1. This section summarises the level of UK expenditure on international development in recent years and then presents comparisons between the UK and other donors.
2. In 2007/08 total GPEX was £6,027m (see Table 1). This represents a decrease of £1,565m (21 per cent) on 2006/07.
3. In 2007/08 the DFID programme made up £5,200m or 86 per cent of total GPEX. Non-DFID debt relief (£4m or 0.1 per cent) and other non-DFID aid (£824m or 14 per cent) made up the remaining elements.
Figure 1 Gross Public Expenditure on Development, 2003/04 – 2007/08
4. Total GPEX was 35 per cent higher in 2007/08 than in 2003/04. The sharp rise in GPEX in 2005/06 and 2006/07 was driven by both increases in the DFID programme and increased provision of non-DFID debt relief. There was a particularly large increase in non-DFID debt relief in 2005/06 reflecting large amounts of debt relief to Nigeria of £1,135m and Iraq of £337m. Nigeria also received £1,649m of debt relief in 2006/07.
5. Figure 2 shows changes in the level and composition of DFID’s programme over the last five years. In 2007/08 the total DFID programme was £5,200m (see Table 3). This is an increase of £172m over 2006/07 (3 per cent). Since 2003/04 DFID’s programme has grown by 40 per cent. This represents an average annual increase of 9 per cent.
6. In 2007/08 over half of DFID’s total programme £2,962m (57 per cent) was bilateral assistance and £1,990m (38 per cent) was multilateral assistance. This is similar to the distribution of DFID’s programme last year, where bilateral assistance was 55 per cent and multilateral assistance was 40 per cent. The remaining 5 per cent was spent on administration costs.
Figure 2 DFID Programme, 2003/04 – 2007/08
7. DFID’s bilateral programme was £2,962m in 2007/08, an increase of £179m over 2006/07 (6 per cent). DFID’s bilateral programme has increased every year over the last five years with bilateral expenditure 47 per cent higher in 2007/08 than 2003/04.
8. Figure 3 provides a summary breakdown of DFID’s bilateral programme. Over a third (£1,096m or 37 per cent) was provided as financial aid. Over half of this (£635m or 21 per cent) was Poverty Reduction Budget Support with ‘other financial aid’ contributing £461m (16 per cent). Around a sixth (£474m or 16 per cent) of bilateral assistance was disbursed as ‘technical cooperation’, £431m (15 per cent) as ‘humanitarian assistance’ and £890m (30 per cent) as ‘other bilateral aid’.
9. Of the £890m classified as ‘other bilateral aid’ in 2007/08, £578m was delivered as bilateral assistance through multilateral organisations including funding of the Education Fast Track Initiative. Of the remainder £299m was delivered through Civil Society Organisations (CSOs); £90m of this was delivered through Partnership Programme Agreements with UK CSOs.
Figure 3 DFID Bilateral Assistance, 2003/04 – 2007/08
10. DFID’s multilateral assistance was £1,990m in 2007/08. This represents a decrease of £21m (1 per cent) over 2006/07.
11. Figure 4 provides a summary of DFID’s multilateral assistance over the last five years. In 2007/08 DFID’s multilateral assistance went primarily to three organisations; the EC received £991m (49 per cent), World Bank Group £493m (25 per cent) and the United Nations £265m (13 per cent). Other recipients, including Regional Development Banks and the Global Fund to Fight AIDS, TB and Malaria, received £256m (13 per cent). A detailed breakdown of DFID’s multilateral assistance by recipient is shown in Table 18.
Figure 4 DFID Multilateral Assistance, 2003/04 – 2007/08
12. The UK, in line with other donors, reports cancellation of aid loans on a lump sum basis to the OECD-DAC. This means that the total outstanding debt is reported as ODA in the year in which a bilateral deal is signed between the UK and a debtor country, except for countries reaching Completion Point under HIPC where the date of the multilateral agreement is used as the date for DAC reporting. 13. The various components of UK debt relief are summarised in Table 4. In 2007/08, DFID debt relief of £71m represented 1 per cent of the DFID programme. Total UK debt relief £75m represents 1 per cent of total GPEX. Countries receiving DFID and non-DFID debt relief are shown in Tables 14 and 5 respectively.
14. Table 6 shows the volume of UK ODA reported to the DAC in each of the last three years alongside information on Other Official and Private Flows. In 2007, total ODA amounted to £4,921m. This represented 0.36 per cent of the UK’s gross national income in that year. More detail on ODA by destination country is shown in Section 4 in Tables 16.1 to 16.6.
15. In 1970 the UN General Assembly endorsed a target that 0.7 per cent of the gross national income of developing countries should be given as ODA. The UK Government is committed to reaching the UN target of 0.7 per cent by 2013. Figure 5 shows that since 1997 the UK ODA/GNI ratio has been on a broadly upward trajectory. The high levels of ODA in 2005 and 2006 reflect high levels of debt relief, particularly for Nigeria, in line with commitments made by the UK and other donors at the 2005 G8 Summit in Gleneagles. The 2007 Comprehensive Spending Review set out plans to reach 0.56 by 2010/11. A full time-series of the level of UK ODA and the ODA/GNI ratio since 1970 is shown in Table 7.
Figure 5 Net ODA/GNI ratios for the UK 1997-2007 and projections to 2010
16. Table 8 and Figures 6 and 7 compare UK ODA figures and ODA/GNI ratios with those of other DAC countries. Some countries have already reached the 0.7 per cent ODA/GNI target (Norway, Sweden, Luxembourg, Denmark and the Netherlands), while other are some way off (Italy, Portugal, Japan, Greece and the USA).
17. Despite its low ODA/GNI ratio, the USA is the largest donor in terms of total expenditure followed by Germany and France. In 2007 the UK ranked as the fourth largest overall donor.
Figure 6 Provisional Net ODA from DAC Donors to Developing Countries 2007
Figure 7 Provisional Net ODA/GNI ratios for DAC donors 2007
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