What is the track record of multi donor trust funds in improving aid effectiveness? An assessment of the available evidence

Aid effectiveness and improving the impact of aid, particularly in fragile and conflictaffected states, has become a central policy issue for many bilateral donors and international organisations in the recent past, as these nations and agencies expend more resources in overseas development aid. Financial analysis reveals that overall aid levels have increased since 2000 and that fragile and conflict-affected states receive substantial amounts of this increased aid (Chapman and Vaillant, 2010). The United Kingdom has contributed a large portion of the increased levels of development aid—in 2011, British Official Development Assistance (ODA) reached GBP £8.70 billion (USD $14.015 billion), the highest level of UK ODA to date and more than double the 2001 ODA levels (DFID, 2011).

The Department for International Development (DFID) is the primary provider of British ODA, distributing nearly 90% (GBP £7.613 billion/US $12.264 billion) of all UK ODA in 2011 (DFID, 2011). As is the case with other donor countries, the majority of UK ODA consists of bilateral expenditure; however, following global trends, in recent years the British government has increased its assistance to multilateral organisations such as the World Bank, other regional development banks and the United Nations. Part of this increased multilateral assistance is provided to multi-donor trust funds (MDTFs), an aid financing modality that is primarily employed in post-crisis contexts, which is itself an area of particular and increasing focus for DFID. With the growing importance of this funding mechanism, DFID commissioned this systematic review to consider the question, ‘What is the track record of multi-donor trust funds in improving the impact of aid?’