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The language of priorities

Ray Collins on major problems with the government’s agenda for overseas aid programmes

Today in the House of Lords, I will press Ministers on the Prosperity Fund. Part of the government’s international development programme, the fund’s primary objective is to promote economic growth that contributes to poverty reduction – a noble aim which we can all get behind. A secondary objective however, is to promote international business opportunities, including for UK companies.

The Prosperity Fund has a considerable budget – £1.22bn for the 2015-22 period. 97% of this spend is expected to be reported as Official Development Assistance and count towards the 0.7% GDP target for overseas aid. Legally therefore, only 3% of the budget can be spent on promoting business – but the government is yet to provide assurances.

The Fund is also overseen by the National Security Council, raising questions over aid intentions. But while developmental projects should be prioritising the world poorest, major programmes are being planned in upper Middle Income Countries (MICs) – for example, Brazil, China, Indonesia and South Africa. Is this the most efficient way of spending our aid budget? The Fund not only fails to target Less Developed Countries, it is also not targeting the poorest and most marginalised in MICs, and so it is not adhering to the Leave No One Behind agenda in the UN’s Sustainable Development Goals.

There have been a series of inquiries into the Fund, including one by the Independent Commission for Aid Impact (ICAI) that suggested its initial proposals promoted UK business more strongly than economic growth. It also raised questions over the lack of transparency. And despite the government enshrining in the law the need for UK aid to take more of a focus on gender, the ICAI made clear that this has not been sufficiently applied with this fund.

Another inquiry has been carried out in the Commons by the Development Select Committee. Its damning verdict concludes that the Fund focuses too hard on trade, has lost sight of the primary task of poverty reduction, and is a step towards the return of tied aid. Ministers have since failed to commit to any improvements.

Oxfam has also been highly critical, finding that 50% of projects implemented in China were explicitly promoting UK expertise and technology or collaborations with UK entities. Again, the government has refused to make meaningful changes.

The Prosperity Fund is not the only UK aid programme with these problems. The Conflict, Stability and Security Fund has been widely criticised for securitising aid and neglecting human rights, despite a proportion being earmarked for aid. Only last year, the ICAI asked the same questions now asked of the Prosperity Fund: does it really help the world’s poorest and most vulnerable? They also noted inadequate results management practices and limited data to evidence value for money, along with inconsistencies in programme quality.

In addition, the Joint Committee on the National Security Strategy has accused the Security Fund of failing to provide enough information about objectives, operations and accomplishments; and the National Audit Office called out the lack of accountability.

Whether the Prosperity Fund, the Security Fund, or the government’s wider development strategy, Ministers must answer for this blatant misdirection of the aid budget. Only Labour will ensure that the UK’s aid budget is once again efficiently spent, on reducing both poverty and inequality.

Lord Ray Collins of Highbury is Shadow International Development Minister in the House of Lords. He tweets @Lord_Collins

Published 7th February 2019

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