Brexit: Overseas Development Assistance

This House of Lords Library Briefing examines current UK expenditure on aid and the mechanisms by which it is spent, including through the European Union institutions, and how these might be impacted post-Brexit. The paper examines the Government’s proposals for the UK-EU relationship post-Brexit and reviews what other commentators have suggested about the implications of Brexit for both UK and EU development assistance.

The UK Government is committed to spending 0.7 percent of the UK’s gross national income (GNI) on overseas aid; the target is written into the International Development (Official Development Assistance Target) Act 2015. The Government uses the definition of overseas aid developed by the Organisation for Economic Cooperation and Development, who use the term Overseas Development Assistance (ODA).

In 2016, the UK spent £13.4 billion on ODA. The UK channelled approximately £1.5 billion of ODA through the European Development Fund (EDF) and the development section of the EU budget. This represents approximately 11 percent of all UK ODA.

Following speculation in the wake of the 2016 referendum the Prime Minister, Theresa May, confirmed in April 2017 that the target of 0.7 percent on ODA would remain, but argued that the Government would need to “look at how that money will be spent and make sure that we are able to spend that money in the most effective way”.  The Government will need to decide how to spend approximately £1.5 billion of ODA which is currently channelled through the EU. The implications for the EU, which faces a substantial drop in development resources post-Brexit are also the subject of some debate. Some commentators have suggested the UK could continue to play a role in EU development policy, for example through continued voluntary contributions to the EDF. The UK Government has stated that it would seek “a deep and special partnership with the EU that goes beyond existing third country arrangements” and would seek to collaborate on “a case-by-case basis […] [with aid] subject to UK’s standards on full transparency, accountability, risk and assurance, results and value for money”.