Conclusions and recommendations
Galvanising other donors
1. We
agree that the forthcoming UN summit on progress towards the Millennium
Development Goals in September 2010 is an important moment to
renew commitments to aid allocations. Some donors have already
fallen short of their interim commitments. We understand that
countries often fail to meet their aid commitments because of
political and economic circumstances unrelated to the acknowledged
need for aid. The UK is already seen as a leader in international
development both in terms of funding and delivery of programmes.
While UK legislation on the target could provide a demonstration
of support for the target ahead of the UN summit, we are not convinced
that such legislation will necessarily galvanise other donors,
especially those suffering the worst effects of the recession,
to meet their aid commitments. (Paragraph 12)
Increased predictability for developing countries
2. The
extent to which commitment to an overall target could provide
greater certainty to individual countries is not clear cut given
the range of variables. Legislation may help developing countries
to know approximately what the UK's aid budget would be over a
period of years, but this will not eliminate yearly fluctuations
resulting from changes in GNI since the target is a percentage
rather than an actual amount. Nor can the impact of changes in
currency values be easily avoided. The most important indicator
of development assistance available to developing countries remains
the amount of Country Programmable Aid, which the proposed legislation
does not address. Nevertheless we agree that the Bill would provide
a degree of predictability at the macro level—that the total
UK aid envelope would not significantly change—and this
would send a positive message to developing countries about the
UK's overall commitment to international development. (Paragraph
19)
Ensuring ODA achieves poverty reduction
3. The
draft Bill does not propose any changes to the 2002 International
Development Act requirement that DFID funding is spent on poverty
reduction. Nevertheless we think that there is a very real danger
that, as aid levels increase over the next few years to meet the
already agreed 0.7% target, more ODA will be spent through other
government departments which are not subject to the 2002 Act.
Such expenditure may not therefore have poverty reduction as its
primary objective. We are concerned that this would have an impact
on the very high reputation of the UK as a donor. To promote greater
transparency on ODA expenditure we recommend that the Government
make provision in any new Bill for the detailed reporting to Parliament
of ODA expenditure by other government departments as part of
the DFID Annual Report. We further recommend that the Government
explore the possibility of making all ODA subject to the 2002
International Development Act. (Paragraph 26)
Accountability measures
4. We
believe that the draft Bill is weakened by its reference to economic,
fiscal or external circumstances as possible reasons for missing
the target. If the target becomes law, it should be expected that
it will be met each year by the Government. Should the target
not be met, a robust explanation of this failure would be expected
by Parliament. The Bill should not try to pre-empt or legitimise
failure by including a list of acceptable reasons for missing
the target. We recommend removing the references in Clause 2 (3)
to economic, fiscal and external circumstances. (Paragraph 30)
5. The
Government did not provide us with an adequate explanation of
why an action plan was not necessary should the target not be
met. While we accept that the Government may intend to meet the
target and would seek to remedy any shortfalls recorded in its
Annual Report, its accountability to Parliament should include
a statement of any actions already taken and those planned in
order to meet the target in the following year. In such instances
we recommend that this action plan be included in its Annual Report,
on which this Committee will take evidence and report to the House.
The House would then have the opportunity to debate the options
set out in the action plan. (Paragraph 33)
6. It
is clear that the Government does not intend compliance with the
0.7% target to be subject to a court of law other than Parliament.
We accept that, as the Bill intends only to make a duty of an
already agreed target, that the Government's primary accountability
for this duty should be to Parliament. We are however aware of,
and have sympathy with, legal arguments that such duties should
not therefore be enshrined in law. (Paragraph 36)
7. This
Committee already has within its remit scrutiny of the expenditure
of the Department for International Development. We do this annually
in our report on the Departmental Annual Report which takes into
account DFID's expenditure and we have commented in each recent
year on progress by the UK towards the 0.7% target. If the Bill
were passed we would continue to examine whether or not the target
had been met. We do not therefore believe it is necessary to explicitly
set out a role for the Committee in relation to this particular
Bill (Paragraph 37)
Impact assessment
8. The
sparse nature of the impact assessment included with the draft
Bill impedes effective scrutiny of it. Moreover, the inclusion
of an assessment, however imperfect, of the benefits to developing
countries would help gain public support for the Bill. This is
especially important in a period when there is scepticism about
the impact of development assistance more generally. DFID needs
to improve the way it communicates the achievements of development
expenditure to taxpayers. A detailed impact assessment of the
draft Bill would have contributed to the public debate. We strongly
recommend that the Government include a more comprehensive impact
assessment of the Bill if it is brought forward after the General
Election. (Paragraph 41)
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