UK
development priorities and UNICEF results. Without voluntary core funding support the
UK would have significantly less influence over organisational reforms and UNICEF
would therefore be a less attractive partner for other types of UK support. UNICEF needs
voluntary core funds to support its global network and Headquarters policy staff, for the
flexibility it provides in programming and to support reforms.
43. UNICEF is an important partner for many of the UK’s development objectives and its role
in achieving the MDGs is critical. Its global reach on children’s issues and very good
assessment by the MAR mean that continuing the UK’s voluntary core funding
relationship for the next two years is the best way of supporting reforms. We will review
progress against the reform priorities in 2 years time and could decrease or change our
method of funding if progress has been too slow.
44. Funding option 1 is therefore preferred, supported by targeted engagement.
Theory of Change for Option 1
45. The theory of change linking DFID funding and activities to the achievement of UK
development objectives is set out below.
46. To deliver better results for children on the ground and contribute towards achievement of
the MDGs, UNICEF needs to improve its organisational effectiveness through making the
necessary reforms identified in the MAR. UN reform can be slow and difficult and the
change we’d like to see can only be achieved through strong engagement by the UK with
key stakeholders. Implementing real reform will also require strong leadership from
UNICEF and the support of the Board’s membership.
47. Voluntary core funding is the mechanism which will best support this approach. It will
allow UNICEF the flexibility to use its funding to cover both administrative costs and
programme work to adapt to emerging priorities and to reform. It will also give the UK
leverage with the agency and other members of the Executive Board.
48. DFID is not prepared to accept lower levels of performance from the UN than from other
multilaterals. DFID will therefore need to do more to ensure we maximise our influence
and create new partnerships to support change. We will be explicit with UNICEF on the
reforms we need to see and will use our funding and influence to encourage performance
improvements and to help sustain the reform process. The UK is well-placed to support
UNICEF on this reform agenda due to our strong technical focus on results, humanitarian
issues, value for money and transparency.
49. As a result of stronger UK engagement and strengthened support we expect key MAR
reforms to be achieved and, in turn, UNICEF’s overall efficiency and effectiveness to
improve. In particular, if the priority reforms identified here are taken forward, UNICEF
will be better placed to make evidence based decisions about its own programming and
to deliver effective outcomes on the ground (both in the development and humanitarian
context) in the areas of its mandate which are important to the UK (child and maternal
health, nutrition, girls education, HIV / AIDS, malaria, water and sanitation and social
protection).
E. Measures to be used or developed to assess value for money
50. DFID will use the same criteria to assess the value for money of its voluntary core
funding contribution to UNICEF in two years time that were used in the MAR. In financial
year 2013/14 a further review will be undertaken to assess progress against key reform
areas identified as weak by the MAR, which included weak reporting on results,
inconsistent humanitarian delivery and weak leadership and partnerships across the UN.
As a result of the outcome of the mid-point review, DFID will decide if voluntary core
funding should remain at £40m per year, or be increased, decreased or earmarked for
specific programmes through voluntary non-core funding. In the meantime, indicative
funding levels for UNICEF for 2013/14 and 2014/15 have been set at £40m per year.
This approach will deliver maximum value for money for UK funding.
51. UNICEF publishes the average unit costs for its procurement of vaccines and we will take
account of this, and any other available unit cost data, at the mid-point review.
Commercial Case
A. Value for money through Procurement
52. The MAR assessed UNICEF as ‘satisfactory’ in terms of cost and value consciousness. It
has clear procurement guidelines in place but did not, at the time of the MAR, routinely
report on unit costs and pricing achieved (savings) from its procurement activities.
However in May 2011 UNICEF published details of the prices it pays for vaccines for the
first time and this is expected to continue and be extended to a wider range of
commodities.
53. UNICEF Supply Division (SD) oversees UNICEF’s global supply and logistics operation.
The organisation procured a total value of $1.9 billion in 2010, 90% of which was for
goods (although the value of services being procured is increasing). UNICEF buys about
5,000 different products annually, focused on emergency response and development.
