The UN has a target for countries to spend 0.7% of their Gross National Income (GNI) on Official Development Assistance (ODA).
ODA refers to aid intended to promote the economic welfare and development of developing countries, and must be reported to the Organisation for Economic Cooperation and Development (OECD).
In 2013, the UK achieved this target for the first time. Since 2015, the Government has also been under a statutory duty to meet it. However, citing the economic impact of the pandemic, the Government will spend 0.5% of GNI for ODA in 2021 as a “temporary measure.” NGOs have said the reduction undermines the Government’s intentions to prioritise global health and girls’ empowerment.
This paper describes international and UK performance against the target, legislative requirements, and debates over the target’s reform.
Duty to meet the target
The Government’s duty to meet the 0.7% target is in the International Development (Official Development Assistance Target) Act 2015. If the target is missed, the Government must report to the UK Parliament explaining why this is the case. The report may cite any relevant economic or fiscal circumstances and their impact on the UK economy or the public finances. This is the Act’s only accountability mechanism.
In 2020, the UK was one of only seven countries reporting to the OECD that it had met the 0.7% target. Only Germany spent more than the UK on aid both in absolute terms ($29 billion, compared to the UK’s $19 billion) and in proportional terms (0.74% of GNI, versus 0.70%). Since 1960, only fourteen countries have ever met the target.
If the UK had spent 0.5% of GNI in 2020, as it plans to in 2021, it would have ranked tenth in the world for its aid spending as a proportion of GNI, rather than seventh.
Legislating for the 0.5% in 2021
In addition to concerns for the impact of the reduction on aid recipients and UK soft power, debate has centred on whether legislation is required for the new target. In November 2020, the Foreign Secretary said he would bring forward a Bill, as he was uncertain when public finances would sufficiently recover to allow spending to return to 0.7% of GNI. However, in March 2021 the Prime Minister said as the reduction was temporary, no legislation was required. No Bill was announced in the 2021 Queen’s Speech.
The Former Solicitor General and Director of Public Prosecutions have both argued legislation is required. Following a vote in the Commons in July 2021 (see below), the Government has re-iterated that it believes no amending legislation is required.
Treasury statement on tests required to restore the target
In July 2021, the Chancellor, Rishi Sunak, published a written statement setting out the tests required to be met to restore the 0.7% target. These are that the Office for Budget Responsibility (OBR) shows that “on a sustainable basis” the country is not borrowing for day-to-day spending and the ratio of underlying debt to GDP is falling.
The Commons voted in support of the tests on 13 July 2021. In the Autumn 2021 Budget and Spending Review, the Government said the fiscal tests were forecast to be met in 2024/25, and has provisionally set aside additional funding to take ODA to 0.7% of GNI in that year. As of the March 2022 Spring Statement, the tests are now expected to be met in 2023/24, but because these forecasts are inherently uncertain, the Government will decide whether to return to spending 0.7% of GNI on aid in 2023/24 at the 2022 Autumn Budget.
Backbench attempt to restore the target and Speaker requirement for a vote, June-July 2021
In June 2021, Andrew Mitchell MP proposed an Amendment to the Advanced Research and Invention Agency Bill 2021-22 to restore the target from 2022. However, the Speaker determined that the Amendment was outside the scope of the Bill. An emergency debate was instead held on 8 June.
Following the decision that the amendment was outside the scope of the bill, the Speaker said that he expected the Government to “find a way […] to allow the House to formally take an effective decision” on maintaining the UK’s commitment to the target of 0.7%. The Speaker said the vote held in July related to his previous statement, suggesting the requirement for the Government to hold a substantive vote had been met.
Reforming the target
In 2017, the Government said it would seek to modernise the ODA rules to include some peacekeeping-related spending.
The Independent Commission for Aid Impact has also recommended the Government consider a more flexible target in order to avoid encouraging spending towards the end of the target year, which is sometimes less effective.
The International Development Committee has concluded inefficient aid spending is minimal and not the result of the target. It has argued redefining ODA may undermine the focus on poverty reduction in UK aid spending. No plans have been announced.
5 November 2021: Updated with spending details of the October 2021 Budget
25 March 2022: Updated following Spring statement on when tests may be met