Assessing Value, Ensuring Impact: The FCDO's Approach to Value for Money in Official Development Assistance

Summary

1. The world is in the midst of an international development reshaping: the UK’s announcement of an Official Development Assistance (ODA) cut from 0.5% to 0.3% of gross national income, the United States’ suspension of many USAID disbursements, and similar aid cuts from OECD donors such as Germany and France this year have created an unprecedented funding squeeze for low- and middle-income countries. In this austere environment, ensuring that the Foreign, Commonwealth and Development Office (FCDO) is maximising value for money is essential to minimise the impact on the world’s most vulnerable.

2. Our report finds that the FCDO is still broadly considered a world leader in its approach to value for money, building on legacy strengths established by the former Department for International Development (DFID). However, it must improve on its transparency and consistency urgently. What we have found to be concerning is the shift of priorities by the FCDO, with value to the taxpayer now central to its value for money strategy, rather than defining value for money as maximising the impact of each pound spent to improve poor people’s lives. Whilst we agree that value to the taxpayer should be an essential consideration by any Government department, we consider the absence of reducing poverty within the FCDO’s current published approach for ODA to be undervaluing the importance of this aspect in its VfM assessments, presenting a significant risk of worse outcomes for the world’s most vulnerable.

3. We also find that there is a surprising lack of accountability or focus on value for money from those that receive FCDO funding to deliver UK ODA. Whilst multilateral organisations can offer donors a powerful pooling mechanism, deep technical expertise, and a unique convening authority, it is concerning that the FCDO has not commissioned a multilateral aid review since 2016. This leaves a critical blind spot on the value for money of the 35% of UK ODA channelled through them. Major replenishments—such as to the Global Fund, Gavi and the World Bank’s International Development Association—combined with significant Home Office ODA spend are squeezing budgets for bilateral programming and making rigorous value for money evaluations more urgent than ever. At the same time, we have found that whilst private contractors deliver a substantial share of UK aid, opaque procurement procedures and limited transparency threatens their efficiency and accountability.

4. Additionally, we find that localisation promises more sustainable, contextually-driven outcomes by shifting funding and decision-making to local actors. Yet, localisation efforts remain stymied by unclear definitions and entrenched donor processes. Restoring systemic value for money assessments, strengthening oversight of contractors, and genuinely increasing localisation are essential to maximise the value of every pound spent.

5. Monitoring, evaluation and learning (MEL) lies at the heart of ensuring value for money in FCDO programmes, and we have found that robust lifecycle monitoring, formal reviews and a DFID-heritage framework leads the FCDO to remain markedly stronger than other Government departments and organisations. However, practical challenges persist, particularly as the bureaucracy and resourcing burden of rigorous monitoring and evaluation can effectively bar smaller local organisations from competing for FCDO funds. Past ODA cuts have already prompted teams to cut MEL from budgets to safeguard frontline delivery, and further reductions threaten to undermine the very assessments that sustain accountability and impact. To ensure future value for money, the FCDO must ringfence MEL funding, support smaller organisations with tailored capacity building, and address internal capacity gaps to sustain a culture of rigorous and trusted evaluation. Our findings offer the Government recommendations on filling these gaps, which we hope they will seriously consider while shaping the future of how the UK Government delivers aid and international development programmes.

1 The FCDO’s Value for Money strategy

VfM Framework

6. Following the 2004 Labour government’s commitment to spending 0.7% of gross national income on aid, which was later endorsed by the Conservative-Liberal Democrat government in 2010, Value for Money (VfM) became an essential feature of the UK’s approach to its spending of aid. Ensuring maximum VfM has been repeated in UK aid strategies since then, and has remained a central tenet to the ways in which DFID, and later the FCDO, operates.

7. All Government departments have a long-standing obligation to achieve VfM in their use of public funds.¹ The term has origins in the use of economic appraisal—evaluating whether the benefits of publicly funded programmes outweigh the costs. There is no universal definition of VfM, though many Government departments use several working definitions that include minimising waste, delivering outputs, and maximising outcomes.²

8. In July 2011, the then-Department for International Development (DFID) published its Approach to Value for Money, a fifteen-page VfM framework. Within this, the Department confirmed that VfM meant “maximising the impact of each pound spent to improve poor people’s lives,” and emphasised the ‘3E framework’:

Box 1: DFID’s 3Es Framework

9. Throughout this inquiry, we have heard that DFID were considered to be leaders in its approach to VfM across Government departments, both within the UK and internationally. Stefan Dercon, Chief Economist at DFID between 2011 and 2017, explained that its focus on VfM

led to a culture where people really paid attention before they approved a programme [ … ] in fact, last week at an invitation from Norway: “Can you come and please talk about value for money and how DFID did it?” [ … ] we were 10 to 15 years ahead of lots of other Governments that were trying to do it. This is something that gets “exported” even today in other organisations.⁴

10. In comparison to DFID, the Foreign and Commonwealth Office’s (FCO) approach to VfM of ODA was less clearly defined. The FCO was the third largest spender of UK ODA in 2020—the final calendar year before the merger of the FCO and DFID—spending £618 million, or 4.3% of the UK’s total ODA spend.⁵ This spend included overseas diplomacy-related costs in ODA-eligible countries, and contributions to multilateral organisations, alongside spend on activity such as the Prosperity Fund and the Conflict, Stability and Security Fund (CSSF).⁶

11. Unlike DFID, there was no separately published framework or operating guidelines for the FCO’s approach to VfM. However, DFID’s 2011 framework noted that “we want to improve the VfM of all aid, not just DFID’s own”.⁷ Shamik Dhar, Chief Economist of the FCO between 2014 and 2019, agreed that the FCO largely followed DFID’s guidelines when it came to ensuring VfM of its ODA spend:

I think initially, 2014–15, the Foreign Office was: “Crumbs, we have a large slug of money here. We had better manage it properly. Therefore, let’s use best practice”, and best practice at the time was exactly what DFID were doing. We strayed from that very, very little.⁸

12. The National Audit Office (NAO) is the UK’s independent public spending watchdog and has statutory authority to report on the value for money of how public money has been spent. The FCDO confirmed that the Department now uses the NAO definition of VfM, being “the optimal use of resources to achieve the intended outcomes”.⁹ The FCDO uses its Programme Operating Framework (PrOF) as its main guidance to staff and partners on its mandatory rules and principles for good programme delivery. This document, 106 pages long as of its most recent update in April 2025, contains numerous references to VfM, but less than one page setting out that the FCDO now uses a 4E framework, compared to the previous 3E approach taken by DFID—the additional ‘E’ being equity, described as “interventions that reach marginalised or hard to reach populations”.¹⁰

13. We have heard many plaudits for the FCDO’s approach to VfM. Anisa Berdellima, Director of Evidence and Impact at MSI Reproductive Choices, told us that “there is no question that the FCDO is a leader in the world when it comes to value for money”.¹¹ Oxford Policy Management, Julian King and Associates, and Verian Group, three consultancies that work on VfM, jointly commended the FCDO’s VfM approach, stating that it “represents quite a broad understanding of VfM, compared with other Government departments”, and that the Department is “recognised as a leader in this respect”.¹² There is explicit reference in the PrOF that VfM

is not about simply opting for the cheapest option or easiest things to measure, but more about understanding the drivers of costs to ensure we get the desired quality at the lowest feasible price.¹³

14. However, we are concerned that there is a lack of consistency and transparency regarding the FCDO’s VfM framework. The FCDO’s PrOF sets out a 4E approach,¹⁴ despite the Department’s written evidence for this inquiry stating that a 5E approach—including cost-effectiveness—is used,¹⁵ later confirmed by Baroness Chapman, Minister of State for International Development, Latin America and Caribbean, in oral evidence.¹⁶ Similar contrasting understanding of the FCDO’s approach can be seen across the written evidence received for this inquiry, with organisations such as Action for Global Health and Sightsavers understanding that the FCDO uses a 4E framework, while LAMP Development, a not-for-profit VfM consultancy organisation, believed a 5E framework is used.¹⁷ Whilst cost-effectiveness may be incorporated within the existing four Es set out in the PrOF, cohesive and consistent messaging is essential for ensuring that the FCDO’s approach to VfM is properly and effectively incorporated into programming. Conflicting interpretations or applications of these models risk undermining strategic alignment, diluting impact, and creating inefficiencies.

15. Other NGOs and development agencies were also unclear on the FCDO’s specific approach, with United Against Malnutrition & Hunger telling us that “our working assumption is that value for money decisions on UK ODA spend continue to be made on the basis of DFID’s 2011 Value for Money Framework”.¹⁸ Except for the short mention of VfM included within the PrOF, there are limited other public documents articulating the FCDO’s understanding of, or approach to, VfM. Without clear, consistent guidance, it becomes difficult for stakeholders and operating partners to assess the effectiveness of aid spending, or to engage meaningfully with policy and programme decisions. Sightsavers highlighted that because both DFID and the FCO spent ODA prior to the merger, the lack of documentation on the FCDO’s approach means that “it is not clear whether different approaches were being used and what impact it has had”.¹⁹ MSI Reproductive Choices also called for the FCDO to create a standardised VfM framework to “allow for mutual understanding, agreement, for relevant mechanisms to be established and appropriate resources to be invested”.²⁰

16. We heard that the lack of public guidance is particularly concerning in respect of the ‘E’ of equity, something the Bond Disability and Development Group deemed to be “essential if FCDO is to ensure that VfM does not exclude those harder or more expensive to reach”.²¹ Within the PrOF, the FCDO highlights the importance of equity in its VfM framework by stating that “an approach that integrates equality and inclusion improves the value for money of programmes, through increased equity and cost-effectiveness”.²² However, as Bond argues,

This document does not provide adequate guidance for FCDO staff on how to address the VfM issues and balance the emphasis on ‘equity’ in practice, which creates the risk that this principle is neglected. This is because reaching more marginalised groups does often require more resource- or time-intensive interventions, and there will always be a significant risk that it results in disincentives to focus on targeting these groups.²³

Value to whom?

