Scottish Ministers are committed to advancing Scotland's place in the world as a responsible nation by building mutually beneficial links with other countries as outlined in the Scottish Government's International Framework. As part of that Framework, Scotland has a distinctive contribution to make in its work with developing countries recognising our global responsibility to work together to achieve the Millennium Development Goals (MDGs).

1.1 AIMS & OBJECTIVES

The Scottish Government recognises the longstanding commitment of organisations and individuals in Scotland to international development, building upon both the historical and contemporary relationships that exist between Scotland and many countries within the developing world. Scotland already contributes to UK efforts through the Department for International Development (DFID) and this policy reflects how the Scottish Government, as a devolved administration, can enhance Scotland's contribution to the global fight against poverty.

The International Development Policy outlines our intention to actively engage with this global agenda and defines the Scottish Government's distinctive contribution and approach to international development thereby providing support and solidarity to developing countries. The overarching aims and objectives of the policy are as follows:

Aims:

• To enhance Scotland's contribution to the global fight against poverty through activity which is clearly designed to support the achievement of the MDGs and economic growth in developing countries.
• To demonstrate Scotland's commitment to play its role in addressing the challenges faced by the developing world, recognising Scotland's identity as a responsible nation.

Objectives:

• To work in a focussed way with a small number of identified developing countries to provide support to those in greatest need and the most vulnerable, working through organisations in Scotland and in line with priorities of the respective countries.
• To develop Scotland's special relationship with Malawi, working with the Government of Malawi to achieve sustainable outcomes.
• To support and promote Scotland's contribution to Fair Trade with developing countries as a responsible nation in the world.
• To support key networking agencies for international development in Scotland recognising their role in information exchange and the promotion of best practice in Scotland's contribution to the achievement of the MDGs.
• To assist with Scotland's response to international humanitarian crises.
• To recognise and build upon Scotland's links with the Indian subcontinent by working together with communities in Scotland to support development, and in turn help support an inclusive society in Scotland.
• To contribute to relevant in-country development policies and priorities and to complement the work of the UK Government and other international development programmes.

The Scottish Government will also seek to encourage greater partnership within the Scottish science base to enable a stronger contribution to development and poverty reduction.

1.2 KEY VALUES & PRINCIPLES

The international development policy has been designed to reflect the following values and principles:

• The needs and priorities of developing countries are paramount. Inevitably, Scotland will learn and benefit from the experience of working in partnership with developing countries, but these benefits will not detract from the development strategies and priorities identified by developing countries.
• We will focus our efforts to make the best use of limited resources and ensure we make a sustained and measurable difference. We are alert to the tension between developing a wider programme alongside a deeper and more focused engagement.
• The Scottish Government is committed to continuing to work with Malawi based on the unique and historical relationship between our two countries. We have confirmed our commitment to honour the Co-operation Agreement ring fencing at least £3 million per annum to support this, within this spending review period. The Scottish Government will continue to work with the Government of Malawi to develop a focused programme of engagement and will continue to review and monitor progress through the Joint Commission process, a mechanism which is strongly supported by the Government of Malawi.
• The policy will encourage the consideration and adoption of best practice in development with an emphasis on country-led identification of need, organisational and institutional capacity building and community-led development. For example, the sharing of knowledge and transfer of skills, the training of trainers and responding to the developing countries' assessment of how we might best support development. The Scottish Government will also look to the development sector in Scotland, through the Network of International Development Organisations in Scotland (NIDOS), for their input regarding their experience of operating different models of development in their countries of operation.
• The policy, and more detailed funding guidance, will take due consideration of the impacts of climate change on the developing world.
• The policy will complement the work of others and not duplicate effort or undermine existing initiatives or government policy. Although international development is a reserved issue under the Scotland Act (1998), the Scottish Government is operating in accordance with the Act by "assisting the Crown in relation to foreign affairs" and will continue to ensure that the policy is developed within those given powers.
• The Scottish Government will continue to support Scotland becoming a Fair Trade Nation through its support of the Scottish Fairtrade Forum.
• Scottish Ministers have increased the International Development Fund within the life of this Parliament, to support the delivery of this policy with a commitment to the operation of transparent and accountable funding processes. The policy will adopt a deeper and more focused approach to the delivery of the policy, continuing to work through organisations in Scotland, based on the development strategies and priorities of developing countries. Whilst the Scottish Government recognises that working through organisations in Scotland may limit the range of work which can be funded, this model is essential to ensure that the Scottish Government is focusing its efforts and working to the stated policy aim of enhancing Scotland's contribution to international development.

1.3 SCOPE OF POLICY

The following broad criteria have informed the areas of operation:

• The nature of the relationship with Scotland, both historical and contemporary.
• The levels of poverty as defined by the UN Human Development Index for 2007/2008 as measured through life expectancy, educational attainment and income.
• Relevant activity and expertise within Scotland.

