Allocation of discretionary funds from Q3 2019

By GiveWell @ 2019-12-28T04:25 (+8)

This is a linkpost to https://blog.givewell.org/2019/12/19/allocation-of-discretionary-funds-from-q3-2019/

In the third quarter of 2019, donors gave a combined $2.6 million to GiveWell for granting to recommended charities at our discretion. We greatly appreciate this support, which enables us to direct funding where we believe it can be used most impactfully. We grant this funding to one or more of our top charities each quarter.

We decided to allocate all $2.6 million to Helen Keller International’s (HKI) vitamin A supplementation (VAS) program. HKI is a GiveWell top charity that supports provision of vitamin A supplements to young children, reducing their likelihood of dying from infectious disease. It does so by providing technical assistance, engaging in advocacy, and contributing funding to government-run VAS programs in sub-Saharan Africa. We based our decision on our estimate of the high cost-effectiveness of the work HKI expects to conduct with this funding.

We provide an updated recommendation for donors below.

Summary

In this post, we discuss:

• what HKI will do with this funding.
• our process for deciding where to allocate funds.
• our bottom line for donors giving today.

Unlike other quarters, we made our decision of where to allocate third-quarter (Q3) discretionary funding alongside annual updates to our list of top charity recommendations, which we published in November. As part of our annual update, we provided a recommendation to Open Philanthropy, a philanthropic organization that is a major supporter of our top charities, about how it should allocate funding to each of our top charities in 2019. We reference this recommendation below.

What will HKI do with this funding?

In addition to granting $2.6 million in Q3 discretionary funding, in November 2019, we recommended that Open Philanthropy grant $9.7 million to HKI’s VAS program, for a total of $12.3 million. This funding will enable HKI to spend:

• $5.5 million to continue its work in five countries (Guinea, Mali, Burkina Faso, Côte d’Ivoire, and Niger), including supplementing its budgets in 2020 and 2021 and extending its funding runway to 2022.
• $4.5 million to start a new program in the Democratic Republic of Congo, with funding to cover 2020-2022.
• $2.4 million to expand its program to Bauchi State, Nigeria, with funding to cover 2020-2022.

We believe that Q3 discretionary funding will be pooled with the Open Philanthropy grant to enable the above; we don’t restrict discretionary funds to a particular piece of HKI’s VAS work, and see all of the above as valuable.

This work is highly cost-effective. We estimate that it is 28 times as cost-effective as cash transfers (“28x cash”)1 overall, and, by country, ranges from 19x cash to 38x cash.2 Additional details on HKI’s funding needs and spending plans are here.

Our process for deciding where to allocate funds

In late 2019, our top charities shared information about how they would use additional funding. Each charity has different opportunities to spend funding that can vary in cost-effectiveness: for example, extension of a charity’s program in one country or expansion of its program to a new country. In some cases, we don’t believe that a charity will be able to support those opportunities with its existing budget and projected donations. In those cases, we refer to the charity’s “funding gaps.”

In general, we follow the seven principles described in this page when deciding which funding gaps to fill. The first of these principles is to put significant weight on our cost-effectiveness estimates, which aim to capture total improvement in well-being per dollar spent. These estimates suggested that HKI’s VAS program had a very high priority funding gap (28x cash overall in the seven countries listed above).

Other possibilities we considered

Sightsavers’ deworming program. We estimated that allocating $2.6 million to GiveWell top charity Sightsavers for its deworming program would be similar in cost-effectiveness to HKI’s VAS program.3

We decided to allocate the $2.6 million to HKI’s VAS program because at the time we made the decision (in October), we were considering changes to our deworming cost-effectiveness model and were uncertain whether we would estimate Sightsavers’ cost-effectiveness as higher or lower than HKI’s.

Other top charities (Against Malaria Foundation, Malaria Consortium’s seasonal malaria chemoprevention program, END Fund’s deworming program, and GiveDirectly). At the time of our decision, we estimated that supporting HKI’s VAS program or Sightsavers’ deworming program would be significantly more cost-effective than supporting other top charities, and thus decided to focus our decision on comparing HKI’s VAS program and Sightsavers’ deworming program.

We did not compare HKI’s VAS program to our top charities SCI Foundation or Evidence Action’s Deworm the World, which we do not believe have near-term funding needs.

Our bottom line for donors giving today

We continue to recommend that donors giving to GiveWell choose the option on our donation form for “grants to recommended charities at GiveWell’s discretion” so that we can direct the funding to the top charity or charities with the most pressing funding needs.

As part of our annual update, we recommended that Open Philanthropy make several grants to our top charities. Taking Open Philanthropy’s support into account, we note that if we had additional funds to allocate at this time, we would likely allocate them to Malaria Consortium’s seasonal malaria chemoprevention (SMC) program. We believe that Malaria Consortium’s program has the highest impact per additional dollar donated today. After the Open Philanthropy grant and the Q3 discretionary funding, additional donations to HKI’s VAS program would support funding gaps that we model as less cost-effective than the funding gaps on Malaria Consortium’s current margin.

Notes