New DFID leadership team sets out priorities

Penny Mordaunt, U.K. secretary of state for international development, and Matthew Rycroft, U.K. permanent secretary of state for international development. Photos from: Minister of State for the Armed Forces, Ministry of Defence, Twitter

LONDON — Penny Mordaunt and Matthew Rycroft outlined their priorities Wednesday in their first appearance together as secretary of state and permanent secretary of the United Kingdom Department for International Development. Speaking in an evidence session before the International Development Committee in the House of Commons, Mordaunt was pressed on issues including the national interest agenda, tied aid, and multilateral reforms.

She gave a lukewarm response when asked about this week’s Global Partnership on Education replenishment conference in Dakar, Senegal, giving advocates — who had previously been optimistic about the U.K. as GPE’s biggest donor — cause for concern.

The secretary of state told IDC chair Stephen Twigg that she would place “caveats … on the focus on money,” and suggested a DFID package of support could include “expertise” and other benefits.

Mordaunt, who has been in the role for three months, and Rycroft, a career diplomat who took over as permanent secretary last week, addressed some of the major issues facing DFID after its leadership transition.

Aid in the national interest

“I would like to have projects which deliver a much more explicit win for the U.K.’s interests as well, because without that we won’t be doing aid well.”

— Penny Mordaunt, U.K. secretary of state for international development

Members of the U.K. aid community applauded Mordaunt and Rycroft’s commitment to preserve the 0.7 percent of gross national income that is spent on overseas aid, as well as Mordaunt’s assurance that DFID will remain an independent department, despite recurring rumors that the DFID budget will be returned to the Foreign & Commonwealth Office.

At the same time, some said they were surprised by Mordaunt’s strong support for spending aid in the national interest and her emphasis on promoting U.K. businesses and industry.

“I would like to have projects which deliver a much more explicit win for the U.K.’s interests as well, because without that we won’t be doing aid well,” she said. Achieving this will involve greater coordination with the Department of International Trade, she said, and also a push to use aid to garner better trade deals post-Brexit. However, she said this would not lead to tied aid.

“Tied aid doesn’t work ... and we don’t have to do that. Whether it’s NGOs, contractors, or British expertise in our public services or elsewhere, we don’t need the help. Frankly, we can compete and we will compete,” she said.

Mordaunt said she wants to provide a “fair, level playing field,” but added that DFID “relies on British business” and that she hopes to work “more strategically with them about investments they’re planning on making” and ask “are we providing the right service to British business?”

Owen Barder, director of Center for Global Development Europe, told Devex: “I was struck by their view that there is no conflict between maintaining poverty reduction as the central objective of aid, and using aid to pursue the British national interest.”

“While that may be true in principle, in practice it is easy to see how pursuit of the national interest could lead to spending aid in ways that are less effective for poverty reduction — and in that context I was glad to hear a firm rejection of any suggestion of returning to ‘tied aid.’”

Jessica Toale, executive director at the Center for Development Results, also took heart in that assurance. Mordaunt “was positive about the impacts that could emerge from the department engaging with business and learning from where they are innovating and delivering results, so I think there is scope to explore and develop this approach without contravening aid rules nor the [International Development Act],” she said.

A new cross-government ‘offer’

“Tied aid doesn’t work ... and we don’t have to do that. Whether it’s NGOs, contractors, or British expertise in our public services or elsewhere, we don’t need the help. Frankly, we can compete and we will compete.”

— Penny Mordaunt, U.K. secretary of state for international development

Mordaunt envisions a stronger role for DFID, particularly DFID ministers, in spending aid across other government departments. Asked whether she hopes to continue her predecessors’ drive to make DFID tools and resources more widely available across Whitehall, she said: “I think we need as DFID to have a new offer to Whitehall, because the expertise on how to do this really well, and how to track it and how to work strategically, is in DFID. We need to be more plugged into Whitehall departments looking at the areas where they want to add value.”

Expertise within DFID “is around management and design of programs,” Mordaunt pointed out, as well as sector-specific expertise, but she said there is room for “more meaningful partnerships across government,” highlighting the National Health Service’s interest in global health security as an example.

Rycroft agreed better collaboration across government is “a crucial agenda for DFID. I think we have a role to play in ensuring coherence in the whole of government’s ODA spending, and making sure it’s all as high quality as DFID spending.”

