International Development Select Committee

Extreme Poverty and The Sustainable Development Goals

Written submission made on behalf of Bond, February 2022

1. Executive Summary

1.1   Bond is the UK network of over 400 UK organisations working in international development.

1.2   To address extreme poverty, the UK’s approach to development must be framed around the Sustainable Development Goals and anchored in the principle to Leave No One Behind. It is difficult to assess the FCDO’s current action on tackling extreme poverty. They have not submitted a second Voluntary National Review of the SDGs, nor is there clear available evidence of their performance against the principles for effective development and their record on transparency has deteriorated in recent years. The allocation of funding suggests a trend away from targeting extreme poverty, as does the decision to cut ODA to 0.5%.

1.3   Climate change and the global pandemic are both causing increased poverty and extreme poverty rates worldwide, exacerbating existing inequalities and vulnerabilities. The UK has a key role to play in responding to these global challenges, acknowledging its responsibilities and that ‘no one is safe until we are all safe’. This must include mainstreaming climate and nature within all activities, increasing new and additional climate finance, developing specific climate and health strategies and using its influence to improve the global response to both crises.

1.4   The FCDO has strong existing frameworks in place that could deliver progress for women and girls in extreme poverty. The 2030 Strategic Vision for Gender Equality (SVGE) recognises that gender equality was foundational for ending poverty and inequality and delivering prosperous societies. It remains to be seen how the Government will take forward this vision in the forthcoming International Development Strategy. Recent indications, including plans to restore spending on women and girls to pre-cuts levels are welcome, but this cannot come at the expense of funding for other vital areas of work. 

1.5   There is evidence that the cuts to the ODA budget significantly harmed poverty-eradication efforts. The decision to withdraw funding as it was most needed, the scale of the cuts and the speed with which they were implemented all caused significant harm to people’s lives, relationships and the reputation of the UK and partner organisations. Greater transparency and analysis are needed to understand the scale of damage inflicted.

1.6   The UK must use all its international levers to promote a just and equitable international system which can eradicate extreme poverty. This requires greater emphasis on a broader policy coherence across the UK Government. We need fair and progressive trade, climate, investment, tax, finance, environment, disability, labour rights, health and education policies which avoid further exacerbating poverty in low- and middle-income countries but rather complement the international development sector’s efforts to eradicate it. The UK should use its role within multilateral institutions to reform and advocate for a more just system.

1.7   The merger of the FCO and DFID has taken a great deal of time and resource away from other issues. There are worrying signs that the development agenda is being subsumed into a broader international agenda which is prioritising a narrow understanding of the UK’s interests over poverty eradication. The merger presents an opportunity to pursue an approach to tackling poverty which uses all the UK’s international expertise and levers, but we have not yet seen evidence that this opportunity is being realised and are concerned by the lack of a dedicated Minister for development.

2. How well is UK Official Development Assistance (ODA) targeted towards tackling extreme poverty and how effectively do the FCDO policies and programmes contribute to the achievement of Target 1.1 of SDG 1?

2.1   A strategic approach. Tackling extreme poverty requires action across the many interrelated drivers of poverty and inequality. Poverty is a multidimensional experience, with income being just one measure. It results from systemic failures and is highly driven by inequalities and other forms of marginalisation and discrimination. ODA is a key tool in this, providing much needed concessional finance to support countries achieve their development goals. However, ODA alone is insufficient for providing long-term sustainable pathways out of poverty. The UK must look across the breadth of its international engagement, including tax, trade, diplomacy and security, and ensure its actions on all of these are coherent in supporting a just and sustainable development approach in partner countries. This includes addressing the drivers of conflict, climate change and biodiversity loss, promoting open societies and addressing the social structures and practices which marginalise people due to race, gender, disability, sexual orientation and age. The UK should also consider the role it plays in international systems and fora, and how these are exacerbating international inequality and poverty. The International Development Strategy must recognise the multidimensional experience of poverty, with a clear commitment across all international levers to promoting sustainable development and tackling extreme poverty.

