Reporting of EU aid increasingly inflated

24 November 2015

Many EU countries, including the Netherlands, Italy, Cyprus, and Portugal are exaggerating their aid spending by including "inflated aid", money spent in their own countries, in their official aid figures.

In 2014, the UK was once again one of the EU member states with the lowest levels of "inflated aid", according to CONCORD’s tenth AidWatch report.

Despite repeated promises, most member states will fail to meet, or even make significant progress towards, the target of spending 0.7% of gross national income on aid in 2014.

Although there was a moderate rise in global aid budgets in 2014, many EU countries like Spain, Portugal and France have cut their budgets over the last few years. Action to improve the effectiveness of development and aid also remains weak.

The data shows that there have been significant increases in "inflated aid" in some countries: 145% in the Netherlands, 107% in Italy, 65% in Cyprus, and 38% in Portugal.

"Aid should be a real transfer of resources to developing countries, yet the EU inflated its aid by some €7.1 billion in 2014, which represents 12% of total aid spending," said Mareen Buschmann, policy adviser for Bond.

Encouragingly, Ireland, Luxembourg, Poland and Bulgaria have decided not to include costs involved in hosting refugees in their official aid figures, contrary to Spain, Malta and Hungary.

aid should be used to support development

"We recognise the urgent nature of the current refugee crisis, but remain convinced that aid should be used to support development. The world’s poorest should not foot the bill for the refugee costs in Europe. Aid is essential to prevent more people having to flee their homes. Continuing to invest in fighting poverty and inequality in developing countries is ultimately the most sustainable way of dealing with the crisis in the long term", said Jessica Poh-Janrell from CONCORD Sweden.

"Effective aid, coupled with greater policy coherence for development on fiscal issues, could provide a great boost to development efforts in developing countries. In the long term, aid is only one cog in the wheel, which will turn only if we make all the other parts work as they should. The Addis Ababa Action Agenda recognises the importance of effective, progressive and fair tax systems in the fight against poverty and inequality", according to Jeroen Kwakkenbos from Eurodad.