A Critical Review of the DFID Needs-Effectiveness Index

What is it about?

When DFID embarked on a review of the allocation of UK Aid between countries and between multilateral organisation in 2010 they developed a quantitative approach to the prioritisation of countries which qualified to receive aid. This approach was based on an innovatory 'Needs-Effectiveness Index' which after publication of the review in 2011 attracted substantial criticism. This article discusses the shortcomings of the index. However, even with an alternative approach to prioritisation it is likely that the countries removed from or down-graded within the recipients of UK Aid would have been very similar to that actually adopted by DFID.

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Why is it important?

The DFID 'Needs-Effectiveness Index' is an example of metrication of decision making in the context of aid allocation. Metrication is intended to give a more systematic approach to decision making in complex circumstances - rather than relying on time-honoured broad discussion. However, if metrication is to be adopted the methods used need to be properly considered, and preferably recognised as being effective, rather than being 'one-off' indices which have not been properly 'de-bugged' (as occurred with the 'Needs-Effectiveness Index'.

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