Following the money: what do the aid cuts tell us about government’s new approach?

The savage cuts to the aid budget, initially because of declining Gross national income (GNI), then as a result of the government’s decision to reduce the aid budget to 0.5%, despite their manifesto commitment and the law, come ahead of a proper strategy for aid and development.

A new International Development Strategy is now being worked on ahead of the Spending Review in the autumn. Though the government’s recent track record when it comes to engagement with civil society is poor, we hope that civil society partners and partner governments will be able to meaningfully feed into that process.

Transparency around the aid cuts process has been lacking. The government has released no overall picture of the cuts, refused Freedom of Information requests, and we have seen stonewalling by ministers and officials. Many NGOs are still waiting, a quarter of the way into the financial year, to hear if lifesaving programmes have been cut or not.

Attempting to follow the money, or rather following where there will be no money, gives us some sense of what the government’s new approach to aid and development will look like in practice, ahead of the new “strategy” later this year.

Thematic spending

Of a total aid budget of around £10 billion this financial year (2021-2022), the FCDO will spend about 80%.

Around half of this (£4 billion) will go towards the 7 priorities set out by the secretary of state for foreign, commonwealth and development affairs, Dominic Raab in December. Many of these are new or different categories, making it difficult to compare to previous years expenditure. What we do know is that in 2019, DFID allocated around £7 billion on sectoral priorities, so overall this is a significant cut.

1. Climate & biodiversity £534 million (new category)
2. Global Health & Covid Response £1305 million (40% drop from reported spending in 2019)
3. Girls’ Education £400 million (new category but 25% drop estimated from IATI data)
4. Humanitarian Preparedness and Response £906 million (41% drop from reported spending in 2019)
5. Open societies & conflict £419 million (new category)
6. Science & Research £38 million (new category)
7. Trade & Economic Development £491 million (new category)

This also means big cuts for some multilateral organisations including the World Bank and WHO, despite initially being singled out as “safe“, alongside allocations to the EU. There have been big cuts to others, with UN agencies like UNDP, UNFPA, UNAids, UNICEF taking the unusual step of speaking out publicly about the impact of significant cuts to their core funding and programmes. UNAids has had its contribution slashed by 80%, and UNICEF by 60%. The UN Population Fund (UNFPA) has had its UK funds cut by 85%, despite the UK historically being a champion of sexual and reproductive health.

The new geography of UK aid

Following requests from the International Development Select Committee (IDC), Dominic Raab revealed more details about where the FCDO has allocated Overseas Development Assistance (ODA) for this year, including a surprisingly short list of recipient countries. Astonishingly, this new list suggests that ODA has been cut entirely to over 100 countries and territories. The countries listed reflect the geographic breakdowns mentioned in the Integrated Review, and mirror the ‘Indo-Pacific tilt’, as well as an increased focus on East Africa and a seemingly arbitrary mix of countries in the ‘Rest of the World’ category. The 3 new regional groupings are: Africa, Indo-Pacific, and Rest of the World. Overall, there is a huge cut to total UK bilateral aid, from the £4 billion allocated across 5 regions in 2019, to around £1.5 billion.

Africa: accounts for roughly half of FCDO bilateral aid this year (£754 million). There are 18 countries in the new list including Kenya, Nigeria, Rwanda, Somalia, South Sudan. Some of the world’s poorest countries in the Sahel are noticeably absent (Niger, Chad, Central African Republic), although Raab notes a Sahel regional programme. North Africa, including Libya and Iraq, is excluded completely. Based on this list as many as 36 African countries have had all their ODA cut compared to 2019.

Indo-Pacific: accounts for a third of FCDO bilateral aid (£510 million). The new list includes 8 countries: Afghanistan, Bangladesh, Burma, China, India, Indonesia, Nepal, Pakistan. As it stands, it looks like 26 Asian countries have had all their UK ODA cut compared to 2019.

Rest of the World (£240 million): This covers Brazil, Mexico, Venezuela, Syria, Yemen and Turkey. Key countries in the Middle East are absent, with what looks like a complete withdrawal from Lebanon, Jordan, the Palestinian territories, alongside a withdrawal from Central America, and Central Asia.

The realities of a new UK approach

The FCDO’s approach of saying where they will spend money, but not explicitly talking about where they are cutting and why, is an attempt to mask some of the cruel new realities of the political choice to drop to 0.5% of GNI. It seems incredible that over 100 countries are no longer receiving UK assistance, the bilateral budget has been more than halved, and a there is now a heavy focus on the political priorities outlined by Raab in the Integrated Review, without a proper strategy.

Some of the UK’s previous commitments are gone, along with its strong track record and leadership, on “Leaving No-one Behind”, and reaching the “furthest behind first”. Some of the countries with the poorest populations in the world will no longer receive any UK aid, such as CAR, Niger, Chad, Mali, Burkina Faso. While a Sahel Regional Progamme is noted, it is unlikely to be of similar scale to previous commitments.

Gone too is the respected commitment to focus half of UK aid spend on vulnerable Fragile and Conflict Affected States (FCAS). There has been a complete withdrawal of bilateral support from many FCAS countries including: Burkina Faso, Cameroon, CAR, Chad, Iraq, Mali, Niger, RoC, Eritrea, the Gambia, Guinea-Bissau, Haiti, Kosovo, Laos PDR, Lebanon, Papua New Guinea, West Bank and Gaza.

So rather than the new International Development Strategy dictating priorities and geographic commitments, the reality is that the cuts are driving the choices being made – with decisions political, opaque and rushed.

What is clear is that the era of “aid in the national interest”, designed to promote UK interests overseas is set to continue, and the previous mantra of providing assistance ‘where its most needed’ is over. This risks many countries falling further behind in development, health and other outcomes, and as Covid-19 has demonstrated, this will have consequences for all of us.

Whilst I hope to see the government commit to return to the UK’s 0.7% aid commitment, this new approach to ODA appears here to stay, and unpicking the damage done by the deep cuts described above will be impossible.