Author Archive

Using Public-Private Partnerships (PPPs) to channel UK aid

April 17, 2013

The use of public-private partnerships (PPPs) to deliver UK aid has been multiplying and looks set to increase in the coming years. All of these PPPs have some kind of arrangement between the public and private sector for the private sector to deliver some or all of the goods or services which traditionally fell under public sector responsibility, such as health care provision or building a road.

The one term PPP can refer to a wide range of different initiatives, some of which can have quite complex structures. For example, PPPs in international development have both a donor government such as the UK and a host government receiving UK aid as the public sector partners, but often the donor governments often channel their money indirectly to PPPs, via the World Bank, the Private Infrastructure Development Group and various other channels. There has also been a recent increase in sales of PPP equity, with over 75% of these transactions now being made through offshore infrastructure funds.

And when it comes to the private sector partner(s), they could be various different business sizes, structures or sectors; ranging from small-scale farmers, artisans or local entrepreneurs to UK companies and transnational corporations.

Given this diversity of the public sector, private sector and PPP structures, it is not possible to make any general assumptions about what the development impacts will be for all PPPs. This means that assumptions must be tested at the assessment, monitoring and evaluation stages for each PPP by all of the actors involved.

CAFOD’s new discussion paper picks out some of the key arguments that we have identified from the international debate about the advantages and disadvantages of using PPPs to deliver UK aid and then raises questions which we think will help the policy debate to better understand:

  • The nature of the value that PPPs add to the delivery of the environmental and poverty reduction objectives of UK aid
  • the ways in which the learning from the impact of these PPPs is informing policy and practice

The paper is the first in a series looking at the use of PPPs to deliver UK aid. CAFOD would like to hear your opinion about these questions. Are they the right questions to ask? Are there questions missing? What do you think are the added benefits of using PPPs to deliver aid? What has been your experience of applying the learning from implementation to new UK aid funded PPPs?

All comments are welcomed and can be sent to:

Beck Wallace, Lead Analyst on Extractive Industries & Corruption bwallace@cafod.org.uk

The UK must do more to fight corruption

December 9, 2011

It has been estimated that corruption causes up to $1 trillion each year to flow out from developing countries into the rich world. This deprives the countries most in need of valuable revenue and has devastating impacts on their citizens’ quality of life. 

Today is International Anti-Corruption Day and CAFOD have joined with likeminded NGOs through BOND’s anti-corruption working group. We are calling on the UK government to do more to tackle the role that UK banks and companies play in fuelling and facilitating the corruption which can undermine development overseas.

CAFOD has welcomed steps taken by the UK government to date, particularly the implementation of the Bribery Act 2010 and calls on the Government to continue following through with the necessary steps to:

  • Ensure there are sufficient dedicated resources available to enforce the Bribery Act
  • Enforce UK anti-money laundering laws
  • Extend the UN Convention Against Corruption and UK Bribery Act to all Crown Dependencies and Overseas Territories.
  • Produce a transparent cross-government anti-corruption strategy under the responsibility of UK Anti-Corruption Champion, Rt Hon Ken Clarke MP. 

A number of other recommendations are made in our full report, such as improving enforcement of know-your-customer rules by banks and other service providers including accountancy firms so that they do not mistakenly handle corrupt money and also the need to better publicise protection promised to whistleblowers to ensure that much more corrupt behaviour comes to light and can be challenged.

Working to make Natural Resources a blessing, not a curse

November 22, 2011

Twelve of the most mineral-rich countries and six of the most oil-rich countries in the world are defined by the World Bank as Heavily-Indebted Poor Countries (HIPCs). Although these countries are rich in natural resources, their people often continue to live in poverty and conflict. The resource curse is alive and well.

Arriving into a hotel in Lusaka, Zambia, the coffee table magazine was full of articles about mining companies, reflecting the boom in the industry alongside recent rises in copper prices. The magazine highlighted how philanthropy was funding community projects, but many of those who voted for the newly elected President had higher hopes that he would ensure the mining industry contributed through its core business activities to Zambian development . CAFOD partners, such as the Jesuit Centre for Theological Reflection, have been challenging tax avoidance by extractives companies and calling for a windfall tax on mining companies. (more…)

Mind the Gaps

October 24, 2011

Yesterday CAFOD gave evidence to the independent working group which is monitoring the UK government’s compliance with the OECD Anti-Bribery Convention.

Corruption undermines economic growth and cripples public services and CAFOD supporter calls were answered as the Bribery Act entered into force in July of this year.

Kenneth Clarke has already committed the government to ensuring that there are no loopholes for subsidiaries and joint ventures within the Guidance of the Act. William Hague has stated that it will be implemented “rigorously, effectively and fairly”. It is vital that the Government stays true to these commitments.

Overall CAFOD have welcomed the progress made by the government. However, we raised a number of vital issues that must be addressed if this legislation is not to be a hollow achievement:

1.    Adequate Resources: The Serious Fraud Office’s budget is planned to have almost halved between 2008/9 and 2014/15 (from £53 million to £29 million) at a time when cases under the new Bribery Act need to be investigated and more resources would be required if the Act is to be implemented effectively.

2.   Keep up the focus: the UK’s anti-bribery investigations will be dealt with through the new National Crime Agency (NCA), where the stated focus is fighting terrorism and organised crime. A particular specialised focus must be maintained on anti-bribery if the Bribery Act is to be effective.

3.    Closing loopholes in the Bribery Act guidance: The Ministry of Justice was required by the Bribery Act itself to set out guidance for commercial organisations about how to prevent bribery, but overstepped its remit when it also provided guidance on which commercial organisations the Act applies to. The fact is that the Act, as approved by parliament, defines the legislation. In giving alternative interpretations of the Act the Ministry of Justice has sent confusing signals to business and may have inadvertently created disadvantages for UK companies.