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San José, Costa Rica

6-7 December 2017

2nd TOSSD TASK FORCE MEETINGItem 7: Brainstorming session on how to accommodate civil society concerns

CSO PaperFive issues for consideration by the Task Force

• Incentives in the TOSSD measurement framework, including on the difference between ODA and TOSSD

• The key principles for TOSSD

• Inclusive governance

• The notion of mutual benefit

• What is missing?

Issues already addressed in other sessionsIncentives in the TOSSD measurement framework

• The proposal to report TOSSD as a single gross figure alsopresents other risks that require attention. For example, CSOsremain concerned that this single headline figure will includeresources mobilised from the private sector even though inmany cases the purpose of such flows is primarily commercial,not developmental. (Item 4. Session on TOSSD Reporting)

• CSOs urge the Task Force to reconsider the relative merits ofreporting the headline figure on a net rather than a grossbasis, as net figures provide particularly valuable data on theresources available to recipient countries over the long-term,whilst also representing more transparently the extent towhich providers are making returns from their investments.(Item 4. Session on TOSSD Reporting)

Issues already addressed in other sessionsKey principles for TOSSD

• The focus on development results and effectiveness is essential to the definition of TOSSD (Item 6. Approaches for associating international standards)

• Human rights, gender equality and the empowerment of all women and girls, and all three pillars of sustainable development as key principles (Item 6. Approaches for associating international standards).

• For South-South Cooperation (SSC), TOSSD should integrate SSC principles from major declarations of the key SSC conferences in Bandung (1955), Buenos Aires (1978), Nairobi (2009), Bogota (2010), and Delhi (2013). (Item 6. Approaches for associating international standards).

Issues already addressed in other sessionsInclusive governance

• Inclusive governance for TOSSD will require broad dialogues/forums (local, country, and international level) where all development actors, including civil society organizations, have a formal voice (Lunch Session day 1 -TOSSD governance session)

Issues already addressed in other sessionsWhat is missing?

• Country ownership (Lunch session)– Using only provider data for the TOSSD recipient measure undermines this

principle because it prevents the recipient country from using its own country systems to determine its perspective on the TOSSD measurement.

– TOSSD should take advantage of recipient data as well as provider data in tracing aid contributions, for instance through such platforms as the International Aid Transparency Initiative as well as the experience of the Global Partnership for Effective Development Cooperation.

• Poverty eradication not included in the TOSSD definition (Item 3. TOSSD definition)– The definition put forth for TOSSD ignores this dimension. CSOS would

propose that the TOSSD definition of Sustainable Development be revised as follows: “The concept of “Sustainable Development” in the context of TOSSD is defined as development that meets the needs of the present without compromising the ability of future generations to meet their own needs, for which the eradication of poverty in all its forms and dimensions is an indispensable requirement.”

Issues already addressed in other sessionsWhat is missing?

• Developing Countries (Item 3. TOSSD definition)– CSOs are concerned about stretching country coverage into high income

countries. suggest that current list of ODA eligible countries includes bothlower middle and upper middle income countries, which in our view issufficiently broad to ensure the important notion of leaving no one behind istaken into account.

– On the other hand, using the UNDP’s human development index or its indexon multi-dimensional poverty as this approach would also be consistent withCSOs’ notion of multidimensional poverty, moving away from GNI as the soledeterminant of country selection. If the latter were to be chosen, it wouldrequire further discussion on the cut-off point and annual adjustments in HDIfor individual countries.

Issues already addressed in other sessionsWhat is missing?

• Double counting (Item 5. Treatment of multilateral flows)– The issue should get undiminished attention to avoid the risk of TOSSD

inflation. In this regard, the background paper on multilateral institutions suggests an approach that focuses on all multilateral institution cross border flows rather than the source of the funding. But such an approach raises issues: “multilateral institutions would report information on all finance they provide to developing countries, including outflows they have funded themselves (e.g. through leveraging operations, retained earnings) and outflows they have received from provider countries (e.g. earmarked funding)”; one question might be what would be included in leveraging operations, similar to issues CSOs have raised around bilateral blended finance and ODA leveraging.

Issues still for discussionInclusive governance

• At the national level: – a) establishing permanent institutionalized spaces for multi-

stakeholder dialogue and accountability on development policy; – b) facilitating inclusive engagement of a diversity of civil society actors

particularly those representing grassroots-based organisations, women, and marginalised populations;

– c) building open and timely access to information and transparent accountability mechanisms and processes, protected by legislation;

– d) implementing full transparency for budget documentation with direct citizens’ engagement in the budgetary processes;

– e) building inclusive fully participatory processes from the country to the global level to aid in achieving development goals at the country-level;

– f) supporting the capacities of a wide range of CSOs to enable them to systematically participate in policy processes.

