Labour is plotting to reverse cuts to foreign aid, but the UK’s spending history reveals a questionable use of funds, writes Anne Strickland
Andy Burnham and Ed Miliband have privately indicated that they want to find “a route back” to spending 0.7 per cent of national income on foreign aid. Currently, no timeframe has been set, and Downing Street points to Labour’s manifesto pledge to restore the target only “as soon as fiscal circumstances allow”. The Institute for Fiscal Studies estimates that this informal commitment would cost roughly £13bn a year.
Britain is already facing a record high tax burden, with the tax take now over £1.1 trillion every year. Finding another £13bn would mean either higher taxes, lower spending elsewhere or more borrowing, but knowing the inclination of this government, the likely option will almost certainly be a combination of more spending and more borrowing. Either way, £13bn is a serious price tag for a policy that is built around hitting an arbitrary target, rather than funding whatever the world’s genuine emergencies actually require in a given year.
Where has Britain spent its foreign aid budget?
If you look at where the money already goes, it is hard to feel confident that this £13bn will end up anywhere better. The Taxpayers’ Alliance uncovered a story last year that £88m had gone to fund a contraception programme in Pakistan, with £74m of that specifically used to promote branded condoms through shops and pharmacies. Another £20m was spent on training tax collectors and simplifying the tax system in Ethiopia; an irony that’s hard to beat, given Britain is lumped with one of the most complicated tax codes in the world. In Guyana, £52m went on building a road through the Amazon rainforest that’s since been dubbed a road to nowhere, funded through a climate scheme now overseen by none other than our new foreign secretary Ed Miliband. All ultimately paid for by British taxpayers.
And that’s before you even get to what doesn’t reach anyone overseas at all. 20 per cent of the entire aid budget, £2.8bn in 2024, went on housing and supporting asylum seekers here in Britain, all under accounting rules that let the Treasury count it as international development. A fifth of so-called “foreign aid” doesn’t actually leave British shores.
A case by case approach
Contrast that with the humanitarian crisis currently happening in Nepal. The death toll from last week’s devastating flash floods and landslides on the Nepal-China border has passed 1,000, with thousands still missing and search efforts still under way. Britain’s response was an initial £5m and an offer of emergency rescue teams, announced within days by Burnham and Miliband, and given the scale of what has happened in Nepal, sending that money was simply the right thing to do, since responding quickly to a genuine crisis like this is exactly what foreign aid is meant for.
This is the case for aid, properly understood. A crisis like Nepal obviously deserves support. But a policy built around always hitting a fixed target doesn’t ask what the world actually needs in a given year, it asks how much has to be spent to hit a percentage, and once genuine emergencies like Nepal are covered, whatever’s left over still has to go somewhere. That’s how you end up with £52m roads to nowhere: not because they were the best use of the money, but because the target demanded more spending than real need could actually account for. Judge aid case by case instead, and the money would go where it’s needed, not towards an arbitrary target that successive governments have argued over for 15 years.
Anne Strickland is a researcher at the Taxpayers’ Alliance