Overview
Overview
Activity Exiting: Planning for Sustainability
This guideline focuses on exit strategies for Activities.
An exit strategy1 is a strategy for ending/phasing out support to, or transitioning from, development activities so the development outcomes will be sustained beyond the period of support.
Another term used for ‘exit’ is ‘phasing out’2. The term ‘transition’ strategy is also used, but it has the connotation of continuation of support but with a transition to a different approach or modality.
To improve its aid effectiveness, NZAID has made a commitment to fewer, bigger, longer and deeper programmes with a shift to higher order modalities that support a higher degree of partner ownership with the continuation of project modalities only where higher modalities are not possible or suitable (see NZAID Guideline on Aid Modalities).
Under this scenario projects will increasingly transition to higher order modalities such as sector support3. With this shift to new forms of cooperation and/or aid modality, exit strategies may depict changes in aid modality rather than a withdrawal from specific area/sector - engagement in a particular policy area or sector continues but the modality of the support changes.
When and how?
An exit or transition strategy needs to be:
- Identified, discussed and planned when an Activity is first identified
- Integrated into the Activity design
- Implemented throughout the life of the Activity
- Assessed at the end of the Activity
Purpose
The key intent of an exit strategy is to achieve sustainability of benefits: The exit strategy should be well planned, supporting the results already achieved and their sustainability in the future.It can lead to broader forms of co-operation and changes that may occur in the aid modality.To neglect consideration of the exit strategy in the design and implementation of an activity can undermine the intended outcomes and impact.
An exit strategy should:
- Be designed and implemented in such a way that the positive effects of donor support are maximised and possible negative effects of exit/transition are minimised.
- Be consistent with the principle of partnership, including recognition that the withdrawal of funds affects not only the activity, but also the partner organisations4.
- Take into consideration the expectations of other donors and contributors.
- Reflect aid effectiveness principles of ownership, harmonisation, alignment, managing for results and mutual accountability
While the timeline and level of detail will vary, exit strategies should be treated as an integral element of all Programmes and Activities.
Exit strategies are commonly not given the attention needed, especially in communication and mutual understanding with partners.Partners may accept an Activity’s closure, but still find it difficult to reconcile the end of what is perceived as a successful Activity. It can be difficult for NZAID as well, since there may be a tacit ‘no-exit strategy’ with partners who have received support for many years and with whom there is a close working relationship.
Reflecting aid effectiveness principlesf
A good exit strategy reflects aid effectiveness principles:
Ownership: Underpinning an exit strategy is the commitment to partner ownership and local sustainability. While NZAID has obligations to pursue a sound exit strategy, partners need also to take responsibility for preparing for a post-ODA environment.
Harmonisation and Alignment of donor support with partner country priorities should be reflected in the planning and implementation of exit strategies and factors such as predictability (both for NZAID and our partner) addressed.
Managing for Results: An exit strategy should include agreed upon milestones, indicators and outputs to be met for the successful conclusion of the Activity and for handover to occur.
Mutual Accountability: The roles and responsibilities should be detailed and agreed upon with clearly defined tasks for both donors and partners.
1 The term ‘exit strategy’ was initially used to describe a financial investment: It is the way in which an investor plans to close out an investment. back
2 ‘Phasing out’ is the term used in the NZAID Tool “Developing a Programme Strategy”. back
3 As indicated in footnote 2, there may be a long term relationship with a partner organisation that is performing well, in which instance an exit strategy that focuses on transitioning of phases, activities, and donor may be included. back
4 Partner organisation may have varying levels of dependency on NZAID funding (e.g. core and/or activity) which should be recognised and openly discussed. With a partner organisation in which there is an anticipated long term relationship, an agreed upon strategy that includes phasing out of areas of support, expansion of donor base, and potential funding from wider sector support should be considered. back