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 2009/10 total GPEX was £7,767m (see Table 1). This represents an increase of £584m (8%) on 2008/09.
3. In 2009/10 the DFID programme made up £6,629m or 85 per cent of total GPEX. Non-DFID aid (£1,138m or 15%) made up the remainder.
4. Total GPEX was 15 per cent higher in 2009/10 than in 2005/06. The 19 per cent increase between 2007/08 and 2008/09 is due to both increases in DFID programme and non-DFID GPEX. Within the non-DFID element of GPEX, some large contributions to joint funds were made for the first time. For example the Department of Energy and Climate Change (DECC) matched DFID’s £50m contribution to the Environmental Transformation Fund.
5. The relatively large values of GPEX in 2005/06 and 2006/07 were 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.
6. The value of the DFID programme has grown steadily over the last few years. In 2009/10 the total DFID programme was £6,629m (see Table 3). This is an increase of £830m over 2008/10 (14%). Since 2005/06 DFID’s programme has grown by 47 per cent. This represents an average annual increase of 11 per cent.
7. Figure 3 shows changes in the level and composition of DFID’s programme over the last five years. In 2009/10 over half of DFID’s total programme £3,958m (60%) was bilateral assistance and £2,436m (37%) was multilateral assistance. This distribution has changed slightly since 2008/09 when 57 per cent of DFID programme was bilateral and 39 per cent was multilateral.
8. DFID’s bilateral programme was £3,958m in 2009/10, an increase of £674m over 2008/09 (21%). DFID’s bilateral programme has increased every year over the last five years with bilateral expenditure 49 per cent higher in 2009/10 than 2005/06.
9. Figure 4 provides a summary breakdown of DFID’s bilateral programme. Over a third was delivered through a multilateral organisation (£1,265m or 32%). Almost a third (£1,153m or 29%) was provided as financial aid in 2009/10. Over half of this (£634m) or 16 per cent of DFID bilateral assistance was Poverty Reduction Budget Support, with ‘other financial aid’ contributing £519m (13%). £599m (15%) of bilateral assistance was disbursed as “bilateral through an NGO”; £435m (11%) as ‘humanitarian assistance’; and £420m (11%) as ‘technical cooperation’.
10. The amount of bilateral assistance delivered through a multilateral organisation has almost doubled to £1,265m in 2009/10 from £656m in 2008/09. This is because there were a number of new bilateral contributions to multi donor pooled funds that are managed by a multilateral organisation. For example, £203m to the Global Trade Liquidity Programme (GTLP); £100m to the Environmental Transformation Fund; £100m to the IDA Social Protection & Crisis Response fund.
11. The payment made by DFID to the GTLP is in the form of a loan and as such it will be returned to DFID in financial year 2010/11 plus interest, minus any losses and minus a fixed administration fee of £3m.
12. DFID’s multilateral assistance was £2,436m in 2009/10. This represents an increase of £159m (7%) since 2008/09. Figure 6 provides a summary of DFID’s multilateral assistance over the last five years. In 2009/10 DFID’s multilateral assistance went primarily to three organisations; the EC received £1,186m (49%), World Bank Group £560m (23%) and the United Nations £216m (9%). Other recipients, including Regional Development Banks and the Global Fund to Fight AIDS, TB and Malaria (GFATM), received £474m (19%); an increase of £176m since 2008/09. This increase is mainly due to an increase of £113m in the contribution to GFATM. A detailed breakdown of DFID’s multilateral assistance by recipient is shown in Table 18.
13. In addition to this multilateral assistance provided as core funding, DFID also channelled £1,265m of its bilateral assistance through Multilateral Organisations in 2009/10 (See Figure 4 above). In addition to this, some other bilateral aid types also channel funding through multilateral organisations, such as Humanitarian Assistance or Debt Relief; £411m was channelled through multilaterals in this way in 2009/10. This means that in total, £1,676m of DFID’s bilateral programme and £4,112m (62%) of DFID’s total programme was channelled through multilateral organisations.
14. 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.
15. The various components of UK debt relief are summarised in Table 4. In 2009/10, DFID debt relief of £92m represented 1 per cent of the DFID programme. Total UK debt relief of £99m represents 1 per cent of total GPEX. Countries receiving DFID and non-DFID debt relief are shown in Tables 4 and 5 respectively.
16. 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 2009, total net ODA amounted to £7,356m. This represented 0.52 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.
17. In 1970 the UN General Assembly endorsed a target that 0.7 per cent of the gross national income of developed countries should be given as ODA. The UK Government is committed to reaching the UN target of 0.7 per cent by 2013. Figure 7 shows that since 1997 the UK ODA/GNI ratio has been on a broadly upward trajectory and in 2009 it reached its highest level since the target was set (at 0.52%). 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. A full time-series of the level of UK ODA and the ODA/GNI ratio since 1970 is shown in Table 7.
18. Table 8 and Figures 8 and 9 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).
19. Despite its low ODA/GNI ratio, the USA is the largest donor in terms of total expenditure followed by Germany. In 2009 the UK ranked as the fourth largest overall donor.
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