IFI governance


UK evaluates World Bank; publishes new strategy

15 November 2004

The UK’s Department for International Development (DFID) has published an evaluation of the World Bank’s work over the past three years. The review of the Institutional Strategy Paper (ISP) for the World Bank for 2000-2003 comes to the unremarkable conclusion that “substantial progress has been made, but [there are] a number of areas where further work will be needed”. Areas where DFID indicated disappointment included:

  • IDA resources “should be more heavily targeted on poor countries”;
  • Country Assistance Strategies should be better aligned with achievement of the Millennium Development Goals;
  • Poverty Reduction Strategies require “widening the breadth of consultation, and improving the depth of analysis and realism of target-setting.” PRSP equivalents should be prepared for middle-income countries;
  • Private sector lending should emphasise low-income “riskier” countries, and show improved impact assessment;
  • Cooperation with other donors, especially the UN, must be improved. “Tensions continue where staff from different institutions reach different conclusions. Tensions also arise from the Bank’s special role in preparing Joint Staff Assessments of PRSPs.”

During consultations held on the ISP for 2004-2007, UK civil society groups called for more specific indicators by which DFID’s progress in reforming the World Bank could be monitored. Many groups expressed concern that between its role as overseer versus that of partner, DFID had drifted too far towards the latter. Highlights of the new ISP include:

Objective Indicators
Strengthen poverty reduction strategies Assistance strategies to include assessment of capacity building needs for: policy analysis, planning, budgeting, monitoring and evaluation.
Improve cooperation with other development actors Staff incentives and training to include coordination with external partners by end FY 06 – especially parliamentarians, civil society and the IMF.
Encourage the use of appropriate financial instruments Lending to be synchronised with national budget cycles by FY07. Review and produce guidelines on streamlining conditionality by October 05. Conduct by end FY06 an analysis of the gap between safeguard policies and relevant international standards. All Bank support to reforms in PRSPs to be informed by impact assessment.
Deliver on Monterrey financing for development agenda Full disclosure of 2005 CPIA exercise for IDA countries by first quarter 2006. “Demonstrable improvement” in open, meritocratic leadership selection. Publication of board minutes within two weeks by end FY05. Measures to address board composition and voting weights to “take place by end FY07”. Indicator on Bank’s relations with civil society “to be developed”.

DFID has committed to review progress on an annual basis in consultation with senior World Bank staff, the results of which will be made publicly available. They will report annually to parliament on this and on “the broad positions taken at the Bank board.”