2015 budget a mixed bag for US aid programs

The World Food Program distributes USAID-donated rice in West Point, one of the Ebola-affected communities in Liberia. Congressional negotiators announced a $1.1 trillion U.S. spending bill that provides emergency funding for critical crises like Ebola and will sustain current aid efforts into next year. Photo by: Morgana Wingard / USAID / CC BY-NC

In a last-minute deal to avoid a U.S. government shutdown at the stroke of midnight on Dec. 12, congressional negotiators announced Wednesday a $1.1 trillion U.S. spending bill that provides emergency funding for critical crises like Ebola and will sustain current aid efforts into next year.

The bill however raises questions about Congress’ long-term strategy for supporting U.S. foreign assistance programs — or lack thereof.

The international affairs portion of the budget amounts to $50.9 billion, a marginal increase over last year’s total. This sum includes the “150 account” base funds plus “overseas contingency operations” — or OCO funding — which was initially created as a short-term, emergency account to support the war on terrorism.

The budget proposal is likely to be voted on in both the House and Senate this week, and despite the slight increase in overall funding for state and foreign operations, a closer look at the 1,137-page document raises cause for concern, according to some aid advocates.

Most notably: While overall funding is slightly up, more money has shifted from international affairs base spending into the OCO account. Base foreign aid funding is down almost 6 percent to its lowest level since 2010.

Concerns about long-term US aid programs

The increased share of international affairs funding in the OCO account has been a trend in recent years, and that worries some development advocates.

Using a “contingency” fund to sustain ongoing global development priorities raises questions about what will happen to aid programs in the long-run, U.S. Global Leadership Coalition President and CEO Liz Schrayer in a statement. “The continued decline in base international affairs funding is a serious concern.”

Given the enormity of the crises throughout the globe, she added, “it’s very risky to continue to reduce core funding while relying on the OCO account to fill the shortfall.”

Shift in foreign policy priorities

Originally created as an emergency refugee account with less than $3 billion, OCO now holds about $64 billion and covers foreign operations ranging from counterterrorism to global health to new and emerging defense and aid crises overseas. It funds programs and operations in a wide range of U.S. government agencies, including the departments of State and Defense as well as the U.S. Agency for International Development.

This year’s plus up to OCO funding stems largely from new money — roughly $5.5 billion overall — for tackling the Ebola crisis in West Africa. The money also supports fighting the Islamic State group, helping countries protect themselves from perceived threats from Russian aggression and mitigating the conflict that brought thousands of Central Americans across the Mexican border to the United States.

The shift of OCO money from strictly emergency or counterterrorism efforts to longer-term foreign aid operational costs has caused some alarm among development professionals, who worry that OCO will draw down over time as priorities shift away from the war on terrorism.

“Relying too heavily on OCO could pose future risks to funding for these crucial programs,” Katie Lee, policy manager at InterAction, told Devex. “We have urged Congress to explore ways to increase base funding.”

The overall foreign aid budget is 5.6 percent below current levels and 16 percent below 2010 levels.

Michael Igoe and Jeff Tyson contributed reporting.

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About the author

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    Molly Anders

    Molly Anders is a U.K. Correspondent for Devex. Based in London, she reports on development finance trends with a focus on British and European institutions. She is especially interested in evidence-based development and women’s economic empowerment, as well as innovative financing for the protection of migrants and refugees. Molly is a former Fulbright Scholar and studied Arabic in Syria, Jordan, Egypt and Morocco.