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The case for experimenting with foreign aid

Lucky old NHS. The Daily Express is demanding that the Government slashes the UK’s foreign aid budget and uses the money instead to fund the national health service instead. The Daily Mail has been banging a similar drum for several years now, calling for the abolition of the UK’s commitment (implemented by David Cameron) to spend at least 0.7 per cent of our national income each year on foreign aid.

What’s odd is that Brexiteers told us the NHS’s coffers would already be swelled in future by all the billions of pounds we would no longer be sending to Brussels after we left the European Union. Perhaps these vectors of pro-Brexit propaganda are as doubtful of that dividend materialising as the rest of us.

Right-wing media attacks on the UK’s foreign aid spending are actually rather similar to their traditional EU coverage. Just as they used to hyperventilate about straight bananas to convince us of the bureaucratic insanity of Brussels, they highlight individual examples of questionable projects in order to try to trash the UK’s entire £13bn aid programme.

But the defences can be weak too. The argument (often put by clergymen) that spending money on aid is simply the right thing to do for a wealthy country like Britain is unsatisfactory. Aid spending for aid spending’s sake isn’t a compelling argument. The case for the foreign aid budget must be that it is effective in reducing poverty, disease and wasted potential, and it addresses a specific problem that would otherwise be very unlikely to be addressed. This raises the question of how we can know whether UK taxpayers’ money is being spent effectively. Rigorous checks and evaluations are obviously a major part of the answer.

But “experiment” is another.

Traditionally, developing-world governments used food subsidies to address poverty. But in 1997 the Mexican government – under the guidance of an economist called Santiago Levy – launched a “Progresa” scheme, in which cash payments were granted to a trial group of mothers in poor families on the condition that they send their children to school and present themselves for regular health checks.

The trial showed excellent results, with a reduction in the number of children below the poverty line and an increase in secondary school enrolment rates. The scheme was implemented nationally and its success prompted Brazil, Peru, Honduras, Jamaica and Malawi to adopt similar programmes.

“Think creatively” is also part of effective aid spending. A study showed that placing cameras in classrooms in rural India had a significant impact on teacher absenteeism. The free distribution of insecticide-treated bed nets in Kenya was shown to be effective in reducing the incidence of malaria.

Not all experiments will work, of course – otherwise they wouldn’t be experiments. Field trials where poor families in developing countries have been given small loans to set up businesses (known as microfinance) have shown disappointingly little impact in terms of consumption, education, health or female empowerment.

The important point is that aid spending failures are to be expected. Solving entrenched problems of poverty is a complicated business. What works in one developing country’s context may not work in another’s. The key is learning from failures. This demands rigorous analysis by independent experts and the swift cancellation of programmes that are not delivering. The Department for International Development has beefed up its project evaluation procedure. It has also tightened up the monitoring of its contractors: an area where there was indeed evidence of waste.

The problem with tabloid coverage of aid spending is that it uses failed projects as ammunition in its propaganda war against the very principle of aid spending. This discourages openness over failures, and inhibits the learning process required among officials and ministers. Imagine if the Mail or the Express had covered the Mexican “Progresa” cash transfer trial proposal back in 1997. Think of the headlines.

In fact, we don’t need to imagine. Earlier this year, the Mail seized on DfID support for a Pakistani state cash-transfer programme to poor families, using the front page headline: “Queue here for UK’s £1bn foreign aid cashpoint”. Would Mexican ministers have dared to sanction Progresa trials in the face of such coverage?

The Express today cites as an example of waste the fact that DfID is funding the World Health Organisation with £15m to organise stop-smoking programmes in developing countries. But smoking is the largest global cause of preventable death, and is on the rise in the developing world as people’s incomes grow.

Research shows anti-smoking messaging is effective, so investing to discourage people in poor countries from taking up cigarettes promises an exceptionally high rate of return on UK taxpayers’ money in terms of health outcomes. But such reasoning is probably to miss the point. The real objection of these newspapers isn’t badly-designed aid programmes or even waste; it’s the fact that money is being spent on foreigner at all.


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