Donor aid is a substantial source of funds for many countries that are struggling to meet the needs of their people and strengthen their economy. What happens when aid bypasses the recipient government’s budget process and is not aligned with the government’s priorities? And what can be done to improve alignment, support good budget processes and decisions, and increase transparency and accountability? The IBP and Publish What You Fund have released a new paper that explores the linkages between aid and budgets. The paper, written by the Overseas Development Institute, first documents similarities in how aid is treated in the national budgets of 14 aid-recipient countries, using two international budget coding systems as standards. Then it offers a generic system for classifying the amount and use of aid that best aligns with the administrative structures of the countries studied. Finally, the paper recommends strategies for increasing the transparency of aid information, particularly aid that is not spent through recipient country budget systems.