20. The lack of public guidance is most pertinent when considering who the FCDO is delivering value to. DFID’s 2011 framework stressed that “VfM in our programme is about maximising the impact of each pound spent to improve poor people’s lives”, placing the focus of VfM squarely on those benefiting directly from programme spending.²⁴ In contrast, the PrOF refers to the importance of securing value to the UK taxpayer.²⁵ The FCDO also told us of the existence of

an internal guide on value for money that states that “the FCDO has a duty to the UK taxpayer to ensure that we do everything we can to maximise the value for money of our actions. Our diplomatic work should maximise the impact of foreign policy. For ODA spend, the main objective is to maximise each pound’s impact on those living in poverty”.²⁶

21. The internal guide mentioned above is not publicly available, and there is no reference to the lives of those living in poverty within the PrOF. As the Bond Disability and Development Group explained, “it is also unclear what internal guidance staff receive on VfM, making it difficult to assess the full extent of the merger”, and the extent to which the differences in VfM approach are expressed and understood.²⁷ When asked about her reflections of the shift in focus from those in poverty to the UK taxpayer, Minister Chapman reaffirmed this focus:

I suppose that it depends what you think the taxpayer wants you to do [ … ] I think that the public supports the aims of development, but they get cross about it when they think that we are making spending decisions that are not having the impact that we say they will have. The challenge for the Department, constantly, is trying to make sure that everything we spend does have the impact that the public would want to see their money achieving.²⁸

Value to the taxpayer is undoubtedly important, as the Government must be ensuring that it makes the most of every taxpayer’s pound, and value to the taxpayer does not have to be at odds with value to those in poverty. However, in the context of ODA spend, a risk is presented when value is solely framed in the terms of the UK taxpayer, downplaying equity and the importance of poverty reduction in how it assesses the VfM of ODA. OECD-DAC guidance states that ODA activities are “carried out with the economic development and welfare of developing countries as their main objective”.²⁹ Therefore, where value for the taxpayer are placed above the value of maximising the impact of money spent to improve the lives of those in poverty, a tension arises—immediate priorities for the taxpayer may not always be those under the spirit of DAC. We acknowledge that both considerations are important, but we consider the absence of reducing poverty within the FCDO’s current published approach to be undervaluing the importance of this aspect, and an inability of the FCDO to clearly state how the newly stated emphasis on value to the taxpayer is not impugning on the original focus of poverty reduction.

22. When asked whether reducing poverty should be explicitly mentioned as a central tenet of the FCDO’s VfM approach, as it was within DFID’s framework, the Minister responded that “I think it is [ … ] I do not know anyone who would disagree with that in the Department”.³⁰ Whilst the Committee recognises the Minister’s assertion that poverty alleviation remains a core priority to the FCDO, the absence of an explicit commitment to this objective within the PrOF’s VfM explanation is concerning. A public and entrenched commitment to this within the FCDO’s VfM framework would not only reinforce strategic coherence but also enhance transparency and accountability in the Department’s aid spending.

Sustainability

25. It is clear that the FCDO do not believe that their current VfM approach is sufficiently wide-ranging. Minister Chapman told us that “value for money is something we need to look at more widely [ … ] do we always encapsulate everything that we could? I think that is a fair challenge”.³¹ Long-term sustainability, ensuring not only that development outcomes are achieved effectively, but are also maintained over time, is a critical dimension of VfM. A project that delivers short-term outputs but fails to maximise local capacity or adapt to environmental or social contexts may ultimately represent poor value, even it appears efficient in the short term. When asked about the importance of capturing sustainability within VfM assessments, Dianne Stewart, Deputy Director of External Relations and Communications at the Global Fund to Fight AIDS, Tuberculosis and Malaria, stated that

We do think that it is a key way in which you also measure your value for money. Are you investing in ways that are going to be sustainable over the long term? [ … ] That is a measure we need to look at in value for money, not just did you get value today but will that deliver value in two years’ time?³²

26. In 2018, the Independent Commission for Aid Impact (ICAI) published a report assessing DFID’s approach to VfM. One key finding of ICAI was that DFID was not sufficiently capturing sustainability within their VfM framework. For example, in water and sanitation work, DFID was not monitoring whether results were sustained beyond the end of programming, unlike other donors.³³ Despite this, there remain very few references to sustainability in the PrOF, with no definition of what the FCDO means by sustainability, nor how this should be considered within a VfM assessment. Without explicit reference to sustainability in the FCDO’s VfM framework, there is a risk that short-term gains may be prioritised over longer-term impact, undermining the effectiveness and resilience of aid investments.

27. Oxford Policy Management, Julian King and Associates, and Verian Group told us that the FCDO must expand the criteria it considers relevant to VfM beyond the 4 or 5Es, to specifically include sustainability.³⁴ Similar thoughts were echoed by Action for Global Health, stating that “the current framework of economy, efficiency and effectiveness must evolve to include the principles of sustainability and resilience”.³⁵ When asked about why sustainability was not included within the FCDO’s VfM principles, Melinda Bohannon, the FCDO’s Director General for Humanitarian and Development, stated that “sustainability and resilience are not formulaically captured, but they are part of our considerations”.³⁶

2 The international development landscape and the UK ODA’s reduction to 0.3%

Cuts to ODA

30. In February 2025, the Government announced a reduction in UK Official Development Assistance (ODA) to 0.3% of gross national income (GNI) by 2027/28 in order to “fully fund our increased investment in defence”.³⁷ This was a further reduction on the supposedly temporary reduction from 0.7% of GNI to 0.5% of GNI implemented by the previous Government in order to meet the economic challenges caused by the covid-19 pandemic. The June 2025 Spending Review confirmed that total ODA spend would reduce to £9.4 billion by the 2028/29 financial year, compared to a total UK ODA spend of £14.1 billion in 2024.³⁸

31. The UK’s announcement of the decision to slash its development aid came only a month after President Trump sanctioned an executive order to freeze all programmes of the US Agency for International Development (USAID). The US was the world’s largest aid donor, providing around 20% of all aid coming from the 32 members of the Organisation for Economic Co-operation and Development’s Development Assistance Committee (OECD-DAC) each year from 2018 to 2023. In 2023, it was the largest single donor of humanitarian aid, providing 42%, compared to the UK’s 9%.³⁹

32. Similar cuts to overseas aid can be seen across Europe. The Netherlands announced plans to reduce spending on international aid from 0.62% to 0.44% of its GNI in 2027;⁴⁰ France has reduced its ODA budget by 35% in their most recent spending bill;⁴¹ Switzerland plans to end development programming in Albania, Bangladesh and Zambia by 2028.⁴² Concerns about the state of the development sector are at an all-time high, reiterating the importance of value for money, long-term sustainable funding, and maximising the value of each British pound spent on humanitarian and development aid. As Deborah Doane, a partner at Rights CoLab and co-convenor of the RINGO Project, an initiative seeking to transform global civil society, explained, “UK aid cuts will only further exacerbate what’s already happening, especially as it happens alongside aid cuts by multiple EU donors”. Rt Hon Andrew Mitchell MP, a former Minister for International Development echoed this sentiment, telling us that “it is a pretty bleak time for the international system at the moment”.⁴³

33. We have heard concerns of what cuts will mean for both humanitarian and development sectors, underlining the importance of including sustainability within VfM assessments. Deborah Doane raised concerns over the prioritisation of aid spending, stating that

Based on conversations we’ve been having, I would expect that for the UK and other European donors who are cutting aid budgets, humanitarian work will be prioritised over ‘development’ - which unfortunately is the work that builds long-term resilience and should lead to reducing the need of humanitarian aid.⁴⁴

This assessment is in line with recent statements from the Minister for International Development on the FCDO’s current priorities. Protection for humanitarian aid spending has been stressed in numerous letters received by this Committee from the Minister, with the promise that “the UK will remain a leading humanitarian actor, in a context where a record 300 million people require humanitarian assistance”.⁴⁵ Whilst the Committee are glad that humanitarian spending on those in desperate need of aid will be prioritised, particularly in the regions of Ukraine, Gaza and Sudan, we are concerned that slashing development aid will continue to lead to unrest and further crises in the future, presenting a threat to UK security.

34. The importance of long-term, predictable funding has been made clear to this Committee by numerous witnesses, particularly following the first round of ODA cuts from 0.7% to 0.5%. The British Red Cross told us that increased levels of predictable funding for humanitarian crises saves both lives and money, allowing for future planning and to retain staff and expertise.⁴⁶ BRAC, an international NGO partnering with more than 100 million people living with inequality and poverty, warned that the withdrawal of predictable funding risks undermining long-term progress in education, nutrition, and poverty alleviation.⁴⁷ Andrew Mitchell MP also highlighted the importance of long-term, stable funding, telling us that

Chopping and changing figures, as we saw in 2020 when the first lot of cuts came in, is very bad value for taxpayers. Why? Because you do not stop and start programmes: if you break them off, you lose a lot of the benefit of the initial investment; then you restart it and you have to go out again. It is bad value for money. Development is, essentially, long term.⁴⁸

In recent years, repeated cuts to the UK aid budget have not only disrupted programme delivery and limited the long-term VfM impacts of the FCDO’s work, but has also harmed the UK’s global reputation. Such instability undermines trust with partners and reduces the effectiveness of aid in reaching those most in need.

35. A significant concern of this Committee has been the impact of ODA cuts on the most marginalised in society. FCDO policy and legal commitments require a proportionate Equalities Impact Assessment at every point of decision making, which have been produced by the Department to detail how ODA changes will affect people with protected characteristics such as age, disability, and gender. Given that these assessments are not legally required to be published, we welcome the FCDO’s proactiveness in producing and publishing them. However, the most recent Equality Impact Assessment, published in July 2025, highlights the adverse impact that upcoming cuts will have on gender, education and health programmes for the 2025/26 financial year.⁴⁹ ODA cuts of 12% in Africa (from £1.55 billion in 2024/25 to £1.37 billion in 2025/26), with reductions to programmes on women’s health, health emergency response, and nutrition, will deeply impact the most vulnerable. Within the assessment, the FCDO acknowledge that “any reductions to health spending risk an increase in disease burden and ultimately in deaths, impacting in particular those living in poverty, women, children and people with disabilities”. We also note with dismay that, contrary to assertions that support for Gaza would continue,⁵⁰ the Occupied Palestinian Territories will see a reduction of 21% in UK ODA in 2025/26.⁵¹ Despite these cuts, the total FCDO ODA programme budget is only due to fall by 6% for the 2025/26 financial year (from £9.28 billion in 2024/25 to £8.7 billion), with more significant cuts to ODA beginning in 2026/27.⁵² It is therefore vital that the FCDO continues to conduct and publish Equality Impact Assessments as more severe cuts are implemented.

