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Brexit casts a shadow over UK development aid

by Yojana Sharma | 23.08.2016

Prime Minister Theresa May raised eyebrows when she named Brexiteer Priti Patel to head the Department for International Development (DfID). Patel, a former employment minister, had previously called for the abolition of the very department she now leads.

Patel has said DfID should be replaced with a department of international trade and development with a focus on trade.  She has suggested farming out DfID’s operations and budgets across other government departments, such as the Foreign and Commonwealth Office.

Little wonder her appointment set alarm bells ringing in the development aid sector, particularly among non-government organisations that deliver a big chunk of the UK’s aid.

But with Britain’s post-EU trade relations still unclear and a trio of Brexiteers fighting for responsibility for trade and international affairs, Patel has had to tone down her fighting talk in her first weeks in the job.

The most she has offered on trade is that Britain’s substantial aid budget – currently around £11 billion a year – can be used as a ‘soft power’ tool to increase our international influence and obtain better trade deals.  

Even on its own, Britain is the world’s fourth-largest development aid donor, a status that can open doors for deals with developing nations.  “Britain is an outward-looking and global nation and DFID will continue to support the UK’s trading partners of the future, working closely with the Foreign and Commonwealth Office and the new Department for International Trade, and creating opportunities for British businesses too,” Patel said this month.

First visits

Patel’s first overseas trip in early August was to Jordan and Lebanon, where she visited refugee camps to see how the UK is providing education and healthcare. So far so very DfID.  

It was only after the new junior minister for Asia in the Foreign Office, Alok Sharma (a Remainer), had been to India, in his first official visit, that Patel followed in his footsteps – a clear sign of the pecking order in foreign affairs, at least.  

That her role is confined to development assistance was clear in her remarks to India’s trade-and-aid-savvy media when asked whether DfiD was becoming more trade-oriented.   “My department has a role to play in economic development, development in poor countries, poor economies and, of course, commerce and trade become part of that,” she said cautiously.

Trade is arguably the trickiest part of the project to extricate Britain from the EU. Developing countries, particularly those in Africa whose volume of trade with the UK is small, will not be high on the agenda for stretched trade and Brexit departments. The focus will be on deals with the likes of the US, Canada, Australia and China as a way of showing that Britain can do Brexit and still carry trade clout.

Other countries will be much further down the priority list, even though exports are vital for poorer countries and DfID may have to increase assistance if Brexit uncertainty hurts their trade.

Commonwealth aid

Brexiteers believe Brexit will usher in a bright new era of relations with the Commonwealth. But Britain already championed ties with the Commonwealth from within the EU. “Britain acting alone could never provide such a high level of support to Commonwealth countries which today are major beneficiaries of EU aid,” says Linda McAvan, chair of the European Parliament’s Development Committee.

As much as €2 billion – 10% of British aid spending – is funnelled via the EU’s European Development Fund to African, Caribbean and Pacific countries, many of them Commonwealth members.

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Britain’s contributes around 15% of the EU’s aid budget.  That money will come back to DfiD to spend as it likes, but its loss will also reconfigure the EU’s development spending. Worse, the uncertainty that will precede Brexit could damage many long-term projects on the ground.

Migration

The EU is the world’s largest development aid donor and, although Brexiteers say the aid process is bureaucratic and slow-moving, Britain has been able to influence the bloc’s spending priorities. For every £1 Britain puts into the EDF another £5 comes from other EU countries. At the same time Britain benefits from the EU’s cadre of on-the-ground aid administrators around the world.

Being part of the EU’s development aid programme also enables the UK to reach more people. For instance, DfID previously had a target to spend half of all UK aid in “fragile and failing states and regions”. Often these are parts of the world where Britain does not have a large presence.

A British pull-out from EU projects such as the EU-Horn of Africa Migration Route Initiative could come back to haunt the UK. The scheme aims to contain migrants within their home countries and to reduce the number reaching the Mediterranean and Europe. Undermining the initiative could make it a lot more challenging to control immigration to the UK – a key aim of Brexiteers like Priti Patel.

Edited by Alan Wheatley