The 2030 Agenda recognises the inextricable link between extreme poverty and inequality, climate change, biodiversity loss and conflict. If the UK is to contribute to fighting extreme poverty, it needs an international development policy framed around the SDGs and anchored in the central principle within the 2030 Agenda to Leave No One Behind[1]. Even before the pandemic, the world was not on track to meet the Sustainable Development Goals (SDGs), with progress stalling or reversing in some areas. There is now sufficient evidence that COVID-19 and climate change have disrupted progress on the SDGs significantly, undermining decades of development efforts. The lack of progress across the SDGs will exacerbate current trends on extreme poverty. The UK Government presented its first Voluntary National Review (VNR) of the SDGs to the United Nations (UN) High-Level Political Forum (HLPF) in July 2019. Despite the UK being at the forefront of the negotiation of the SDGs, we are yet to see any meaningful progress on the commitments made in 2019 and the UK Government has not committed to producing a second VNR, as recommended by the IDC report.[2] In comparison, in 2021 alone 24 countries presented a VNR for the second time and 10 for the third. The majority of G7 nations have now either presented or have committed to presenting a second VNR by 2023.[3]

2.2   Principles for tackling extreme poverty. There is limited information of the extent to which FCDO is following the commonly agreed and well-evidenced best-practice on tackling poverty, with some worrying indications available from the ODA allocation and cuts process. DFID had a strong practice of evidence-based programming and decision-making and provided significant support towards further research on ODA effectiveness. It is not clear to what extent this practice has been carried into the FCDO, but it is vital decision-making around ODA investment is based on evidence of what best targets poverty. The UK has historically prioritised grants over loans, spending a very small proportion of ODA through loans, an approach which maximises the poverty-eradication benefits and reduces the burden on partner communities. In 2020 the amount delivered as loans rose, but at 1.6%[4] remains well below that of many other key donors.

The Paris Declaration on Aid Effectiveness[5] and Busan Principles for Effective Development[6] are a key, internationally agreed, approach to ensure ODA achieves its objective of tackling poverty. Country ownership and alignment with partner country priorities are key, as is the UK’s commitment under the OECD[7] to strengthen local ownership of ODA investments. Despite these commitments, the UK does not currently have any clear definition on what a shift to locally-led development would mean and does not gather any data on the extent to which their work is locally-led. For any progress on this to be made, they need to at a minimum define their objectives and collect data on how much of their funding reaches local organisations, and this data must be disaggregated. The UK has taken some steps over recent years to improve the harmonisation of their activities with those of other donors to reduce the administrative burden on countries and maximise effectiveness, but there still remain significant challenges to partners and communities who are required to align with the different systems of multiple donors, presenting a time and resource burden and reducing overall effectiveness. On transparency and accountability, the UK has historically led best-practice, setting up the IATI standard and regularly updating its aid publication both through this and other routes. However, changes to their IATI reporting following the merger and the lack of transparency around the ODA cuts[8] (including reports of banning civil servants from speaking to civil society, gagging clauses on NGOs[9], refusals of FOI requests[10] and sharing data in forms which make comparison to previous years difficult[11]) all point to serious backwards steps on ODA transparency. Similarly, the commitment to provide predictable, long-term funding was broken through the speed with which the 2021 aid cuts were decided and implemented, causing partners to have to abruptly end existing programmes.

