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Trade not Aid in Boris Johnson's new Government?

In his victory speech, Boris Johnson spoke of the “jostling sets of instincts in the human heart” – the instinct to earn money and look after your own family, set against that of looking after the poorest and neediest, and promoting the good of society as a whole. The Tory party has the “best instincts” to balance these desires, he said.

This balancing act will be tested soon after he moves into No 10. How will he ensure the UK, which has the third largest aid budget in the world, retains its reputation as a “development superpower”, in the words of former international development secretary Penny Mordaunt, with the competing trade, diplomacy and defence requirements of post-Brexit Britain?

The UK’s £38bn defence budget is just 2.5 times greater than the £14bn aid budget.

After leaving his job as foreign secretary, Johnson spelled out his thinking over foreign aid, telling the Financial Times that if “Global Britain” is going to achieve its “full and massive potential” then we must bring back the Department for International Development (DfID) to the Foreign Office. “We can’t keep spending huge sums of British taxpayers’ money as though we were some independent Scandinavian NGO.”

In February, he went further. Writing the foreword of a report by Bob Seely, Tory member of the foreign affairs select committee, and James Rogers, a strategist at the Henry Jackson Society thinktank, he suggested aid should “do more to serve the political and commercial interests” of Britain. The report called for the closure of DfID as a separate department and argued the UK should be free to to define its aid spending, unconstrained by criteria set by external organisations. Its purpose should be expanded from poverty reduction to include “the nation’s overall strategic goals”, the paper argued. It added the Foreign Office should incorporate both DfID and the trade department.

In practice, these changes may not be as easy as they first appear. The UK cannot, for instance, unilaterally alter the definition of aid, set out by the OECD’s development assistance committee. Stephen Twigg, the chair of the parliamentary committee overseeing DfID, as well as former international development secretary and Tory MP Andrew Mitchell, have also cautioned losing a “world leader” in DfID could backfire, and weaken Britain’s standing on global issues.

Following Johnson’s appointment as prime minister on Tuesday, development organisations, already concerned at the existing pot of aid money being spent outside DfID, warned against any “messy and costly” merger between DfID, the Department for International Trade (DIT) and the Foreign Office.

“Trade is an important part of the development puzzle, but it’s not the only piece. The UK government should be careful of relying solely on the ‘trade your way out of poverty’ mindset,” said Tim Pilkington, chief executive of World Vision UK.

Sara Pantuliano, acting executive director of the Overseas Development Institute thinktank, said a merger between departments would have “little benefit”.

“If the Prime Minister merges DfID with the Foreign Office there is a risk that its considerable expertise on the ground is lost; that UK leadership in humanitarian and development work could be eroded; and aid could become politicised.

“Overseas Development Institute research suggests there is little benefit in terms of efficiency savings through departmental mergers, and the Independent Commission for Aid Impact has criticised the way the rest of UK government has spent overseas aid.”

While there have been similar mergers in other countries, such as Canada, care was taken to preserve and maintain the department’s infrastructure, so that expertise was not lost, she said. “But subsuming the aid agency into the trade agenda, and compromising DfID’s expertise, would be a huge mistake.”

More than a quarter of the aid budget is already spent by other departments, up from a 10th in 2014.

On Monday, Liam Fox said the DIT will use increasing amounts of the aid budget to help promote investment in developing countries and to promote British interests.

A spokesperson for the DIT said it was “building its capacity to be an aid spending department, ensuring we have the skills, people and processes in place to meet all aid requirements and generate maximum impact from our aid spending”.

Critics have highlighted a potential conflict of interest in tying aid spending on global poverty to Britain’s trade interests. Last year, the Commons international development committee criticised programmes with such “dual objectives” for “being used as a slush fund to pay for developing the UK’s diplomatic, trade or national security interests”.

Dan Carden, the shadow international development secretary, said: “Pinching aid money from the world’s poorest to prop up rich investors is a new low, even for the Tories. As the government desperately chase post-Brexit trade deals, they must rule out raiding the aid budget for anything other than fighting global poverty.”

Privately, some NGOs believe Johnson has too much else on his plate at the moment, not least from Brexit and Iran, to worry about changes to Whitehall.

However, many in the Tory party, including Mordaunt, have long been calling for an overhaul of the way DfID spends money.

Rogers, of the Henry Jackson Society, said: “I don’t know what Boris Johnson is planning, but the world is changing and it’s becoming less benign than in the past. We need to think more about how we draw together the components of UK state power – whether it is defence, defence engagement, intervention in humanitarian situations and of course, the aid and development assistance budget, through DfID and others.” He added: “The proposals that we have put forward and Boris Johnson endorsed [are] to re-empower the Foreign Office and turn DfID into an agency within it. They would still have some autonomy but could be used more strategically.”

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