A conversation with Andrew Mitchell on UK aid reform

Andrew Mitchell is a unique figure in the U.K. government this week. While Cabinet colleagues wait to hear about cuts to their budgets of up to 40 percent in the chancellor of the exchequer’s comprehensive spending review, he can look forward to extra millions of pounds for the Department for International Development as the coalition government fulfills election pledges to “ring-fence” and, indeed, increase the overseas aid budget.

But coming into office with a commitment to get value for money from all international aid, Mitchell spent his first few months as as British secretary of state for international development establishing his own series of spending reviews. According to Mitchell, these reviews will be completed in early 2011.

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In an exclusive interview with Devex, Mitchell discussed the progress of reforms he introduced at DfID, including time frames of specific actions. He also revealed what he intends to do to win the British public’s esteem for U.K. aid programs and clarified that the government’s zero-tolerance policy toward corruption does not equate to merely cutting aid money to troubled recipient countries.

The big thrust of the U.K.’s aid policy is on aid effectiveness and value for money, which you have said is your top priority. Do you think large sums of aid money have been wasted in the past?

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I think that in the past, there has been too much of a focus on inputs and not enough of a focus on outcomes and results. Let me explain what I mean by that. The prime minister [David Cameron] heading off to Maputo on a day trip to announce half a billion dollars for primary school education is an input, and inputs are important. But much more important is the output of that money – how many schools you build, how many teachers you train, and even more important than that, how many kids get a quality education.

The truth is that if I go on television tonight and announce 20 million pounds for Tanzania, the reaction from many people will be to want to put their boot through the television set, given the state of the deficit and public debt in Britain. But if I announce that I am going to help to get another 200,000 girls to school in Tanzania, then with the British spirit of generosity and concern for the least well-off, there is a chance to capture people’s attention and support for this budget.

If you then go on to say, as we have done, that we will make the evaluation of British aid independent of ministers – because no one is going to believe me if I say that British aid is well spent as a government minister, but they will perhaps believe an independent body reporting not to ministers but to Parliament – then you are in a much more interesting position. This is the Independent Commission for Aid Impact, ICAI. Once you are demonstrating the results you are achieving, you’ve got the attention of taxpayer. And if you then explain that this is being independently evaluated, I think you have a chance to get the point across.

By the middle of next year, I expect to be able to publish a document that will encapsulate Britain’s offer to the developing world – how many kids we will get into school, how much health care we will be able to support and promote with measurable results, to how many people will we be able to get clean water and sanitation, people who live at the end of the track in our world and don’t have these things. That is the passion we bring to development. And I think we will be able to encapsulate this in a form that is compelling for the British public – the focus on the results. That is very different from what has happened in the past.

There have been a number of aid reviews and policy initiatives announced since the coalition government was formed in May. Can you give an update on where we are with these and a timetable of when they will be completed?

At the heart of the process is the bilateral aid review, where we are looking at every country in which we are involved, seeing whether we should be there, seeing what results we can achieve in those countries, what results we can win, what they would cost, whether the cost is effective. We are also having a similar review of the multilateral agencies through which British taxpayers’ money is passed – what results they are achieving. Then there is the humanitarian review, looking at how we respond to humanitarian emergencies.

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All of this is part of our structural reform plan. The bilateral aid review should be completed in January, the multilateral aid review shortly thereafter, and the emergency relief review comes in a bit after that. Once all these reviews are in and I can explain what we are going to achieve over the next year and the next three years in terms of results, then I intend to publish that in full.

We’ve also got the announcement of our Poverty Impact Fund, which is the subject at the moment of a public consultation, and that too will be very important. Then there is My Aid [where members of the public can vote for particular development programs]. That is designed to bring home to people in Britain the importance of the work of development and to give them an opportunity to have some influence on it. We are working hard to deliver that program, and I hope to be able to say something more about it in the next few weeks.

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Talking about public reaction, one almost clichéd response to international aid expenditure is to ask, “Why are we giving all this money to corrupt regimes?” Tackling corruption, or promoting transparency, is high on the government’s agenda. Can you give any specifics of how this is going to work?

We have a presumption in favor of total transparency. I published a transparency guarantee in early June. From January, all the work of my department, all the funds we expend above 500 pounds, will be on the website. This is all about accountability and transparency. This transparency is important not only for British taxpayers to be able to see what we are doing, it is also important to enable poor people in poor countries to hold their own leaders to account as well. And that is a very important part of the agenda in tackling corruption, on which we have a zero tolerance policy.

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Would you ever contemplate withdrawing funding from a regime that could be proved to have been corrupt?

I would certainly contemplate doing so. But where corruption takes place, that is an argument for changing the way in which you are delivering your support. You must have a zero tolerance approach to corruption – full stop. But, equally, you need to be careful that by reacting to corruption, you have no effect on the elite in such a country but actually just end up taking girls out of school as a result of withdrawing your money. So, the intelligent approach to this is to stop the corruption, defend British taxpayers’ interests and make sure that the noble development aims which we are seeking can be delivered.

The other big thrust in government policy is on the role of the private sector in development. What is the thinking behind that, and how do you see it progressing?

Firstly, that aid is a means to an end not an end in itself. In the end, the way that people lift themselves out of poverty is through wealth creation, through jobs, through sustainable enterprise, and through a judicial system which allows investors to know that they will be treated fairly. There are all sorts of examples of ways in which we can promote that. I am setting up within my department a new private-sector division which is designed to bring all these assets together into one place – the work we do to promote enterprise, working with the private sector to deliver for the poorest in our world.

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Then we are going to reform CDC [formally the Commonwealth Development Corp.]. When Labour came to power in 1997, it was a failing development finance institution. Labour privatized the management without privatizing the capital, and it has now become a financial business insufficiently attuned to development. We need to put it back in the middle so that it has within its DNA both specific city financial discipline on the one hand and strong development instincts on the other. We have just set up a consultation on that, and CDC will be publishing their business plan at the end of the first quarter of next year.

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Within the government, how are you justifying the fact that you are in the unique position of being the only person who’s actually looking at increasing funds over the next few years, while some of your colleagues are having their budgets slashed by up to 40 percent?

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First of all, I’m incredibly proud of the prime minister and the coalition government for standing by their commitments on Britain’s development policies and on the 0.7 percent of [gross national income] being spent from 2013 on development. I am particularly proud because the prime minister has made it clear that we will not balance the books on the backs of the poorest people on the planet. I believe that’s right.

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In 100 years, our grandchildren will look back on the world today in much the same way as we look back on the slave trade, with a mixture of amazement and incredulity that today, in our world, 4,000 will die from diseases which we have the power to prevent. And 75 percent of them will be children under 5.

So, the cause which we are passionately supporting is both moral and in our national interest. And so long as it is delineated in terms of the results that our money can buy, with the independent evaluation of the way in which that money is spent, then I think we can do right by the hard-pressed British taxpayer, and also do right by the poorest in the world.

Our generations have the ability to do something about these grotesque discrepancies of opportunity and wealth which exist in our world, for the first time ever. No previous generations have been able to do this; it’s partly because of globalization. That is the challenge to our generations, and the commitment of this coalition government.

Read more about Andrew Mitchell’s plans to reform the way DfID delivers overseas aid. In part two of our exclusive interview, the British secretary of state for international development discusses DfID procurement reform and shares advice on how non-governmental organizations may secure DfID funding.