EU Development Assistance - International Development Committee Contents


2  EU aid instruments and organisations

6.  Unlike in the UK where we have a single department, the Department for International Development (DFID), within the EU there are three key players which have responsibility for aid and development matters: Directorate-General of EuropeAid, Development and Co-operation (DG DEVCO), which is headed up by the Commissioner for Development Andris Piebalgs; Directorate-General for Humanitarian Aid and Civil Protection (ECHO); and the European External Action Service (EEAS).

7.   The EEAS is the overseas diplomatic arm of the EU responsible for EU delegations throughout the world. It prepares country strategies and programmes development funds in consultation with DG DEVCO. DG DEVCO is currently present in approximately 150 worldwide EU delegations.

EU aid instruments

8.  Of the total European Commission budget only 5.7% goes to external actions (known as Heading 4, Global Europe) and this includes the foreign and diplomatic work of the EEAS as well as the development and aid funding of DG DEVCO and DG ECHO.

9.  However, EU development assistance comprises of not just the European Commission budget (around 70%) but also the European Development Fund (EDF) (around 30%). Below is a table which shows the distribution of EU funds in 2010 between the EDF and the European Commission budget instruments with the UK's contributions to these.

Table 1 - Breakdown of how much DFID funding went to each Budget Instrument and the EDF in 2010
EU Aid Instrument

(100% attributed to DFID unless otherwise stated)

Total value in millions of Euros DFID's share

in millions of Euros

DFID Share in Sterling
European Development Fund (nearly 100% ODA) 3135479.66 409
EU Budget - Heading 4 Global Europe 6440955.51 821.64
European Neighbourhood Partnership Instrument (95% ODA: 95% of UK share attributed to DFID) 1408204.65 175.49
Development Cooperation Instrument - Geographic and Regional aid (100% ODA) 1108169.52 145.36
Humanitarian Aid and Civil Protection (ECHO) (100% ODA) 948145.04 124.37
Pre Accession Instrument (90% ODA; 100% of UK share attributed to DFID) 943144.28 123.72
Development Cooperation Instrument Thematic aid (nearly 100% ODA) 839119.38 102.37
Food Facility (Nutrition funding) (100% ODA) 36255.39 47.49
European Instrument for Democracy and Human Rights (100% ODA) 15423.56 20.20
Instrument for Stability (70% ODA - 70% of UK share attributed to DFID) 12713.60 11.66
OTHER551 80.0968.67
TOTAL9575 1435.171230.64

DFID Submission EV 66

EUROPEAN DEVELOPMENT FUND

10.  The UK currently contributes £409 million to the EDF. This equates to a 14.8% share of the €22.7 billion Member States total, the third largest after Germany (20.5%) and France (19.55%).

11.  In theory these contributions are 'voluntary': the Commission proposes an overall amount for the fund together with contribution shares for each Member State, based on a 'budget key'. While Member States may contribute less or more, in practice the 'key' is followed. The EDF is managed by a committee made up of Member States and the Commission. The European Parliament does not have any say over EDF expenditure.

12.  The EDF finances cooperation with the African, Caribbean and Pacific group of states (ACP) and Overseas Countries and Territories (OCTs), under the Cotonou Partnership Agreement.
Box 1 - Cotonou Partnership Agreement

The Cotonou Partnership Agreement between the members of the African, Caribbean and Pacific Group of States and the European Union and its Member States was signed on 23 June 2000 in Cotonou, Bénin. It is for a twenty-year period from March 2000 to February 2020, and entered into force in April 2003.

The partnership is focused on reducing and eventually eradicating poverty through sustainable development and the gradual integration of the ACP countries into the world economy.

Today, the ACP Group of States comprises of 79 countries, 78 of them signatories of the Cotonou-Agreement (with Cuba being the exception).

13.  The current (10th) EDF runs for the five years 2008-2013. Of the total allocated (€22.7 billion), the majority is allocated to the ACP group at €22 billion with €286 million allocated to the OCTs. A further €430 million goes to the Commission for support expenditure (programming and implementation). The future funding of the EDF is currently under discussion as part of the Multi Annual Financial Framework negotiations.

ODA THROUGH THE EUROPEAN COMMISSION BUDGET

14.  The UK contributes £820 million to the European Commission budget through its various development instruments. The Development Cooperation Instrument (DCI) concentrates on Asia, Latin America, the Middle East and South Africa, whilst the European Neighbourhood Partnership Instrument (ENPI) focuses on countries neighbouring Europe such as Morocco and Russia. Both the DCI and the ENPI contain a set of crosscutting thematic programmes which are applicable to all developing countries (including those that are members of the ACP group of states). According to the DCI Regulations, ODA must account for 95% of the DCI funding on average (100% of the geographic programmes and 90% of the thematic programmes).

THE EU IN THE MULTILATERAL AID REVIEW

15.  DFID's 2011 Multilateral Aid Review (MAR) found the EDF to fit closely with DFID's objectives. It was acknowledged to have a strong poverty focus with 85% of funds spent on low income countries. In addition, it was seen to be built on a partnership model and accompanied by political dialogue.[3]

16.  Christian Aid said that the Cotonou Agreement was based on the three pillars of aid, trade and political dialogue which institutionalised the opportunity for in-depth, ongoing political partnerships with the ACP countries. Under the agreement the recipient governments were heavily involved in all stages of all the decision-making processes resulting in real participation and ownership. [4] Commissioner Piebalgs agreed saying the EDF gave the opportunity to reflect with the recipient country the "most effective ways to strengthen the country's own system to deal with poverty".[5]

17.  Although the UK contributes twice as much through the European Commission budget instruments to development than through the EDF, the European Commission budget was rated as weak by the MAR in its contribution to UK development objectives. This is mainly due to its low poverty focus—85% of the budget goes to middle income countries.[6] On the positive side, the European Commission budget was found to have "strong monitoring and financial management systems".[7]

Relations between the EU organisations with responsibility for development

18.  Concerns have been raised about coordination between DG ECHO and DG DEVCO, and in particular, the problems this poses for linking relief, rehabilitation and development. For example, we heard on our visit to Brussels that there had been problems in the Sahel in the transition from humanitarian assistance to development aid.

19.  Following the establishment of the EEAS and the decision to allocate responsibility for development programming jointly to the EEAS and DG DEVCO, CONCORD has suggested there needs to be more clarity about roles in the programming process. CONCORD also has concerns that the EEAS is in danger of marginalising anti-poverty objectives.[8]

20.  We are concerned that two separate European Commission departments dealing with development aid and humanitarian aid pose problems for linking relief, rehabilitation and development. Furthermore, clarity is needed on roles and responsibilities between the European External Action Service (EEAS) and the Directorate-General of EuropeAid, Development and Co-operation (DG DEVCO)in the programming process. The UK Government should seek reassurances that DG DEVCO, the Directorate-General for Humanitarian Aid and Civil Protection (ECHO)and the EEAS are working together in a coherent and coordinated manner and that anti-poverty objectives are not being marginalised within the EEAS.


3   DFID, Multilateral Aid Review: Ensuring maximum value for money for UK aid through multilateral organisations Summary - European Development Fund, March 2011. ECHO was marked as strong in contributing to UK development objectives. Back

4   Q 6 Back

5   Q 88 Back

6   DFID, Multilateral Aid Review: Ensuring maximum value for money for UK aid through multilateral organisations Summary - European Commission Budget, March 2011 Back

7   DFID, Multilateral Aid Review: Ensuring maximum value for money for UK aid through multilateral organisations Summary - European Commission Budget, March 2011 Back

8   Information from informal meeting in Brussels  Back


 
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Prepared 27 April 2012