Time to rewrite the UK aid policy - by Alistair Thompson

Like millions of people on Monday I read with horror that over the last few years the UK government has been funding aid to Argentina.

Horrified, because this aid has continued to be paid despite the constant harassment of British subjects on the Falkland Islands.

I am not just talking about the recent sabre rattling by the Argentinean President Cristina de Kirchner, who has engaged in a war of words over the island’s future, but the persistent and aggressive behaviour that left a bad taste in the islander’s mouth.

Fishing boats and other vessels flying the Falklands flag have been barred from ports in Argentina and in some of the neighbouring countries. There are constant threats to the vital air link that connects the Falklands to South America and allows for the import of fresh food and other essential supplies.

Every time this issue is discussed the TV screens are filled with pictures of youths burning the union flag in Buenos Aries, all state organised of course. And then there is the litany of attempts in the UN to force the UK to share sovereignty. The islanders don’t want to be part of Argentina. It’s that simple.

To his credit, the Prime Minister has been absolutely firm, the future of the island can only be determined by the islanders themselves. And in the face of growing provocation has despatched a Type 45 Destroyer and nuclear submarine to the areas.    

But the exclusive by David Wooding in The Sun, which will have rattled many a tea cup over breakfast, underlines a more serious point, namely that there is still a massive problem with the UK’s aid policy.

Mr Wooding has highlighted just one bizarre example of our international aid policy, one which has allowed the Argentinean Government to take £452 million from an international fund to which the hard pressed UK taxpayer has contributed a whopping £4.66 billion.

But what is unclear from the Sun article and indeed DfID’s website is if this is different to the direct aid of £2.319 million paid to Argentina since 2006, or the +£6 million in UK Imputed Multilateral Shares. In short there appears to be a complete lack of transparency.

Deep within the bowels of No 10, I am sure that the PM’s senior policy advisers will be calling Mr Mitchell and demanding an urgent explanation of this deeply damaging story. Not just because why should we be funding a hostile nation and secondly because it brings into disrepute the whole policy. 

Four years into the age of austerity, DfID was one of the few departments to see its budget increase, the others being health and the EU. At the time this was challenged by many on the Tory Right, forcing Mr Cameron to slap down his critics and promise that ALL the money paid out in aid would go to the most needy and would be in our national interest.

And stories like this undermine the PM’s position. The British public do not mind supporting starving children in sub-Saharan Africa, or vaccination projects in Asia.

But this latest news follows revelations that India, which has its own space programme, China, which spent $44 billion on hosting the Olympics and Qatar, which will spend an estimated £138 billion on the 2022 football World Cup, have all received UK aid in recent years. It will anger many ordinary voters, who see their pay packets squeezed, services cut and soldiers and sailors laid off. 
Coupled to this is the way that the UK Government is happy to hand over large sums of money to existing foreign state agencies, in the strange belief that this is more efficient and effective way to deliver aid. But we can dismiss this.

The international development committee has already issued a critical report on the UK’s aid policy.  Malcolm Bruce, the chairman of the committee, told the BBC that "in countries where fraud and corruption are rife, the Department for International Development will not always be able to mitigate against this adequately - especially where it sub-contracts delivery of its programmes to third parties. This means it may not be able to guarantee value for money for every pound it spends”.

The Americans have made massive inroads into this problem, because they set up parallel delivery structures giving them a much greater level of control of how and where their money is spent. Perhaps the UK Government should learn from the world’s biggest giver of international aid.

Then there is the apparent ease with which the US pulls the plug on unsuccessful and corrupt schemes. Evidenced most recently by the US request for the UK to withhold payment to Argentina after they refused to pay back more than £40 billion of loans, despite having the money.

I simply can’t imagine the UK doing something similar, but it seems sensible to use aid as a means of ensuring the reasonable behaviour of other countries in the way they treat their own people, or act on the international stage. Doesn’t it?

I have no doubt that Andrew Mitchell will make changes to DfID and how as a nation we allocate aid. But until this new policy has been fully implemented, stopping these deeply damaging stories, international aid will remain a contentious issue, which will cost Mr Cameron and our party droves of Conservative voters. 

                                                                                                      
14.2 Total DFID Expenditure and GPEX by Recipient Country (Americas) 2006/07-2010/111
              £ thousand
 Financial Aid
 Aid from other UK Official Sources 5Total Bilateral Gross Public ExpenditureUK Imputed Multilateral Shares3
Argentina2006/07                          -                           -                      -                     -                     -                     -                -                       -                -                       -                     -                        -    1 520
2007/08                          -                           -                      -                     -                     -                     -                -                       -                -                       -     479     479    1 522
2008/09                          -                           -                      -                     -                     -                     -                -                       -                -                       -     574     574    1 145
2009/10                          -                           -                      -                     -                     -                     -                -                       -                -                       -     916     916    1 835
2010/11                          -                           -                      -                     -                     -                     -                -                       -                -                       -     350     350  ..