A new government white paper on UK aid has been condemned as a “double whammy to the world’s poor”.
The Foreign, Commonwealth and Development Office’s (FCDO) first strategy paper on overseas assistance since the merged department was formed and large-scale cuts were implemented in 2020, is dominated by a near halving of UK aid to multilateral bodies, including the UN the World Bank, and a renewed focus on aid as an adjunct to trade.
The foreign secretary, Liz Truss, claimed that reliable private sector investments will challenge “malign actors” and bring countries into the orbit of free market economies, a clear reference to the challenge posed by China’s large aid programme.
“In an increasingly geopolitical world, we must use development as a key part of our foreign policy. Malign actors treat economics and development as a means of control, using patronage, investment and debt as a form of economic coercion and political power. We won’t mirror their malign tactics, but we will match them in our resolve to provide an alternative,” said Truss.
The 20-page development paper, which is devoid of many specific budget allocations, sets out the high-level goal of cutting the proportion of UK aid going to multilateral bodies from 40% of the budget to 25% by 2025. The UK aid budget has been cut by £4bn since 2020.
Critics will claim the move reduces the UK’s influence within these bodies at a critical time, and that Britain can never, on its own, hope to match Chinese bilateral aid. More than 100 countries have signed up to China’s “belt and road” infrastructure programmes. At the G7 in Cornwall last year, the UK pledged to work with the US administration on a western alternative to Chinese aid, but little reference is made to this plan in the paper.
Sarah Champion, chair of the Commons international development committee, said: “The foreign secretary’s strategy has two main thrusts. It advocates aid for trade – linking the provision of aid to access for UK goods and services. And it says more of our money should go on direct government-to-government spending rather than spending through international bodies such as the United Nations.
“I fear that adds up to a double whammy against the global poor.”
She added: “Supporting the poorest in the world should not be conditional on a trade deal or agreeing to investment partnerships. The UK has rightly been hugely critical of China for such an approach, so I fail to see why we are following down the same road. It is depressing and disappointing that the UK would devise a strategy like this,” she said.
The paper places a new emphasis on women and girls, but says the budget to cover education, empowerment, sexual and reproductive health and rights and ending violence will only be restored to levels reached at the end of 2021. Aid groups had hoped funding would be restored to 2020 levels, before the government aid cuts started to bite.
The UK has already cut £1.5bn from a World Bank programme to help poor countries recover from Covid. It remains the largest European donor to the bank, but has now fallen behind the US and Japan.
Other priorities set out in the white paper are climate finance and humanitarian aid, which is set at £3bn over the next three years. The paper says Africa remains a priority for the UK since “geostrategic competition in Africa will intensify over the next decade, and the impacts of Covid-19, climate change and biodiversity loss are increasing the vulnerability of many countries and their citizens”.
A similar importance is attached to the Indo-Pacific, but the paper gives no country-specific funding allocations.
The paper did not give a date for when the UK will return its overall aid budget to 0.7% of GNI. The chancellor, Rishi Sunak, has said he expects it won’t be before 2024-5.
But the paper noted: “A return to 0.7% will allow us to scale up critical elements of our new strategy, including on climate and nature, as well as our ability to invest in countries.”
In one of the few specific pledges in the white paper, the FCDO has promised to reduce the time it takes the department to approve a business case for programmes under £40m in value, to less than six weeks – currently it can take months.
