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Projecting Canadian ODA for Fiscal Year 2001/02

An Overview of CIDA’s 2001-2002 Estimates
(Part III – Report on Plans and Priorities)

Canadian ODA volume for 2001/02 increases slightly, but continues to represent only 0.24% of Canadian GNP, down from 0.30% in 1998/99. There is no evidence of planned increases to reach 0.35% by 2005, en route to the UN target of 0.7%.

Bilateral geographic programs and CIDA administration, including Policy Branch, received the largest increases against the 2001/02 Estimates, 14.1% and 31.4% respectively. However, a significant portion of the increase to the bilateral programs is unallocated and may be available to other Branches for Agency priorities yet to be determined.

Branch Plans and Priorities, including Canadian Partnership, set out Branch targets to realize the Social Development Priorities.

Branch Plans and Priorities outline several pilot projects to test new programming approaches involving support for country poverty plans, the World Bank’s Comprehensive Development Framework, and Sector Wide Approaches. Canadian Partnership Branch will undertake a pilot sector approach involving child protection in West Africa.

This CCIC Briefing Notes comments only on the financial aspects of the 2001/02 Part III Estimates. The Estimates also discuss plans and priorities for the Agency as a whole and for each "business line".

1. Trends in Canadian ODA for 2001/02

1.1 Projected ODA for 2001/02 Using figures from the 2001/02 CIDA Estimates, CCIC calculates that total Canadian ODA in this fiscal year will be about $2,600 million or 0.24% of GNP. The International Assistance Envelope* for 2001/02 is increased by $45 million over 2000/01, an amount previously announced in the February 2000 Federal Budget. That budget also made available $15 million in 2001/02 for the climate change fund which is managed by CIDA.


* The International Assistance Envelope (IAE) contains the budgetary allocations by the federal government to international assistance and is published each year in CIDA’ Part III Estimates. The IAE includes allocations to CIDA, DFAIT, and the Department of Finance. A small portion of the IAE is not included in ODA because it is allocated to countries in Eastern Europe and the former Soviet Union that are not considered eligible for ODA. Official Development Assistance (ODA) includes all of the IAE eligible for ODA as well as other amounts allocated by Canadian governments that the Development Assistance Committee of the OECD allow to be included in ODA – first year refugee costs, provincial governments’ spending on aid, bilateral debt forgiveness, imputed costs for students studying in Canada etc. These later amounts must be estimated by CCIC to predict ODA for a given year until CIDA publishes its official ODA statistics for that year. The last year that these official statistics are available is 1998/99.


1.2 ODA for 2000/01 In March 2001 the government announced that $140.5 million was being added retroactively to Canadian aid in 2000/01, of which $100 million was allocated to CIDA. These funds were allocated to pay Canadian dues owning international institutions for the calendar year 2001, thereby freeing up resources for other programs in the 2001/02 fiscal year. Smaller amounts were also allocated -- $8 million for a special payment by CIDA and $15 million to the HIPC Trust Fund. The 2001/02 Part III Estimates for CIDA report an additional $200 million in forecast spending by CIDA for 2000/01, which have been authorized through supplementary Estimates since March 2000. The impact of these additions is to push our calculation of actual ODA for 2000/01 to a projected $2,777 million or 0.27% of GNP for that year. This is an increase over 1999/2000 of $120 million, with ODA for that year projected at 0.28% of GNP. In 1998/99 official statistics put Canadian ODA at 0.30% of GNP.

1.3 CCIC Commentary The government continues to add small, often retroactively and one-off, increases to Canadian ODA. This approach to increasing our aid budget reinforces uncertainty and does little to permit the long-term planning essential for effective development impact. In terms of the UN target of 0.7%, these past two years of small and retroactive supplements are likely to leave our ODA/GNP ratio below even the level reached in 1998/99 (0.30%). The government is clearly not allocating the aid resources needed to match the Prime Minister’s international rhetorical commitment at the G8 and elsewhere to increase Canadian ODA. We are nowhere near planned increases that would raise Canadian ODA to 0.35% by 2005, as a step towards the international target.

2. CIDA Projections and Program for 2001/02

2.1 New Resources for CIDA
CIDA is allocated a very significant proportion of the aid budget for ODA, with the Department of Finance, DFAIT, imputed expenditures for refugees and students in Canada, and non-budgetary debt relief making up the balance. Comparing the Part III Estimates for 2000/01 and 2001/02, CIDA is authorized to spend an additional $60 million in 2001/02 for a total of $1,825.1 million. The March government announcement to prepay $140.5 million in UN/IFI dues owed for 2001 freed at least $100 million inCIDA resources for reallocation to other CIDA programs. However, as happened last fiscal year, at some year in the future when the government chooses not to prepay these dues, CIDA is required to pay "double dues" for that fiscal year.

