This paper is part of a series synthesizing work on PRSPs; aid modalities; and aid harmonisation to encourage dialogue between UK and Japanese researchers on these issues.

Direct Budget Support (DBS) refers to aid channelled directly to government budgets, to be disbursed using their own allocation, procurement and accounting systems.This paper sets out an overview of the UK’s current thinking on this new aid modality. Although a number of different donors also support the move to budget support, DFID has been a strong advocate of the new approach and globally some of the first research results on budget support have been UK-led. The new aid modalities are far from simple, however, and different approaches to the modalities by different donors may in fact significantly influence effectiveness. A number of global learning networks have been set up to support donors with the complex issues involved in this area. One of these is the LENPA (Learning Network on Program-Based Approaches) network, hosted by the Canadian aid agency, CIDA. Much of the debate on budget support is therefore already global; all major donors are already involved. This paper is therefore not an attempt to cover all of the current debate; its focus is thinking in the UK.