Accra - Smarter Aid, Better Results

Australia has signed up to a new global agenda for aid reform, one that strives for a smarter approach to delivering aid. It's all about improving the way aid works to provide better results for the poor.

The global agenda is the most significant outcome of the recent Third High Level Forum on Aid Effectiveness, held in Accra, Ghana. The purpose of the forum was to review progress in implementing the commitments made in the 2005 Paris Declaration on Aid Effectiveness and identify actions to increase progress.

The forum was attended by more than 1200 representatives, including heads of state and ministers from countries that give and receive aid, heads of the World Bank and multi-lateral organisations such as other regional banks and UN organisations. Australia was represented by Parliamentary Secretary for International Development Assistance, Mr Bob McMullan MP.

Accra Outcomes

The Accra Agenda for Action (AAA) was the major outcome of the conference and commits donors and recipient countries to take action to improve aid delivery even further. The agenda speeds up reforms that have been in train for several years now. Australia fully supports the agenda, which includes:

Improving the way aid is delivered in 'fragile states' - the most difficult environment to achieve sustainable results. This involves better adapting aid delivery to each country's specific context and meeting State-building and peace-building needs. An example is committing to longer-term, 3-5 year strategies to improve planning and budgeting.
Being more transparent and accountable in the way aid is delivered, as this in turn contributes to better results. Australia is one of 14 donors to join the International Aid Transparency Initiative to further this goal. Australia is also one of few donors producing a public 'health check' of its aid program.
Developing stronger partnerships as mutual responsibility, respect and trust leads to better development. Such partnerships should see both countries (the donor and recipient) give equal weight to jointly achieving development goals.
Untying aid and using partner country systems much more to deliver aid. The evidence is clear - untied aid is more efficient and it has been identified as a significant priority for reform.
Encouraging new aid donors to also implement the Accra Action Agenda. This will streamline aid delivery so it is more efficient and effective. Australia will continue to engage new and emerging donors on aid effectiveness principles.

Australian Delegation Statement on Accra Agenda for Action

Australia's Role

There are many examples where Australia is already progressing the above reforms. These include:

Working with Timor-Leste on issues of fragility and conflict. Our two countries just undertook a significant study to identify better ways to deliver aid and achieve results. We will now work on resolving the issues identified, including a better sequenced approach to implementing the reforms so as not to overload the resources within such a small country. We will also work to better align the many international donors in delivering aid to reduce the administrative burden and ensure Timor-Leste's systems and policies support each other.
A Balancing Act: Implementation of the Paris Declaration in Timor-Leste

Conducting an Annual Review of Development Results to improve transparency and accountability. This review of Australian Government aid, by the Office of Development Effectiveness, has acted as a catalyst to make major improvements to our performance systems. Australia is one of only a few bilateral donors doing such a comprehensive review. The review identifies what is working and what is not. This is critical to learning from our experiences and spending taxpayers' money wisely in a high risk environment.

The new Pacific Partnerships of Development are a better approach to partnerships. Partnerships have been signed with Papua New Guinea and Samoa and are currently being negotiated with other Pacific countries. They outline a new commitment to delivering aid which aims for recipient country-led development. This means we are jointly responsible for reducing poverty and delivering sustainable development.

Supporting the Republic of Korea as a new aid donor in our region that wants to join the Development Assistance Committee (DAC - the international group of donors within the OECD). Australia welcomes Korea's proposal to be a member of the DAC and to increase its aid contribution in our region. As such the two countries are working closely to share knowledge and experiences in aid effectiveness and delivery.

Challenges for Australia

Australia is facing the challenge of increasing its aid contribution. It is very important that our aid dollars are spent wisely and get the best development results possible. Implmenting the Accra Agenda for Action, as part of our own development effectiveness reforms, will assist us to meet this challenge.

We work with many countries that do face issues of fragility and conflict. This is the most difficult aid environment to work in. Being effective in these ever changing environments is always challenging and we need to work with our partner countries to find better ways of doing development. A willingness to innovate will be key.

Working much more through partner country systems and policies, to support their reforms and development goals is a challenge. For instance, this will require Australia to use partner financial systems much more - a challenge when these systems are weak. But using these systems more can help to strengthen them.

September 2008