Management of the 0.7% ODA spending target in 2020
The government successfully met its aid spending target in 2020 through reprioritising programmes as the COVID-19 pandemic hit – but economic uncertainty and the government’s ‘cut once, cut deep’ approach meant that cuts to bilateral aid were ultimately more drastic than they needed to be.
Our approach
This review builds on ICAI’s rapid review of the management of the 0.7% ODA spending target (which covered the period 2013-19) and the National Audit Office’s (NAO) 2015 and 2017 investigations of the government’s management and oversight of the ODA target. As was reported in our review covering 2013-19, the UK interprets the target as both a floor and a ceiling: the government has sought to achieve but not exceed 0.7% of gross national income (GNI) each year.
We assessed the UK government’s performance in managing the target for ODA spending in 2020 given the major disruptions to GNI and UK aid as a result of the COVID-19 crisis. The review examines the complexities in managing the 0.7% spending target during times of significant external shocks to the UK system. It builds on the insights of the systems and processes detailed in our initial review and also explores how ODA-spending departments have managed the target, and taken value for money considerations into account, following the response to recent pressures on the UK economy and aid programme.
One of the main findings of our earlier review was that in periods of ‘steady state’, with a steadily increasing ODA budget in line with increases in GNI, the management of the spending target was well calibrated, but that the system may not be sufficiently robust to manage unforeseen exogenous shocks while effectively mitigating value for money risks.
Review questions
We sought to answer the following review questions:
- Effectiveness: To what extent are the systems and processes for managing the 0.7% aid spending target resilient to external shocks?
- Effectiveness: How well did the responsible departments manage the prioritisation process of the in-year spending cuts to UK aid programmes?
- Efficiency: What are the value for money risks associated with meeting the spending target when the variables reach extremes and how well do the responsible departments mitigate them?
Methodology
This review draws on the robust methodological approach used in the preceding spending target review and includes the following components:
- Updated strategic review: desk research of departmental and cross-government policies, strategies and guidance in relation to management of the target in 2020.
- Key informant interviews: with relevant stakeholders, including officials from aid-spending departments, HM Treasury and multilateral partners.
- Revisiting sampled departments: review of previous sample of ODA spending departments’ approaches to managing the spending target in light of the impacts of the COVID-19 pandemic on the UK economy and on UK aid.