The Case for a Supplementary IDA Budget: A lifeline for children

The COVID-19 pandemic is having a devastating impact on children’s lives across the world. Nowhere is this more evident than in the world’s poorest countries served by the World Bank’s International Development Association (IDA), which provides grants and concessional finance to 74 of the poorest low and lower middle-income countries. To help countries to respond to the COVID crisis, the World Bank has frontloaded spending from the current round of funding (IDA19) to provide timely and much-needed support but now faces a large deficit from the summer of 2021. To bridge the deficit and continue scaling up IDA funding to 2023 the World Bank has requested donors contribute towards a supplementary budget of US$25 billion.

This paper explores the case for the supplement and how it could unlock billions of dollars of much-needed finance to help protect children from the worst impacts of the crisis. It also assesses how the supplemental budget could be funded and outlines how maintaining government debt sustainability and improving the World Bank’s own accountability systems will be crucial for the effectiveness of IDA’s operations.