This article is from the March 2013 issue of Total Politics
Yes, says Rushanara Ali
These are difficult times to be talking about international development. The British people are facing the worst economic crisis since the Great Depression and they are paying the price for this government’s economic failures.
More widely, the global economy is far from in the clear. This year, GDP growth across the OECD is projected only to match 2012’s anaemic 1.4 per cent. It is, therefore, hardly surprising that people feel conflicted about our international development funding and work. Yet even in tough economic times, the British have shown themselves to be incredibly generous and have always stepped forward to give to good causes when faced with need. The British public donated £79m to the East Africa Crisis Appeal in 2011 to help the 13 million people in need of support following the devastating drought in the region. They also raised £107m after the 2010 Haiti earthquake.
Britain has led the way in tackling global poverty. I am proud that the Labour party made the UK into a global leader on international development. We created the Department for International Development (DfID), and increased our development funding to meet the UN agreed commitment to spend 0.7 per cent of Gross National Income (GNI) on Official Development Assistance (ODA).
Labour also helped lift three million people out of poverty, led the way on debt relief, and established a funding mechanism for the Millennium Development Goals, innovative development in Africa and sources of funding for health and education.
The Conservative-led government should put right its broken promise and ensure the 0.7 per cent of GNI is enshrined in law. Not only would this allow us to focus on how the money is spent, it would also ensure our contribution is permanently linked to the state of the nation’s finances. Britain must set the example that the international community needs to be prepared to support development, not just in good economic times, but also in tough ones that hit the world’s poorest hardest.
Labour believes that no one should go hungry, whether here at home or in some of the poorest places around the globe. For less than one per cent of our national income, we can lead the world in eliminating absolute poverty, reduce inequality, protect scarce planetary resources and end aid dependency by 2030.
Assisting the poorest countries in the world is not just the right thing to do, it is also smart policy. We live in an increasingly interconnected and interdependent world. Trade, jobs, migration, the cost of energy and food, the impact of climate change, and our security are all profoundly affected by factors and alliances beyond our borders.
By helping fragile countries sustainably develop both politically and economically, we minimise the pressures that lead to instability, and build new markets for trade and growth. Relentless attacks from the right ignore the success stories and long-term economic benefits of international development aid. South Korea and Botswana developed and prospered by using aid to achieve economic take-off, which in turn reduced their aid dependency. And last year, the South Korean market for English exports grew at a faster rate than any other country. Rising economic powers such as China and India, which benefited from UK aid, have already become important trading partners.
It is time to move beyond the notion that development and aid are a zero-sum game. We live in a globalised world where what is good for a developing nation is often good for Britain. Our aid expenditure must be used efficiently and effectively, and it is right that we have robust conditions to tackle corruption and ensure transparency. That means not only setting clear governance standards on developing countries to minimise waste and corruption but also willing to be tough on companies that dodge taxes which deny developing countries the revenue that is rightfully theirs.
We need a new consensus among wealthy countries to renew an absolute commitment to transparent and accountable development. A commitment that values the voices of developing countries and that recognises their right to determine their own futures and in time can become self-reliant and free from aid dependence.
Rushanara Ali is Labour MP for Bethnal Green and Bow and shadow international development minister
No, says Gerald Howarth
In 2009, the prime minister reaffirmed his commitment that the UK would meet an aid target of 0.7 per cent of Gross National Income (GNI) by 2015. He believes he gave a commitment upon which he should not renege and I hugely respect that.
However, since coming into government we have been faced with the reality that Gordon Brown destroyed the public finances, leaving us with an annual budget deficit of £156bn, the largest in the developed world. It represents a threat to our national security, and interest payments on the debt now cost about £50bn a year. The coalition government immediately set about trying to tackle the deficit, making painful cuts across nearly all departments, except the NHS and DfID budgets, which continue to increase. Reducing the deficit has proved far more challenging than we hoped.
I am not opposed to overseas aid but given the dire straits we face I cannot see the present justification for its ring-fencing. Instead, we should freeze aid spending at current levels. In 2011, we spent £8.63bn on overseas aid, or 0.56 per cent of GNI. That figure will increase to £11.3bn this year. The prime minister can with confidence assert we have given leadership: based on a percentage of GDP, we are already the sixth largest aid contributor, whilst Germany contributes 0.39 per cent of GNI and the US 0.20 per cent. The 0.7 per cent target is a completely arbitrary figure anyway, and takes no account of other contributions countries like the UK and the US make.
For example, Britain undertakes a huge amount of development work through inter-departmental initiatives such as the Building Stability Overseas Strategy. This incorporates DfID but also MOD and FCO budgets, covering everything from promoting trade and free markets to establishing fair judicial systems.
One of the strategy’s key areas is the provision of defence training, a contribution which we are applying to the present situation in Mali, displaying Britain’s world-class nation building and conflict stabilisation capability. Some 240 of the troops sent to the region will train African soldiers. This is far more than a military operation; it is the basis for a long term developmental plan: a well-trained military can help create stability and lasting peace so civil society and commerce can thrive, as is happening in Helmand Province. Additionally, all three armed services perform an outstanding disaster relief role.
We also established the Arab Partnership in response to the Arab Spring to support long-term political and economic reform and we continue to train troops from Uruguay to the Ukraine.
No one can now deny that we live in an incredibly volatile and unpredictable world, as the situation in North Africa, Syria, Iran and Yemen testify. Whilst some argue that we need to increase the aid budget as a means of stopping the tide of radicalisation, a robust military capability is essential to fight extremism now.
Of course, I recognise the challenges and needs posed by developing countries and I salute much of DfID’s work, but our current financial situation inevitably limits our ability to meet all these demands. We have too often seen UK aid being misspent or falling into the wrong hands. The decision to pull the plug on the £5bn Agri-Business Park in Afghanistan, which a DfID report itself considered a “high risk investment that has a high risk of financial failure”, is but the latest example.
Properly targeted aid has a role to play in helping to reduce poverty and therefore instability. However, aid does not in my view leverage as much influence in the world as defence. Politics is about establishing priorities. I strongly support the government’s domestic priority of tackling our national debt inherited from Labour, but recent events across the globe demand that our priority overseas should switch from DfID to the MOD and the FCO. There can be no justification for DfID spending an extra £2.65bn this year. The budget must be frozen. If half the money saved from freezing the aid budget were diverted to the MOD to restore some of our lost capabilities, such as the Maritime Patrol Aircraft, it would still leave £1.3bn to spend at home on other hard-pressed government departments.
Gerald Howarth is Conservative MP for Aldershot and former defence minister