The Millenium Development Goals (MDGs) have set ambitious targets for poverty reduction. In an attempt to tackle poverty many of the worlds poorest countries have now produced their own Poverty Reduction Strategies which rest somewhere between focusing on achieving the MDG targets and focusing on the priorities of their own population. Donors have increasingly focused aid to support the Poverty Reduction Strategies, mainly in the form of budget support. This paper suggests that this has had mixed results and more could be done to ensure aid effectiveness.