As much as a third of the heavily cut UK overseas aid budget is being spent on housing refugees in the UK, the international development select committee says in a report today.
Describing the trend as unsustainable and unprecedented, the committee also finds UK aid spending per refugee has almost tripled, increasing from £6,700 in 2019 to £21,700 in 2021, according to the most recent three years of figures.
The select committee says it has been a political choice by the government to spend so much of the aid budget on refugees in the UK, and insists it is not required to do so by international rules defining legitimate aid.
The committee members say they have hit a brick wall in getting information from the government about the precise current spending, but say it is known that more than £1bn of UK’s aid budget was spent on refugees in the UK in 2021, representing almost 10% of the total budget.
The report finds the per capita spending on refugees exceeds any other OECD Development Assistance Committee (DAC) country during 2018-21 and is about three times the DAC average of £7,400. The figures will strengthen those that claim the primary Whitehall owner of the overseas aid budget, the Foreign, Commonwealth and Development Office, has been unable to keep control of Home Office refugee spending.
The Home Office supplementary estimate includes plans to spend more than £2.6bn of official development assistance (ODA) in 2022–23, nearly £2bn more than its main estimate, or 300%. The chief reason is that between March 2020 and September 2022 the number of asylum seekers housed in “contingency accommodation”, which largely consists of hotels, had increased from under 2,600 to more than 37,000.
The report finds that, partly as a result, in 2021 UK bilateral aid spending in least developed countries (LDCs) decreased to £1.4bn, which represented about 12% of the aid budget. That 50% decrease in aid to LDCs amounted to a more than £900m cut in UK aid spending.
In the face of the Foreign Office stonewalling about the current position, the committee instead refer to claims by the respected Center for Global Development (CGD) which estimates that the amount of aid spent on in-country refugee costs in 2022 could exceed £3bn, an increase of more than 300% since 2020.
The charity Save the Children estimated that those costs could be as high as £4.5bn in 2022-23, accounting for one-third of the entire aid budget.
The rules only allow the Home Office to raid the ODA budget to cover the first year costs of a refugee in the UK.
The committee finds a £1.7bn reduction in ODA spending from FCDO compared with the initially estimated budget, “to support the reallocation of ODA budget across government”. The figures show an increase of almost £2bn in ODA for the Home Office, compared with this year’s initial budget.
Sarah Champion, the chair of the committee, said: “There has been a determined effort to prevent us from seeing the full picture. The government has wilfully attempted to prevent us carrying out our scrutiny role. Our attempts to access straightforward information about how the government is spending the ODA budget in the UK hit a brick wall.”
The Foreign Office said in response to the committee report: “The government has acted decisively and compassionately to support the people of Ukraine and Afghanistan to escape oppression and conflict and find refuge in the UK, and at the autumn statement we provided an additional £2.5bn to help meet the increased costs of this support.
“We report all aid spending in line with the OECD’s rules, which allow funding to be spent on food and shelter for asylum seekers and refugees for their first year in the UK.
“The UK government spent more than £11bn in aid in 2021 and remains one of the largest global aid donors with most of it still going towards supporting the poorest communities around the world, helping tackle deadly diseases and getting millions of girls into school.”
