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International aid – size isn’t everything

The 0.7% target has only ever been an incentive for more aid, not better aid

As an international development consultant who is in favour of cutting the aid budget I might appear to be a turkey voting for Christmas. But that is the position that I find myself in following the Chancellor’s announcement that the UK’s development spending is to be cut from 0.7% of GNI to 0.5%.

As in the case of the FCO-DFID merger, the predictable criticism has been heard from leading vested interests in the charity sector. Of course, one would expect Oxfam, Save the Children, and other major international non-governmental organisations to decry a reduction in their supply of public cash, but it is interesting to see that they have vocal support within the Conservative party.

It seems that the Daily Mail readers are finally getting their way

As with the FCO-DFID merger, the move is predictably Johnsonian. It fits a pattern of policy which deliberately departs from the spending priorities of the Blairite-Cameroonian continuum, in favour of those prioritised by most of the country. Ever since I began working in aid in the mid-naughties, there has been the Daily Mail voice arguing that aid money would be better spent at home than on “corrupt dictatorships” abroad – and it seems that the Daily Mail readers are finally getting their way. The levelling-up agenda and the Chancellor’s changes to the Green Book would also fit this pattern. It is telling that whilst the aid cut will save around £4bn, a new Levelling-up fund of around £4bn is being created to invest in domestic infrastructure.

Concerned friends may worry that I fit their description of an “uneducated Daily Mail type.”  They check with me to make sure I am aware of the good that Britain’s aid budget does around the world, the international prestige that it buys us, and the tiny impact that this reallocation will have on Britain’s domestic finances, whilst undermining so much global good.

The UK has earned a deserved reputation as an international development superpower

None of this is untrue. The UK has earned a deserved reputation as an international development superpower through the twenty-teens. Our 0.7% GNI aid target has left other major economies trailing: Germany spends 0.6%; France 0.44%; and the United States a measly 0.16%.  The UK Aid logo has become a powerful symbol in humanitarian hotspots from South Sudan to Myanmar. Our commitment has given us diplomatic leverage and moral high ground in international fora, including the OECD and G20.

As a practitioner who has worked for many years on projects funded by a variety of bilateral aid agencies, I can truthfully say that the theory and quality of the UK’s aid programmes is world leading. Indeed, my experience of Australian Aid programmes is that they have usually appeared to be copy-and-paste jobs of three years’ old DFID initiatives.

These benefits have informed the criticism of the proposed cut by Tory MPs, including the former Foreign Secretary Jeremy Hunt and the former International Development Secretary Andrew Mitchell. I don’t necessarily disagree.  However, speaking from a decade of ground level experience, my view of international development spending is closer to the dictum that it’s not the size that matters, it’s what you do with it.

When politicians allocate aid spending targets, civil servants must think of ways to spend up to the target. Thanks to our 0.7% GNI target being written into law in 2015, our previously-DFID civil servants are legally obliged to find ways to spend an ever-increasing amount of money, whether they know good ways to spend it or not.

The result is that the average DFID programme over the last few years has mushroomed, with giant “facilities” being designed to spend hundreds of millions of pounds over periods of up to five to seven years. These are often on things that are very hard to define, such as “pro-poor economic growth”, “peace building”, and “democracy”.  DFID (now FCDO) procurement systems – which set out the real practicalities of how aid gets spent – have continued to award the management of such facilities to major private consultancy firms who have built up multi-million pound businesses on the back of such contracts, whether they deliver or not.

Many of these contractors are not British, and until recently they were paid on a milestone basis – in other words as long as they told a good enough story about what they had done on the ground, they were paid in lumpsums, with no receipts required.

Contracts only work when you can properly define what is to be delivered. Whilst contractual requirements such as “number of schools constructed” or “number of people immunised” work quite well in the historic aid sectors of education and healthcare, it is almost impossible to put into a contractual requirement when amorphous concepts such as “good governance” or “prosperity” have been achieved. The 0.7% target has only ever been an incentive for more aid, not necessarily better aid.

Part of the government’s Global Britain agenda involves a recalibration of the UK’s spending on all four levers of overseas influence: defence, diplomacy, aid, and trade. When seen in this wider light, the spending on all four should be calibrated to produce the strategic goal. If paying aid contractors £60m to produce reports about prosperity is not as effective as providing the poorest with an income through developing trade, then why not reallocate aid budget to trade?  It is important that the integrated spending review considers such questions. If it does then Britain will get better at what it does with its overseas spending, however large its size.

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