Future of UK aid and development assistance

The Government plans to spend a greater proportion of its shrinking ODA pot through multilateral institutions. There is logic to this, but the Government is yet to set out how it will ensure that its multilateral programme spending is used in line with its principles for ODA spend. (Conclusion, Paragraph 11)

A multilateral development review is urgently needed to underpin the change in proportion of ODA spent through this channel. The Government needs a clear understanding of its current commitments and the performance of multilateral organisations it supports. (Conclusion, Paragraph 12)

The Government should commission a multilateral development review to consider and report on the performance of the organisations it supports, before the end of 2026. (Recommendation, Paragraph 13)

It is the responsibility of the Government to remain accountable to the public, principally through Parliament, on how ODA is spent. However, it is also morally obliged to be accountable to those receiving UK ODA and their governments. We agree with the Development Minister that ODA should not be seen as simply a tool for increasing the influence of the UK. However, in a contested world, the UK cannot allow any misunderstanding about its commitment to its bilateral partners which could give its adversaries a foothold. Moreover, as the Government recognises, the UK’s diplomatic capital allows it to affect changes that dramatically improve the lives of the poor. This leverage must not be diminished through weak communications over the UK’s financial commitments or lack of oversight over programmes it funds. The Committee see the value of UK soft power in promoting human rights, democracy and the rule-based international order. The UK can and should be unashamed to promote its values, language, and culture in a world where significant powers, who do not share our values, are expanding their influence. (Conclusion, Paragraph 16) 14

To improve communication and transparency around multilateral spend, we recommend that: a. the Government works with multilateral partners on a communication plan which will convey to bilateral partners and the UK public the work that the UK Government supports; b. the FCDO takes urgent steps to improve the accessibility of data on multilateral programming available to the aid sector and the public. (Recommendation, Paragraph 17)

To be effective, the Government’s aspiration to spend ODA more efficiently through a reformed multilateral system requires two things: influence and expertise. Both require money that is well targeted and accountable. The Government has not provided adequate reassurance that the internal resources needed to maintain this influence and expertise have been safeguarded. (Conclusion, Paragraph 19)

We urge the Government to fully assess requirements for the staffing required to oversee and support reform of the UK’s multilateral partners by an upfront skills audit focussed on what is needed to support a future aid landscape. Steps should be taken to ensure that this capacity is retained and built upon under the FCDO 2030 restructuring programme. (Recommendation, Paragraph 20)

The FCDO has an impressive and nuanced understanding of situations on- the-ground through its overseas network and local staff. As part of the next round of spending decisions, in-country missions must have the autonomy needed to spend ODA within the Government’s wider development policy framework. (Conclusion, Paragraph 24)

To enable the FCDO to provide relevant and impactful support in its bilateral partner countries: a. sufficient levels of bilateral ODA must be earmarked for programmes, the design and delivery of which would be overseen by the FCDO (and other delivery departments) in-country; b. Centrally Managed Programmes (CMPs) need to undergo a thorough review to ensure that central oversight is providing the best value for money. Missions must have the structures and independence to approve CMPs based on their own strategic priorities and understanding of the local development context. They must also have the freedom and expertise to assess the impact of CMPs, requiring intentional communication with the programme managers. (Recommendation, Paragraph 25) 15

Where missions across a region, or a thematic area, have identified shared opportunities and solutions, collaboration should be encouraged. Supporting such initiatives will be an efficient use of limited funds as well as a good utilisation of expertise, whether in the region or in the UK. (Conclusion, Paragraph 26)

Badly designed and delivered development and humanitarian assistance is bad for the UK. It carries risks to those it is designed to serve and reputational risks to the UK Government. (Conclusion, Paragraph 27)

Missions must, therefore, have access to in-house expertise both on the ground and in the UK. This expertise needs to cover both thematic issues relating to poverty alleviation, as well as the geographic knowledge of specific contexts. Local staff are absolutely vital for achieving effective projects that represent value for money. (Recommendation, Paragraph 28)

We request that, in its response to this report, the Government provides details on how it intends to prioritise poverty reduction as it restructures the department. (Recommendation, Paragraph 30)

We reiterate our previous concerns around the sequencing and speed of the FCDO 2030 programme. (Conclusion, Paragraph 32)

We call on the Government to pause the processes currently underway until the following actions have been completed: a. a structured assessment of staffing required to deliver the Government’s priorities both in the UK and in countries with a diplomatic mission, to be presented in a Workforce Plan for this spending review period; b. a thorough skills audit and an equalities impact assessment to support and inform the Workforce Plan; c. an assessment of the impact of the ODA programming decisions on the extreme poor, as well as the UK’s ability to lead diplomatically on key issues impacting them. (Recommendation, Paragraph 33)