2.3   Assessing outcomes. It is difficult to directly assess the impacts and outcomes of the FCDO’s invested ODA budgets. The results from DFID’s 2015-2020 single departmental plan, due in 2021, have not been published, meaning there is not currently any data on the progress towards the objective in that plan to ‘tackle extreme poverty and help the world’s most vulnerable’. The FCDO’s 2021-22 Outcome Delivery Plan (ODP)[12], which replaces the single departmental plan, has lost any reference to extreme poverty, instead having an outcome to ‘shape the international order and ensure the UK is a force for good by supporting sustainable development’. Within the FCDO ODP, SDG2 (Zero Hunger), SDG3 (Good Health and Wellbeing) and SDG16 (Peace, Justice and Strong Institutions) are the ones most well covered by the FCDO’s priority outcomes, as well as some of the climate change and environmental Goals. However, only two SDG1 (No Poverty) targets (1.3 and 1.5) have been mapped to FCDO priority outcomes which implies that the UK is not planning on implementing target 1.1 at all, which is highly concerning. Further, UK ODA reporting is currently not aligned to the SDGs, and it is not possible to understand the contribution of UK ODA to SDG implementation. Rather than applying a piecemeal approach to SDG implementation, the government should apply a considered approach to identifying what aspects of SDG implementation the UK is best equipped to support and publish a results framework, with indicators aligned to the SDGs at a target level and including data on cross-government ODA spending on the SDGs, appropriately disaggregated, to ensure no one is left behind. Additionally, the OECD DAC CRS SDG field offers the opportunity to align programme reporting with SDGs, and the FCDO should make this mandatory across all ODA programmes.

2.4   Allocation of funding. Recent analysis from the Center for Global Development[13] finds that the FCDO’s focus on poverty is declining. The UK has historically ranked highest among major donors for targeting poverty, but the share of ODA going to the poorest countries has steadily declined since 2015, closing the gap with other countries. Worryingly, the amount of budget going to unspecified regions or countries has also increased and is far more than for other donors, meaning we do not have the full picture on where the UK’s budget is being spent. When controlled for this, the UK falls below the US for share of ODA going to the lowest-income countries. When looking at Africa, home to 64% of those who live in extreme poverty, the trends are even more worrying. In 2021-22, the FCDO’s share of regionally allocable ODA to Africa will fall below 50% for the first time in 15 years. The strategic shift towards the Indo-Pacific, combined with the drastically cut ODA budget, means the FCDO’s spend in Africa in 21-22 will be over 50% lower than in 2019 and the lowest amount in real terms in 15 years.

The decision to cut funding, reducing the ODA budget from 0.7% to 0.5% GNI, also did not reflect a commitment to poverty eradication. With the world struggling to respond to the pandemic and poverty rates rising worldwide, the aid cuts demonstrated a choice to turn inwards just as support was urgently needed. Not only the scale of the cuts but also the speed with which they were implemented, with little warning to allow partners to respond and mitigate the impact of the withdrawn funds, caused significant suffering for those who are most marginalised. Alongside this, the UK has also made the political decision to include Covid-19 vaccine donations, debt relief, recycled SDRs (special drawing rights) and the supposedly ‘new and additional’ climate finance within the 0.5% aid budget. While these are welcome initiatives, counting them within the 0.5% aid budgets means there are fewer resources available for critical interventions to fight poverty 

3. How might the FCDO’s strategy, policies and programmes need to change as the number of people in extreme poverty grows due to the global pandemic or the effects of climate change?

3.1   Impact on poverty rates. Climate change and the global pandemic are both causing increased poverty and extreme poverty rates worldwide. The World Health Organisation and World Bank have found that the COVID-19 pandemic is causing a decades-long reversal in global progress towards the SDGs[14], with more than half a billion pushed into poverty or extreme poverty due to the pandemic. UN Secretary General Antonio Guterres talked of how the pandemic is “deepening inequalities, decimating economies and plunging millions into extreme poverty.”[15] The World Health Organisation and other UN agencies are reporting that people with disabilities are being disproportionately affected by Covid-19 and are more likely to experience poverty because of the pandemic[16]. At the same time, the climate crisis is increasing poverty and exacerbating inequalities and vulnerabilities and is projected to push more than 100 million people in low- and middle-income countries below the poverty line by 2030.[17] These compounded and intensifying global challenges put at risk decades of progress on development and require a step-change in global efforts to combat extreme poverty and achieve the SDGs. As Guterres’ in his 2021 SDG report, ‘the triple threat of COVID-19, conflict and climate change makes the global goal of ending poverty by 2030 beyond reach unless immediate and substantial policy actions are implemented.’[18] The escalating crisis of climate change and the long-running impacts of the pandemic intersect with other drivers of poverty such as conflict[19], food insecurity[20], disability[21], water insecurity[22] and gender inequality[23]. It is vital that the International Development Strategy responds to the rising climate change - and pandemic-related needs, both through integrating health, climate change and nature-responsive approaches within all programming, an increase in overall development funding, new and additional climate finance and specific strategies addressing the global health and climate crises.