54. UNICEF is largely decentralised and in principle the Country Office has primacy in
procurement. However, since the purchase of certain specialised goods (those which
require specific technical expertise to procure or where it is considered strategically
important to influence the supply market) is centralised, in effect a lot of procurement is
carried out centrally. Given UNICEF’s responsibilities for MDGs 4, 5 and 6, around 80%
of its spend is on health and requires technical experts (e.g. pharmacists) and strong
quality assurance for procurement. By undertaking this procurement centrally UNICEF is
able to use its buying power to influence the market and achieve better prices for certain
products. UNICEF’s Supply Division is also sometimes asked to support country offices
to undertake local procurement.
55. HQ and Supply Division procurements are subject to international competition. Local
buying is subject to national tendering, but country offices can tender regionally where
appropriate. UNICEF has developed strategies for buying major individual products, such
as bed nets or key pharmaceutical commodities; it is making greater use of category
management approaches; it places achievement of best value for money as an overriding objective; and it does try actively to reduce the unit costs of products. Winning
tenders are usually selected on the basis of the lowest priced acceptable offer, unless it
is considered more efficient to work with one supplier. However, there is no overall
procurement strategy or system for setting procurement savings targets.
56. UNICEF leads the work on reviewing procurement practices in One UN country offices as
part of wider work on establishing a Common Scheme for Vendors to the UN system.
80% of its procurement is done in collaboration with other UN organisations and UNICEF
works with UN partners, NGOs and others to avoid duplication and ensure that joint
procurement takes place where possible. UNICEF’s aim is to transfer procurement
capacity to partner governments.
57. We will discuss with UNICEF the possibility of asking DFID’s Procurement Division to
undertake an in-depth review of UNICEF’s procurement capability. This would provide us
with better knowledge of its systems and benefit UNICEF by identifying where further
improvements could be made to enable better value for money. We will also engage with
UNICEF on procurement issues through the Board.
Financial Case
A. How much it will cost
58. DFID will provide funding of up to £160m over the four year period 2011-2015. For 2011
and 2012, UNICEF will receive £40m per year. Depending on the results of our mid-term
assessment in 2012 funding may increase or decrease in the outer 2 years.
B. How it will be funded: capital/programme/admin
59. The funding will be paid from DFID’s programme budget.
C. How funds will be paid out
60. The annual £40m allocations will be released in two payments of £20 million during
UNICEF’s financial year (January to December) to reduce the possibility of payment in
advance of need. For 2011 DFID will make the two £20 million payments in August and
October. In 2012 the payments will spread more evenly across UNICEF’s financial year
and will be made in April and September. By September 2013 the mid-point review will
have been completed and DFID will release funding for 2013 by October. For 2014
payments will be made in April and September. The timing of payments will be set out in
a Memorandum of Understanding (MoU) between DFID and UNICEF.
61. To ensure no payment in advance of need DFID will monitor UNICEF’s balance of
voluntary core funding. In 2010 UNICEF’s unspent cash balance from voluntary core
funding resources was $422m, a reduction from a high of $652m in 2008. The general
practice of non-profit organisations, including the UN community, is to maintain a level of
liquidity equivalent to 3-6 months expenditure. In UNICEF’s case this would be in the
range $270m to $540m. The UK commits to being a good donor and to meeting the
schedule of payments set out in our MoU, helping UNICEF to manage its reserves. We
will continue to monitor UNICEF’s cash balance annually.
D. How expenditure will be monitored, reported, and accounted for
62. UNICEF’s expenditure is monitored through the UK’s engagement at Executive Board
meetings and bilaterally with UNICEF as required. These functions are carried out by
both officials in the UK and also at the UK’s Mission to the UN in New York.
63. UNICEF provides a range of reports to the Executive Board that DFID uses to monitor its
performance and account for DFID’s voluntary core funding contribution. The main
reports are:
 Annual Report of the Executive Director (EDAR) and its Data Companion. This
provides an overview of the results UNICEF has achieved over the year as well
as measures of its organisational performance. It also presents details of
expenditure by each of the 5 focus areas of UNICEF’s mandate and
humanitarian expenditure.
