The truth about foreign aid that politicians won't admit
IPN Opinion article
This Thursday, the final leaders' debate will at last confront Britain's dire economic predicament. But whatever remedy each party offers for our ballooning deficit and tottering credit rating, none of them wants to admit the money they have agreed to waste on an ill-conceived overseas aid target.
Whatever the leaders disagree about in this election, on development aid even Nick Clegg can't pretend to offer a fresh choice: the three main parties are all as bad as each other. The manifestos of Labour, the Conservatives and the Liberal Democrats all commit the next Government to wasting taxpayers' money just so they can sound compassionate.
The politicians have all chosen to jump aboard the Bono-Geldof bandwagon: tie Britain to giving at least 0.7 per cent of national income for overseas aid every year. That sounds firm and fair, and no doubt their spin doctors love the idea. But the 0.7 per cent target makes no sense, except to rock stars and pressure groups. It is discredited, outdated and offers to increase aid without considering what the results might be.
Last week, International Policy Network published the British edition of Ghost of 0.7%, an academic paper that dismantles the consensus figure.
The truth is that "0.7 per cent" was dreamt up as a campaigning tool in the 1960s. It is forty years out of date, and based on "financing gap theory", an idea which has since lost all credibility. Worst of all, when you take the campaigners' model and recalculate it with updated economic figures, the results now suggest that we should, at best, give a grant of 0.05 per cent of GDP - less than a tenth of the aid we are already spending.
Yet this is a policy pushed by rock stars and lobby groups, not economists. Bob Geldof said it was "a rare and wonderful thing"; Bono called the proposal "transformative". And we know how Nick, Dave and Gordon enjoy basking in the fuzzy warmth of celebrity endorsements. But 0.7 per cent never made sense, and in serious times it is an absurd idea. Asking the country to send money abroad without good reason in the middle of Britain's worst financial crisis since the 1970s should never have been on any party's agenda.
But the politicians don't care. They have calculated that this meaningless target will sound good, and not whether it might do good. Meanwhile, it will cost the taxpayer a fortune. Meeting the 0.7 per cent government aid target would increase government spending by £2 billion a year, based on the most recent figures. That would pay almost 100,000 nurses or police constables.
Britain's unsustainable budget deficit makes it essential to scrap this outdated and ill-conceived target. Instead, with no clear plan from any political party for avoiding repetition of past failures over aid spending, they have agreed on a Bill to make this ghost of the 1960s a legal requirement.
It is outrageous that our political class are still not offering us choice over important issues. The parties all promise cuts and reforms for our public services, but say increasing funding for unreformed international development aid is the only possible option. With the country sinking in debt, they are committed to wasting further billions just to burnish their haloes for the camera.
British development policy needs fresh ideas. We should be learning from the most effective anti-poverty campaign in history: the recent rapid and welcome economic growth that has taken place in Brazil, China, India and many other developing countries, thanks to sensible policies implemented by their governments. But British politicians aren't looking for what works, just what looks good. On this, as on too much else, they're all the same.
Alec van Gelder is Project Director at International Policy Network, a London-based think tank