Savings

Foreign aid budget will remain capped as Jeremy Hunt seeks more savings

Britain’s foreign aid budget will remain capped at this year’s autumn statement and will not return to the level promised by the Tories in the last election, according to The Telegraph.

Sources familiar with preparations for Jeremy Hunt’s November 17 statement said he was unlikely to increase the budget from its current level of 0.5% of gross national income (GNI).

The government is required by law to spend 0.7% of GNI on aid, but the budget has been temporarily reduced by Rishi Sunak in November 2020 in an effort to recoup expenses during the Covid-19 pandemic.

Last July he said the budget would not return to its previous level until the government’s spending watchdog said that “on a sustainable basis” the country was not borrowing for day-to-day spending and that the underlying debt-to-GDP ratio was falling.

Foreign, Commonwealth and Development Office officials now expect the statement to leave the budget unchanged as Mr Hunt seeks around £50billion in savings and revenue.

It is possible that the current freeze could be extended for another two years, which would save the Treasury around £4billion.

Call on Britain to give more

Before the statement, Andrew Mitchell, the Minister in charge of aid at the Ministry of Foreign Affairsallegedly pleaded for Britain to give more money to international institutions.

In particular, he thinks the UK should contribute to the Global Fund, an international development organization that funds projects to end HIV/AIDS, tuberculosis and malaria.

Despite becoming the Global Fund’s third largest donor since its launch in 2002, Britain has yet to make a contribution this year and has been asked to provide £1.82 billion, an increase of 30% compared to 2019.

The UK’s reduced aid package is also under pressure from Ukraine’s refugee scheme and national asylum seeker accommodation schemes, both of which are funded from the same budget.

Officials are concerned about the rising cost of the Home Office’s handling of the crisis at the Manston center in Kent, which has been forced to send asylum seekers to hotels and other accommodation at a cost of £7 million per day.

Under current rules, the cost of hosting refugees and asylum seekers can be covered from the aid budget for a year after each person arrives in the UK, but development sources said to the Telegraph that aid projects will have to be dropped to pay for the cost of refugee aid programs if this policy continues.