 Biannual Financial Report and Audited Statements. These provide details of
all income and expenditure in the biennium, including details of fund balances
and reserves held at the end of the financial year; expenditure on programmes
and on administration / management; and expenditure by region and country.

These statements are audited by UN’s Board of Auditors and the last financial
statement for the biennium ending 31 March 2009 received an unmodified
audit opinion (i.e. there are no substantial issues to address). An interim
financial report and statements are provided in the intermediate years.
Annual Report on the Evaluation Function and Major Evaluations in UNICEF;
Annual Report on Internal Audit Activities; Audit Advisory Committee Annual
Report. These provide an overview of UNICEF’s programmatic performance,
the risks facing the organisation and the steps needed to address any
weaknesses.
Management Case
A. Oversight
64. UNICEF is managed by the Executive Director, Mr Anthony Lake, and his senior
management team. It is governed by 36 member states of the UN, representing 5
regional groups. Composition of the board is African states (8 seats), Asian states (7
seats), Eastern European states (4 seats), Latin American and Caribbean states (5
seats) and Western European and Other states (12 seats). Each member has equal
voice and voting rights. Non-board members can also participate in board sessions to
express their views but do not have the right to vote.
65. Membership is rotational and the UK is currently a member of the governing board for
2010 to 2012. The Executive Board is subject to the authority of the UN Economic and
Social Council and it meets three times a year to set policy direction and provide
oversight. Its functions include: giving guidance to the Executive Director on the work of
the organisation; monitoring the performance of UNICEF; approving programmes; and
deciding on administrative and financial plans and budgets.
66. The work of the Executive Board is coordinated by a Bureau, comprising the President
and four Vice-Presidents, each officer representing one of the five regional groups. The
Board aims to take decisions by consensus. Meetings are held in public, unless the
Board determines otherwise. It can invite states and participants who have an interest in
any agenda items to participate in deliberations without the right to vote. If countries
have serious concerns with UNICEF’s operations these are usually initially raised through
bilateral contacts with the UNICEF Executive Director and senior management.
67. The MAR concluded that UNICEF has a satisfactory accountability framework in
operation. An Audit Advisory Committee has been in operation since 2008 with the
primary role of advising the Executive Director and informing the Executive Board on the
functioning of the UNICEF oversight system. It assesses the programme of work of the
Office of Internal Audit and the resources required to implement the programme of work
and makes recommendations accordingly. It submits its annual report to the Executive
Director which is then included in the annual report of the Office of Internal Audit and
presented to the Executive Board. The five members of the Audit Advisory Committee
are external to UNICEF and are appointed by the Executive Director who also designates
a chairperson. The chairperson is invited to attend the Executive Board when the annual
report is presented.
68. UNICEF’s Office of Internal Audit (OIA) undertakes audits, provides advice and carries
out investigations. Its annual audit plan and the annual office work plan for internal
improvement measures are reviewed and endorsed by the UNICEF Audit Advisory
Committee, and OIA reports to that Committee on progress made. The audit plan is
coordinated with the Evaluation Office and the external United Nations Board of Auditors.
The Audit Advisory Committee Annual Report in 2009 noted that the quality assessment
conducted by the Institute of Internal Auditors (IIA) found the OIA to generally conform to
their ‘Standards’ and their ‘Code of Ethics’. This provided the Committee, and the
Executive Board, with a strong assurance on the high quality of the office’s work.
69. UNICEF also has an Ethics Office and policy in place since 2007 including whistle blower
protection and a financial disclosure policy.
70. The UN Board of Auditors is UNICEF’s external auditor and is responsible for certifying
UNICEF’s financial statements. Their report to the Board covers compliance and the
proper use of resources as well as their economic, efficient and effective use.
