Aid: investment or moral obligation?

Last week’s Queen’s Speech saw a glaring omission – the failure to include a key coalition promise to enshrine into law the commitment to spend 0.7 per cent of our gross national income on development aid. 

The commitment, made at the 2005 Gleneagles summit, has for years been seen as the holy grail of development policy – often referred to, never fully attained. It was even upheld by all political parties during the 2010 general election, despite the severe economic downturn. But after a few years of defending 0.7 per cent, politicians are now backsliding. A recent report form the House of Lords proposed that the government should abandon the target, arguing that aid may hinder rather than help development. 

But the coalition purportedly remains committed. So, as a way of fighting off the sceptics, David Cameron and international development secretary Andrew Mitchell have been vociferously defending aid by suggesting that it is in our national interest. Late last year, it was reported that the UK would continue giving aid to India, a country that now has its own overseas aid programme, partly as a means to try to secure a Typhoon fighter jet contract for BAE Systems. 

Well this sent some alarm bells ringing here at Offley Road. I wrote a blog post in the Guardian, pointing out the parallels with the Pergau Dam case (taken by WDM in 1994), in which aid for trade was found to be illegal. I clearly raised the hackles of the Department for International Development (DFID), and Andrew Mitchell felt the need to write me a letter defending his government’s policies (PDF). 

Notably, while he argues that our aid is untied, he also writes: “This government believes in free trade, fair competition and the strength of British businesses. Helping developing countries prosper and grow is important for our own economic opportunities as a global trading nation.” At the same time, the government is looking at moving some of our aid towards a sovereign wealth fund model – meaning that it will need to deliver a financial return for the UK. In a nutshell, it seems aid no longer forms part of our moral commitment to global equity, but instead there has to be a “business case” to justify it. 

Unsurprisingly, many development organisations are up in arms about the back-tracking on aid commitments, and development and aid seem to have become all but synonymous in these troubled times. So much so that there is a growing attempt by some organisations to create another Make Poverty History moment in 2013 to ensure the 0.7 per cent pledge is upheld. 

And here is the challenge for WDM. We’re well aware that aid doesn’t equal development. We have a history of campaigning for aid - one of our very first campaigns, under the aegis of Action for World Development, aimed to achieve a target of 1 per cent of our national income going to aid by 1972, and at the time we secured a million signatures on a petition in support of it. But we would rather focus on the structural issues which others often seem to ignore. Economic policies that support employment and trade justice, reigning in the finance sector or loosening intellectual property rights on things like seeds or pharmaceuticals, would all do more to impact on poverty reduction than the delivery of aid.

Nonetheless, we find ourselves entering into the debate over aid once again, with increasing alarm. A battle we thought we had fought and won is up for grabs again and we don’t like the direction it is heading in. While we are certainly putting our efforts into campaigning on structural issues, we also feel the need to intervene in the aid debate. Aid, in our view, is important in the short term for poverty relief and should form part of the UK’s effort to reduce global inequality. So we’re aiming to look at the direction of aid – mainly at the retrograde trend that seems to prioritise the UK’s own corporate interests over those of people facing poverty, and in particular at the development of the murky sovereign wealth fund. We’ve already put in a freedom of information request to get more details. 

In the meantime, we would like to hear what you think – what are your feelings on the direction of aid? If the UK government believes the only way to keep the aid budget secured is by promoting its benefits to the UK, is that acceptable? Do you think the target of 0.7 per cent is important? Do you have any views on the House of Lords’ report? What is your view of Andrew Mitchell’s letter? Please comment below.