3.2   A global approach. The pandemic and the climate crisis have made clear that ‘no one is safe until we are all safe’. Instead of leaning into our shared risk and responsibility to respond to the pandemic and to transform development to prevent catastrophic climate change, the UK chose to cut ODA whilst continuing to use it as the source of the UK’s climate finance commitments and obligations, and also chose to buy up global vaccine supplies. This harms low- and middle-income countries’ abilities to respond to the COVID-19 and climate crisis, as well as associated economic damage and climate impacts, prolonging the pandemic for all countries and reversing development gains. The climate and nature crises are primarily the result of actions taken by high-income countries and yet the consequences are overwhelmingly felt in middle- and low-income countries. Responding to these and future crises requires an approach based in global solidarity, acknowledging the UK’s responsibility towards partner countries and greater ability to financially contribute to the response. This must include protecting and even increasing the ODA budget in times of global crisis, providing climate finance that is new and additional to pre-existing ODA commitments and supporting global and equitable access to vaccines and broader health services. In the context of escalating impacts, the UK must become a champion for the needs and priorities of climate-vulnerable countries and fulfil its commitments under Article 8 of the Paris Agreement to avert, minimise, and address loss and damage, through supporting the G77's calls for a financing facility for loss and damage finance, establishing new and additional finance for loss and damage, and being a positive and progressive voice for the needs and priorities of climate-vulnerable in the Warsaw Mechanism and the Santiago Network for Loss and Damage."

3.3   Responsive and long-term programming. Climate change and global crises such as COVID-19 are increasing humanitarian need globally, to an extent that existing funds and structures cannot meet the demands. The UK must continue to play its part in providing flexible humanitarian funding which can respond effectively to local needs and in ensuring that appropriate global systems are in place so that low and middle incomes countries are not forced to take on debt to respond to climate change related disasters not of their making. Alongside this, it is also crucial that UK ODA targets the long-term structures and processes which can support communities to prepare for, avoid and respond effectively to crises when they arise. This includes investing in effective and accessible healthcare systems, increasing support for adaptation to climate change and supporting broader development and inclusion outcomes.

4. How effectively do the FCDO’s strategy, policies and programmes address the needs of women and girls in extreme poverty?[24]

4.1   The FCDO has strong existing frameworks in place that could deliver progress for women and girls in extreme poverty. The 2014 gender equality amendment to the International Development Act requires that all UK ODA help reduce gender equality. The 2030 Strategic Vision for Gender Equality (2018) set out an ambitious call to action that sought to create a world where ‘girls, women, men and boys will be equal, empowered and safe’.1 It takes a holistic approach to tackling gender inequality that recognised its intersecting and intersectional roots as well as the need for multipronged interventions in support of: universal sexual and reproductive health rights, girls education, women’s economic empowerment, women’s political empowerment and ending violence against women and girls. The 2030 Strategic Vision (SVGE) recognised that gender equality was foundational for ending poverty and inequality and delivering prosperous societies.  

