Gordon Brown: inputs = success
Rousing stuff from Gordon Brown in the Independent, where he announced draft legislation enforcing the UK to hit and maintain the United Nations target of 0.7 per cent of national income to be spent on aid each year:
“In conscience and in our own self-interest, for their sake and ours, we dare not fail. We must act now to give the entire world back its future and its hope.”
What he actually meant was:
“In the interests of DfID’s many conscientious bureaucrats, for their sake and mine, this government dare not fail. I must act now, to spend more tax payers’ money, giving hope to the legion of NGOs, charities, trade unions and self-interested government officials who rely on DfID for their future.”
If the past four decades of Overseas Development Assistance (ODA) have taught us anything, it is that it has been monstrously ineffective. No one is advocating scaling down emergency relief efforts (such as the Haitian response, which has prompted the latest bout of ministerial soul searching), nor are they advocating restricting private aid flows, such as remittance payments or charitable projects. What they are right to question is the efficacy of ODA, distributed by DfID to the tune of £6.3 billion in 2008, in tackling poverty in the developing world.
So far it has been a disaster: despite over $1 trillion in aid since 1960, Africans are poorer now, than they were forty years ago. The money simply does not reach those who need it. Worryingly it is estimated that 40 per cent of Africa’s military spending is inadvertently financed by aid (Collier: 2007). It seems unlikely that increasing aid flows to an arbitrary amount set by the UN in 1970 will change this–not to mention the oddity of linking aid expenditure to national productivity. It rather smacks of medieval church donations: “we don’t care how much you give–as long as it’s more than you can afford.”
The last forty years has demonstrated that pumping aid money into faltering economies simply doesn’t work. Brown and Cameron want to re-test this theory by throwing another £10 billion annually at the problem (0.7% of national). Not only will this not work, but it is a terrible idea to judge projects upon the size of their budgets rather than the outcome of their endeavour. Et tu, Clegg?
January 18th, 2010 at 3:56 pm
Blimey, the entire world is cheap, if 0.7% of our measly GDP is enough to give it future and hope. What could we get for 2%?
January 18th, 2010 at 9:14 pm
The foreign aid budget has been very effective! UK trade unions (well, those that fund the Labour party anyway) have financially benefited greatly from receiving these funds.
January 18th, 2010 at 10:59 pm
Close down the DfID.
People who want to send money overseas can arrange it for themselves. Simple.
January 19th, 2010 at 12:02 am
Despite your quoting Collier, I don’t think Paul would agree with you for a moment. His book sets out when aid works and when it doesn’t. We need more of the former and less of the latter.
BTW there is good evidence that in cases like Haiti value for money is very poor – we could almost certainly increase life expectancy more effectively elsewhere per £ spent.
January 19th, 2010 at 1:56 pm
Thank you for your comments.
Tim, apologies for the confusion but I referenced, rather than quoted, Paul Collier. The statistic I used came from his work- I wasn’t implying his endorsement of my views.
It is worth noting that Collier has adopted an appraisal approach based on outcomes, instead of inputs, to assess the efficacy of aid- Brown, Cameron et al were evidently too busy airbrushing their posters to attend Fundamentals of Economics Part II!
Furthermore, I fully agree that Overseas Development Assistance to Haiti has provided extremely poor value for money. I didn’t say otherwise. I was drawing a distinction between ongoing government to government aid and emergency relief efforts (such as the one underway in Haiti).
Jack, I fully agree that private aid flows are infinitely preferable to DfID handouts and Alex, I apologise for omitting DfID generous contributions to the Trades Union Congress- I’m sure Labour are praying it will pay dividends come May!
March 31st, 2010 at 12:34 am
[…] years might, you would think, mean that if development aid worked, most Africans wouldn’t be poorer now than they were 40 years ago. Yet despite being one of the richest parts of the world in terms of natural resources, Africa […]
June 29th, 2010 at 1:16 pm
If you have a few moments, please do this survey on international aid and NGOs https://opinio.ucl.ac.uk/s?s=9805 it is even more relevant now following the budget. The survey is for academic research. Thank you