09 June 2013

Nutrition 4 Growth: How Big are the Pledges?

Well, that was quite an event: David Cameron, MIchel Temer, Bill Gates, Kofi Annan, Joyce Banda, Enda Kenny, Justine Greening, Anjelique Kidjo, Tony Lake, Ertharin Cousin, Graziano De Silva, Raj Shah, etc. And very well conceived and executed.

But ultimately it was a story of hedges, pledges and edges.

Hedges, because the Children's Investment Fund Foundation (CIFF) funded by profits from the TCI Hedge Fund surprised everyone (and perhaps themselves) by pledging $700 million to nutrition over the next 7 years. Phenomenal for a Foundation that is only 10 years old.

Pledges, because despite everyone saying it is about more than the money, the money is a big part of it.

$4 billion was pledged by the Donor government and Foundation donors. But just how significant is that?

This is not an easy question to answer.

Try this (and let me know if I have done something obviously wrong).
  1. Assumption 1: say economic growth will take care of about half of stunting (this is what the evidence says). So, assume economic growth continues in the high burden countries
  2. That means we need about an extra $10bn a year on nutrition specific programmes (the Lancet estimates) to take care of just under a quarter of stunting
  3. Assumption 2: I would guess an increase of $15bn/year (who knows?) classified as nutrition sensitive programmes is also needed to take care of the remaining quarter. Note this will probably show as zero or a small marginal costs as it is mostly about making existing potentially nutrition sensitive programmes actually nutrition sensitive.
  4. Assumption 3: so the total 7 year bill is $70bn. The assumption of donors is that they will cover 30% of that cost (and where were India and Indonesian pledges?) which puts their bill at $21bn.
  5. So we can almost eliminate stunting by 2020 for $21bn of donor funds if the high burden countries find $49bn and economic growth continues. Phew.
  6. Assumption 4: however, we probably don't have the capacity to spend that step increase sensibly so assume half  of that envelope is scaled up over the 7 years, which is $10.5bn for donors and $24.5 bn for high burden countries
  7. Assumption 5: so an increase of $4 bn (if the donor pledge is realised) to 2020 looks to cover just under 40% of the donor gap. This is probably an underestimate of the gap covered given the matching element of the pledges risks some double counting. 
  8. $4bn at 40% of the gap to 2020 seems like a very positive result, albeit with very favourable assumptions (continued economic growth, high burden country financing materialising, zero marginal costs on nutrition sensitive interventions, new pledges being kept). With less favourable assumptions the $4bn looks much smaller. 
  9. Another way of looking at it is that a $4bn increase over 7 years is an average of about $570k/year extra on top of an annual $400k of nutrition specific + $4bn of nutrition sensitive (rough estimate from donor work in April) or about a 13% increase on average, but will be a lot higher as a % by 2020 as this will be backloaded.
  10. But even if the pledges do represent 40% of the gap, that still leaves $6bn for the donors to find, $4bn of pledges to materialise and be spent sensibly, donor fatigue not to set in and SUN to help civil society in high burden countries encourage/pressure their governments (esp India and Indonesia) to find the $24.5 bn of domestic resources.  
So, not bad at all with the rosy scenario. Less good with the more realistic scenarios. But as I said, it is very murky.

Edges, because whatever the scenario, we now have to be hard edged and hold funders (donor and domestic) to their commitments and to find additional funding commitments to end stunting and other forms of undernutrition.

Brazil 2016 is a future staging post for new additional commitments and we need a few additional staging posts  between now and then.

Hedges, Pledges and Edges. We need to make it work for the world's most vulnerable children.


Jeneral28 said...

Is the UK still caught up in giving aid to easily measurable results like nutrition and hunger?

Lawrence Haddad said...

Jeneral28--here is an issue where aid really can make a sustainable difference--I'm as skeptical as the next person about aid=good, but this area seems different.

Lawrence Haddad said...

Several of you have said what about the $18bn pledge on nutrition sensitive programmes? I have not included it because I have no idea if it is additional, or what the baseline is. And it is not listed on the DFID website.... If you know, tell me more about it...Thanks

Molly Kinder said...

Lawrence, I am surprised you note only donor/foundation pledges without any reference to financial pledges from the high burden countries themselves. The Lancet series that came out on Thursday suggested donors should be responsible for 30-40% of total tab for scaling up nutrition to save the lives of 1 million children/year...the remaining 60-70% of the bill should be footed by the high burden countries themselves. Indeed, the 2020 stunting target endorsed by 90 signatories on Saturday relies heavily on domestic resources from the big 4 high burden countries -- India, Indonesia, Pakistan, and Nigeria -- who collectively account for nearly 2/3 of that stunting target. DFID's financing target assumed the vast majority of resources for the national nutrition plans of those big 4 countries would come from domestic resources. Yet of those 4 countries, only 1 (Nigeria) made a financial pledge on Saturday, and a modest one at that (an additional $10 million - in a country where more than 11 million children are stunted), whereas India made no commitment of any type at all. Several other African countries did make financial pledges, including Ethiopia, Malawi and others. Given the centrality of domestic resources to finance the fight against undernutrition, the omission of developing country pledges from your analysis is notable.

Lawrence Haddad said...

Hi Molly, I'm not as quick on the draw as you--

country pledges are up on DH now... agree, the country pledges have a way to go..

I put a table up on Scribd and tried to do a bit of quick cross-referencing to HANCI.

I'm not as good as you are at this real time analysis!

Now I just have to make sense of the nutrition sensitive pledges...