The situation for women and girls has, if anything, become more precarious since the SVGE was published. The coronavirus pandemic, the climate emergency and multiple ongoing conflicts and humanitarian crises, as well as the rising challenges to the global consensus on women and girls’ rights have set back and, in some cases, reversed progress on gender equality as they have on ending extreme poverty and the other sustainable development goals.   

Over the last two years, political decisions to cut UK aid spending have also resulted in cuts to programme areas that are critical to women and girls. Even before the cuts, the majority of UK ODA did not explicitly address gender inequality and very little funded women’s rights organisations.2 UK Aid cuts, and the way they are being implemented, will have a wide-ranging and long-standing devastating impact on gender equality focused programming, and women and girls will suffer most from reductions in funding to critical sectors.3 An estimated 20 million fewer women and girls will receive UK Aid support due to the cuts, and major cuts have been made to sexual and reproductive health and rights and girls’ education work. Gone too is the respected commitment to focus half of UK aid spend on vulnerable Fragile and Conflict Affected States (FCAS). There has been a complete withdrawal of bilateral support from many FCAS countries such as Lebanon, where food insecurity, health issues and protection (including from gender-based violence) continue to disproportionately impact women and girls, and current models do not prioritise reaching the women and girls most vulnerable to the impacts of conflict and crises. 

It remains to be seen how the FCDO will take forward the UK’s previous vision and commitment to eliminating gender inequality. We eagerly await the publication of the International Development Strategy. To date, the signs are not good. The seven strategic priorities articulated by the former Foreign Secretary in November 2020 raised concerns that the previous multidimensional approach to gender equality had been reduced to a singular focus on girls’ education. While vital, on its own girls’ education will not deliver the transformation needed to root out gender inequality and deliver the benefits in terms of poverty reduction and development. More recent announcements by the new Foreign Secretary have hinted at a wider focus but centred on ‘women and girls’, rather than the more holistic and transformational gender equality framing used previously. More encouraging is the Foreign Secretary’s announcement in November 2021 that the aid budget for women’s and girls would be restored to pre-cuts levels in 2022. To ensure that this funding is used most effectively, including to contribute to the eradication of extreme poverty, the FCDO should ensure that it is invested in transformative gender equality programming and does not take away from ODA spend on other vital issues.  

5         What effect have the cuts in UK ODA had on the FCDO’s ability to address extreme poverty? What evidence is there to suggest poverty was a key consideration in deciding where the cuts should fall?

5.1   Decision and process. The decision to drastically reduce the ODA budget from 0.7% to 0.5% GNI and the process taken to implement these cuts did not reflect a commitment to poverty eradication. With poverty rates rising due to the pandemic and climate change continuing unabated, the decision to cut support for partner countries will have created additional suffering just as support was needed most. Through cutting existing programmes with little notice and planning, the FCDO risks further worsening poverty outcomes through poorly-managed exits. Reports of civil servants being given between five and seven working days to prepare the cuts, with Ministers spending just seven hours discussing the £2.9billion cuts[25], do not suggest a process designed to reduce the harm on those living in extreme poverty or to Leave No One behind. The lack of transparency outlined in our answer to Question 1 also decreased partners’ ability to absorb and cope with the cuts, being unable to effectively plan and forcing them to go through long periods of uncertainty whilst waiting communication of the decision.

ICAI’s Review into the management of the 0.7% ODA spending target in 2020[26] found that the government’s approach to implementing the reduction resulted in cuts disproportionately occurring in countries most vulnerable to COVID, with cuts in these countries approximately six times greater than countries not identified as most vulnerable. The cuts were also disproportionately made to bilateral programmes, which are often less able to manage sudden reductions and where the consequences of cuts will be felt more keenly.

