Thursday, January 16, 2014

A glance at the United Kingdom's Department for International Development (DfID), and careers in government grantmaking

Summary: I take a quick glance at the financial statements of  the United Kingdom's foreign agency, the Department for International Development (DfID). The agency's portfolio includes many highly effective interventions, but likely has some room for improvement in its funding allocation and delivery. Its budget is more than $6.5 million per employee, suggesting that if an employee has at least a modest positive influence over DfID activities, then he or she could do more direct good there than by working in industry and donating to the most effective international health charities. I suggest looking more closely at this broader category, of careers in government grant allocation.


United Kingdom foreign aid: a lot of budget, few staff
The Department for International Development is the United Kingdom's primary institution for official development assistance. Its 2011-2012 budget was £6.7 billion (current) & £1.4 billion (capital), or $11 billion and $2.3 billion. In 2013, it was announced that the budget would increase to  £10.3bn in 2014/15 and £11.1bn in 2015/16. The UK aid budget is one of the largest in the world:



How many civil servants work for this agency? A Guardian article linked me to this helpful spreadsheet of civil service employees by agency, which gives the DfID a permanent payroll staff (as of March 2010) of 1,565 full-time-equivalents. That amounts to over £4 million pounds of budget per staffer.

The portfolio of the DfID includes highly cost-effective interventions
What is that budget spent on? The DfID's annual report for 2011-2012 gives extensive information. Skimming through it I see a lot of favorable information.

For example, one worry about nominally high foreign aid budgets is that they may include a lot of war-related costs that are not optimally targeted from a humanitarian point of view. However, on page 35 the Afghanistan program is only £153.9 million.

The agency reports 12.3 million children vaccinated,  extensive malaria net distributions, micronutrients distributed, and other top interventions. Other interventions are less favored by the likes of the DCPP or GiveWell. The agency staff are laboring under various mandates from above, and doubtless doing a great deal to get the most good out of their budgets, but it still seems likely there is still some room to improve the allocation of resources, and the delivery and monitoring of the aid.

If employees at DfID can meaningfully improve the allocation or delivery of aid, they might do much more direct good than earning to give to international health charities
With a budget of over $6.5 million per person, including very narrow and junior roles, if someone entering the more policy-oriented tracks within DfID might have good prospects to influence much more money than they could donate from industry. This influence would be harder to target: someone earning to give can target any charity in the entire world, free of bureaucratic constraints, while nudging within a government department would usually be much more constrained. Still, the existing portfolio shows that highly effective interventions make up a substantial portion of the DfID aid portfolio, so opportunities to increase or enable them should exist.

I remain greatly uncertain about the extent of influence a staffer could have: interviews with staff, examinations of the legal mandates DfID works under, and case studies of DfID flexibility would be very interesting. It would also be helpful to zoom in on more policy-relevant positions within the organization. For a top university graduate entering the agency through its graduate scheme program, the comparable universe of staff might be much smaller than 1,565. [Niel Bowerman adds in comments that the Fast Stream is a more favorable bet.]

One caveat about building a career in this area is flexibility: for cause-neutral donors who suspect the best altruistic interventions right now do not lie in the area of international health, the human capital built at DfID might wind up less adaptable to later projects elsewhere.

This is also yet another case where it would be helpful to have estimates (on a cardinal scale) of the value of, e.g. donations to GiveWell's top charities compared to typical DfID spending.

5 comments:

Niel Bowerman said...

Hi Carl,
Great post. This has made me update in favour of studying this approach more. A bunch of the programmes in DfID will ultimately be decided by the Secretary of State, which is not selected through the fast stream but is instead a political appointee. Also the fast stream is the quick way to get to the top of the management hierarchy at DfID not the graduate scheme. (However, you flagging it has just persuaded someone here that they should apply for it!)
It would be interesting to see how many fast stream people enter DfID each year. I don't think it would be unreasonable to assume that FastStreamers control 10% of the DfID budget each year. Thus 10% of the annual budget/the average annual fast stream intake would give you an idea of the size of budget the average fast streamer would control during their time at DfID. This is complicated by the fact that some fast streamers would enter DfID from other departments, and some would leave.
Posts like this are great though, thanks for writing it!
Cheers,
Niel

Carl said...

Thanks Niel, I have edited the text to refer to the Fast Stream.

Haydn said...

Cool post! You can do similar estimates for a bunch of other places:

Gates Foundation
Annual Budget: $3.4bn
Staff: 1194
=$2.8m per staff member

USAID
Annual Budget: $32.9bn
Staff: 3909
=$8.4m per staff member

Of course this is a first step - you then need to work out (a) how hard it is to become an employee and (b) how influence over the budget is distributed within the organisation. However as a way to get a rough estimate of different careers it is pretty useful!

p.s. The USAID 2012 Budget "Reflects hard choices based on a clear view of where a dollar of funding could
have the greatest impact"

Carl said...

Thanks Haydn, much appreciated.

Regarding USAID, I would note that USAID is balancing many objectives, and a different weighting on those would matter:

"The State and USAID budget focuses on other key national security and domestic economic benefits as detailed below. These investments help prevent wars, contain conflicts, reduce the threat of nuclear weapons, counter terrorism, respond to humanitarian needs, contain and reverse global pandemics, expand global markets, counter extremism, secure our borders and protect Americans abroad."

Robert Wiblin said...

A remarkable share of US Aid goes to countries in which the US has recently fought a war. It doesn't seem targetted on the poorest countries at all:

https://stats.oecd.org/qwids/#?x=2&y=6&f=3:51,4:1,1:24,5:3,7:1&q=3:51+4:1+1:24+5:3+7:1+2:1,262,263,2,3,4,5,6,7,8,9,10,11,12,13,14,15,16,17,18,19,20,21,22,23,24,25,27,28,29,30,31,32,33,34,35,36,37,38,39,40,41,42,43,44,45,46,47,49,50,51,52,53,54,55,56,57,59,60,273,63,62,64,65,66,67,68,69,70,71,72,73,74,75,76,78,79,81,82,83,84,85,86,87,88,90,89,274,91,92,93,95,96,97,98,100,101,102,103,104,105,106,107,108,109,110,111,112,113,114,115,116,117,118,119,120,121,122,123,124,125,126,127,128,129,130,131,132,133,135,136,137,138,139,141,144,145,146,147,148,149,150,151,152,154,155,156,157,275,158,159,160,161,162,163,164,165,166,167,168,169,170,171,172,173,174,175,176,177,178,179,180,181,182,183,184,185,186,187,188,189,190,134,191,192,193,216,217,218,220,221,222,223,224,225,226,227,228,229,230,219,231,257,195,196,259,197,233,198,238,200,234,235,270,201,202,271,203,204,205,206,208,236,209,210,211,212,213,215,266,272,265,267,G1+6:2007,2008,2009,2010,2011,2012