Group Discussion 1Concerns over the utility of TOSSD for partner countries

beyond increased transparency• TOSSD data will help recipient countries better apprehend the

volume, nature, and use of officially supported resources they receive which, in turn, will help them improve strategic development planning processes, better manage budget outlays, and strengthen balance of payments statistics.

• Other potential utility for TOSSD: – Identifying “invisible flows” (e.g. illicit financial flows, transfer pricing)? – Increasing transparency regarding public debt obligations – including

contingent liabilities arising from public/private partnerships?– Getting a handle on the development results or impact of TOSSD flows?

Issue for discussion

Do TF members have any ideas on the above points?

Group Discussion 1Concerns that TOSSD could undermine ODA

• Creating an alternative measure of official support for developing countries, TOSSD could open the door for provider countries to shy away from previous ODA commitments and other international targets

Issues for discussion

Is the proposed TOSSD measurement system sufficiently different from the ODA measurement system?

How could the TOSSD reporting system ensure that support for projects financing

complex/multidimensional SDG targets covering more than one sector do not give rise to double-

counting? For example, how would the TOSSD system distinguish among multiple objectives in a given

sectoral programme?

Example: a slum redevelopment project aiming at upgrading housing, improving access to potable

water and promoting self-employment among young disaffected youth provides support that relates

to SDG target 6.1 (universal and equitable access to safe and affordable water), SDG target 8.6 (youth

unemployment), SDG target 9.3 (increasing access to finance by small/informal enterprises) and SDG

target 11.1 (access to adequate, safe and affordable housing). What elements would be needed in the

reporting system to appropriately allocate the official funding across these SDG targets? How might

this be recorded in the TOSSD system?

Group Discussion 1The Notion of Mutual Benefit

• The principle of mutual benefit, when applied to traditional North-South flows, could undermine the historic commitments to support global development through the imperative to achieve the UN target 0.7% of a donor's GNI for ODA.

• TOSSD (…) may incentivize reductions or less ambition for donor ODA commitments, and lead to further neglect of the historical basis of providing aid to the Global South.

• Mutual benefit cannot be achieved between substantially unequal partners.

Issue for discussion

Do TF members have any ideas on the above points?

Group Discussion 2The question of the project identifier

• The possibility of tracking projects over their lifetime in the TOSSD system by linking up both the commitments and disbursements for a given project.

• In practice, however, several issues arise:– Links can be easily broken (e.g. changes in IT systems).– To capture the full project, any contributions from other financiers (public or private) should

be reported using the same unique identifier. Is this feasible? It may only be so as and when the financing package is pulled together (at the commitment stage). Would a project identifier reduce the risk of double counting?

– Is information on projects over their lifetime useful if it is incomplete? If not, does it make sense to complicate the reporting with this feature?

– Practical issues such as commitment vs. cumulative commitment.– Practical issues also for activities that are not “projects” as such, e.g. sending an expert. – As regards tracking net flows over the lifetime of a project, data on return flows are often

treated as confidential at the project level if the recipients are private sector entities. This suggests that data on earnings on non-grant financial instruments repatriated to the provider country may need to be collected at the aggregate level. And what is the cross-border flow exactly? If a provider country sells its equity stake to an investor in another country, there is an amount received by the provider but the investment remains in the developing country – the transaction has merely amounted to a change in ownership of the investment.

Group Discussion 2The question of the project identifier

Issues for discussion

How realistic is it to develop a project identifier system in the TOSSD

framework? Is there any utility in doing so if data are not complete for each

project?

How could a project identifier system best be organised given the complexity

of project financing across multiple providers? Once the commitments have

been made? Who would be responsible for establishing and ensuring all

financiers use the project identified?

Are there technical solutions for limiting or eliminating the risk that IT links

break?

What TOSSD data might be collected as aggregates?

Group discussion 3CSO outreach options

Issue for discussion

• How, and when, might outreach to civil society and other interested development stakeholders regarding the emerging shape of the cross-border pillar be carried out? – An internet-based CSO consultation?– Convening a special CSO event to discuss TOSSD in 2018?– Participating in strategically relevant side events at upcoming UN meetings

and/or other important international events?

• Would any Task Force members be interested in volunteering to participate in some capacity in this regard?

Thank you!