5.2   Impact. The FCDO’s annual report[27] provides a picture of which countries were most drastically affected by the cuts. Recent research from the Center for Global Development[28] highlighted that these cuts have led to ODA to Africa falling by over 50% compared to 2019. It also found an increase in the average income of ODA recipients, from $4,200 to $4,800, Further analysis of the annual report shows us that Africa received proportionally bigger cuts than Asia (28%) or the newly-prioritised Indo-Pacific region (33%). With 64% of people in extreme poverty living in Africa, this backs up the findings of the ICAI review that poverty was not a key consideration in deciding where they should fall. The Middle East region saw cuts of nearly 75%, undermining stability and increasing the risk of conflict, a major driver of extreme poverty.

Due to the lack of transparency around the cuts, it is difficult to calculate the exact harm caused to those living in extreme poverty. However, the different analyses available reveal a stark picture. 72 million people will miss out on treatment for neglected tropical diseases between October 2021 and April 2022[29]. The NGO BRAC reported that the cuts to their partnership with the UK will result in 360,000 fewer girls getting an education, 12 million infants not getting nutritional support, 14.6 million women and girls not getting access to family planning services, 2 million households not receiving climate change interventions and 385,000 families in extreme poverty missing out on training or support.[30] Cuts in funding to the International Planned Parenthood Foundation are estimated to result in an additional 7.5 million unintended pregnancies and 22,000 maternal deaths[31]. All of which make ending extreme poverty harder and less likely.

An equalities assessment from the FCDO found that the government were warned[32] of the negative impact of the cuts on gender equality and people with disabilities. The document also stated that there would be “a 60% reduction in funding for social protection programmes” pointing out that these programmes are key in reducing poverty and mitigating economic shocks for the most marginalised. There has not at this stage been any comprehensive assessment of the extent of harm caused by the cuts to those of marginalised identities. Such analysis would be crucial to understanding and reducing the harm of the cuts going forward.

Cuts to climate change adaptation programming were also made, despite spending in this area needing to increase to fulfil UK ICF obligations. As a result, high-quality and high performing programmes were closed mid-way through - leaving communities vulnerable - and new programming will need to be started in the very near future to pick back up the spending to the level required.

6         How the FCDO can play a more effective part in the eradication of poverty as a convener, thought leader and investor.

6.1   The UK must use all its international levers to promote a just and equitable international system which can eradicate extreme poverty. This requires greater emphasis on broader policy coherence across the UK Government. We need fair and progressive trade, climate, investment, tax, finance, environment, disability, labour rights, health and education policies which avoid further exacerbating poverty in low- and middle-income countries but rather complement the international development sector’s efforts to eradicate it. This must include aligning all international and domestic investment with the goals of the Paris Agreement and the Convention on Biological Diversity, including ceasing all investment in fossil fuels and increasing support for energy access from sustainable sources.

6.2   Trade. The Integrated Review made a commitment to support economic development in lower-income countries, with a focus on ‘free and fair trade’ and plans to partner with the African continent on ‘prosperity goals’[33]. When done well, supporting countries to build their income from trade can help support long-term growth out of poverty. As the UK redefines its trade relations with the rest of the world following Brexit, it should avoid ‘arm-twisting’ trade deals with low- and middle-income countries which constrain their national development efforts. The upcoming IDS should articulate a sustainable development approach to trade that is coherent with the objectives of reducing poverty and inequalities and addressing climate change and biodiversity loss, in keeping with the development strategies of low- and middle-income countries. UK trade strategies, agreements and policies should be fully consistent with the SDGs, the promise to leave no one behind, the Paris Agreement and the Convention on Biological Diversity, and they should focus on helping to reverse the current model of resource extraction from lower-income countries and enabling sustainable development.

External bodies funded by the UK government to deliver economic development objectives should be fully accountable to UK government strategies and policies, without exemptions, particularly regarding the SDGs, human rights, disability rights, labour rights, climate action and biodiversity. This will address the ambiguity about the application of previous strategies and policies to bodies such as the CDC, which is wholly owned and funded by the UK government – recently demonstrated by its exemptions to the UK’s commitment to end international financing for fossil fuels[34].