In-donor refugee costs and cross-HMG spend of ODA

40. DFID, and later the FCDO, has been the principal spender of UK ODA, and responsible for managing the majority of the UK aid budget. However, in recent years, the Home Office’s ODA-eligible spending, particularly on in-donor refugee costs (IDRC) has grown significantly, rising from 3% of all UK ODA in 2016 to a peak of 29% in 2022.⁵³ Per the most recent FCDO Statistics on International Development, £2.8 billion was spent on IDRC in 2024, a £1.4 billion decrease compared to 2023, but still 20% of total UK ODA.⁵⁴ The majority of this spending on IDRC is carried out by the Home Office, which spent 84% of the total £2.8 billion in 2024, an increase from 69% in 2023. Whilst spending fell across all departments incurring IDRC in 2024 compared to 2023, the Home Office still spent 17% of all UK ODA in 2024. The 2025 Spending Review set out the Government’s plans for total departmental expenditure until 2028/29, and departmental programming allocations excluding forecasted spend on IDRC. Using this data, ICAI suggest that asylum costs are expected to continue to absorb approximately one-fifth of the aid budget in 2027/28, and that ODA funds available for purposes other than IDRC will fall to roughly 0.24% of UK GNI, the lowest level relative to national income in more than 50 years of UK ODA statistics.⁵⁵

41. Under international aid rules, many of the costs of hosting refugees can be classed as ODA for the first 12 months that refugees are in the UK, including basic subsistence costs such as food and accommodation, with the OECD-DAC advising that countries should adopt a “conservative” approach to accounting, meaning they should not overreport this ODA spend.⁵⁶ The Government has justified its decision to spend a proportion of the aid budget in the UK because this spending is allowable under the DAC rules. However, as our predecessor Committee identified in its report, Aid spending in the UK, the use of ODA for that purpose does not fall within the OECD’s definition of ODA, which is spending that “promotes and specifically targets the economic development and welfare of developing countries”.⁵⁷ Given the recent iteration of cuts to 0.3% of GNI, we continue to agree with our predecessor Committee’s finding that UK Government policy on ODA spending on in-country refugees is incompatible with the spirit of the OECD Development Assistance Committee rules, particularly in a world of rapidly decreasing aid budgets.

42. When the 0.7% of GNI target was made statutory in 2015, DFID, and later the FCDO, was given the role of “spender and saver of last resort”, meaning that the Department was required to adjust its ODA budget each calendar year based on the spend of other Government departments, to ensure that total UK ODA spend reached, but did not exceed, the 0.7% target. However, under the 2025 Spending Review, the FCDO has been relieved of this role, meaning that the Department will now receive an annual ODA allocation based on GNI.⁵⁸ This means that whilst high levels of refugee costs in the UK may still result in the FCDO receiving a lower ODA allocation, they are not subject to the volatility of in-year spending by other Departments. This should allow for the FCDO to make more effective use of a stable budget. We note, however, that there has been no commitment made for the FCDO to automatically receive any additional ODA resources if other Government department’s ODA spending is lower than expected, nor if there is an unexpectedly high GNI. When asked about any excess ODA budget if the spend on asylum costs came down faster than expected, Rt Hon David Lammy MP, then-Foreign Secretary, told us that

The price of stability is that I accepted that it would not automatically come back to us, but I have made it clear to the Committee that I will be making the case for increased spend, particularly in relation to development. You have that as my commitment.⁵⁹

Whilst we appreciate that the FCDO now has a more predictable and stable ODA budget to enable better long-term planning, without a mechanism to reallocate underspent ODA or respond to rising GNI, the Department may still face constraints in addressing urgent global challenges. A risk is also presented that in such a situation, this may also mean that total ODA spending in real terms may be less than 0.3% of UK GNI.

43. We welcomed the Government’s commitment within the 2025 Spending Review to ensure that asylum costs fall, and to end the use of expensive hotel accommodation for asylum seekers within this Parliament.⁶⁰ However, it is not clear whether the FCDO or the Home Office have an approach to ensuring this is achieved, or whether there is an incentive for the Home Office to do so. When asked how the FCDO will monitor the reduction of the amount of money being spent by the Home Office on hotel costs, David Lammy MP told us that “the thing I am principally concerned with is that my budget is stable and is not affected by paying hotel bills in this country”.⁶¹ Whilst we recognise that the FCDO is no longer spender and saver of last resort, this approach appears shortsighted—if hotel costs do not fall as set out within the Spending Review, this will continue to put downward pressure on the FCDO’s allocated ODA budget, and even further limit the amount of aid that the Department will have for development and humanitarian purposes in subsequent years. It is vital that formal steps are taken to cap the amount of ODA that the Home Office can use for IDRC to stave off further erosion of essential funding.

44. Witnesses have also told us of the lack of a cohesive VfM strategy across all Departments spending ODA. For example, Save the Children UK highlighted that there continues to be large elements of ODA and departmental spending that face a lack of evaluation, specifying that “this issue is broader than just FCDO”.⁶² The FCDO accepts that there could be enhanced coherence across Government and with international organisations to prevent duplication of work and to ensure the effective use of resources.⁶³ The Minister for International Development revealed to us last month that the FCDO had recently been given a stronger leadership position in the way that the UK spends ODA across Whitehall, with a revitalised ODA Board that shares an approach to development. She told us that a lack of communication and strategy between Government departments had resulted in duplication and confusion in-country:

This is ridiculous. It is wasteful. It is diplomatically stupid, because we are not then getting the benefit of what we are spending in a country to use with our bilateral relationship. This has to stop [ … ] it is a priority to fix.⁶⁴

This new role gives the FCDO an opportunity to wield its reputation as a global leader for ensuring that VfM is delivered across all of the UK’s ODA spend, by driving greater coordination, transparency and accountability across the UK Government. If implemented effectively, this leadership role could be a turning point in addressing inefficiencies across Departments, and ensuring that UK aid delivers maximum impact for the communities it is intended to support.

3 The FCDO’s engagement with partners

51. The FCDO’s ability to deliver VfM is closely tied to how effectively it engages with a diverse range of partners across its programming. From multilateral organisations and NGOs to philanthropic organisations and private contractors, we recognise that each brings unique capabilities and perspectives that can enhance programme impact and efficiency. However, ensuring VfM within these partnerships requires clear expectations, oversight and accountability mechanisms.

Multilateral Organisations

52. Roughly one third of development aid from high-income countries is provided as core (or “un-earmarked”) funding to multilateral organisations.⁶⁵ These include multilateral development banks, such as the World Bank, which disbursed $90 billion in 2024, alongside a further $117 billion in financial commitments.⁶⁶ They can offer donors like the UK the benefit of their larger scale, depth and breadth of operations and technical expertise, often including a presence on the ground. When asked about the importance of multilateral aid, Abdoulaye Fabregas, an economist at the OECD, told us of the importance of the multiplier effect, allowing donors to pool resources and encourage others to do the same; put simply, “money is the first comparative advantage”.⁶⁷ Other benefits he highlighted include knowledge sharing, the convening power to spark corrective action, and that OECD analysis has found that multilaterals often score highly in terms of their effectiveness.

53. Figure 1 below shows the proportion of all UK ODA by delivery channel from 2020 to 2024. On average across this time, 30% of all UK ODA has been spent through multilateral channels. Regarding FCDO ODA specifically, the Permanent Under-Secretary confirmed in a letter to the Committee in January 2025 that multilateral contributions made up 42% of the ODA budget. Bilateral contributions made up 33%, and the remaining 22% was a combination of miscellaneous transactions including research and development, scholarships, and operating costs.⁶⁸ Abdoulaye Fabregas told us that these figures are relatively comparable to multilateral spending in other OECD-DAC countries.⁶⁹

Figure 1: Proportion of UK ODA by delivery channel across all Government departments, 2020 to 2024 (£ million)⁷⁰

54. The UK has long championed the use of multilateral funds. For many years, it was the largest absolute provider to the International Development Association (IDA), the World Bank’s fund for the lowest income countries. The UK remains one of IDA’s top donors, with the FCDO recently pledging funding of £1.98 billion over three years during the recent IDA21 funding round—a 40% increase from its IDA20 contribution in 2022. Despite this commitment being made just months before the Government’s decision to cut aid funding to 0.3% of GNI, the Minister for International Development recently confirmed to us that the UK will still honour this pledge “as a foundation of our commitment to core multilateral partnerships”.⁷¹ In July 2025, the Foreign Secretary also informed us of the UK’s commitment of £1.25 billion to Gavi, an international organisation improving access to vaccines, for the 2026–2030 period. This reaffirmed the UK’s continued commitment to the multilateral system despite significant budget cuts.⁷²

55. We heard from Dianne Stewart, Deputy Director of External Relations and Communications at the Global Fund, about the numerous ways the Global Fund believe they ensure good VfM for its donors. Importantly, she highlighted that they are subject to reviews by, and report on their VfM to, the FCDO, receiving a rating of “excellent” in their most recent annual review performed by the Department.⁷³ This raises the important question of the role of the UK within the multilateral system, particularly in assessing the VfM of the billions of pounds it sends each year to multilateral organisations. Unlike for bilateral aid, the UK does not have direct influence over how multilateral aid is spent, requiring a different approach to VfM than its bilateral spending. Jennifer Armitage, Managing Director at LAMP Development, told us of the myriad of mechanisms that the FCDO have to ensure that VfM is being achieved through its multilateral contributions, including spending management processes, standard operating procedures, and annual reviews. She added that she believes that “the UK has very high standards and most multilaterals are in line with those”.⁷⁴

56. Despite our panellists agreeing that the FCDO applied enough scrutiny over how each multilateral organisation spends UK ODA once channelled through them,⁷⁵ we remain concerned that the FCDO has not recently carried out a widescale VfM assessment of the multilateral organisations it sends ODA to. In 2011, DFID published its Multilateral Aid Review (MAR), a systematic assessment of the VfM offered by 43 multilateral organisations receiving UK ODA.⁷⁶ This exercise was repeated for 36 organisations in the 2016 Multilateral Development Review (MDR).⁷⁷ These reviews confirmed that the multilateral system is a critical complement to what the FCDO can do through bilateral spend, with both reviews finding that UNICEF, Gavi and the Global Fund offer particularly good VfM for UK aid. However, despite significant changes in the value of UK spend channelled through multilateral organisations, and two severe budget cuts to ODA since 2021, no further reviews have been performed since 2016. Jennifer Armitage stressed the importance of these reviews:

It is selecting the best multilaterals for the UK to invest in, given the priorities. I think that is important because it acts as a justification for not spending it on bilateral aid, which can also achieve great outcomes and impacts.⁷⁸

57. With many multilateral development replenishments in 2025, including IDA, Gavi, and the upcoming Global Fund funding round for 2026–2028, and significant Home Office ODA costs, we expect that there will be very little remaining spend for bilateral programming, and the 2024/25 FCDO Annual Report and Accounts already show significant bilateral cuts anticipated for the 2025/26 financial year, before many of these multilateral commitments begin.⁷⁹ VfM is therefore more essential than ever to ensure that the Government gets the most out of every pound spent, and has the greatest level of impact on those living in poverty. We do not find that multilateral organisations offer poor VfM—on the contrary, we have heard how essential they are to convene powerful actors and leverage as much money as possible—but more must be done to ensure maximum VfM is being achieved from UK ODA.

Locally-led practices

60. The UK was a key signatory of the Grand Bargain, an agreement made at the World Humanitarian Summit in 2016 (and its 2.0 renewal in 2021) which aimed to transfer 25% of global humanitarian funds to local and national actors. However, in 2023, only 4.5% of all trackable humanitarian funding went directly to local and national actors,⁸⁰ with reports indicating that only 2–3% of funds reached local actors directly.⁸¹

61. The OECD have stressed that the changing nature of development co-operation has underscored the need for renewed attention to locally-led development, including in multinational forums, given an increased reliance on the multilateral system.⁸² At the same time, rising humanitarian need and global instability have put pressure on the constrained aid budgets for many DAC members, as detailed in Chapter 2. This means that identifying domestic and international opportunities to put locally led development at the centre of national and international debate will be ever more critical.

