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October 18, 2018
Overseas aid: Taxpayers' bill could be cut - Mordaunt

Overseas aid: Taxpayers’ bill could be cut – Mordaunt

An RAF A400M aircraft in Jakarta, Indonesia, carrying UK and Indonesian Aid for Balikpapan to be distributed to the earthquake and tsunami hit island of SulawesiImage copyright

Image caption

Penny Mordaunt said aid from Britain helped humanitarian efforts across the globe, such as after the recent Indonesian earthquake and tsunami

Millions of pounds a year could be cut from the taxpayers’ overseas aid bill under changes set out by the international development secretary.

Penny Mordaunt wants profits from development projects to be included in the UK commitment to spending 0.7% of national income on aid.

She also said private investment could “make aid money work twice as hard”.

Labour said viewing global poverty as an “investment opportunity” was an “outrageous distortion”.

Launching a consultation on the plan, Ms Mordaunt told a news conference that redefining what counts as aid spending could contribute to “reducing the ask on the public purse”.

The government is examining whether profits from investments by aid bodies should count towards the 0.7% foreign aid commitment, which is enshrined in law.

However, this would require a change in international rules.

Image copyright
CDC Group/Twitter

Image caption

Ms Mordaunt made her speech at the London offices of CDC, a government-funded body that invests in overseas development projects

Ms Mordaunt also said she wanted a national conversation about “doing good, while making money”, suggesting people should have the chance to invest savings and pensions in schemes that benefited development.

“We want to give British savers the choice to make a financial return in exchange for their goodwill to change the world for the better,” she said.

Changes won’t be straightforward

By Chris Mason, BBC political correspondent

In the distant past, when political debate roamed free across a plethora of issues and politicians could complete a sentence without saying Brexit, rows about foreign aid were frequent, and noisy.

And so while Penny Mordaunt’s remarks about Brexit are grabbing headlines, her vision for international development should not be ignored. Last year, £13.9bn of taxpayers’ money was spent on overseas aid.

It is the law that 0.7% of national income should be spent on aid, meaning the figure rises as the economy grows even if there are public spending cuts happening elsewhere.

The international development secretary explicitly said her plan would involve “reducing the ask on the public purse”.

But changing the international rules to allow this to happen won’t be straightforward. And while some will cheer the plan, others will ask if the government is running away from its responsibilities.

Ms Mordaunt also pledged her support for Prime Minister Theresa May over Brexit, which she said presented an opportunity to look afresh at the UK’s support for global development.

The UK would have “more flexibility to consider how we use the aid budget”, and an opportunity to mobilise private investment to support development

She also defended opponents of foreign aid, saying Brexiteers and aid sceptics were “not selfish, uncaring little Englanders” but often the most charitable.

Kate Osamor, Labour’s shadow international development secretary, said classifying private finance as aid would “entrench inequality”, adding: “Poverty is not a commodity.”

“This is an outrageous distortion of the country’s overseas development programme,” she said.

“The Tories’ plans to rewrite the international rules on aid and slash billions of pounds of public money will do nothing to end global poverty or reduce inequality.”

Source BBC News

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