71. Reports from all parts of UNICEF’s oversight machinery are presented to the Executive
Board with management responses from the Executive Director. These provide an
update on the implementation of any audit recommendations and an overview of the risks
facing the organisation. All of the reports are available on UNICEF’s website. Executive
Board members can comment on the reports and make suggestions to UNICEF which
help to improve and strengthen its audit functions.
72. These functions allow the UK to exercise appropriate oversight of its funding. The UK
actively participates in the Executive Board meetings and raises issues of concern
through the Board and bilaterally as required.
B. Management
DFID Staffing / Resourcing
73. DFID has adequate staff resources to provide proportionate management and oversight
of UK taxpayers’ funds. An A2 Results Adviser will dedicate 40% of her time to act as the
institutional lead for UNICEF, including providing financial oversight, in addition to
providing results advice across the UNCD portfolio. She will be supported by a B1
Deputy Programme Manager (DPM) who will be responsible for programme
management, including Blue Book compliance, project reviews, briefings and payments.
All programme management activities will be carried out in accordance with DFID
procedures and oversight requirements. The A2 Results Adviser and B1 Deputy
Programme Manager will support UKMis in representing the UK on the Executive Board
of the agency during formal meetings in New York.
74. The UK Mission to the UN (UKMis) in New York is the focal point for face to face
engagement with UNICEF, with guidance on policy being provided from HQ. UKMis will
take the lead on issues where discussions are sensitive and a face to face meeting is
required to ensure appropriate oversight. UKMis and UNCD will work closely on
engagement with UNICEF and other stakeholders.
75. A Senior Humanitarian Adviser in CHASE will provide technical advice on the key reform
priority of improved humanitarian leadership and delivery. His link to a network of
humanitarian advisers in DFID country offices will assist us in establishing stronger
engagement on country level humanitarian performance. Feedback from a small number
of focus country offices will also provide an opportunity for engagement on wider
performance and DFID will actively work to strengthen this dimension.
76. Policy Division (PD) will provide technical inputs and advice as co-ordinated by their
designated lead for UNICEF. PD will also assist when information is gathered from
country offices through providing guidance on technical questions to be used to draw out
the most relevant information for further assessment purposes.
77. DFID’s Internal Audit Department will provide advice on key financial papers that are
presented to UNICEF’s governing body. Board documents and reports will be scrutinised
to ensure that funds are spent efficiently and effectively to maximise the potential impacts
of UNICEF’s work. Procurement department will also provide advice and guidance on
procurement issues as necessary.
78. The team will also draw on the expertise of other UNCD advisers as required.
Engagement / Influencing
79. Given the complexities of creating change in the UN and the criticality of UNICEF to UK
objectives, low engagement with UNICEF is not viewed as a viable approach since it is
high risk, could result in limited progress and would not fulfil our responsibilities to the UK
taxpayer. UNICEF was a strong performer in the MAR and we are proposing to provide
£40m of voluntary core funding per year for the next two years. This necessitates a
strong engagement with UNICEF, focussed on UK policy and reform priorities, to ensure
that DFID’s funding delivers maximum value for money and results.
80. In order to manage DFID’s voluntary core funds, make progress on the MAR reform
agenda and deliver results for children, DFID will increase its engagement with UNICEF
over the next two years. We will seek to build stronger relations with UNICEF and other
Executive Board members. We will develop a comprehensive stakeholder and
institutional analysis to map the levers for and barriers to change and achieve maximum
leverage from UNCD’s staff resources. DFID will also strengthen our engagement at a
country level to understand UNICEF’s delivery of results on the ground.
C. Conditionality
81. Funding for the first 2 years has been agreed by Ministers. The level of funding for
2013/14 and 2014/15 will be dependent on progress being made against the reform
agenda which was set out in the MAR. If there is little or no progress further consideration
will be required as to whether funding should be decreased or earmarked to specific
programmes through voluntary non-core funding.
