Statistics on International Development 2007
Section 2
How much is the UK expenditure on International Development?
1. This section presents a summary of how much the UK has spent on international development in recent years and then draws comparisons between the UK and other donors.
Gross Public Expenditure on Development (GPEX)
2. In 2006/07 total GPEX was £7,487m (see Table 1
). This represents an
increase of £808m on 2005/06 (12 per cent).
3. In 2006/07 the DFID programme made up two thirds (66 per cent or £4,923m) of total GPEX. Non-DFID debt relief (25 per cent or £1,867m) and other non-DFID aid (9 per cent or £698m) make up the remaining elements.
Figure 1 Gross Public Expenditure on Development 2002/03 – 2006/07
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4. Total GPEX has increased by an average of 16 per cent per year over the last four years and was 80 per cent higher (£3,327m) in 2006/07 than in 2002/03. The rise in GPEX over the last five years has been 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.
The DFID Aid Programme
5. Figure 2 shows changes in the level and the composition of DFID's programme. In 2006/07 the total DFID programme was £4,923m (see Table 3). This is an
increase of £459m over 2005/06 (10 per cent). Since 2002/03 DFID’s programme has grown by 47
per cent. This represents an
average annual increase of 10 per cent.
6. In 2006/07 over half of DFID's total programme (£2,562m or 52 per cent) was bilateral assistance and £2,126m (43 per cent) was provided directly to multilateral organisations. This is a change in the distribution of DFID's programme compared with last year where bilateral assistance was 56 per cent and 39 per cent was given directly to multilateral organisations. The remaining 5 per cent was spent on administration costs.
Figure 2
DFID Programme 2002/03 – 2006/07
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7. DFID’s bilateral programme was £2,562m in 2006/07, an increase of £60m over 2005/06 (2 per cent). DFID's bilateral programme has increased every year over the last five years with bilateral expenditure 47 per cent higher in 2006/07 than 2002/03.
Figure 3
DFID Bilateral Expenditure 2002/03 – 2006/07
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8. Figure 3 provides a summary breakdown of DFID’s bilateral programme. Over a third (£943m or 37 per cent) was provided as financial aid. Just under half of this (£434m or 17 per cent) was Poverty Reduction Budget Support with other financial aid contributing £509m (20 per cent). Around a fifth (£523m or 20 per cent) of bilateral expenditure was disbursed as ‘technical cooperation’, £692m (27 per cent) as 'other bilateral aid', (of which £286m or 11 per cent took the form of ‘contributions to CSOs’) and £336m (13 per cent) as ‘humanitarian assistance’.
9. DFID’s multilateral programme increased by £402m (23 per cent) to £2,126m in 2006/07 (this is largely attributable to an increase in payments to the World Bank and how those payments were scheduled). Administration remained similar to the previous year at £234m.
10. DFID's multilateral expenditure was 43 per cent higher in 2006/07 than 2002/03 and has increased in every year over the last five years except 2004/05. There were two reasons for the lower expenditure in 2004/05: attribution of the EC development budget for ten new EU member states moving from DFID to the Treasury in 2004/05 and a particularly large flow to the World Bank in 2003/04.
11. Figure 4 provides a summary of DFID's multilateral expenditure over
2002/03 to 2006/07. In 2006/07 DFID's multilateral expenditure was channelled
primarily through three organisations; the EC received £964m (45 per
cent), World Bank Group £592m (28 per cent) and UN agencies £308m (14 per cent).
Other recipients, including the regional development banks and the Global Fund to Fight
AIDS, TB and Malaria received 12 per cent. Further explanation can be
found in Section 3 and a detailed breakdown of DFID's multilateral expenditure
by recipient is shown Table 18
(32 kb).
Figure 4
DFID Multilateral Expenditure 2002/03 – 2006/07
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12. DFID’s humanitarian assistance in 2006/07 totalled £484m, a decrease of £64m (12 per cent) over 2005/06. In 2006/07 £336m of DFID’s humanitarian assistance was spent bilaterally and £148m was spent multilaterally via the EC and UN.
Reporting of Debt Relief
13. 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.
14. The various components of UK debt relief are summarised in
Table 4(
20 kb). In
2006/07, DFID debt relief of £144.8m represents, 3 per cent of the DFID
programme while total UK debt relief of £ 2,011m makes up 27 per cent of total GPEX.
Debt relief for Nigeria of £1,649m accounts for 82 per cent of UK debt relief and
22 per cent of total GPEX. Countries receiving DFID and non DFID debt relief are
shown in Tables 5
(22 kb), 14
(60 kb)
respectively.
15. Table 16.1
(22 kb) reports UK bilateral debt relief as reported to the DAC for 2006
as £1,908m. The sums reported to the DAC are different from those shown in
Table
4
(20 kb)since a net figure is reported to the DAC (i.e. the difference between loans
repaid and debts forgiven in the year in question) whereas elsewhere we show the
total debt forgiven.
UK and International ODA Flows
16. Table 6 shows what the UK has reported to the DAC in terms of the break
down of our aid into ODA, OOF in each of the last three
years. This also includes information on private flows from the UK to developing
countries. In 2006, total ODA amounted to £6,770m. This represented 0.51 per
cent of the UK’s gross national income in that year. Tables
14.1,
14.2,
14.3,
14.4,
14.5
and 14.6 expand
on Total Net Bilateral ODA reported in Table 6
(23 kb), reporting on destination
country.
17. In 1970 the UN General Assembly endorsed a target that 0.7 per cent of
the gross national income (GNI) of donor countries should be given as ODA.
Progress on the UK’s ODA/GNI ratio since 1970 is shown in
Table 7
(33 kb) and Figure 5.
This shows the UK’s ODA/GNI ratio increased in the 1970s, reaching a peak of
0.51 per cent in 1979. It then fell through the 1980s and remained around 0.30
per cent for the first half of the 1990s before dipping further to reach a low
of 0.24 per cent in 1999. Since then the ODA/GNI ratio has been on an upward
trajectory. The UK Government is committed to reaching the UN target of 0.7 per
cent by 2013.
Figure 5
Net ODA/GNI Ratios for the UK 1970-2006
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18. Table 8
(25 kb) and Figures 6 and 7 compare UK ODA figures and ODA/GNI ratios
with those for other DAC donor countries. Some countries have already reached
the 0.7 per cent ODA/GNI target (Sweden, Luxembourg, Norway, Netherlands,
Denmark), while others are some way off (e.g. Portugal, Italy, USA, Greece).
19. Despite its low ODA/GNI ratio, the USA is the largest donor in terms of total expenditure. In 2006 the UK ranked as the second largest overall donor (up from third in 2005), followed by Japan, France and Germany.
Figure 6
Provisional Net ODA from DAC Donors to Developing Countries 2006
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Figure 7
Provisional Net ODA/GNI Ratios for DAC Donors 2006
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