Commitment to ring fence UK aid welcome but questions remain

The commitment to ring fence UK aid and reach 0.7 per cent of GDP is welcome, and a testament to the hard work of many Labour MPs in the last Government.

David Taylor is chair of the Labour Campaign for International Development (LCID)

The commitment to ring fence UK aid and reach 0.7 per cent of GDP is welcome, and a testament to the hard work of many Labour MPs in the last Government and anti-poverty campaigners in making this a consensus issue in the eyes of the British public. However, as with the rest of the Comprehensive Spending Review, behind the rhetoric there are real concerns and real questions that need answering.

As Harriet Harman said in her statement yesterday, freezing spending in the Department for International Development (DfID) until the third year requires a huge leap of faith in the coalition. It is also contrary to what the Conservatives themselves pledged before the election.

When 57 per cent of Tory party members oppose the ringfencing – see this poll by Conservative Home today – it is vital that they bring forward the legislation they promised and enshrine in law the requirement to meet the 0.7 per cent target from 2013.

The Labour deputy leader said:

“The Bill is already drafted and we will give it full co-operation for its passage through Parliament. Failure to do so will only raise fears that they remain in doubt about whether they will actually keep their promise.”

 

Conflict

We must be vigilant in ensuring that UK aid is not siphoned off for military purposes. NGOs such as Oxfam and Save the Children have become increasingly alarmed at the direction the coalition is taking in this regard, as reported in The Guardian yesterday.

The coalition has indicated that 30 per cent of overseas development aid (ODA) is to be spent in fragile and conflict-affected states (Strategic Defence and Security Review, page 44). Given that 40 per cent of ODA is currently spent on country programmes, this would mean 75% of country programme money going to conflict countries. Which countries are defined as ‘fragile and conflict affected’ is therefore important – currently DfID’s definition stretches to include a wide number of countries including Ethiopia, Kenya, and Nigeria.

However, if that definition is narrowed to only a small number of countries, such as Yemen, Pakistan, Somalia and Afghanistan, then this puts our obligations to people in some of the poorest countries at risk including the likes of Ghana, Malawi, Tanzania and Zambia.

When Left Foot Forward interviewed Andrew Mitchell on the leaked DfID cuts, he said that this new emphasis would not mean that money would be diverted from health and education programmes in non-conflict countries. He must be held to account on this.

 

Beyond aid: financing for development

As others have argued on this blog, there is an alternative way to fund overseas aid – and that’s a Robin Hood Tax on the banks. But Britain can take strong action on something which will not cost the UK taxpayer a penny – clamping down on tax evasion. According to Christian Aid, tax dodging by companies operating in developing countries would potentially give developing countries up to $160bn (£100bn) a year.

The coalition government should take strong action on this and have spoken warm words on this issue. It will be difficult, however, for the UK to be credible on this issue when Mr Mitchell and chancellor George Osborne have been accused of tax avoidance themselves – Channel 4’s Dispatches revealed on Monday that Mr Mitchell has invested at least £130,000 in offshore investment funds, one of which is based in the Caribbean tax haven of the British Virgin Islands.

 

Key unanswered questions:

• Will the definition of fragile and/or unstable states change?

• Will DfID guarantee that cash spent in these states will be spent according to best poverty reduction practice?

• To what extent will climate finance contributions be additional to ODA?

• What are the proportions that will be spent by each government department involved in climate change?

• How much flexibility remains in the budget for decisions to be made in the bilateral, multilateral and humanitarian aid reviews? (e.g. some IFI contributions are listed under ‘Capital’ expenditure limits.)

• Given the backloading, will some programmes be cut in the first two years in order to meet the rising contribution to fragile/conflict states?

• When will the legislation for the 0.7 per cent target be introduced?

13 Responses to “Commitment to ring fence UK aid welcome but questions remain”

  1. Shamik Das

    Commitment to ring fence UK aid welcome but questions remain: //bit.ly/a7Wkcb writes @DavidTaylor85 on @leftfootfwd #CSR

  2. LCID

    We review the CSR and SDSR for Left Foot Forward / @LeftFootFwd: //fb.me/HAWlAVpx

  3. David Taylor

    My latest piece @leftfootfwd: Commitment to ring fence UK aid welcome but questions remain //bit.ly/ckw9F3

  4. Malcolm Evison

    RT @leftfootfwd: Commitment to ring fence UK aid welcome but questions remain //bit.ly/ckw9F3

  5. Tom Baker

    RT @DavidTaylor85: My latest piece @leftfootfwd: Commitment to ring fence UK aid welcome but questions remain //bit.ly/ckw9F3

  6. Tom Baker

    RT @LabourCID: We review the CSR and SDSR for Left Foot Forward / @LeftFootFwd: //fb.me/HAWlAVpx

  7. John Lees

    All this does is waste our money on highly paid aid workers working tax free abroard. No wonder the aid lobby is happy. If I was an aid worker I would wish teh money to be spent in teh carabean or a county with a beach – not Afganistan. Lets spend this £ on things that benefit the UK. At least put a UK flag on it.

  8. Jiesheng

    John Lees, while yes aid funds are needed to sustain aid workers, aid workes earn onaverage much less than yourhigh street banker and live in worse conditions than the average household.

    If you are concernwith money, the concern should be whether aid is easily fungible and what to do with fungible aid

  9. Jiesheng

    Here is where i agree and part company. The Robin Hood Tax is a no-goer–just check out Owen Barder’s thoughts on them–//www.owen.org/blog/3092

    Fragile states–is a Wstern definition set within the context of neo-liberalism. While all you Labour people attack the Tories over this, do not forget that Labour penned the 2000 and 2006 White Papers were fragile states were placed within the context of security. The 2000 paper also showed that aid inDFId was matched to neo-liberalism.So you cry for financing for development isonly filling a leaking bottle. You can ask for more aid (quite impossible in a global recession) but using the same policies delivers nothing.

  10. Mr. Sensible

    David, I think it was right to protect the aid budget.

    Some people have criticized this, but I think if our country cannot support those in desperate need we will not look good.

    Foreign aid is not the reason for cuts elsewhere.

    As you say, the Robbin Hood Tax would certainly help matters.

    On the question of ‘fragile states’, as you say we need to see the definition, but if we try to deal with these kind of states now we can prevent a conflict possibly in the future.

  11. Jiesheng

    Mr.Sensible, there already exists a definition amongst mostOECD members on fragible states–usually meaning those states that can’t join up into the global market economy. It’s placed within the neo-liberal context.

    I fail to see a united effort to explain why the foreign aid budget must be protected during a reccession. DFID (the current DFID) hascut back on development awareness. Labour has used the same drum beat. Only the Guardian Newspaper bothers to havea section dedicated to development.

  12. Helen

    What makes John Lees think that Aid Workers don’t pay tax? All UK government employees (DFID, FCO etc) working overseas are UK resident for tax purposes. The many local employees pay taxes to their own governments.

  13. Global Giving UK

    Interesting blog @leftfootforward 'Commitment to ring fence #UK aid welcome but questions remain' – //bit.ly/bCJV0B

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