62. Witnesses told us of the importance of locally-led practice for ensuring VfM, and were clear on the benefits that this can have for both the UK and for local communities benefitting from UK ODA spend. Sarah Annable-Garner, CEO of Action Through Enterprise, told us that

With a local team, working in the local language, communities can speak freely – including when something isn’t working for them. By staying constantly in touch on the ground, our programmes keep on track. And if we need to pivot, we will do, never spending money that’s not needed or wanted, protecting programmes into the future.⁸³

Organisations such as BRAC also advocated for locally-led practices which result in better sustainability for local communities, particularly when investing in their core capabilities. BRAC also explained how locally-led organisations are able to prioritise context-specific challenges, such as healthcare and poverty reduction, to achieve lasting progress on Sustainable Development Goal One, which calls for an end to all poverty.⁸⁴ CAFOD told us that they welcomed the increased focus on local context by the FCDO in recent years, adding that current analysis estimates that local actors are 32% more cost effective in delivering ODA programming compared to international organisations.⁸⁵ In its written evidence, the FCDO also told us that the PrOF encourages staff to consider the development effectiveness principles to “provide aid in such a way that it supports and strengthens local responsibility, capacity, accountability and leadership”.⁸⁶

63. This inquiry has not been the only time we have heard of the importance of localisation and locally-led practice. Our recent report, The Government’s efforts to achieve SDG2: Zero Hunger reiterated the importance of localisation in nutrition-related programming. We recognised that the Government has worthy intentions, but that “a concerted effort will be needed across the FCDO for these aspirations to become a reality”.⁸⁷ Similarly, our report The FCDO’s Approach to Displaced People also found that the Government is not making sufficient progress in meeting its commitments to localisation in humanitarian programming.⁸⁸ When asked about progress on Grand Bargain commitments, we failed to receive a satisfactory response from the FCDO, who told us that the Department “strongly supports the role of national and local organisations”, but failed to provide us with data on progress towards meeting any commitments made.⁸⁹

64. We acknowledge that, given the reduction of UK ODA to 0.3% of GNI, there will likely be decreasing levels of funding available for bilateral programmes. This means that engaging with local communities becomes ever more vital to ensure that what little money is left from the UK’s budget is going as far as possible. As Asif Saleh, Executive Director of BRAC, told us:

Locally-led partnerships demonstrate greater economic efficiency and sustainability. Local implementers have specialised knowledge of the market system to produce and deliver the same service for less, using local systems which are more suited to the local context.⁹⁰

The International Rescue Committee UK reiterated this, telling us that humanitarian action is more efficient when delivered in partnership with local NGOs, civil society and grassroots organisations.⁹¹ Dr Tom Drake and Dr Pete Baker, from the Center for Global Development, also agreed that by prioritising initiatives that help countries to use their own resources more effectively, the FCDO can contribute to sustainable development, thereby acknowledging that VfM extends beyond short-term project successes to include long-term systemic improvements.⁹²

65. As discussed in Chapter 1 of this report, many witnesses have told us about the inconsistency of VfM understanding and application across the Department, largely as a result of the lack of one cohesive VfM framework or strategy. Similar criticisms have been made of the FCDO’s approach to localisation, with Bond highlighting the lack of strategic focus on localisation across the Department.⁹³ The 2023 UK White Paper on International Development included a commitment for the UK to “work towards a more inclusive and more locally-led approach”, including a commitment to “publish a strategy setting out how the UK will support local leadership on development, climate, nature and humanitarian action”.⁹⁴ However, as Bond observed, it appears that there has been limited action taken to deliver on these commitments, and no local leadership strategy has been published to date. In a letter sent to the Committee in June 2025, the Minister set out four “essential shifts” in delivering development, which included a transformation “from international investment to local provision; working through local partners and civil society to deliver sustainable, locally-led solutions”.⁹⁵ Given this seemingly renewed focus on the importance of locally-led practice, it is vital that the FCDO ensures that FCDO staff are guided by a cohesive strategic approach that places both local voices and VfM at the centre.

Philanthropy

69. According to most recent data, UK philanthropic spending on development between 2016–2019 was approximately US$730 million per year.⁹⁶ Philanthropy will not, and cannot, fill the gap in the UK aid budget, but it could make a contribution, particularly if the Government makes a serious attempt to convince UK philanthropists to increase giving to overseas aid. As Deborah Doane, a partner at Rights CoLab and co-convenor of the RINGO Project, told us that philanthropy can be used to catalyse shifts in the wider system, and to take risks that more traditional forms of government aid cannot.⁹⁷

70. When asked whether the Government had considered the role that philanthropic organisations could play in achieving greater VfM, the Minister for International Development responded that “how they assess their value for money and what they are prepared to spend their money on is completely different from how a Government need to think and behave”, but also acknowledged that “one thing that I want to do is try to work in a way that is complementary [ … ] we need to stay close to our friends and colleagues who work through philanthropic organisations”.⁹⁸

71. The most comprehensive data on UK philanthropy for international development comes from a report by the OECD in 2021, which drew on data collected on global foundation giving to development causes between 2016 and 2019. According to this report, the UK ranked highly for development philanthropy, placing third—behind the US and Spain—in terms of total given to development foundations, with a total spend of roughly $2.2 billion.⁹⁹ However, as Dr Jessica Sklair, Lecturer in the School of Business and Management at Queen Mary University of London, explained, it is difficult to calculate this as a percentage of UK philanthropic spending overall. Overall charitable giving in the UK in 2023 was approximately £13.9 billion, with 7% of this total going to fund overseas aid and disaster relief, though this total spend excludes philanthropic foundations.¹⁰⁰ Deborah Doane also reminded us that the UK’s strong research and policy sector, with leading academic institutions teaching development, feeds into government policy and philanthropic efforts in a more intangible way than straight funding.¹⁰¹

72. We recognise that there are several challenges and risks associated with depending on philanthropy to support government agendas, both in development as well as more generally. Primarily, concerns were raised regarding how philanthropic funding priorities are often dictated by the interests of donors and foundation boards, often with a short-term focus rather than sustainability for the beneficiary;¹⁰² Deborah Doane described this as “effectively the privatisation of what could and should be public expenditure”.¹⁰³ Witnesses also warned us of the lack of transparency and accountability around philanthropic funding; given that foundations are essentially voluntary actors, they are not directly accountable to local actors or governments.¹⁰⁴ Appropriate due diligence before the FCDO engages with philanthropic organisations would help to mitigate these risks, particularly alongside explicit recognition that philanthropic organisations are not replacing ODA, and are instead another means by which the FCDO can leverage their influence to encourage greater VfM and aid the world’s poorest.

73. We heard of a number of possible levers that the UK Government could use to promote philanthropy for development within the UK. What is clear is the important role that the FCDO could play in relationship building, both with and across philanthropic organisations. Dr Sklair told us of the significance of cultivating strong relationships with High Net Worth Individuals (HNWIs).¹⁰⁵ Deborah Doane echoed this, telling us that the Government can use the power of such individuals to convene and develop multi-stakeholder partnerships.¹⁰⁶ Intermediaries have also called on the Government to develop a national philanthropic strategy to set direction and co-ordinate philanthropic activity.¹⁰⁷ Given the Minister’s desire to ensure that philanthropy and the Government work in a complementary manner, the FCDO are well placed to open a dialogue to encourage beneficial collaboration between the philanthropic and public sectors.

Private Contractors

76. For the purpose of this inquiry, in line with our predecessor Committee’s report on DFID’s use of private sector contractors, the term ‘contractors’ refers to private sector organisations, many of which operate on a for-profit basis.¹⁰⁸

77. Throughout the course of this inquiry, concerns were raised in respect of the VfM of FCDO spending that was channelled through private contractors. In the financial year ending 31 March 2024, the FCDO spent a total of £3.4 billion via nearly 1,200 contracts. Of that, over £550 million was spent on 64 development-related contracts, a 49% increase from approximately £340 million in the prior year. The rest of the spend (roughly £2.9 billion) went to non-development contracts, largely administrative costs, or internal improvements such as construction and remodelling.¹⁰⁹ The Minister told us that currently, in the 2024/25 financial year, spend through contracts make up 9.6% of total FCDO ODA programmes.¹¹⁰

78. The way in which DFID, and later the FCDO, have engaged with private contractors changed throughout the 2010s. DFID was historically set up as a “commissioning organisation”, therefore not a direct implementer of the development programmes that it funds.¹¹¹ There were three main channels through which DFID delivered its bilateral programmes: through multilateral agencies, civil society organisations, and contractors. DFID’s spending through suppliers doubled between 2011 and 2016, reaching £1.4 billion in the 2016–17 financial year—14% of its total budget.¹¹² We received written evidence to this inquiry from a group of academics who identified that from 2016 onwards, in an effort to secure greater VfM, DFID—and later the FCDO—”successfully exerted pressure on the margins and commercial models of the suppliers”, with suppliers identifying an “adversarial shift” in the FCDO’s approach.¹¹³ They identified that this has led to a sharp division in the market between prime contractors and smaller firms, with prime contractors primarily winning the majority of procurement bids. These adversarial shifts, which may lead to damaged relationships and inefficiencies, as well as a broader loss of expertise due to fewer smaller firms, all represent key threats to the FCDO’s VfM procedures.

