Rise in aid spending is a good thing but civil society should be vigilant

7 April 2017
Author: Mike Green

In 2015, the UK enshrined in law its commitment to spend 0.7% of gross national income (GNI) on aid. This figure was first calculated and pledged by the United Nations over 35 years ago to ensure progress in helping the world’s poorest. The UK first met this target in 2013 and yesterday it was important to see it had again met the target in 2016, spending £13,348m, or 0.70% of its GNI on Official Development Assistance (ODA). 

UK aid goes to some of the most vulnerable and poorest people across the world at a time where it’s needed more than ever. UK aid saves lives, reduces poverty and creates sustainable development. Another reason to be proud of UK aid is the expertise and transparency of the Department of International Development (DFID). The standards of detail and accountability for DFID spending are among the highest of any UK government department. Thanks to bodies like the Independent Commission for Aid Impact, which scrutinises aid spending to ensure value for UK taxpayer, we also have clear understanding of successes and just as importantly, when and where aid is not being used effectively.  

Digging deeper into the latest official ODA figures, there are areas where we as civil society will need to be vigilant. While ODA spending remained at 0.7% of GNI, the amount spent by DIFD is decreasing. In 2015 DFID spent 80.5% of the aid budget, in 2016 this had decreased to 74%. This is due to a government decision to increase aid going to other departments.   

UK aid increased by £1,210m in 2016 thanks to a shift in the methodology used to calculate GNI, which also saw GNI figures increase substantially. This has meant the share of the ODA budget going to different departments has increased from 19.5% in 2015 to 26.0% in 2016 - a relative increase of 46.5%. However, some departments are receiving more. Over 90% of the aid increase in real terms (£1,100m out of £1,200m) was delivered outside of DFID, with the Foreign Office, the Department for Business, Energy and Industrial Strategy and the Home Office the biggest recipients. 

There are very good reasons for the government to use the expertise of all departments to ensure the effectiveness of aid spending. The Department of Health for example manages "the Ross fund", part of which supports research into diseases with epidemic potential, such as Ebola, as well as neglected tropical diseases that affect over one billion people worldwide.

What is of concern are the levels of accountability and transparency that other government departments have when spending aid. This point was outlined in a report published in February by the Independent Commission of Aid Impact examining the new cross-government "Prosperity Fund". Administered by the Foreign and Commonwealth office, the fund “promotes economic reform and development needed for growth in developing countries.” From the latest figures released, the fund is due to scale up from £55 million in 2016-17 to a planned £350 million expenditure of ODA in 2019-20. The report raised concerns on the short time in which the fund was expected to manage such a spending increase, outlined challenges the fund would have in ‘meeting both its primary purpose of poverty reduction’ and said there was too little public information available about its work.

Other departments do have expertise to contribute in achieving poverty reduction and sustainable development, but they are not subject to the same levels of scrutiny and the same standards on aid transparency as DFID, which leaves fundamental questions unanswered. How do we ensure that aid spent by other government departments strives to reduce poverty and promote sustainable development as prescribed by the International Development Acts? Is all UK aid contributing to achieving the SDGs? And is aid which is delivered by other government department’s value for money for the British tax payer? 

The UK can be proud of continuing to spend 0.7% of its GNI on ODA. The transparency and accountability of DFID ensures that success in poverty alleviation is celebrated, whilst at the same time highlighting where spending needs to be improved. 

At a time of domestic spending cuts and increased scepticism of aid, it is more important than ever that other government departments, who have seen an increase in their ODA spending, have the same rigorous focus on aid effectiveness, the same level of accountability and the same level of transparency as DFID.  

About the author

Mike Green
Bond

Mike Green is policy adviser at Bond, working on UK and EU aid policy. He supports members on issues surrounding aid quality and quantity, financing for development, EU aid, and the OECD Development Assistance Committee.