MFAN Thanks Congress for Rejecting Steep Cuts to Development, Advancing Aid Effectiveness in FY2018 Omnibus

March 29, 2018 (WASHINGTON) – This statement is delivered on behalf of the Modernizing Foreign Assistance Network (MFAN) by Co-Chairs George Ingram, Tessie San Martin, and Connie Veillette.

MFAN wishes to thank Congress for rejecting the Trump Administration’s proposed massive cut to development and foreign assistance in the final Fiscal Year 2018 Omnibus. The bill funds the International Affairs Budget at $55.9 billion, which represents a 3.8% increase from the FY17 enacted levels, excluding supplemental funding. This is a strong rebuff of the dangerous administration proposal that would have hamstrung development effectiveness and amounted to an American retreat from global engagement. With this budget, Congress reiterates its commitment to maintaining U.S. leadership on development and diplomacy and exercising its oversight role.

MFAN is particularly pleased to see many aid effectiveness and reform elements incorporated in the final bill.

Strategic Transitions

The bill requires Congressional consultation on USAID’s strategic transitions efforts. It explicitly states that metrics, principles, and plans for post-transition engagement should be developed and shared with the relevant committees as well as the development community. MFAN and over 100 organization and individuals have been supportive of efforts to facilitate responsible transitions from aid based on countries’ development progress.

Redesign

This year’s bill builds on strong language in FY17 that asserted an important role for Congress in the redesign and reform efforts at the State Department and USAID.  The FY18 legislation calls for the Secretary of State and USAID Administrator to each submit a report to Congress “summarizing all efforts taken during calendar year 2017 to reorganize, redesign, or otherwise change the form or function of their respective agencies.” Furthermore the bill stipulates that funds be made available to maintain Foreign and Civil Service staff levels. These provisions echo the recommendation of MFAN and 170 organizations and individuals who called for redesign to be based on sound principles of aid effectiveness and for engagement with both the development community and Congress.

Domestic Resource Mobilization

In line with the last several funding bills, the FY18 legislation includes supportive language encouraging domestic resource mobilization (DRM). Enabling countries to raise their own resources for development is critical to both country ownership and transition to new forms of partnership with the United States. The Omnibus calls for the USAID Administrator to consult with Congress on how USAID is determining country eligibility, developing objectives, monitoring implementation, and measuring outcomes of DRM assistance. MFAN urges USAID to incorporate these elements into a broader agency strategy on DRM.

USAID Operating Expenses and Capital Investment Fund

USAID’s Operating Expenses (OE) are critical to maintaining staffing and operations as the United States’ lead development agency. MFAN was disappointed to see OE received a cut. This important account was funded at $1,347.7 million, slightly lower than FY17. Additionally, USAID’s Capital Investment Fund (CIF) – which provides resources for many of the agency’s IT and data systems that enable USAID to be more transparent and accountable – received $197.1 million, also a small reduction from last year. Sufficient funding of these accounts is essential to aid effectiveness.

Development Finance

Finally, the bill signals support for improving the U.S. Government’s development finance tools by calling for a review of all development finance programs which includes “recommendations for enhancing the effectiveness of such programs.” MFAN has expressed support for the bipartisan Congressional effort to modernize U.S. development finance capabilities, and continues to work with the sponsors to further strengthen the legislation.

MFAN applauds Congress for continuing to support effective development through the appropriations process. We are hopeful these provisions can be built upon in Fiscal Year 2019. We look forward to working with appropriators in both chambers to further modernize and strengthen U.S. development efforts.

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