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Public consultation on the design of the new poverty impact fund

This consultation is now closed.

The UK Government aims to establish a new Poverty Impact Fund this year. The objective is to support poverty-fighting groups, with a focus on service delivery in support of the Millennium Development Goals.

As part of developing the Fund, the Department for International Development (DFID) is inviting views from those with an interest in civil society funding.

Proposed Outline

The Fund is being designed with 2 initial funding windows, tailored to different types and sizes of organisations:

  • Innovation Grants: for small UK-based CSOs (annual average turnover  £500,000), encouraging innovative approaches to poverty reduction.
  • Impact Grants: for UK-based CSOs working on poverty reduction programmes at larger scale in one or more poor countries.  This window will also be available to locally registered CSOs in countries where DFID has a country office.

DFID proposes to establish the Innovation and Impact windows this year and may consider developing a further Investment Window, for large UK and globally recognised organisations with strong strategic and policy relevance to DFID, at a later stage.

The table below outlines the key parameters for the Innovation and Impact windows.  Final agreement of the PIF is subject to the government's spending review which will be completed by the autumn. 

POVERTY IMPACt FUND
Innovation Window Impact Window
Proposed Value 10% of PIF (grants worth up to £4m annually) 90% of PIF (grants worth up to £36m annually)
Purpose Poverty reduction, with innovation encouraged. 
Can be small scale service delivery, but emphasise learning to allow scaling up
Poverty reduction linked to MDGs.
Projects focused on off-track MDGs prioritised.
Risk appetite Medium – High risk: to encourage potentially higher rewards from ground-breaking work Low – Medium risk: lower risk for work at greater scale to deliver real benefits for poor people.
Grant size Up to £250,000.
Annual value of grant less than 40% of CSO’s annual income.
Max 2 grants per CSO
 Min. £250,000 - max £2 million.
Annual value of grant less than 40% of CSO’s annual income.
Max 3 grants per CSO
Duration Up to 3 years Up to 3 years
Matched funding requirement 25% 50%
Eligibility ‘Small’ UK-based not for profit organisations, with an average income of less than £500,000 p.a. for the past 2 years. ‘Medium’ sized UK-based not for profit organisations (but no fixed upper or lower limit).  Organisations receiving PPAs excluded. 
Locally registered CSOs in countries where DFID has a country office. 
Funding rounds Two per year One per year

Projects would be expected to focus on poverty reduction, service delivery and the most off-track MDGs; be consistent with national poverty reduction strategies; show a strong understanding of local context; and include beneficiaries in design and feedback.

Activities that would not be eligible:

  • Disaster and humanitarian relief projects
  • Research work
  • Core support
  • Funding to governments or for-profit businesses
  • Religious evangelising and proselytising
  • Campaigning that takes a partisan political stance
  • Any element of a project that discriminates between individuals or groups because of their race, ethnicity, gender, sexual orientation, religion or disability
  • Scholarships
  • Projects comprised mainly of shipping or transport costs, including shipping used technology, vehicles, books
  • Land purchase or purchase of buildings
  • Surgical procedures which don’t have a direct impact on poverty
  • Child sponsorship

We welcome your views and ideas to help develop the new Fund.  The consultation questions are as follows:

  1. What are your views on the overall design and scope of the Poverty Impact Fund?
  2. What are your comments on particular elements of the design:
  • The size of the grants under each window
  • The number of grants that can be held by a CSO at any one time
  • Matched funding levels.

Please send your views and comments to: pifconsultation@dfid.gov.uk

In order to move forward quickly to establish this Fund, the consultation period will be 8 weeks.  It will, therefore, run until 22 September 2010.  We will consider carefully all comments received - however we are unable to acknowledge individual responses.

Last updated: 23 Jul 2010

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