Roadblock on the Journey to Self-Reliance: Budget Cuts, Budget Uncertainty, and Bureaucratic Delays

In 2018, the United States Agency for International Development (USAID) embarked on USAID Transformation, to more effectively advance national security and support host country partners on their Journey to Self-Reliance including “strengthening in-country capacity and facilitate locally-led development.” Similar “localization” efforts are also underway through the President's Emergency Plan for AIDS Relief (PEPFAR) to directly implement 70% of its funding through local indigenous partners by 2020.

This type of transformation will arguably take significant resources to build the capacity of local partners and institutions, and to strengthen local civil society to take on their own development initiatives. However, budget uncertainty and bureaucratic delays are increasingly becoming the norm, where the President’s Budget Request in Fiscal Years 2018, 2019 and 2020 proposed significant funding cuts for US development and diplomacy by more than 30%. Despite clear and unwavering Congressional support for international assistance, agencies are often required to use these severed request levels in their planning and strategy development for specific sectors, making programming on the ground difficult and planning confusing.

This report finds that budget cuts, budget uncertainties and bureaucratic delays have direct negative impacts on the most poor and vulnerable, who foreign assistance projects often aim to serve. They also undermine USAID’s ability to realize its localization efforts, through the Journey to Self-Reliance and its PEPFAR funding targets. Lastly, such budget issues ultimately cause direct harm to USAID and undermine the will of US taxpayers to which they are accountable.

Recommendations

To the Administration:

1. The Administration should avoid early termination of programs, which would likely be required in the event of drastic budget cuts, at all costs.
2. The Administration should refrain from proposing severe budget cuts on critically important development programs.
3. The Administration should make every effort to obligate funding on time.
4. The Administration should not withhold funding for programs that have already been authorized and appropriated or redirect funds that undermine long-term strategic objectives and contradict Congressional intent.

To Congress:

1. Congress should restore regular order for appropriations and conduct a review to determine where other processes within the Administration can be responsibly expedited.
2. Congress should reject proposals to drastically cut programs without strong justification and maintain robust funding for international poverty-reducing humanitarian and development programs.
3. Congress should request the US Government Accountability Office to conduct a meta-analysis on the impacts of budget uncertainty as well as cuts and delays on programs.

To both:

1. Congress and the Administration should consider outlaying funding for the duration of an award at the outset.

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