Mr. Tony Cotter:

I thank the Chairman and members of the committee for inviting us here today to discuss the 11th European Development Fund, EDF. The EDF is the main instrument for delivering EU development assistance to the African, Caribbean and Pacific, ACP, group of states. The European Union funds its development co-operation programmes through the Union’s external relations financial instruments on the one hand and the EDF on the other. The external relations instruments are funded through the EU budget and the EDF is funded through direct assessed contributions by member states. Each EDF is concluded for a multi-annual period and the 11th EDF will cover the period 2014 to 2020. Total funding for the 11th EDF will amount to €30.5 billion. Ireland’s contribution, based on a contribution key of 0.94%, will be €286 million.

The EDF legislative package consists of four main components, the first of which is the internal agreement, which was negotiated under the Irish Presidency, has been signed by all member states and is in the process of being ratified by them. The internal agreement sets out the overall funding that will be provided within the multi-annual period of the EDF and individual member states’ share of the contribution, known as the key. The second part of the legislative package is the implementation regulation, which sets out how the EDF will be administered, including the responsibilities of the EDF committee, of which Ireland is an active member. The implementation regulation also establishes objectives and eligibility criteria, the general framework for allocating funds, programming and implementation. Negotiations on the text of the implementation regulation are ongoing within the ACP working group in Brussels.

