0.7% is the Magic Number?
How much of our national income do you think we spend on overseas aid?
Much of the public think we spend a lot more than we actually do. Estimates range from 10%-60% but the real figure is less than 0.7% - the target that World Leaders set themselves to achieve by 2015.
It is no wonder that some people think aid budgets should be decreased, though the majority of the general public are supportive of the aid agenda.
The House of Lords Economics Affairs Committee argued recently that the government should abandon its commitment to spending 0.7% of our GNI (Gross National Income) on aid. This is despite all three major parties having agreed to enshrine it in legislation in their 2010 manifestos.
Far from being an arbitrary figure, the 0.7% target was first introduced by a Nobel Prize winning economist in 1972 and has regularly been reviewed – notably at the 2005 World Summit and the G8 Gleneagles Summit.
And because the target is a proportion rather than a total figure, if and when our income slows or shrinks, the amount we allocate in aid will also decrease.
There are 22 states that have committed to the 0.7% target - five of which have already achieved it (Sweden, Norway, Luxembourg, Denmark, Netherlands)
Legally committing ourselves to the 0.7% target was is a great way for the UK to show leadership and set an example. And it’s worked. Many states including the US do not want to be overshadowed by our policy, which is a fair and proportionate one based on income.
Of course, the ultimate aim is that countries flourish and are able to break the cycle of aid and live independently of it, become equal trading partners and high income countries. But this remains a dream we are pursuing, not a reality we are facing.
Fluctuation in aid is a false economy. Maintaining aid flows at as predicable rate as possible will increase value for money by having a preventative aspect. As Paddy Ashdown said: “Long-term development aid means that we can reduce the amount we have to spend on humanitarian emergencies and will help millions more children go to school and live to celebrate their fifth birthdays”
The UK government has stood its ground on their commitment, and we applaud them for doing so. The Lords do need to be heard on one account though if nothing else: DFID needs to be adequately resourced in terms of staff and capacity to be able to deliver on its promise of demonstrating its impact on the world’s poorest people. That in itself requires time and money. Dedicating 0.7% of our GNI is not the end result; it is the means by which we will achieve results in the long run.
This is a bold move that deserves the strongest support, something we can look back on and say ‘this was a real moment where we moved from rhetoric to reality’.