79. When we asked whether spending via contractors was a necessary part of international development, witnesses agreed that it was. Sinead Magill, Chief Executive Officer of Palladium, highlighted the technical in-house skill retained by private contractors.¹¹⁴ Dr Brendan Whitty, from St Andrews University, also acknowledged that “the pretty wide ecology of development contractors offers a lot of really useful skills: good management skills, good technical skills, and legally, managing compliance”, but added an additional qualification that this came at the expense of high costs.¹¹⁵

80. Regarding previous media scrutiny of DFID focusing on profits made by contractors, our predecessor Committee found that much of this scrutiny was misleading, and found that “it is clear that DFID holds value for money as the prime objective in its strategic use of contractors”.¹¹⁶ When asked about the appropriate level of fair but not excessive profits, Dr Whitty told us that, in fact, profit margins had “dropped a little too low even maybe for some and there is a little too much commercial pressure”. He vocalised concerns about the loss of expertise as a result of the recent ODA cut to 0.3%, stating that

I understand that firms are struggling at the moment because the cuts are coming and there is a risk that you will lose competitiveness. [ … ] The smaller organisations start to fail, go out of business, and that will be a real problem for the sector. We have been really worried about the loss of capability within FCDO. There is a parallel risk about the loss of capability in the consultancy ecology.¹¹⁷

Sinead Magill agreed that she was worried about the loss of expertise industry-wide, but added that “the sector is very resilient, and the reason I am optimistic about the business is that while international donors are having to make much more difficult decisions to pull back on foreign assistance, development is a theme that is being mainstreamed in a whole range of other sectors”.¹¹⁸

81. When asked about determining fair level of profits, the Minister told us that the FCDO do not set a maximum profit level in its procurements, but that the Department track agreed profit levels in its contracts as a part of its Cost Benchmarking database. She also confirmed that in 86 contracts awarded since 2023, the average profit was 4.0%.¹¹⁹ We commend the FCDO for making considerable efforts to limit excessive profit and profiteering, particularly in comparison to 2017 when our predecessor Committee’s report was published, which revealed that most DFID suppliers earned an average profit of 5.5%.¹²⁰

82. However, concerns about loss of expertise and the VfM that these organisations can offer remain. Dr Mawdsley, Dr Whitty, Dr Gilbert, Dr Russon, Dr Sklair and Dr Taylor contended that as contractors have increasingly become responsible for management and technical work, this has undermined the FCDO’s localisation agenda as responsibility has been taken away from local actors in-country, as discussed earlier in this chapter, as well as leading to a loss of internal technical capability within the FCDO.¹²¹ The FCDO have acknowledged that using private contractors does not always offer good VfM, telling us that

There are cost savings, as well as efficiency gains, to be made from using FCDO staff in the delivery of programmes in place of outsourced alternatives. FCDO is already making modest use of project-funded posts – and will be considering expanding its use of these in the delivery of programmes (where it adds the most value) as part of the upcoming Spending Review.¹²²

83. When we asked the Minister to explain in further detail these efficiency gains and cost savings, she explained that cost savings are calculated by comparing the cost of the FCDO salaries and associated costs with the fee rates charged by a consultant in the same specialism. She told us that in one year, the FCDO found that creating new internal staff roles to deliver parts of programmes rather than engaging with external private companies saved an estimated £4 million, or 24% of the cost of an outsourced alternative.¹²³ This aligns with comments from Dr Whitty, who told us that the FCDO’s current model of using private contractors is expensive, and recommended that “it would be better if it were taken back into the hands of FCDO to have smaller, more targeted programmes”.¹²⁴ Whilst the FCDO has acknowledged to us the limitations of outsourcing, and identified clear cost-saving opportunities through internal delivery, the absence of any public statement or commitments following the June 2025 Spending Review leaves uncertainty around whether these insights will translate into meaningful policy shifts.

84. One key finding of our predecessor Committee’s report on DFID’s use of private sector contractors was a lack of transparency. It recommended that DFID “make every effort to level the playing field in terms of information available”.¹²⁵ We commend the FCDO for its performance in the 2024 Aid Transparency Index, where it was rated the highest transparency performer of any foreign ministry.¹²⁶ The FCDO encourages implementing partners of the UK’s aid, including private contractors, to publish organisation and activity data in accordance with the International Aid Transparency Initiative (IATI) Standard, a global initiative to improve the transparency and accountability of aid funding on both international development and humanitarian activities.¹²⁷ However, whilst the FCDO website notes that most agreements mandate the following of this standard, not all agreements require this, meaning some FCDO partners managing UK ODA are not upheld to the same transparency requirements.¹²⁸

85. The data provided to IATI is used to inform DevTracker, the UK’s public information for UK aid spending, showing the public how the Government is spending its ODA. The FCDO’s website states that if organisations required to publish their information to IATI do not do so, they may not be eligible for funds in future. When asked about the transparency of IATI data, Sinead Magill described it as “quite difficult data”, and told us that “[IATI] is designed for somebody to input into, but as a receiver of it, unless you are coming from a point of knowledge, it is quite impenetrable to read”.¹²⁹ Dr Whitty told us of holes in the data collected by the FCDO, partially due to it being a time-consuming and demanding process, but disagreed with the notion that it was “impenetrable” to read, instead contending that it was collected and recorded inconsistently, making it difficult to make sense of incomplete data.¹³⁰

86. However, we also note that the FCDO’s website indicates that training on IATI disclosures must be organised by the organisations themselves, not provided by the FCDO: “If your organisation is new to publishing to IATI, you will need to give guidance to empower and resource technical staff to organise your data effectively to publish to the IATI standard”.¹³¹ By placing the burden of IATI training solely on recipient organisations, the FCDO risks inconsistent data quality and reduced compliance, undermining both transparency and the ability to appropriately assess VfM across aid programming. This also disadvantages smaller organisations with a lack of resources to organise training or afford technical staff.

4 Monitoring, Evaluation and Learning

92. Monitoring, Evaluation and Learning (MEL) is a significant part of ensuring that VfM is achieved through policies, interventions and programmes. The OECD uses the following definitions of MEL:

Box 2: OECD definitions of Monitoring, Evaluation and Lessons learned

93. MEL is vital to ensure that VfM is being achieved in development and humanitarian programming by providing the evidence base needed to assess whether programmes are delivering intended outcomes effectively, equitably and sustainably. MEL also strengthens accountability to taxpayers and partners by demonstrating how resources are being used, and the results achieved; Bond’s 2016 paper on Assessing and Managing Value for Money: Lessons for NGOs makes clear the importance of robust governance and accountability arrangements for ensuring effective measurement of VfM.¹³³ When asked about the importance of MEL, Anisa Berdellima, Director of Evidence and Impact at MSI Reproductive Choices, explained:

Whether a woman is here in London or in rural Madagascar, she should expect the same level and quality of services. [ … ] By setting out these processes and really being able to track not only the expenditure that goes in delivery but the impact you are having, you can make a decision; you can either say, “This intervention is cost-effective,” or “Actually, I can identify new ways of doing this intervention that could generate cost savings to put back into the programme and enable us to reach even more women”.¹³⁴

94. The FCDO’s Evaluation Policy, published in April 2025, states that “evaluations can be applied to programmes, policies, portfolios, themes or strategic areas, to improve our efficiency, effectiveness and value for money”.¹³⁵ The FCDO told us that the department’s PrOF factors in VfM considerations at every stage of the programme lifecycle. This includes:

Box 3: FCDO VfM considerations throughout the programme lifecycle

95. We received multiple pieces of evidence commending the FCDO’s MEL processes, particularly those that are rooted in the legacy strengths of DFID’s processes. Alex Hurrell, Head of Evaluation at Verian Group, highlighted the importance of the FCDO’s legacy departments, telling us that, “compared to other UK Departments, the FCDO actually has a lot of legacy strengths in MEL and in value for money [ … ] there is best practice there that should not be forgotten about”.¹³⁸ Mark Henstridge, CEO of Oxford Policy Management, echoed this, telling us that “our sense is that the strength of the DFID frameworks has come through” into the FCDO’s approach to VfM.¹³⁹

96. Organisations such as Oxford Policy Management and LAMP Development identified in their written evidence that the “FCDO considers VfM reasonably systematically throughout the project cycle”,¹⁴⁰ and that “the programme monitoring and reporting system appears robust”.¹⁴¹ Alex Hurrell told us that, “I work with lots of other Departments in the UK now, and I would still say there is a stronger evaluation culture in the FCDO, despite all the changes that have happened, than there is in many other Government departments”.¹⁴² Similar remarks were confirmed by Mark Henstridge, who commended the FCDO’s institutional memory:

In our experience, [the FCDO’s current MEL processes] are generally good, and we think that reflects what Alex talked about in terms of evaluative culture. For the FCDO, there is a bit of institutional memory that comes through the evaluation. Where there are in-country MEL advisers, those too provide continuity, and we think it is taken seriously.¹⁴³

97. However, there was recognition that there were areas for improvement. Professor Bernhard Reinsberg, Dr Cecilia Corsini, and Dr Guiseppe Zaccaria commended the FCDO on their “robust oversight mechanisms to ensure VfM”, but highlighted ICAI’s 2023 report on The FCDO’s Programme Operating Framework, which found that the PrOF is “not yet fully aligned with FCDO’s objectives, and not yet adapted to a new reality of declining aid budgets [ … ] it is not clearly written and risks distracting from the important content main messages”.^{144 145} Save the Children UK told us that large elements of ODA and Departmental spending lack proper evaluation, particularly that of the former FCO’s portfolio.¹⁴⁶ MSI Reproductive Choices also argued that “there is not a cohesive approach to monitoring delivery and outputs to ensure VfM is achieved across FCDO programming”, citing differences in levels of expertise and experience across teams leading to additional work for implementing partners.¹⁴⁷ The International Rescue Committee UK echoed this, stating that the department’s understanding of VfM can be inconsistent:

The FCDO still has substantive progress to make in embedding VfM into its delivery and outputs. The Department’s understanding of VfM can be somewhat inconsistent between teams. [ … ] There is also variable effectiveness in monitoring delivery outputs from a VfM perspective. Some SROs, for example, only focus on VfM as a financial concept [ … ] rather than a holistic understanding of both the quantifiable and non-quantifiable benefits of a project.¹⁴⁸

98. When asked about the metrics used by the FCDO to evaluate effectiveness, the Minister told us that the FCDO supports various types of interventions in many different sectors and countries. She recognised that “the lack of data in many of the contexts we operate in means that quantitative metrics are often not possible or good quality,” and assured us that the FCDO’s metrics of value changed across context and programmes.¹⁴⁹ It is positive that the FCDO adopts a flexible approach to evaluative metrics, as this allows for more accurate and meaningful VfM assessments—a rigid, one size fits all framework could obscure important nuances—and flexibility enables the use of indicators that reflect local realities and programme-specific goals, ensuring that VfM assessments are both relevant and credible.

99. However, we have also heard throughout this inquiry about the importance of championing and supporting local organisations to deliver the best possible VfM for the communities they are serving. It is concerning to us to hear that despite the FCDO’s attempts to ensure that VfM assessments are flexible and context-driven, this is not always necessarily felt by local organisations subjected to the bureaucracy of stringent MEL processes, both by the FCDO and other international providers. Sightsavers told us that onerous MEL requirements from the FCDO takes time and resources away from implementing vital programming, and asked for more proportionate requirements on programme providers.¹⁵⁰ Anisa Berdellima also acknowledged that great focus on VfM and MEL is important in ensuring partners are reaching “the poorest of the poorest”, but questioned whether such requirements for implementing partners—often small, locally-led organisations—was truly inclusive, and that “there is more work to be done together with the FCDO on having that understanding that maybe there needs to be different expectations depending on the partner you are working with”.¹⁵¹ We also heard similar comments from Jennifer Armitage, who reiterated the need for fair reporting requirements:

Value for money reporting can sometimes be in addition to the already very thorough oversight mechanisms [ … ] It is important to be proportionate. A lot of the bilateral suppliers had a vested interest in investing in their approaches to value for money and setting up systems to report on unit costs and things such as that. Those sorts of resources maybe were not available to all delivery partners and implementing partners, especially those that were locally based or run on much tighter budgets.¹⁵²

FCDO Staffing Capacity

105. The FCDO told us of many ways in which they are aware their oversight mechanisms must be improved, and we are particularly concerned about those regarding staffing.¹⁵³ We have heard throughout this inquiry about the impact of the FCO and DFID merger on VfM, particularly in relation to the loss of development expertise. The Bond Disability and Development Group in particular told us of their concerns that the cuts in technical capacity within the FCDO may lead to inaccuracy in assessing what counts as VfM, particularly when assessing equity.¹⁵⁴ The concerns raised throughout this inquiry reflect our own in respect of the loss of expertise seen within the FCDO since the merger, and the impact that this will have not only on the programmes that the Department are able to deliver, but also on the ground by those smaller organisations relying on the FCDO for support.