6.3   Tax and illicit finance. Similarly, the UK must recognise its role in facilitating international tax avoidance and flows of illicit finance which deprive developing countries of billions of pounds every year, money which could otherwise be used to support communities out of poverty. As of 2020, countries are losing a total of over US$427 billion in tax each year to international corporate tax abuse and private tax evasion[35]. The UK government should address the eradication of tax havens and illicit financial flows, particularly from lower-income countries, and the closing of domestic and international loopholes for high-net-worth individuals and corporations. The UK has a significant role and influence in shaping global international tax rules and financial transparency, as well as contributing to illicit financial flows, in large part due to the policies in place in its Overseas Territories and Crown Dependencies. The UK should conduct an independent analysis and official recognition of the impact its dependent territories have on financial transparency and international development, and should fully implement a public register of beneficial ownership as required in the 2018 Sanctions and Anti-Money Laundering Act[36].

6.4   Debt. Debt cancellation is one of the fastest ways for countries to ensure resources are available to contribute to achieving the SDGs, addressing the climate crisis and eradicating extreme poverty. In 2020, Eurodad estimated that cancellation of debt repayment for 69 countries in 2020 and 2021 would free up US$38.2bn from bilateral, multilateral and private lenders[37]. For this, we need a comprehensive system to cancel global external debt to a level consistent with sustainable development across private, multilateral and bilateral creditors. The G20’s Common Framework[38] does not deliver this. It must be strengthened to force private sector participation and expanded to include all countries that need debt relief, and the UK should play an active role in pushing for this strengthening. Resources freed up by debt cancellation should be unconditional and additional to existing financial commitments.

6.5   Diplomacy. The UK’s ODA spend must go hand in hand with a larger commitment to reshaping the international rules that keep countries and communities in extreme poverty. The UK government should use its position to guide the reshaping of the international development approach, recognising other governments and local communities as equal and expert partners. Through the G7, G20, OECD and UN fora the UK should play a progressive role, brokering consensus amongst high-, middle- and low-income countries on the urgently needed reforms of global economic governance to eliminate structural and systemic issues which prevent low- and middle-income countries from achieving their development goals. The UK government should use its position to acknowledge and promote the voices of those who have been traditionally excluded from these conversations.

A key part of this is supporting and strengthening an international rules-based system for development assistance. By promoting, reforming and strengthening the rules for ODA set out by the OECD’s Development Assistance Committee (DAC), as well as broader multilateral agreements on aid and development, the UK can align allies around a vision of a multilateral, liberal and open system based on mutual collaboration and strengthening which delivers for the world’s poorest.

To support the creation of sustainable and just economies, the UK should use its diplomatic influence to support the reinvention of the World Trade Organisation as a multilateral forum focused on aligning trade rules to other international standards, especially the SDGs, the Paris Agreement and the Convention on Biological Diversity, and addressing the longstanding concerns of low- and middle-income countries, particularly regarding food and agricultural trade policies. The UK should support democratic reform of the International Monetary Fund and World Bank, working with these institutions to ensure their policies are aligned with the SDGs, the Paris Agreement, the Convention on Biological Diversity and respect for labour and human rights, as well as being led by the priorities and strategies of low- and middle-income countries. The UK should take action in these institutions to accelerate progress towards universal health coverage and universal social protection[39]. The UK should also use its diplomatic influence over international financial institutions to prevent conditionality and the promotion of privatisation and austerity measures that increase inequalities, hold back recovery and prevent the transformative changes needed to address the climate crisis.

Civil society organisations and human rights defenders are critical development actors, working alongside and in solidarity with vulnerable and marginalised communities and holding governments to account. They amplify the voices of people living in extreme poverty, enabling vulnerable and marginalised communities to ensure that development assistance meets their needs and priorities. In a strategic and systematic manner, the UK should use its diplomatic channels to put pressure on states that restrict civil society and encourage governments to protect human rights online and offline. This includes working with like-minded countries at the UN and other multilateral bodies to enable the full and meaningful participation of civil society in these forums and to ensure that international norms and standards promote civic space and human rights.