He pointed to the current collaboration between DFID and the Department of International Trade as one example worth replicating.

“There is a unit of staff who come from DFID but who are in [Trade] working on this aid for trade agenda and are managing to do two things at once: they are managing to help tackle extreme poverty, and it is laying the foundations for better creation of markets with which British companies will be able to trade in the future,” he said.

But, with a hiring cap still in place at DFID, it was unclear how it could spare the staff to support other departments, some members of the aid community said.

“I was left a little unclear whether they believe DFID has, or should have, any formal responsibility for policing this assurance that aid effectiveness will not be compromised, especially when it is increasingly spent by other government departments which — unlike DFID — do not have poverty reduction as their core mission,” Barder said.

“But I was left in no doubt that they are keenly interested in collaborating with, and influencing, the rest of government to the extent that they can,” he said. “I’d like to see DFID joining up with the Treasury too, given the common interest that both departments have in long-term shared global prosperity.”

Another push for ODA peacekeeping reforms

When you have a peacekeeping operation I think it has more than 15 percent impact on poverty eradication and development.”

— Matthew Rycroft, U.K. permanent secretary of state for international development

Mordaunt was unequivocal about her intention to seek another amendment to the ODA rules regarding allowable costs for peacekeeping and security forces.

Former Secretary of State Priti Patel lobbied the OECD Development Assistance Committee and achieved an increase in the coefficient for counting peacekeeping costs as ODA from 7 percent to 15 percent. Mordaunt hopes to increase this further.

“Where it makes sense … activities which are fundamental for us to deliver our mission — security, for example, the space to be able to act, peacekeeping — we want to do more on,” she said. “We will continue to push for those things that are sensible, further relaxation on the rules on peacekeeping being one, and I think our core mission is helped, not hindered in that,” she added.

Rycroft said that in his experience at the United Nations, a 15 percent coefficient for peacekeeping “is still a rather small proportion in terms of the impact that it can have on development.”

He said there’s “a lot of join-up between peacekeeping, development, and humanitarian crises, and everything else. Everything is interconnected, so when you have a peacekeeping operation I think it has more than 15 percent impact on poverty eradication and development.”

Holding multilaterals to account

Finally, Mordaunt praised Patel for strengthening DFID’s approach to reforming the multilateral development system, and promised to take measures even further in how DFID incentivizes better value for money from its multilateral partners.

“There is still more to do. We have some stellar performers — Gavi being the most effective and most aligned to what we want to see happen. There are a lot, though, that are nowhere near that level,” she said. Mordaunt refused to name names but said there was one multilateral organization she had “particular concerns” about and that went through a replenishment process before she joined DFID.  

“I think that where I’ve got particular concerns that organization needs to hear from me, but I’m really focused on the bottom performing third of our multilaterals,” she said.

The bottom performers in the most recent 2016 Multilateral Development Review include the U.N. Educational, Scientific and Cultural Organization; the Global Facility for Disaster Reduction and Recovery; and the Commonwealth Secretariat. Asked if UNESCO was one of the organizations under review, Mordaunt confirmed but added that the organization’s new Director-General Audrey Azoulay “is very focused on the reform agenda, and I’ve been very clear to her what I expect to see happen. She has got a tough job and we will support her in that.”

“I think that where I’ve got particular concerns that organization needs to hear from me, but I’m really focused on the bottom performing third of our multilaterals.”

— Penny Mordaunt, U.K. secretary of state for international development

Rycroft, fresh from his role as U.K. ambassador to the U.N., did not shy away from calling for reform across the multilateral system.

He said he would bring three traits to DFID from his job as U.N. ambassador: A passionate belief in the Sustainable Development Agenda; a belief in the multilateral system, along with a belief that the system is inherently good for the U.K.; and at the same time “a desire to see the multilateral system reformed.”

He added that the system as it stands is simply “not good enough for the 21st century.”

For more U.K. news, views and analysis visit the Future of DFID series page, follow @devex on Twitter and tweet using the hashtag #FutureofDFID.

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About the authors

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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.
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    Sophie Edwards

    Sophie Edwards is a reporter for Devex based in London covering global development news including global education, water and sanitation, innovative financing, the environment along with other topics. She has previously worked for NGOs, the World Bank and spent a number of years as a journalist for a regional newspaper in the U.K. She has an MA from the Institute of Development Studies and a BA from Cambridge University.