D. Monitoring and Evaluation
82. As part of this business case DFID has developed a logical framework (logframe) which
will be used to monitor progress annually. The logframe sets out the impact, outcome and
outputs described in the Strategic Case alongside indicators which describe how these
will be measured, baselines, milestones and targets for tracking progress. The baseline
for our reforms in the logframe will be the MAR and for results will be information from
UNICEF’s own development results framework. Given that improving results is a reform
priority for UNICEF, DFID will only utilise indicators from its results frameworks where
they are sufficiently robust and include both baselines and targets.
83. The logframe will be reviewed and scored annually to monitor what progress is being
made. The logframe also clearly sets out the weights to be applied to each outcome
indicator and output to calculate the annual score. Given that UNICEF’s own results
framework and reporting is weak, greater weight will initially be given to reform progress
(including on improving results management).
84. Annual reviews will assess progress through information provided by UNICEF in a range
of different reports to the Executive Board (e.g. its Annual Report of the Executive
Director and audit reports) and information it provides directly to DFID. This data is of
sufficient quality to use as evidence for annual reviews. We will also seek feedback on
UNICEF’s performance in a range of countries and from DFID humanitarian advisers who
work with UNICEF in the field. Further information on humanitarian performance will be
obtained from DFID response team country office monitoring (RIOT reports) and
independently commissioned evaluations (e.g. on cluster coordination) as well as from
internal monitoring processes being set up within CHASE.
85. The first annual review will assess UNICEF’s progress against the milestones set out in
the logframe. At the mid-point review a more holistic review will be undertaken against
the MAR reform priorities resulting in a decision about funding levels for 2013/14 and
2014/15.
86. The logframe itself will be re-assessed at each Annual Review and indicators, milestones
and targets will be updated as appropriate to reflect, for example, the mid-term review in
2013 which may result in revised reform priorities. UNICEF will also be developing a new
Strategic Plan for implementation from 2014 and this will mean that targets for indicators
in its own results framework will need to be updated at that stage. UNICEF has also
indicated that it is doing some internal thinking about how to monitor the UK’s reform
priorities and we will, where possible, look to use its own monitoring evidence in the
logframe when it is available.
Evaluation
87. UNICEF operates a decentralised evaluation function with a central Evaluation Office
(EO) performing a coordination role as well as undertaking global evaluations. UNICEF
Country Representatives are responsible for in-country evaluations in accordance with
norms established by the EO; Regional Directors are responsible for regional
evaluations; and HQ Directors are responsible for evaluations of global policies and
initiatives for which they are accountable. The EO fosters the professionalisation of the
evaluation function, develops approaches and methodologies for evaluation, and
maintains the institutional database of evaluations. UNICEF has also initiated a ‘Global
Evaluation Quality Oversight’ system under which UNICEF’s evaluations are
independently reviewed and rated against UN Evaluation Group (UNEG) / UNICEF
Evaluation Report Standards. Reports meeting the satisfactory rating are made available
in UNICEF’s Global Evaluation Database (GED).
88. The MAR recognised that UNICEF had made progress on evaluation, for example by
taking forward recommendations to establish a predictable evaluation budget, provide
additional interventions to strengthen and support field offices and to improve RBM
throughout the organisation. However, further work is required to increase the
independence of evaluations, maintain the proportion of the overall budget spent on
evaluation and mitigate the impact of staff turnover. In particular, there remain concerns
about the inconsistency of management responses to evaluations and more consistent
use of evaluation materials in guiding strategic decisions is needed.
89. DFID will not conduct an in-depth evaluation of UNICEF’s work. However we will take
opportunities, as they arise, to share our expertise and support UNICEF in its mission to
strengthen its evaluation function. Our focus in the first two years of this intervention will
be on engaging with UNICEF to improve its results frameworks and results based
management as this is an important part of a strong evaluation function. However, we
will also engage over this period on evaluations presented to the Board and provide
statements or decisions as required on their quality and on the recommendations for
follow-up. DFID will also seek to work with other likeminded donors on evaluation issues.
Our future engagement with UNICEF will be guided by the development (by October
2011) of UNCD’s overarching evaluation strategy and on advice from DFID’s Evaluation
Department.