The third component of the EDF legislative framework is the financial regulation.The regulation determines the detailed rules for the payment of the contribution of member states to the fund, as established by the internal agreement. The text of the financial regulation has been negotiated by the Brussels-based African, Caribbean and Pacific, ACP, working group and will be formally adopted once all EU member states have formally ratified the internal agreement. The overarching principle of the proposal on the financial regulation is maximum alignment with the financial regulation applicable to the general budget of the Union and its rules of application.
The fourth and final part of the legislative package is the overseas association decision, which establishes a partnership to support the overseas countries and territories' sustainable development as well as to promote the values and standards of the EU in the wider world. The overseas association decision was agreed under the Lithuanian Presidency in December 2013.
The EDF operates in each of the ACP countries on the basis of a multi-annual country strategy paper, CSP, which is jointly agreed with the partner country government and with other stakeholders, including EU member states. The CSP is operationalised by annual action programmes, AAPs, which detail the sectors and projects being targeted on a yearly basis. These CSPs, AAPs and other financial proposals to be funded from the EDF are discussed at the EDF committee, which meets regularly in Brussels and where Ireland is represented.
The EDF is subject to annual review by the European Court of Auditors. The Court of Auditors checks that EU funds, including those spent on development activities, are correctly accounted for and spent in compliance with the relevant rules and legislation, with due consideration for achieving best value for money, irrespective of where the funds are spent. The EDF consistently achieves an annual statement of assurance from the Court of Auditors.
The European Parliament is responsible for discharging the EDF’s accounts, further to the Court of Auditors annual review. The Parliament discharged the accounts for the year ending 2011 in 2013 and the procedure to review the accounts for year ending 2012 is under way.
Irish Aid engages very actively with the EDF. The geographical focus and aims of the EDF are closely aligned with those of Irish Aid. The EDF is the primary EU funding instrument for sub-Saharan Africa and has a strong focus on poverty eradication and on fragile and conflict-affected states. Current European Commission proposals envisage over 91% of the 11th EDF funding being allocated to Africa, which includes significant allocations for our key partner countries. For example, Mozambique is set to receive €734 million, Ethiopia €712 million, Tanzania €626 million, Uganda €578 million, Malawi €560 million, Zambia €484 million, Sierra Leone €376 million and Liberia €279 million.
Acting together enables all member states, including Ireland, to benefit from the EU’s wide geographical representation in third countries that is unmatched by any individual member state. We can, through our support for EDF programmes, complement the work Irish Aid is already doing, especially in the social sectors, and also contribute to programmes where Ireland does not have a comparative advantage, such as infrastructure and private sector development.
EDF programmes significantly complement Irish Aid’s work in our programme countries. For example, in Malawi, the focus on water and sanitation in the 2013 EDF annual action programme is crucial to improving nutrition and complements the scaling-up nutrition work with which Ireland has been centrally involved. Similarly in Tanzania, where Irish Aid’s programme has a strong focus on agriculture, the EDF-supported southern agriculture growth corridor initiative, SAGCOT, aims to promote the participation of smallholder farmers in the development of agriculture value chains.
Irish Aid has been a long-standing supporter of Ethiopia’sproductive safety nets programme. As chair of the PSNP donor working group in 2010, Ireland fully supported an allocation of €58 million under the 2010 EDF annual action plan to the programme. It was designed to reduce the vulnerability of 8.29 million chronically food insecure people through conditional transfer of resources for labour intensive public works, and unconditional transfers in direct support of labour poor households.
Ireland’s engagement with and oversight of the European Development Fund is managed through our membership of the European Development Fund committee. In the context of discussions at the committee, we obviously take a particular interest in the eight Irish Aid partner countries supported by the EDF. In advance of meetings, we consult our missions in partner countries to ensure that, to the greatest extent possible, there is complementarity between the EDF and the approach of Irish Aid’s bilateral programmes in our partner countries.
The EDF's programming is also informed byAn Agenda for Change, the EU development co-operation policy that was adopted in 2012. A key aim of the policy is that the EU should sharpen the sectoral and geographical focus of its aid programmes. This is resulting in a concentration of aid on those sectors, countries and regions where the EU has comparative advantage. Also, the application of the concept of differentiation will ensure aid resources are allocated to those countries most in need. Ireland has consistently articulated support for the differentiated type of approach. In the context of the 11th EDF, it will see an increase in resources allocated to the least developed and low income countries, reduced funding for middle income countries and an increased geographical focus on sub-Saharan Africa. As well as seeking to ensure the relevance of the EDF's policy and programming approaches to Ireland's bilateral development priorities, Irish Aid engages in issues of oversight and governance of the EDF through our participation in the EDF committee.
The EDF has also been subject to a number of major external assessments of its performance. The European Commission carried out a performance review of the EDF in 2011. It acknowledged the difficulty in directly attributing development results and, more particularly, progress towards achieving the millennium development goals, MDGs, precisely to the various funding sources. It concluded that the EDF had made a very substantial contribution to assisting ACP countries in progressing the MDGs.
The UK’s multilateral aid review, also in 2011, concluded that the EDF represents very good value for money for UK aid. It is one of only nine funding mechanisms, out of the 43 multilateral organisations assessed, that attained the categorisation. The review highlighted the EDF's ambitious objectives, strong financial accountability processes, clear and transparent resource allocation procedures based on need and performance, and long programming cycles offering a high degree of predictability and a full range of instruments.
The OECD Development Assistance Committee's, DAC, peer review of EU aid in 2012 also reported positively on the EDF. It highlighted its flexibility and adaptability to changes in the political and economic climate. I am aware the Oireachtas Joint Committee on Foreign Affairs and Trade met the DAC peer review team last week and the team spoke positively of the engagement.
Irish Aid is increasingly conscious of the potential which EDF funds may have for Irish business. Obviously the EDF budget is very significant. We are starting a one year pilot project with IBEC. The intention is to furnish IBEC with early information on programmes approved by the EDF committee and IBEC, in turn, will transmit the information to Irish businesses. The aim of the pilot project is to raise awareness among Irish companies of the potential available for EDF programmes. The wish and hope is that, in due course, Irish companies will successfully tender for EDF contracts. Perhaps we can speak further about that aspect later in this session.

In conclusion, I hope I have provided a useful, if brief, overview of the legislative package governing the 11th EDF. I also hope I have demonstrated the synergies between the EDF and Ireland’s bilateral programme and outlined the governance arrangements that underpin the EDF. I thank the committee for this opportunity to talk about the process of implementing the 11th EDF, its governance and how its aims and objectives align closely with those of Irish Aid. We will do our best to answer questions members may have.