This paper explains the rationale for the development of sector programmes in the context of evolving thinking on aid effectiveness, and defines the sector wide approach. It discusses the emerging evidence on the circumstances in which sector programmes are likely to be successful, and sets out a framework for assessing when different types of aid intervention, including sector programmes, are likely to be appropriate.The paper goes on to discuss how sector programmes need to be nested within the overall strategic framework of national policy, including the potential role of the Comprehensive Development Framework, and the poverty reduction strategies required for access to HIPC debt relief and concessional IMF finance. The paper discusses the problems of co-ordinating donors and Government in support of a single strategy, deriving some lessons for the ambitious national strategy exercises from the experience of sector programmes. It includes discussion of approaches to dealing with disagreements, including the continuing role of conditionality. The ultimate stage in donor co-ordination would be for donors to provide direct budget support to a single Government led strategy. The paper discusses the policy issues raised by direct support to the Government budget, and lessons from experience of budget support in Africa. The final section looks at the extent to which sector programmes and similar approaches are relevant to countries with weaker policy, governance and institutional environments.