E. Risk Assessment
90. DFID’s voluntary core funding to UNICEF is judged to be medium risk overall. We have
set out the four key risks to this intervention and our intended mitigation strategy below.
Whilst these could have a high impact on the successful delivery of this intervention, we
consider that they can be lessened through continued dialogue and engagement with
other Board members and with UNICEF itself. These risks will be reviewed on an annual
basis as part of the overall project review.
Risks to this intervention
91. Other Executive Board members block reforms (likelihood: medium; impact: high).
DFID will manage this risk by increasing our engagement with UNICEF and its Board.
Senior officials from DFID, including the Head of UNCD, will engage more regularly
with other likeminded donors to build support our reforms. UKMis will also engage with
other influential Board members in New York. DFID will seek to build new relationships
with emerging powers and will identify opportunities for top management and
Ministerial engagement with key donor partners.
92. UNICEF management and staff fail to implement reforms (likelihood: medium; impact:
high). To mitigate this risk, DFID will engage with UNICEF staff in middle, senior and
high level grades to support its reform efforts. The UK should also be prepared to cut
voluntary core funding if reform progress is too slow by the 2013 mid-point review. .
93. UNICEF’s perception of the importance of the UK’s reform agenda (likelihood: medium;
impact: medium). The UK will increase its voluntary core funding to £40m at the same
time as identifying key areas of reform which we would like the organisation to take
forward. To mitigate the risk that increased funding could have a negative impact on
UNICEF’s perceptions of the importance of reform, we will continue to emphasise the
criticality of reform progress to future funding decisions in our dialogue with the agency
and in statements and contributions to decisions delivered at the Executive Board. Any
concerns raised through annual reviews of this intervention will be clearly
communicated to UNICEF in terms of the potential implications for funding.
94. UNICEF’s internal systems do not support improvement in reporting on results
(likelihood: medium; impact: high). In February 2011, UNICEF presented its latest
Report of the Board of Auditors to the Executive Board. UNICEF received an
unmodified audit opinion. However, a number of recommendations were made to
address potential risks to the organisation and two were of particular relevance to this
intervention. The auditors identified that IPSAS implementation could be affected by
outdated communication and training plans impacting on UNICEF’s ability to report on
results and that UNICEF’s forthcoming results based budget may be weak in terms of
the quality of results which are specific, measurable, attainable, relevant and time
bound. To mitigate these risks, the Executive Board has requested UNICEF to update
its IPSAS communication and training plan and to develop training courses for staff in
respect of results-based budgeting methodology. The UK will continue to engage
through the Executive Board on these issues.
F. Results and Benefits Management
95. The logical framework sets out the impact, outcomes and outputs for this business
case. It is based on UNICEF’s delivery of results on the ground (as set out in its own
Strategic Plan, Results Framework and reporting) and achievement of reforms in the
areas identified as weak by the MAR. If these are delivered this should lead to better,
more efficient performance by the agency. Milestones have been included where
possible to assess if progress is on track.
96. We will revisit the logframe at each annual review and, particularly, after the mid-point
review in 2013 to ensure that the chosen indicators are still appropriate and to seek to
introduce more targets which relate to UNICEF’s delivery of results and MAR reform
areas.
97. At annual review, the logframe will be assessed as outlined in section E. This will
require an assessment of whether milestones have been achieved as expected or
whether there has been over- or under- achievement. In this context:

Overachievement would constitute UNICEF demonstrating that it had achieved the
milestones set out in the logframe and that it had either been judged a strong
performer against the MAR reform areas with no slippage at all in all other areas by
the mid-point review in 2013; or delivered greater than expected results in the UK’s
key policy areas; or both.

Underachievement would constitute UNICEF being judged to have made no, or
limited, progress against the MAR reform areas; making some progress on MAR
reforms but slipping on others; or concerns about the level of UNICEF’s delivery of
development results by the mid-point review in 2013.
98. DFID will increase its engagement with DFID country offices and other non-focus
countries to gather more feedback on UNICEF’s performance in country.
99. The logframe is annexed.