2.2 Allocation of CIDA Increases While a few CIDA program lines have small decreases, the following areas of CIDA’s Estimates for 2001/02 show a significant increase over Estimates for 2000/01:

Bilateral Geographic Programs $94.8 million increase (14.1%) (despite the fact that the geographic programs are expecting to under-spend by approximately $50 million in 2000/01). However, we understand that a significant portion of this increase is unallocated and may be available to other Branches based on Agency priorities yet to be determined.

Voluntary Sector $3.9 million increase (2.1%) (The Partnership Branch as a whole is expected to over-spend by $16.5 million in 2000/01.)

CIDA Administration $35.2 million increase (31.4%). In 2000/01 CIDA was authorized to increase its administration spending by more than $30 million. The person year equivalents are expected to grow from 1,252.2 to 1,340 or 88 PYEs (7.4%). Of this number Policy Branch is increasing by 42 PYEs to 143 PYEs, with the balance in Corporate Affairs.

IDRC and Rights and Democracy Both IDRC and Rights and Democracy are funded beyond the CIDA budget and have increases of $6.4 million (7.4%) and $0.5 million (11.4%) respectively.

2.3 Translating the objectives for CIDA’s Social Development Priorities (SDPs) into an effective program of activities The Estimates give a brief indication for each Branch their contributions to meeting the targets for the SDPs:

For Multilateral Branch, there will be more emphasis in UNICEF, UNAIDS, food fortification with the World Food Program and enhanced support for the Canadian International Immunization Initiatives.

For Canadian Partnership Branch, partners receiving project funds will be expected to adjust their existing projects to the SDPs or submit new projects. Partners receiving program funding, will be "offered the opportunity to adjust their programs to the SDPs without having to wait for the renewal of their program funding in three years" (page 29).

The Africa and Middle East Branch expect to increase its investments in the SPDs from 28% to 50% of its 2000/01 budget, with particular emphasis on HIV/AIDS, basic education and health sector programming, and child protection programming in the region.

For Asia Branch, investments in SPDs will rise from 18% in 2000/01 to 27% in 2001/02 and will double in five year’s time (36%). Basic education will be an emphasis in Bangladesh, China, Indonesia and Pakistan. There will be enhanced work on HIV/AIDS with regional and country partners, along with increased work in the health sector in China and Bangladesh and possibly Pakistan and the Philippines, and child protection issues (child labour and disability).

The Americas Branch suggests no numerical targets, but suggests that the Branch will continue programming in primary health and basic education, HIV/AIDS and child protection in relation to street children and child labour issues.

2.4 Implementation of Pilot Projects to test specific programming approaches, including Comprehensive Development Frameworks (CDFs), Poverty Reduction Papers (PRSPs), and Sector Wide Approaches (SWAps) The Estimates outline some special initiatives that are under way to pilot with partners projects and programs for new approaches in CIDA’s contributions to international cooperation.

Policy Branch has been developing knowledge networks in many important areas of programming, including poverty, SWAps, gender equality and civil society. The Branch will be creating an Analysis and Research Division to allow "the Agency to extract better lessons learned, take further advantage of major developments in international development thinking, and develop more effective strategies to tackle global poverty" (page 30).

Multilateral Branch will be promoting more linkages between multilateral and bilateral programming and financing mechanisms in relation to CDFs, SWAPs and other innovative programming initiatives.

Canadian Partnership Branch will conduct a pilot consortium project on child protection in West Africa involving a sector approach with NGOs from Canada and Africa, other donors and governments. The consortium will design an appropriate framework and action plan that will guide activities by both governments and NGOs.

Central and Eastern Europe Branch will be designing new programming tools for managing the "graduation process" of certain Countries in Transition from an aid relationship to one broadly based politically, commercially, and socially.

For the Geographic Branches there will be greater emphasis on supporting country owned poverty strategies in selected countries (Burkina Faso, Cameroon, Mali) and a programming approach (Honduras and Senegal). CIDA will explore SWAps in Bangladesh, Bolivia, Caribbean Regional Program, throughout SS Africa and specifically Ghana.

Brian Tomlinson
Revised April 25, 2001


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