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How Government Spends on Development: Analysis of GAC Development Spending Room

TanzaniaVendor

by Aniket Bhushan 

Published: September 27, 2017

This analysis is conducted using a unique joined up database of GAC open data feeds, which we have recently updated (August 2017) and deals with the following main question:

  • How much of the planned (future) GAC development spending tract is already clearly visible?

It also reflects on other areas:

  • Examination of net balances at the project/spending line level.
  • Comparison of balances with the total spending tract (as per the DP 2017-18 and Main Estimates).
  • Examination of project selection types.
  • Meta-analysis of results information and data.
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Main Findings

Development advocates and campaigners, especially those working to motivate the government to increase spending on development, tend to link their efforts to budgetary cycles. Given this, there is a tendency to exaggerate the level of agency involved in determining spending levels. Going by budgetary cycles and annualized reporting, from the outside it may look like the department (in this case GAC-development) is determining a substantial amount every year – given approx. CAD$5.4 billion in total international assistance, of which GAC-development accounts for over 70% at approx. CAD$3.9 billion.

However, as we have repeatedly shown, and this analysis updates again, the majority of development spending is continuous over fiscal cycles and therefore necessarily somewhat path-dependent (think for e.g. of contributions to and through multilateral agencies and specialized vertical funds, which make up the bulk of Canada’s investment in development, and take place over multiple fiscal cycles).

A key empirical question that is typically not well-addressed, however, is how much of future planned spending is determined at any given point in time. The present analysis aims to address this (albeit a moving target) reflective of the current point in time and our most recent data update (August 2017):

  • We estimate the total net known amount to be spent on currently operational spending lines to be at least approx. CAD$4.42 billion.
  • The majority of this, approx. CAD$4.07 billion, as expected, will be spent between 2017 and 2022.
  • Relative to the planned spending tract from the most recent Departmental Plan (out to 2019), approx. 40% of core ‘international development’ (SO3.2) is clearly visible in the form of known spend on already operational projects/spending lines.
  • Back of the envelope estimates suggest approx. 15% or about CAD$375 million per fiscal as the ‘determinable’ room within core GAC international development spending (SO3.2). This is merely a rough gauge based on a set of assumptions.
  • In terms of selection criteria, the largest share of spending is channeled through pre-approved multilateral channels.
  • Our meta-analysis of results information and data suggests this is an area of weakness. Of a total 3871 spending lines in the database there were no ‘progress and results achieved’ reported in approx. 55%, many of which include projects that have been completed years ago.
  • The lack of results information, and robust analysis at the aggregate level around the same, we believe hurts credibility and lowers support for development spending.
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 We estimate total net known amount to be spent on currently operational spending lines at: CAD$4.42 billion. 

Net_byend

The bulk of this, as expected, will be spent between 2017 and 2022. And the top 20 lines that account for approx. CAD$1.83 billion are given below.

top20_net

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