Sir Keir Starmer is set to take the UK’s overseas aid budget to its lowest level as a percentage of national income since records began. This decision marks a dramatic departure from Labour’s historical commitment to international development and its previous manifesto pledges. The findings, presented by Ian Mitchell, co-director of the London-based think tank the Centre for Global Development, highlight the scale of the UK aid cuts.
On Tuesday, Starmer announced that the aid budget would be reduced from 0.5% to 0.3% of gross national income (GNI) by 2027. In 2023, approximately £4.3 billion—around 28% of the UK’s aid budget—was allocated to the Home Office to fund the cost of housing asylum seekers in the UK. Even if these costs are halved by 2027, Mitchell calculates that the UK will still spend just 0.23% of national income on overseas aid, the lowest proportion since records began in 1960.
How Does This Compare to Previous Aid Spending?
Historically, the UK’s lowest overseas aid spending was recorded in 1999 at 0.24% of GNI. Under Starmer’s new policy, UK aid cuts could drop below this level. If per-head refugee costs remain unchanged, the amount spent on official development assistance for refugees would be around £3 billion in 2027, leaving only 0.20% of GNI for international aid beyond refugee support.
The UK government has historically prided itself on being a leader in global development efforts. For decades, the country has played a significant role in funding critical programmes, from humanitarian relief to educational initiatives. Many analysts argue that reducing aid to such a historic low is not only a fiscal decision but a political and ethical one, as it shifts the UK’s position in global affairs.
What Are Charities and NGOs Saying About the Cuts?
A coalition of 138 charities has condemned the decision, describing it as the single largest reduction to the UK aid programme in history. In a letter organised by Bond, an umbrella group for UK overseas aid organisations, NGOs expressed their alarm at what they see as a move to fund defence at the expense of development aid.
“We implore you to reverse this decision before significant damage is done to both the UK’s development and humanitarian work and its global reputation,” the letter states. The NGOs demand a Commons statement outlining alternative options that were considered before the UK aid cuts were announced. They argue that this move will “destroy Labour’s legacy on international development” and undermine the UK’s credibility as a reliable global partner.
Many aid organisations also point to the fact that UK aid has traditionally played a role in stabilising conflict-ridden regions, supporting poverty alleviation, and providing immediate disaster relief. Cutting the budget drastically will not only impact these humanitarian efforts but could also create geopolitical instability that may have long-term repercussions for the UK itself.
Which Countries and Programmes Will Be Affected?
The UK aid cuts are expected to have a major impact on climate change finance, humanitarian aid, and vaccination programmes such as Gavi, the global vaccination initiative backed by Bill Gates. Bilateral aid programmes in Syria, Yemen, Afghanistan, Ethiopia, and Nigeria are likely to suffer the most significant reductions.
Aid organisations warn that UK-led unilateral projects will be particularly vulnerable, as they are easier to shut down than multilateral initiatives. One aid sector official remarked, “With the amount committed to refugees in the UK and now this cut, there will be almost nothing left. It’s an absolute mess.”
Experts argue that cutting aid to these regions could exacerbate conflicts, increase refugee flows, and even contribute to global health crises. For example, reducing support to Gavi could slow vaccination efforts in low-income countries, potentially leading to the resurgence of diseases like measles and polio.
How Is the Foreign, Commonwealth and Development Office (FCDO) Reacting?
Within the FCDO, there is reported “shock and distress” among staff, many of whom have already endured the abolition of the independent department under a previous government restructuring. A voluntary redundancy scheme is already in place to reduce headcount, and morale is said to be at an all-time low. One civil servant noted, “No one wants to work on closing down programmes they have spent their working life setting up.”
Anneliese Dodds, the development minister, is expected to address concerns in a “fireside chat” with FCDO staff to reassure them that their work remains valued. However, union sources predict inevitable job losses, as some staff salaries are paid from the aid budget.
With fewer resources, the FCDO may struggle to manage existing development projects effectively. The pressure to cut costs while maintaining some level of international presence may lead to inefficiencies, reduced oversight, and diminished impact in regions that rely on UK aid.
Can Frozen Russian Assets Be Used to Offset the Aid Cuts?
European diplomats are urging the UK to support the release of $200 billion (£158.5 billion) in frozen Russian assets to aid Ukraine. The UK has so far only agreed to use the interest from these funds to guarantee loans for Ukraine, but the foreign secretary has suggested that a broader seizure of assets may be necessary.
Before the UK aid cuts were announced, the foreign secretary stated, “Europe has to act quickly, and I believe we should move from freezing assets to seizing assets.” However, efforts to unlock these funds face resistance from Germany, France, and the European Central Bank.
Another potential solution is to repurpose the £2.5 billion in frozen assets belonging to Russian oligarchs, including the former Chelsea football club owner. While such measures could provide some short-term relief, they would not replace the structural commitment that UK aid has historically provided.
How Have Key Politicians Reacted to the Cuts?
The foreign secretary was reportedly informed of the halving of the aid budget only 72 hours in advance. Just two weeks prior, he had warned US officials that reducing funding for international development would be a strategic mistake. Similarly, the development minister had emphasised the need for predictability in aid spending.
The decision to implement UK aid cuts has sparked widespread debate, with critics arguing that it damages the UK’s standing on the global stage. Whether these cuts will remain in place or be revised in the coming years remains uncertain, but the impact on international aid recipients and the UK’s global reputation is likely to be profound.
Beyond its immediate financial impact, the cuts raise questions about the UK’s long-term commitment to international development. As global challenges such as climate change, humanitarian crises, and pandemics continue to escalate, reduced UK aid funding could hinder international efforts to address these urgent issues.
Ultimately, while the government argues that budgetary constraints necessitate these cuts, many experts and NGOs insist that the long-term costs—both humanitarian and geopolitical—may far outweigh the short-term savings. The coming months will likely see increased pressure from the international community and civil society groups urging the government to reconsider its position on UK aid cuts.
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