106. Particularly of concern to us is the FCDO’s admission that “feedback from Programme Managers indicates that they feel their role is not valued and recognised in the wider organisation [ … ] the FCDO teams are expected to do more [than their equivalents in other Government departments]”.¹⁵⁵ Staff morale and retention are critical to maintaining the quality and effectiveness of aid programming, and when experienced staff feel undervalued or disengaged, the risk to VfM increases significantly. This risk continues to increase as a result of capacity issues within the central assurance level of the organisation, which the FCDO told us means that there are limited opportunities to ensure that controls are being operated as intended.¹⁵⁶ When we asked the Minister about the steps she was taking to improve the experience at work for her staff, she listed a number of initiatives including new mandatory learning for Heads of Mission, a supported accreditation process, and opportunities for global networking. Despite her assurances that “the FCDO recognise the value and importance of good programme management”,¹⁵⁷ we remain sceptical that these offerings will significantly alleviate the pressure that indispensable FCDO staff are currently under.

107. Further pressures come from the reduction of ODA to 0.3%. In their 2022 report Managing Reductions in Official Development Assistance Spending, which considered the FCDO’s transition to spending 0.7% to 0.5% of GNI on ODA, the NAO found that existing processes lacked the rigour needed to maximise impact and measure progress against its aims and objectives.¹⁵⁸ Similar findings were reported by ICAI in 2024, who noted that MEL was often cut from programme budgets to protect frontline spending.¹⁵⁹ When asked about whether the reduction to 0.3% would have any impact on MEL, Mark Henstridge told us that

Obviously, it has some risks. The challenge is that it becomes something that might be too easy to short circuit. But with a tighter budget, it is all the more important because it is such an important part of making sure there is value for money. There is a risk, it is true.¹⁶⁰

With continued implementation of cuts on development spend looming, there is a renewed risk to VfM if programme teams are forced to make similar decisions this time around, particularly at a time when ensuring that every programme delivers the best possible VfM should be a priority.

Conclusions and recommendations

The FCDO’s Value for Money strategy

1. DFID was a global leader in its approach to value for money (VfM), and the Committee are pleased to hear that some of the core foundations of DFID’s framework have transferred into the FCDO. However, it is concerning that there is very little publicly available information on the FCDO’s current understanding of, and approach to, VfM. There is also limited public guidance available for FCDO staff and operating partners on the FCDO’s approach to VfM, and how to address VfM issues. This is particularly alarming in respect to ensuring that the principle of equity, achieving which often requires more resource- or time-intensive interventions, is assessed appropriately. (Conclusion, Paragraph 17)

2. The FCDO must publish a clear strategy and framework regarding its approach to VfM, as had previously been done by DFID and other Government departments. This should include:

a. A clear definition of VfM;

b. The FCDO’s core VfM principles;

c. How the FCDO assesses VfM against its core principles;

d. Governance, accountability and evaluation measures; and

e. Examples of how VfM issues can and should be considered in different contexts, including when working with partners. (Recommendation, Paragraph 18)

3. Alongside a clear VfM strategy and framework, the FCDO should publish detailed and practical guidance for its staff and partners on how to approach and conduct VfM assessments, particularly in respect to equity, ensuring that programme activities address the needs of the most marginalised in society. The FCDO should also ensure that all partners are informed of the latest VfM strategy, to ensure coherence. This guidance should be produced as soon as possible, in the least to coincide with the 2026 Spring Statement. (Recommendation, Paragraph 19)

4. The Committee is disappointed to note that per the FCDO’s current published definition of VfM in its Programme Operating Framework, the department frames VfM in the context of value to the taxpayer, not improving the lives of those in poverty. Whilst accountability to the taxpayer should be a key facet of any VfM approach for a Government department, reducing poverty globally, and maximising the impact of each pound to do so, must remain the FCDO’s central tenet for ODA spending. (Conclusion, Paragraph 23)

5. It is essential that the FCDO makes it clear in all strategy frameworks and guidance documents that improving the lives of those in poverty is the core principle of the FCDO’s approach to VfM. All economy, efficiency, effectiveness and equity assessments must be explicitly considered against this principle. (Recommendation, Paragraph 24)

6. Sustainability is essential for ensuring that programmes have a long-lasting impact after a programme has ended. Despite broad recognition of the importance of sustainability, the FCDO is yet to formalise this within its VfM criteria. This should not just be an informal consideration within VfM assessments, but should mandatorily and consistently measured throughout a programme. (Conclusion, Paragraph 28)

7. The Committee recommend that sustainability should be a named central tenet of the FCDO’s VfM assessment criteria by the end of the 2025/26 financial year, and should be regularly and formally considered throughout the life of a programme. (Recommendation, Paragraph 29)

The international development landscape and the UK ODA’s reduction to 0.3%

8. The UK’s planned reduction of ODA spend from 0.5% to 0.3% of gross national income will have devastating consequences across the world. The Committee recognises that increased defence spending is needed and is to be welcomed. However, to do this at the expense of the world’s most vulnerable undermines not only the UK’s soft power, but also its national security. (Conclusion, Paragraph 36)

9. Guaranteed, long-term funding for programmes is essential for ensuring that VfM is achieved, and that the impact of FCDO work continues to be felt long after the end of a programme. In the last five years, the UK has significantly cut its aid budget twice—damaging not just its international reputation and standing, but also those most in dire need of assistance. (Conclusion, Paragraph 37)

10. The Government must make every effort to return to spending 0.5% of GNI on ODA at a minimum, as soon as possible. The Government should produce a clear schedule for rebuilding aid from the interim level of 0.3%, with defined milestones in each Spending Review to provide certainty to the FCDO and partner countries and organisations. (Recommendation, Paragraph 38)

11. We recommend that the Government commits to publishing an impact assessment for every year in which cuts to ODA are implemented, including the 2026/27 financial year, and providing rationale for how these decisions align with the impact that UK aid aims to achieve. (Recommendation, Paragraph 39)

12. The Committee notes the continuing badging of high levels of Government spending on refugee costs within the UK as ODA with dismay. Whilst the Spending Review commits to ending the use of asylum hotels in this Parliament, the level of the UK’s in-country support for the poorest people in the world should not be dependent on the success of domestic immigration policy. (Conclusion, Paragraph 45)

13. Whilst the Committee recognises that in-donor refugee spend is allowable under DAC rules, in a world of rapidly decreasing aid budgets it is not in the spirit of what ODA should be used for, which per the OECD is spending that promotes and specifically targets the economic development and welfare of developing countries. Excessive spend on hotel costs is not an effective use of development budgets. (Conclusion, Paragraph 46)

14. The Government should consider that Home Office in-donor refugee costs should be capped at a fixed percentage of total ODA spend to protect a rapidly diminishing envelope of funding. This should include formal review points if projections breach 80% of the agreed caps. (Recommendation, Paragraph 47)

15. The FCDO must make formal representation to HM Treasury that any unspent ODA allocated to other Government departments is channelled back through the FCDO to continue its vital humanitarian and development work, and to ensure that overall ODA spending does not fall even further to below 0.3%. This representation must not be on a case-by-case basis, but requesting a commitment that all unspent ODA in future will be reallocated back to the FCDO. (Recommendation, Paragraph 48)

16. VfM approaches differ between Government departments, including in relation to ODA spend. The Minister’s announcement that the FCDO have been granted a greater leadership position in the way that ODA is spent across Whitehall is an opportunity for the FCDO to exert its leadership on all departments spending ODA and ensure that maximum VfM is being achieved across all aid spending. (Conclusion, Paragraph 49)

17. Achieving VfM for every pound of ODA is now more vital than ever, and it is essential that one consistent framework is applied across all aid spending. Given that the FCDO is the largest administrator of ODA, its published framework, in line with our recommendation in Chapter 1, should be used, with the Second Permanent Under-Secretary of the FCDO having formal oversight over the VfM of ODA spending across all departments. (Recommendation, Paragraph 50)

The FCDO’s engagement with partners

18. We recognise that multilateral organisations can offer good VfM in many circumstances. However, it is concerning that the FCDO has not commissioned a review of its multilateral aid spend since 2016, despite £2.8 billion of core ODA funding being spent through multilaterals in 2024. (Conclusion, Paragraph 58)

19. We recommend that the Government conducts a new multilateral aid review of its current ODA spending to ensure that VfM is being achieved by the end of the 2025/26 financial year. This should include:

a. An evaluation of the most effective proportion of spending through multilateral vs bilateral programming;

b. Consideration of the benefits the UK receives through its multilateral development programming;

c. How much UK funding to multilateral organisations is going towards administration costs compared to direct programme activities; and

d. Evaluation of the performance of each multilateral organisations receiving UK ODA, including their impact, efficiency and alignment with UK priorities. (Recommendation, Paragraph 59)

20. The Government has ambitious and earnest intentions for championing locally-led solutions. However, there is a significant risk that these ambitions could be lost amidst financial pressures, in favour of centrally managed programmes, and that the VfM benefits that localisation can offer will be lost. (Conclusion, Paragraph 66)

21. The Government must prioritise localised interventions for context-specific challenges, including poverty reduction and community health. Given a reduced ODA budget, these interventions should be targeted towards areas with the highest level of impact to maximise VfM and fulfil the globally agreed Grand Bargain. (Recommendation, Paragraph 67)

22. The Minister for International Development must ensure that there is coherence across the department in respect of promoting locally-led programmes and ensuring they deliver good VfM. This should include prioritising the development of a local leadership strategy as a cross-departmental piece of work that places lower- and middle-income countries at the centre. (Recommendation, Paragraph 68)

23. Philanthropic organisations have considerable power that the FCDO is currently not wielding to its maximum impact. Whilst the Government must be aware of the risks and implement mitigations where possible, there are compelling reasons for the Department to improve engagement with philanthropic organisations. (Conclusion, Paragraph 74)

24. We recommend that the FCDO convenes regular strategic dialogues with philanthropists and development foundations to ensure that work can be aligned and complementary, and to encourage knowledge sharing. (Recommendation, Paragraph 75)

25. The FCDO’s use of private contractors is not inherently poor value for money. However, the published organisation and activity data of all implementing partners, including private contractors, is often incomplete and obscure. This exposes every pound spent to a higher risk of under-delivering impact. (Conclusion, Paragraph 87)