The policy will comprise six distinct elements listed below. This approach will ensure that all policy activity and funding criteria can closely reflect the needs of each country and/ or region. It will also enable the Scottish Government to more clearly demonstrate the impact of the International Development Fund. Further details will be published on the website.

• Sub-Saharan Africa Development Programme - Zambia, Tanzania, Rwanda and Darfur region of Sudan (block grant funding)
• Malawi Development Programme (maximum of two targeted grant rounds per year and competitive tendering exercises to commission work in line with priorities developed with the Government of Malawi as and when required).
• Fair Trade Scotland Programme (support to be channelled through the Scottish Fair Trade Forum based on formal application and assessment).
• Core Funding for Scottish-Based Networking Organisations (specific applications and assessment as required).
• Response to International Humanitarian Crises (one-off and short-term allocations based on a formal proposal and assessment process).
• Indian Subcontinent Development (geographical priorities and operational procedure to be developed in discussion with key stakeholders).

1.4 INTERNATIONAL DEVELOPMENT FUND (IDF)

The delivery of the policy will be supported by the International Development Fund which will be dispersed through tailored funding arrangements for each element. Total allocation per financial year (1st April to 31st March) will be as follows:

2008/09 - £6 million

2009/10 - £6 million

2010/11 - £9 million

Three main funding mechanisms will be adopted as follows:

• Challenge Fund Model - a funding round is announced with pre-defined criteria outlining broad areas of interest. Any organisation meeting the basic eligibility criteria may bid for funds. There is no limit to the number of organisations who can bid.
• Targeted Competitive Tendering - a requirement for a specific piece of work is identified with the developing country. Organisations working in relevant sectors will be invited to express an interest in bidding and those that meet the basic criteria will be invited to bid for the required work. Usually 4 or 5 organisations will be invited to bid in any one exercise.
• Block Grant Funding - a direct grant will be awarded (through a competitive process) to a key organisation or a consortium of organisations to deliver a strategic programme. Decisions as to how the grant is spent will be under the direction of the organisation/s holding the block grant.

Eligibility requirements and funding criteria for each scheme will be published on the Scottish Government website along with available budget, anticipated timescales for funding decisions and information on the process for decision-making. This information will also be made available to NIDOS and to the Scotland-Malawi Partnership (in relation to the Malawi Programme). This will enable both organisations to alert their members. Any contractual commitments that began prior to the introduction of this policy will be honoured until their contractual completion.

1.5 FUNDING ASSESSMENT PROCESS

The Scottish Government is committed to fair and transparent processes for all funding activity. Funding criteria for each funding round and information on the process will be published on the Scottish Government website. It is anticipated that external assessors will be contracted to assess bids in the main funding rounds. This excludes individual contracts to networking agencies in Scotland, support to the Scottish Fair Trade Forum and specifically commissioned work for the Malawi programme which will undergo internal assessment by officials, seeking advice where appropriate. The cost of contracting external assessors will not be drawn from the International Development Fund. Assessment forms will available on request on completion of each funding exercise.

1.6 PROJECT MONITORING & INDEPENDENT EVALUATION

The Scottish Government is committed to rigorous monitoring and evaluation procedures for all Scottish Government funded activity. Six monthly and annual reporting for all projects will continue, with a revised reporting format. Details of reporting requirements will be published on the Scottish Government website and adherence to these requirements will remain a condition of the grant contract. A formal evaluation of the policy will also be developed to support the policy. The cost of this activity will not be drawn from the International Development Fund. Further information will be provided on the Scottish Government website.

1.7 MINISTERIAL GROUPS TO SUPPORT THE POLICY

The Scottish Government recognises the important role played by all previous advisory groups. The new policy will be supported by two distinct groups with clear and focused remits.

An International Development Advisory Group (IDAG) will be set up, drawn from the external international development sector and other interested parties, to be chaired by the Minister. Members will be asked to join the group by invitation of the Minister. This group will provide support and advice to the Minister across all six elements of the international development policy including the Malawi programme. It is not proposed that this group take on the assessment of individual funding applications or funding decisions. It is suggested that the group meet twice a year. Membership will be published on the Scottish Government website.

An additional group to provide support on the Malawi programme will also be set up - the Scotland-Malawi Advisory Group (SMAG). This group will also be chaired by the Minister but will take a more informal format and provide a mechanism for more informal brainstorming and discussion. Members will be invited by the Minister to join the group which will meet as and when required. It will also be supported by e-mail discussions. It is not proposed that this group reports to the main group, but that it remains a standalone group in recognition of Scotland's special relationship with Malawi.

Acknowledgements

This policy has been developed following consideration of responses to the public review (conducted from August to October 2007), and the experience of operating the policy to date. The Scottish Government is grateful to all individuals and organisations who contributed.

May 2008