UK changes this year’s aid spend again with new estimates

The U.K. government has again altered aid expenditure for the 2025-2026 financial year, according to comments made during a parliamentary committee hearing Tuesday. U.K. Chancellor Rachel Reeves had announced in the Spring Statement in March that aid cuts would start immediately with a reduction of £500 million from the original budget in 2025-26. But speaking at the International Development Committee hearing Tuesday, Member of Parliament Sarah Champion, who chairs the committee, said that estimates of government spending on international development received by the committee differed significantly from expectations. Jenny Chapman, the U.K. development minister, said this was done to create fiscal breathing room, given the reductions planned in the coming years. The estimates, which have been made public, indicate £480 million originally earmarked for "core multilateral programs" has been reallocated to FCDO's development finance institution, British International Investment. “What I didn’t feel comfortable doing was just continuing with in-year spending as had been budgeted, knowing that at the end of that financial year we’re going to be facing a substantial reduction and an even more substantial reduction at the end of the year after that,” Chapman told the committee. According to the Spring Statement, the government intends to make cuts of £4.8 billion in 2026-27 and £6.5 billion in 2027-28, when U.K. official development assistance, or ODA, will reach 0.3% of gross national income. Chapman said that overseas offices and missions providing diplomatic and development services, aka “posts,” had been told to continue their preexisting commitments for this year, as well as any humanitarian work, but had been forced to justify why anything outside of this should be funded. She added that the amended budget would enable the department to plan funding commitments more effectively and that “what we really want to do is get posts on three-year deals because there is less money.” Member of Parliament Monica Harding commented that the spending estimates appeared to show a “rebalancing away from multilateral aid to bilateral aid.” Asked by another MP whether the U.K. would stand by its £11.6 billion climate finance commitment made in 2019, Chapman declined to confirm this, and said searching for any new climate funding would “be pretty fruitless if I’m completely honest with you.” Asked what the government’s priorities were for the upcoming United Nations’ Fourth International Conference on Financing for Development, or FfD4, that will take place in Seville, Spain, later this month, Melinda Bohannon, director general for humanitarian and development at the U.K. Foreign, Commonwealth & Development Office, listed private capital mobilization, debt transparency, domestic resource mobilization, illicit finance, and programming for women and girls. Chapman is understood to be attending the conference alongside the U.K. Foreign Secretary David Lammy, with Prime Minister Keir Starmer not having ruled out going, according to Bond, the network of U.K.-based NGOs working in international development. Ahead of the conference, negotiations are taking place on the text of the outcome document but Bond claims the U.K. is blocking much of the progress in talks, especially around debt relief. Asked during the hearing whether Bond’s claim that the U.K. had rejected proposals for a “debt workout mechanism” — a proposed international body to facilitate and resolve sovereign debt crises — was correct, Bohannon responded that she did not know that any proposals on debt had been “rejected outright.”