The existence and adequate resourcing of the Independent Commission on Aid Impact sends a powerful message to all stakeholders that the UK takes transparency and value for money seriously. We are alarmed by apparent misunderstanding of the ICAI’s distinct role by the Development Minister. (Conclusion, Paragraph 35)

Whilst we agree that the value for money of every aspect of Government spending must be assessed, we caution against any rapid decision- making with regards to the ICAI’s future. Full funding should remain in 16 place until a final decision made—a decision based on an assessment of the existing arrangements compared against other options. (Recommendation, Paragraph 36)

As its Parliamentary oversight body, this Committee must be kept fully appraised of the Government’s work and decision-making around ICAI’s future. (Recommendation, Paragraph 37)

In the coming years, the greatest need will be in fragile and conflict- affected states, and states most vulnerable to climate change. Working in partnership to address these needs mutually benefits the affected countries and the UK. The empowerment and equipping of these states, and their civil society organisations, should be central to the FCDO’s approach. Resourcing decisions for ODA by the Government in the coming weeks and months need to accurately reflect where the greatest need is. They also need to reflect where preventative action is likely to have the greatest impact. (Conclusion, Paragraph 39)

Upholding the rights of marginalised groups, as well as realising the potential of women and girls in both achieving societal resilience and poverty reduction, should be strategic priorities for UK ODA. This must be reflected in the spending allocations. (Conclusion, Paragraph 41)

The FCDO must have the expertise and resources required to empower marginalised groups in decision-making forums, as well as the ability to equip them in their efforts to bring about lasting change in their communities. The FCDO will need to ensure that, through its spending allocations, it retains centralised and local gender expertise. It will also need gender-specific bilateral funding to achieve its aims. (Recommendation, Paragraph 42)

The Government’s focusses on global health, and climate and nature are welcome. However, the Government must maintain the flexibility within these priorities to accommodate the interconnectedness of development challenges. It also needs the flexibility to be able to respond to needs expressed by its bilateral partners in governments and civil society. This is particularly important in fragile and conflict-affected states. (Conclusion, Paragraph 43)

We urge the Government to consider the nature of interconnected challenges such as nutrition, food systems, education, Water Sanitation and Hygiene, and governance challenges—particularly in relation to fragile and conflict-affected states—as it plans how it will deploy its financial and human resources in a holistic way over this spending period. (Recommendation, Paragraph 44) 17

In the coming months we expect to see much greater transparency from the Government over the evidence base for its newly articulated approach to international relief and development and the tangible impact it expects this to have. We anticipate more information on how it intends to communicate both the approach and its results, and how the various components will be brought together to form a coherent policy. (Conclusion, Paragraph 24)

In its response to this report, we request the Government provides more detail on its approach in areas where this is sorely lacking, and clarify its own policy position. This will serve to reassure Parliament, the sector, and the public that the policy announcements made to date are part of a coherent approach to ODA programming and work as part of a clear theory of change. Specifically, the Government must: a. Outline the evidence base for the “four essential shifts” and how this will be used to evaluate their success. A clear qualitative and quantitative description of what success looks like is required and over what time scale. It should also include a model for how development partnerships are envisaged to operate with clearly defined roles for FCDO missions, external stakeholders and departmental support. b. Provide a description of its approach to engaging with multilaterals with an evidence base for the choices of which organisations and mechanisms it will invest in, prioritising institutions with a proven track record of delivery. This should be accompanied by a measurable and time-bound plan for reform and a detailed approach for how alignment with UK priorities will be achieved. c. Set out an account of the risk and impact assessment exercises, beyond the Equalities Risk Assessment, that the Department has undertaken around the reductions and reprioritising of ODA. This should include details of the measures taken to mitigate risks, including: discussions with other ODA-delivering countries; 14 communication with bilateral development partners; and intentional efforts to ensure the UK’s multilateral contributions fill the gaps left by the reprioritising of bilateral ODA. d. Present a clear strategy for how the Government will engage with civil society in the UK around development challenges. Specifically, how the Government will work to ensure the energy and resources of diaspora groups and UK-based NGOs complement its own priorities for the spending of

From the evidence we have received, and applying it to what we know of the Government’s approach, we have prepared a document to convert the Government’s ambitions into a policy to alleviate poverty. This outlines some of the key considerations that will need to be borne in mind as the Government’s aspirations are translated into practical policies. (Conclusion, Paragraph 26)

We recommend that the Government considers Appendix 1 as a working policy document for its approach to aid and development. In its response, we request that the Government indicates where it agrees or disagrees with the Committee’s policy paper and why. (Recommendation, Paragraph 27) 15