Dominic Raab: Change in the law surrounding foreign aid is needed

Fears that Britain’s overseas aid budget will be limited for years due to economic uncertainty

Britain's Foreign Secretary Dominic Raab explains how Britain will refocus the foreign aid budget as it cuts funds to help mend its coronavirus-battered finances. / AFP / Tolga Akmen

The UK will introduce new legislation to alter its foreign aid budget because it may need to slash spending over many years to cope with the economic fallout of the pandemic.

Foreign Secretary Dominic Raab said legislation would be introduced in the House of Commons but did not give a date for the process.

The move paves the way for a potential rebellion against the government’s plans after Chancellor Rishi Sunak announced in Wednesday’s spending review he would cut the aid budget to 0.5 per cent of Gross National Income (GNI),

The sum spent on overseas aid is roughly £4 billion ($5.3bn) from a £15bn budget, or 0.7 per cent of GNI.

Mr Raab insisted the cut was temporary, and implemented only because of the current economic crisis brought on by Covid-19.

However, he said new legislation would be required as it was unclear when the economic turmoil would end.

He told MPs: “The International Development (Official Development Assistance Target) Act 2015, the bill that enshrines meeting the target of 0.7% in law, envisages circumstances in which the target may not be met, in particular in the context of economic pressures.

“Given that we cannot at this moment predict with certainty when the current fiscal circumstances will have sufficiently improved, and our need to plan accordingly, we will bring forward legislation in due course.”

Speaking earlier, Mr Sunak said the existing law gave the government the power to temporarily shelve the 0.7 per cent target.

He told BBC Radio 4's Today programme: "The existing legislation that we have for the aid target specifically allows for the fact it may not be possible in certain circumstances to meet the aid target and that is contained in the existing legislation as it is."

But critics pointed out that the Treasury was releasing billions elsewhere for other priorities, including military spending, even as it pleads pandemic poverty in the budget overall.

Baroness Sugg quit her post as a Foriegn Office minister in protest.

Mark Sheard, chief executive of the aid group World Vision UK, said the government's spending priorities would come "at the cost of lives" just as it prepares to take over the G7 presidency and host global summits on climate change and education next year.

"The UK's commitment to ending poverty worldwide has always been something of which we could be rightly proud, but just when global leadership is most needed we are stepping back," he said.

By cutting aid, the government had "relinquished its right to talk about 'Global Britain' leading the world", he added.

However, Mr Raab underlined British goals for the G7 and COP26 climate summits, and said 2021 would be "a year of leadership for Global Britain as a force for good around the world".

Criticism of the government also came from religious leaders, including Archbishop of Canterbury Justin Welby, the leader of the worldwide Anglican church, who called it "shameful and wrong", as well as five former prime ministers.

Most pertinently for Prime Minister Boris Johnson ahead of a parliamentary vote to amend the aid target, several Conservatives have broken ranks to join opposition parties in vowing to oppose the move, pointing out that the UK risks falling foul of Joe Biden's incoming US presidency.

"As President-elect Biden commits to a new era of Western leadership, here we are about to mark the start of our G7 presidency by cutting our overseas aid budget," Tobias Ellwood, chairman of the House of Commons defence committee, told parliament.

"Downgrading our soft power programmes will leave vacuums in some of the poorest parts of the world that will further poverty and instability," the Conservative MP said.

"It is likely to see China and Russia extending their authoritarian influence by taking our place."

Former international development secretary Andrew Mitchell said the reduction would be "the cause of 100,000 preventable deaths, mainly among children".

The government says it is not backtracking on global commitments as it starts a new chapter outside the European Union, pointing in part to its involvement in research and future not-for-profit distribution of a vaccine against Covid-19.

The aid budget will remain at a hefty £10bn, ranking highly in the G7 club of rich nations, officials said.

Below is an edited extract of Foreign Secretary Dominic Raab's statement to MPs after Britain announced cuts to foreign aid

The UK is facing the worst economic contraction in almost 300 years, and a budget deficit of close to £400bn – double that of the last financial crisis.

Britain is responding to a health emergency, but also an economic emergency, and every penny of public spending will rightly come under intense scrutiny by our constituents.

Given the impact of this global pandemic on the economy and, as a result, the public finances, we have concluded after extensive consideration, and I have to say with regret, that we cannot for the moment meet our target of spending 0.7 per cent of Gross National Income on Overseas Development Assistance (ODA). And we will move to a target of 0.5 per cent next year.

This is a temporary measure. It is one we have taken as a matter of necessity – we will return to 0.7 per cent when the fiscal situation allows.

All countries are reconciling themselves, not just to the health impact of the pandemic, but also the economic impact of Covid-19.

We expect our development spending next year to total around £10bn, maintaining our status as one of the leading countries in the world, in terms of our ODA spend.

ODA is a vital, essential, and absolutely indispensable element of that strategic approach. But, to maximise its effectiveness, it must be used in combination with our development policy expertise, our security deployments and support abroad, and strengthened global cooperation through our diplomatic network.

We make our aid go further by bringing it together with all these other elements, and by making sure that they are all aligned and pushing in the same direction.

I will prioritise that £10bn in five particular ways. First, we will prioritise measures to tackle climate change, protect biodiversity and finance low carbon and climate resilient technologies such as solar and wind in poor and emerging economies.

Second, we will prioritise measures to tackle Covid, and promote wider international health security.

We will maintain our position as a world leader, investing in the GAVI vaccine alliance, COVAX, the Global Fund for Aids, TB and Malaria, and the International Finance Facility for Immunisation.

Third, we will continue to prioritise girls’ education, because it is the right thing to do, and because the fortunes of so many of the poorest countries depend on tapping the full potential of all of their people, which must include women and girls in education.

Fourth, we will focus ODA on resolving conflicts, alleviating humanitarian crises, defending open societies and promoting trade and investment, including by increasing UK partnerships in science research and technology.

Finally, at all times we will look to improve our delivery of our aid in order to increase the impact of that our policy interventions have on the ground, in the countries and communities they are designed to benefit and help.

The United Kingdom is out there every day, our people, on the ground in the disaster zones, in the refugee camps, tackling famine and drought, helping lift people out of poverty, striving to resolve conflicts and build a more hopeful future for millions of people struggling and striving against the odds.

Even in the toughest economic times, we will continue that mission, we will continue to lead.