Why we’re allocating discretionary funds to the Deworm the World Initiative

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Many donors who give through GiveWell’s website choose to donate to support “Grants to recommended charities at GiveWell’s discretion,” rather than selecting a specific recommended charity or charities as the target of their gift.

We periodically grant these “discretionary funds” to what we see as the highest-value funding opportunities among our top charities. We last granted discretionary funds in April; then, we granted $4.4 million to the Against Malaria Foundation and $0.5 million to the Deworm the World Initiative.

Since we last allocated funds, we received an additional $1.25 million in discretionary funds that we recently granted out. We also hold roughly $1 million in discretionary funds that we plan to grant out in the next month or two. We plan to grant all of this funding to the Deworm the World Initiative.

Recommendation for donors

We continue to recommend that donors give 100% of their donation to the Against Malaria Foundation (AMF). In other words, although we’re choosing to grant discretionary funds to Deworm the World, we don’t believe that donors who rely on our recommendations should adjust their giving at this time. We explain the rationale for this below.

Summary

This post will discuss:

  • Why we believe Deworm the World has a pressing funding need.
  • The benefits of granting discretionary funds to Deworm the World today.
  • The risks of granting discretionary funds to Deworm the World today.
  • Why we’re continuing to recommend that donors give 100% of their donation to AMF.

Deworm the World’s funding gap

Deworm the World recently told us that they have a pressing funding need. We model Deworm the World as the most cost-effective of our top charities (~10x as cost-effective as cash transfers). Last November, we recommended what we estimated was enough funding to make it 80 percent likely that Deworm the World would not be constrained by funding in the next year. (Due to donors following GiveWell’s recommendations, this recommendation generally tracks with what charities receive as a result.) The existence of a funding gap today thus surprised us.

We understand Deworm the World’s funding gap is driven by two primary factors. First, our estimate of Deworm the World’s room for more funding made assumptions about how much funding it would receive from other funders, and so far this year revenue has been lower than projections.

Second, global costs (salaries, office space, travel, etc. for staff based outside of countries where programs operate) were erroneously left out of our cost-effectiveness analysis for Deworm the World last year. Deworm the World did not include these costs in its list of ways it might spend money and we did not recognize that they were not built into the budget.

The existence of this gap, and some time-sensitive considerations discussed below, led us to decide to recommend the current discretionary funds go to Deworm the World. We also considered granting them to AMF, which is our current top recommendation for donors; we believe AMF has significant room for more funding. However, we decided that Deworm the World’s funding need was more pressing. We don’t expect this decision to change the total amount that AMF and Deworm the World each receive as a result of GiveWell’s recommendation in 2017, so the cost of not choosing AMF today is delaying when AMF receives this funding.

Benefits of granting discretionary funds to Deworm the World now

Deworm the World is currently in discussions with the government of Kenya to sign a memorandum of understanding (MOU) to continue its deworming program in Kenya for the next five years. Deworm the World had enough funding committed to the program to fund two years and believes that if it had a larger funding commitment, the government would see the MOU as a higher priority and might speed up the process to finalize the MOU. When we spoke with Deworm the World about additional funding in June and July, of particular concern were the upcoming elections in Kenya on August 8. Because elections tend to take government officials away from other work, Deworm the World feared that delaying the MOU process could delay its deworming work and, in a worst-case scenario, cause the 2017-2018 round of deworming in Kenya to be missed.

Though we understand from Deworm the World that the MOU was not signed prior to the elections, our expectation is that receiving this funding several months earlier than it otherwise would have will decrease the likelihood of Kenya missing a round of deworming.

In addition, Deworm the World may have opportunities this year to fund work in Pakistan and additional work in India (it currently works in only a portion of the states in India). Receiving additional funding now may allow Deworm the World to accelerate its work in those locations.

We have not completed a full room for more funding analysis of Deworm the World since last October and are unsure how much additional room for more funding Deworm the World has.

Risks of granting discretionary funds to Deworm the World now

We believe that granting GiveWell’s discretionary funds to Deworm the World now has the following risks:

  • We may later come to believe that Deworm the World needed less than $2.25 million this year.

    We have not seen complete financial information from Deworm the World and we are unsure how much additional funding would be needed to bring them to the level of being 80 percent likely that they won’t be bottlenecked by funding (we generally target our most cost-effective top charities receiving this level of funding).

    Discretionary funds allocated now will reduce our estimation of Deworm the World’s 2017 end-of-year room for more funding, which we incorporate into our annual year-end recommendations. It’s possible, although we think highly unlikely, that once we see Deworm the World’s full financial information (which we expect to before our end-of-year recommendation decisions), we will conclude that the amount we want to recommend to them this year is less than $2.25 million.

    We don’t think this is likely; our best guess is that granting funds to Deworm the World today will accelerate when they receive funds from GiveWell but not change the overall amount of funding they receive in 2017 due to our recommendation.

    It’s also possible that receiving GiveWell discretionary funds now will, for example, allow Deworm the World to lay more groundwork in Pakistan this year and create new opportunities to fund deworming in Pakistan next year, thus increasing our estimate of Deworm the World’s room-for-more funding at the end of the year.

  • If we decide at the end of the year that Deworm the World is no longer a top charity, we may not think it should have received $2.25 million a few months before. We think this is highly unlikely.
  • Funding for and implementation of Kenya’s deworming program is complex. It involves the government of Kenya, multiple funders (including GiveWell-influenced donors, the Children’s Investment Fund Foundation, and the END Fund), and the Deworm the World Initiative, among others. We’d recommend any donor considering major gifts to Deworm the World before we publish our updated review of Deworm the World in November contact us one-on-one to discuss these considerations.

Recommendation to individuals

We continue to recommend that donors give to our current top recommendation: the Against Malaria Foundation. We are not changing the recommendation to donors because:

  1. We are unsure how much additional funding we would like to see Deworm the World receive this year. Making it our new recommendation for donors could drive enough funding in the next few months to overshoot the total Deworm the World could effectively use in the near future.
  2. The main benefit of giving to Deworm the World now, rather than at the end of the year, is to accelerate the timeline for the MOU in Kenya and possibly work in Pakistan and India. We anticipate that much of the funding driven by a GiveWell recommendation to donors (e.g., as we currently recommend giving 100% to AMF) would not reach Deworm the World until about the time when we will have completed a full room for more funding analysis of Deworm the World’s work, so we see limited benefit in changing our recommendation now, while we do see the cost noted above.

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