In Depth

How is the UK’s foreign aid budget spent?

60 Tory MPs expected to vote against £4bn cuts

A number of Conservative MPs are orchestrating a plan to block Boris Johnson and Rishi Sunak’s plan to slash £4bn from the UK’s foreign aid budget, which has rekindled the debate about how the money is spent and what benefit it brings.

Former health secretary Jeremy Hunt and Tobias Ellwood, chairman of the Commons defence committee, have criticised the budget reduction, which was announced as part of Sunak’s spending review earlier this week.

Reduced spending on foreign aid has “been sought by Conservative rightwingers, who say it plays well with swing voters at a time of domestic austerity”, The Guardian says.

However, the pledge to slash spending comes just a week after Foreign Secretary Dominic Raab told members of Joe Biden’s transition team that the UK had a “moral interest” in supporting vulnerable countries through Covid-19.

How much does the UK pay in overseas aid?

Since 1970, the UN has set a target for donor countries to contribute 0.7% of their GDP on foreign aid.

The UK government has been signed up to the target since 1974, but it only reached it for the first time in 2013.

In 2015, the necessity to hit 0.7% of GDP was enshrined in UK law. While the obligation can’t be enforced through the courts, the international development secretary has to explain themselves to Parliament if the UK doesn’t meet the target.

Official figures show the government hit the target in 2016, contributing a total of £13.4bn to the international aid budget. Figures from 2017 show that Britain was the only member of the G7 to meet the 0.7% target, according to statistics published by the Organisation for Economic Co-operation and Development (OECD).

“The only donors more generous than Britain by proportion of their economies are Sweden (1.01%), Luxembourg (1%), Norway (0.99%) and Denmark (0.72%),” The Times reported in 2018. The non-Western countries that exceeded the UN target were the United Arab Emirates and Turkey, it adds.

The £13.4bn spent by the UK in 2016 is around one-tenth of what the government spends on health in England.

After Sunak today announced a cut in aid spending, Britain will commit 0.5% of gross national income to overseas aid efforts in 2021, a reduction in spending of around £4bn.

Why is foreign aid spending controversial?

Around a third of the UK’s aid budget in 2016 was spent via multilateral organisations such as the UN, while the remainder, classed as “bilateral aid”, is sent directly to developing countries. The five biggest recipients of the UK’s bilateral aid were Pakistan, Syria, Ethiopia, Nigeria and Afghanistan, says Full Fact.

About 15% of the UK’s foreign aid was spent on humanitarian aid, or crisis relief, with the rest focused on strategic or long-term goals. It is used to vaccinate children from preventable diseases, enabling them to go to school, while helping people work their way out of poverty, providing food, nutrition and medical care are also key goals.

But recent reports have unearthed issues with foreign aid spending. For example, a study by three economists published in February found that billions of pounds of aid allocated to the most in-need nations ends up in tax havens.

The study, Elite Capture of Foreign Aid, tracked the flow of aid money to 22 nations, finding that as much as a sixth ended up in tax havens like Switzerland.

But others - including some on the Conservative benches - have said that now is not the time for cuts.

Up to 60 Tory MPs are expected to vote down the reducing foreign aid, with Conservative MP Andrew Mitchell accusing Foreign Secretary Raab of allowing “a dismal start” to the UK’ premiership of the G7.

“The 0.7% was not just one commitment, it was a commitment to the poor made by every single member of the Commons at the last election, apart from the DUP,” Mitchell said.

Hunt has also attacked the plans, arguing that “to cut our aid budget by a third, in a year when millions more will fall into extreme poverty, will make not just them poorer but us poorer in the eyes of the world”.

Kevin Watkins, chief executive at Save the Children, called the cuts “unprincipled, unjustified and profoundly harmful both to Britain’s reputation and more importantly to millions of people around the world”.

However, the reduction in spending is supported by voters, with a YouGov poll revealing that two-thirds of voters support the cuts, including the majority of supporters of all major political parties.

As a result of recent controversies over where the funding is spent, MPs on the international development committee opened an inquiry into foreign aid earlier this year.


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