7         How has the merger of the Foreign and Commonwealth Office and the Department for International Development affected the UK’s approach to extreme poverty?

7.1   The merger of the FCDO and strategic steer to align the UK’s diplomatic, trade and development activities presented an opportunity to pursue the approach outlined in our answer to question 1, using all available tools to promote sustainable and inclusive development. However, in practice this has played out as a demotion of development as a tool for the ‘national interest’, rather than a move towards a systems-wide approach to achieving sustainable development for all. The Integrated Review of security, defence, development and foreign policy[40] gave negligible space to development, whilst the International Development Strategy has been repeatedly delayed. There is no longer a Cabinet Minister for development, with the Foreign Secretary instead covering a huge portfolio spanning from foreign policy and security, human rights, women and girls and development. The strategic shift to the Indo-Pacific prioritises geo-political motivations over poverty-eradication, and the former Foreign Secretary’s statement on ODA priorities[41] did not include poverty as an explicit priority. Climate change priorities have been dropped from trade deals[42]. While the UK prioritised open societies following the merger, and committed to protect global human rights and promote civic space in the Integrated Review and at the G7 Summit in Carbis Bay, the new Foreign Secretary has instead focused on building a 'Network of Liberty,' a much vaguer concept centred around the promotion of individual freedoms and economic liberalism[43]. At the same time, the strategic focus on the UK’s commitment to ‘leave no one behind’[44] has lessened, exemplifying the move away from prioritising those who have been most marginalised.

It is positive that the FCDO will be responsible for deciding the final departmental allocation of ODA and administering the majority of UK ODA. While other government departments can play a key role in delivering ODA, when relevant to their areas of expertise, the FCDO is best placed to spend the majority of ODA given the expertise and experience that DFID had in delivering ODA effectively and equitably. Although the FCDO is best placed in theory, it is also a new department and many of its processes and policies are still in development. It is critical therefore that these are put in place, and that DFID’s expertise is built upon, to ensure that ODA is administered effectively and equitably, and in line with the International Development and the Gender Act. As an example, the FCDO should ensure that it consistently uses the OECD DAC Disability Marker, which was previously used by DFID and not the FCO.

Bond published 15 Principles and Hallmarks[45] to track how the new FCDO performed against its objectives and delivers for those living in poverty. Six months on, we found limited progress against these markers, with only two recording ‘good’ levels of progress[46]. Now almost 18 months on from the merger of the two department, progress against many of the hallmarks remains concerning.

The process of merging two departments is complicated and presents a high administrative burden. This has distracted time and attention away from the other pressing priorities for the department over the past 18 months, energy that could have been spent focusing on responding to COVID, climate change or the current situation in the Ukraine. Raphael Marshall’s evidence to the Foreign Affairs Select Committee[47] on the handling of the withdrawal from Afghanistan cited the fact the FCDO continued to operate on two different systems as contributing to the poor handling of the crisis, with former-DFID and FCO officials unable to access or share key pieces of information. Reports of over 200 former-DFID employees leaving the new FCDO raise concerns around a serious loss of development expertise within the new department[48].

8. Conclusion. With just 8 years remaining until 2030, the focus for all those committed to achieving the sustainable development goals, including ending extreme poverty must be on action and implementation. The forthcoming international development strategy is an opportunity for the FCDO to set bold ambition, but what is needed is bold action. The UK must put poverty eradication and achieving the SDGs at the heart its development approach, using all available levers to promote long-term pathways out of poverty and ensuring coherence across government. Through reversing the ODA cuts and adhering to best-practice for effective aid spending, the government can use its ODA budget to target extreme poverty and support long-term sustainable development. We hope to see increased transparency and renewed commitment to this objective in the International Development Strategy and in FCDO decisions going forward.