26. It is essential that the FCDO requires all of its contracts with private contractors to adhere to the International Aid Transparency Initiative, not just most, to ensure that all implementers of UK ODA are held to the same transparency and accountability standards. (Recommendation, Paragraph 88)

27. The FCDO must make every effort to improve the transparency of the data it collects on its engagement with contractors and operating partners. The information that is required of organisations to report through IATI must be published in a way that is clear, user-friendly, and complete. (Recommendation, Paragraph 89)

28. We are concerned about the potential loss of expertise within the FCDO as a result of engagement with private contractors, particularly where contracts have been ongoing for many years, where in-house expertise could have instead been used. (Conclusion, Paragraph 90)

29. The FCDO should perform an audit of all individual private contractor engagement longer than 12 months or approaching renewal. This must assess whether extended tenures align with performance outcomes and original mandates, with findings with clear recommendations for terminations or formal renegotiations to be escalated to senior leadership. (Recommendation, Paragraph 91)

Monitoring, Evaluation and Learning

30. We have been glad to hear that there is a stronger evaluation culture in the FCDO than can be seen in many other Government departments, and that the FCDO’s monitoring, evaluation and learning (MEL) processes are strong in comparison to other international actors. There has been a clear continuity of MEL processes from DFID to the FCDO, with the retained strengths of DFID’s frameworks being apparent. (Conclusion, Paragraph 100)

31. It is also positive that the FCDO recognises that the lack of data in many of the contexts it operates in means that some quantitative metrics are not possible or of good quality, and offers flexibility around this for operating partners. (Conclusion, Paragraph 101)

32. Whilst the FCDO’s strong MEL processes help to ensure that programmes are delivering VfM, these expectations increase administrative demands on organisations delivering these programmes. This may lead to smaller NGOs not applying for programme funding. (Conclusion, Paragraph 102)

33. Wherever possible, the UK should support smaller organisations in MEL processes without placing unrealistic expectations on the level of data and reporting they are able to provide. Whilst we recognise and agree that MEL is vital for ensuring VfM, this should not be at the expense of using local organisations. The FCDO should establish business hubs in partner countries to assist and support small organisations on the ground to meet MEL requirements. These hubs should include facilities such as feedback channels direct to the FCDO for local actors, which would aid in alleviating the excessive burden on organisations due to onerous, but necessary, MEL processes. (Recommendation, Paragraph 103)

34. To enhance the effectiveness and accountability of UK ODA spending, we recommend that MEL reporting requirements of ODA programming should be standardised across all Government departments. In line with our recommendation in Chapter 2, the Second Permanent Under-Secretary at the FCDO should have formal oversight of this, given their responsibility for ODA spend across Government. (Recommendation, Paragraph 104)

35. As a global leader in promoting VfM across development spending, it is vital that the FCDO protects its MEL budget. MEL should not be optional; it is a core function that underpins effective, accountable and adaptive programming. Without appropriate and complete MEL in place, the VfM of FCDO programmes cannot be adequately assessed. It is highly concerning that previous ODA reductions resulted in MEL being cut from programme budgets. (Conclusion, Paragraph 108)

36. It is essential that the FCDO ringfences MEL spend within programme budgets and protects these throughout the reduction of ODA to 0.3% of GNI. Further cuts to MEL threaten to undermine the very assessments that sustain the accountability and impact of all FCDO work. (Recommendation, Paragraph 109)

37. It is concerning that Programme Managers do not feel valued within the FCDO, a problem compounded by capacity issues and higher expectations than made of counterparts elsewhere in Government. Despite the Minister’s assurances that the FCDO recognises the importance of management, we are sceptical that measures such as mandatory training and networking opportunities will alleviate the pressure that FCDO staff are currently under. (Conclusion, Paragraph 110)

38. The FCDO must make every effort to ensure that its staff feel valued and appreciated within the organisation, particularly amidst budget insecurity. The Committee recommend that the FCDO commissions a rapid capacity assessment, and recruit or offer secondments to additional specialists to relieve overworked Programme Managers, rebalance workloads and bring better value to the taxpayer. (Recommendation, Paragraph 111)

Formal minutes

Tuesday 14 October 2025

Members present:

Sarah Champion, in the Chair

Tracy Gilbert

Monica Harding

Noah Law

Alice Macdonald

Brian Mathew

David Mundell

James Naish

Sam Rushworth

Assessing Value, Ensuring Impact: The FCDO’s Approach to Value for Money in Official Development Assistance)

Draft Report (Assessing Value, Ensuring Impact: The FCDO’s Approach to Value for Money in Official Development Assistance), proposed by the Chair, brought up and read.

Ordered, That the draft Report be read a second time, paragraph by paragraph.

Paragraphs 1 to 111 read and agreed to.

Summary agreed to.

Resolved, That the Report be the Seventh Report of the Committee to the House.

Ordered, That the Chair make the Report to the House.

Ordered, That embargoed copies of the Report be made available (Standing Order No. 134).

Adjournment

Adjourned till Tuesday 28 October at 1.30 p.m.

Witnesses

The following witnesses gave evidence. Transcripts can be viewed on the inquiry publications page of the Committee’s website.

Tuesday 11 February 2025

Stefan Dercon CMG, Professor of Economic Policy, University of Oxford; Shamik Dhar, Director Economist, Deer Run AdvisoryQ1–19

Dianne Stewart, Deputy-Director of External Relations and Communications, The Global Fund to Fight AIDS, Tuberculosis and Malaria; Abdoulaye Fabregas, Economist, OECD; Jennifer Armitage, Managing Director, LAMP DevelopmentQ20–64

Tuesday 25 March 2025

Sarah Annable-Gardner, Chief Executive, Action Through EnterpriseQ65–69

Rt Hon Andrew Mitchell, Member, House of CommonsQ70–96

Tuesday 3 June 2025

The Rt Hon. the Baroness Chapman of Darlington, Minister of State for International Development, Latin America and the Caribbean, Foreign, Commonwealth & Development Office; Melinda Bohannon, Director General Humanitarian and Development, Foreign, Commonwealth & Development OfficeQ97–113

Tuesday 17 June 2025

Anisa Berdellima, Director of Evidence and Impact, MSI Reproductive Choices; Alex Hurrell, Head of Evaluation, Verian Group UK Ltd; Mark Henstridge, Chief Executive Officer, Oxford Policy ManagementQ114–149

Sinead Magill, Chief Executive Officer, Palladium Group; Dr Brendan Whitty, Lecturer in Non-Profit Management, St Andrews UniversityQ150–211

Published written evidence

The following written evidence was received and can be viewed on the inquiry publications page of the Committee’s website.

APM numbers are generated by the evidence processing system and so may not be complete.

1 Action Through Enterprise APM0039

2 Action Through Enterprise APM0035

3 Action for Global Health APM0001

4 BOND Disability and Development Group APM0014

5 BRAC APM0040

6 Bond APM0032

7 CAFOD APM0024

8 CBM UK (Global Disability Inclusion) APM0022

9 Doane, Deborah (Partner, Rights CoLab) APM0041

10 Drake, Dr Tom (Senior Policy Analyst, Center for Global Development); and Dr Pete Baker (Deputy Director Global Health Policy, Center for Global Development) APM0018

11 Dunn Flores, Ben APM0007

12 Foreign Commonwealth & Development Office APM0008

13 Foreign, Commonwealth & Development Office APM0044

14 Gavi, the Vaccine Alliance APM0037

15 Global Financing Facility for Women, Children and Adolescents (GFF) APM0028

16 Government of Jersey APM0036

17 International Finance Facility for Education APM0038

18 International Rescue Committee UK APM0029

19 Kooperation Global APM0006

20 LAMP Development APM0030

21 MSI Reproductive Choices APM0017

22 Malaria No More UK APM0012

23 Mawdsley, Dr Emma (Professor, University of Cambridge); Dr Brendan Whitty (Lecturer, University of St Andrews); Dr Paul Gilbert (Senior Lecturer, University of Sussex); Dr Jo-Anna Russon (Senior Lecturer, University of Nottingham); Dr Jessica Sklair (Lecturer, Queen Mary University of London); and Dr Olivia Taylor (Lecturer, University of Sussex) APM0025

24 Oxford Policy Management Ltd; Julian King and Associates Ltd; and Verian Group UK Ltd APM0015

25 Reinsberg, Professor Bernhard (Professor of International Political Economy and Development, University of Glasgow); Dr Cecilia Corsini (Research Associate, University of Glasgow); and Dr Giuseppe Zaccaria (Research Associate, University of Glasgow) APM0004

26 Saldanha, Mr Allan APM0005

27 Save the Children UK APM0021

28 School of Global Development, University of East Anglia APM0034

29 Sightsavers APM0003

30 Sklair, Dr Jessica (Lecturer and IHSS Fellow, School of Business and Management & Institute for the Humanities and Social Sciences Queen Mary University of London) APM0042

31 Smeden, Gerard van (Founder, Unifix Care) APM0013

32 UNICEF UK APM0033

33 Unitaid APM0043

34 United Against Malnutrition and Hunger APM0002

List of Reports from the Committee during the current Parliament

All publications from the Committee are available on the publications page of the Committee’s website.

Session 2024–26

Number	Title	Reference
6th	6th report – The FCDO’s Approach to Displaced People	HC 525
5th	Protection not permission: The UK’s role in upholding international humanitarian law and supporting the safe delivery of humanitarian aid	HC 526
4th	The ‘In Development’ process	HC 333
3rd	The Government’s efforts to achieve SDG2: Zero Hunger	HC 515
2nd	Israel and the Occupied Palestinian Territory	HC 373
1st	Appointment of the Chief Commissioner of the Independent Commission for Aid Impact	HC 448
5th Special	Protection not permission: The UK’s role in upholding international humanitarian law and supporting the safe delivery of humanitarian aid: Government Response	HC 1301
4th Special	The Government’s efforts to achieve SDG2: Zero Hunger: Government Response	HC 923
3rd Special	Israel and the Occupied Palestinian Territory: Government Response	HC 797
2nd Special	The UK Small Island Developing States Strategy: Government Response	HC 597
1st Special	FCDO and disability-inclusive development: Government Response	HC 568

---

Footnotes

1 HM Treasury, Managing Public Money, May 2023

2 Oxford Policy Management, Assessing Value for Money, page 1

3 Department for International Development, DFID’s Approach to Value for Money, July 2011, Figure 1

4 Q12

5 Statistics on International Development, Final UK ODA Spend 2020, Table 2, September 2021

6 Publish What You Fund, United Kingdom, Foreign & Commonwealth Office (FCO), published June 2020, accessed 15 September 2025

7 DFID’s Approach to Value for Money, page 2

8 Q7

9 Foreign Commonwealth & Development Office (APM0008)

10 Foreign, Commonwealth & Development Office, FCDO Programme Operating Framework, last updated April 2025, page 8

11 Q141

12 Oxford Policy Management, Julian King & Associates, Verian Group (APM0015)

13 FCDO Programme Operating Framework, page 9

14 FCDO Programme Operating Framework, page 8

15 Foreign Commonwealth & Development Office (APM0008)

16 Q98

17 For organisations understanding a 4E interpretation, see Action for Global Health (APM0001) and Sightsavers (APM0003). For a 5E interpretation, see LAMP Development (APM0030).

18 United Against Malnutrition and Hunger (APM0002)

19 Sightsavers (APM0003)

20 MSI Reproductive Choices (APM0017)

21 BOND Disability and Development Group (APM0014)

22 FCDO Programme Operating Framework, page 32

23 Bond (APM0032)

24 DFID’s Approach to Value for Money, page 2

25 FCDO Programme Operating Framework, page 8

26 Foreign Commonwealth & Development Office (APM0008)

27 BOND Disability and Development Group (APM0014)

28 Q101

29 OECD-DAC, Official development assistance (ODA): Frequently asked questions, 5 July 2024, accessed 18 September 2025

30 Q102

31 Q147

32 Q55

33 Independent Commission for Aid Impact, DFID’s approach to value for money in programme and portfolio management, February 2018

34 Oxford Policy Management Ltd, Julian King and Associates Ltd, Verian Group UK Ltd (APM0015)

35 Action for Global Health (APM0001)

36 Q99

37 Prime Minister, Defence and Security, Volume 762, 25 February 2025

38 HM Treasury, Spending Review 2025, published June 2025, accessed 18 September 2025

39 House of Commons Library, US aid, the UK, and funding for multilateral aid bodies in 2025, June 2025

40 Government of the Netherlands, Policy letter on international development, 21 February 2025, accessed 18 September 2025

41 Alison Hird, France launches commission to evaluate overseas aid, RFI, 2 March 2025, accessed 18 September 2025

42 Matthew Allen, Foreign aid cuts: where does Switzerland lie?, Swiss Info, 7 February 2025, accessed 18 September 2025

43 Q78

44 Deborah Doane (Partner at Rights CoLab) (APM0041)

45 Letter from the Minister for International Development to the Chair regarding the Spending Review 2025, 12 June 2025

46 Written evidence received for the Committee’s inquiry into the effectiveness of UK aid, British Red Cross (EUA0070)

47 Written evidence received for the Committee’s inquiry into the effectiveness of UK aid, BRAC

48 Q80

49 FCDO, Equality impact assessment of Official Development Assistance (ODA) programme allocations for 2025 to 2026, published 2 September 2025, accessed 18 September 2025

50 Letter from the Minister for International Development to the Chair regarding the Spending Review 2025, 12 June 2025

51 FCDO, Equality impact assessment of Official Development Assistance (ODA) programme allocations for 2025 to 2026

52 HM Treasury, Spending Review 2025, published June 2025, accessed 18 September 2025

53 House of Commons Library, The aid budget and support for refugees in the UK, 2022 to 2025, number 9663, 2 May 2025, page 2

54 FCDO, Statistics on International Development: Final UK ODA Spend 2024, September 2025

55 Independent Commission for Aid Impact, Management of the official development assistance spending target, July 2025

56 DAC, Clarification to the statistical reporting directives on in-donor refugee costs, October 2017, page 9

57 International Development Committee, Sixth Report of Session 2022–23, Aid spending in the UK, HC898, page 5

58 Letter from the Minister for International Development to the Chair regarding initial 2025/26 ODA allocations and the Spring Statement, 27 March 2025

59 Q69

60 HM Treasury, Spending Review 2025, published June 2025, accessed 18 September 2025

61 Q63

62 Save the Children UK (APM0021)

63 Foreign Commonwealth & Development Office (APM0008)

64 Q151

65 OECD Data Explorer, Providers’ total use of the multilateral system, accessed 15 September 2025

66 World Bank Group, Fiscal Year Data, accessed 15 September 2025

67 Q25

68 Letter from the Permanent Under-Secretary of the FCDO to the Chair, 16 January 2025

69 Q27

70 Statistics on International Development, Final UK ODA Spend 2024, September 2024, accessed 18 September 2025, page 12

71 Letter from the Minister for International Development to the Chair regarding ODA programme allocations for the 2025/26 financial year, 22 July 2025

72 Letter from the Secretary of State for Foreign, Commonwealth and Development Affairs regarding the UK’s pledge to Gavi, 12 July 2025

73 Q37

74 Q49

75 Q49

76 Department for International Development, Multilateral Aid Review, published October 2013, accessed 15 September 2025

77 Department for International Development, Multilateral Development Review, published December 2016, accessed 15 September 2025

78 Q58

79 FCDO, Annual Report and Accounts 2024–25, HC 1198, 22 July 2025

80 Written evidence received for the Committee’s inquiry into the FCDO’s Approach to Displaced People, CAFOD (ADP0006)

81 BRAC (APM0040)

82 OECD, Multilateral Development Finance 2024, September 2024, accessed 15 September 2025

83 Action Through Enterprise (APM0039)

84 BRAC (APM0040)

85 CAFOD (APM0024)

86 Foreign Commonwealth & Development Office (APM0008)

87 International Development Committee, Third Report of Session 2024–25, The Government’s efforts to achieve SDG2: Zero Hunger, HC 515, para 60

88 International Development Committee, Sixth Report of Session 2024–25, The FCDO’s Approach to Displaced People, HC 525, para 96

89 Foreign, Commonwealth & Development Office (APM0044)

90 BRAC (APM0040)

91 International Rescue Committee UK (APM0029)

92 Dr Tom Drake (Senior Policy Analyst at Center for Global Development); Dr Pete Baker (Deputy Director Global Health Policy at Center for Global Development) (APM0018)

93 Bond (APM0032)

94 FCDO, International development in a contested world, CP 975, November 2023, page 31

95 Letter from the Minister of State for International Development regarding the 2025 Spending Review, 12 June 2025

96 Dr Jessica Sklair (Lecturer and IHSS Fellow at School of Business and Management & Institute for the Humanities and Social Sciences Queen Mary University of London) (APM0042)

97 Deborah Doane (Partner at Rights CoLab) (APM0041)

98 Q109

99 Dr Jessica Sklair (APM0042)

100 Dr Jessica Sklair (APM0042)

101 Deborah Doane (APM0041)

102 Dr Jessica Sklair (APM0042)

103 Deborah Doane (APM0041)

104 Deborah Doane (APM0041)

105 Dr Jessica Sklair (APM0042)

106 Deborah Doane (APM0041)

107 Charles Keidan, The missing billion, payouts needed, Alliance, 18 May 2023, accessed 15 September 2025

108 International Development Committee, Eighth report of session 2016–17, DFID’s use of private sector contractors, HC920

109 Almost half of the FCDO’s total spend via contracts was on one single contract, worth £1.4 billion, given to H Young & Co (EA) Ltd for the refurbishment of the British High Commission building in Kenya, though this is not ODA spend. See Alecsondra Kieren Si, FCDO’s top development contractors of 2023/24, Devex, 8 April 2024, accessed 15 September 2025

110 Foreign, Commonwealth & Development Office (APM0044)

111 Written evidence received for the Committee’s inquiry into DFID’s use of private sector contractors, Department for International Development (CON0039)

112 Independent Commission for Aid Impact, Achieving value for money through procurement, part one, November 2017, page i

113 Dr Emma Mawdsley (Professor at University of Cambridge); Dr Brendan Whitty (Lecturer at University of St Andrews); Dr Paul Gilbert (Senior Lecturer at University of Sussex); Dr Jo-Anna Russon (Senior Lecturer at University of Nottingham); Dr Jessica Sklair (Lecturer at Queen Mary University of London); Dr Olivia Taylor (Lecturer at University of Sussex) (APM0025)

114 Q156

115 Q152

116 International Development Committee, Eighth report of session 2016–17, DFID’s use of private sector contractors, HC920, page 43

117 Q194

118 Q195

119 Foreign, Commonwealth & Development Office (APM0044)

120 International Development Committee, Eighth Report of Ssession 2016–17, DFID’s use of private sector contractors, HC920, page 43

121 Dr Emma Mawdsley (Professor at University of Cambridge); Dr Brendan Whitty (Lecturer at University of St Andrews); Dr Paul Gilbert (Senior Lecturer at University of Sussex); Dr Jo-Anna Russon (Senior Lecturer at University of Nottingham); Dr Jessica Sklair (Lecturer at Queen Mary University of London); Dr Olivia Taylor (Lecturer at University of Sussex) (APM0025)

122 Foreign Commonwealth & Development Office (APM0008)

123 Foreign, Commonwealth & Development Office (APM0044)

124 Q209

125 International Development Committee, Eighth report of session 2016–17, DFID’s use of private sector contractors, HC920, page 49

126 Publish What You Fund, Aid Transparency Index 2024, July 2025 pg 33

127 International Aid Transparency Initiative - iatistandard.org, accessed 15 September 2025

128 FCDO, FCDO IATI Guidelines, gov.uk, last updated April 2023, accessed 15 September 2025

129 Q169

130 Q170

131 FCDO, FCDO IATI Guidelines, gov.uk, last updated April 2023, accessed 15 September 2025

132 OECD, Glossary of Key Terms in Evaluation and Results-Based Management, June 2022, accessed 15 September 2025

133 Bond, Assessing and Managing Value for Money: Lessons for NGOs, October 2016, pg 9

134 Q119

135 FCDO, FCDO evaluation policy 2025, gov.uk, April 2025, accessed 15 September 2025

136 HM Treasury, Guide to developing the programme business case, published 2018, accessed 15 September 2025

137 Foreign Commonwealth & Development Office (APM0008)

138 Q140

139 Q130

140 Oxford Policy Management Ltd, Julian King and Associates Ltd, Verian Group UK Ltd (APM0015)

141 LAMP Development (APM0030)

142 Q126

143 Q129

144 Professor Bernhard Reinsberg (Professor of International Political Economy and Development at University of Glasgow); Dr Cecilia Corsini (Research Associate at University of Glasgow); Dr Giuseppe Zaccaria (Research Associate at University of Glasgow) (APM0004)

145 Independent Commission for Aid Impact, The FCDO’s Programme Operating Framework, June 2023

146 Save the Children UK (APM0021)

147 MSI Reproductive Choices (APM0017)

148 International Rescue Committee UK (APM0029)

149 Foreign, Commonwealth & Development Office (APM0044)

150 Sightsavers (APM0003)

151 Q142

152 Q60

153 See pages 13 to 15, Foreign Commonwealth & Development Office (APM0008)

154 BOND Disability and Development Group (APM0014)

155 Foreign Commonwealth & Development Office (APM0008)

156 Foreign Commonwealth & Development Office (APM0008)

157 Foreign, Commonwealth & Development Office (APM0044)

158 National Audit Office, Managing reductions in Official Development Assistance spending, March 2022

159 Independent Commission for Aid Impact, Tackling fraud in UK aid: country case studies, March 2024

160 Q132