National Audit Office report on Managing the Official Development Assistance target

In 2015, the UK government met the target to spend 0.7% of its gross national income on ODA for the third year in a row, spending £12.1 billion (compared to £11.4 billion in 2013 and £11.7 billion in 2014). Provisional data suggest that the target will be met in 2016 (with spending of £13.3 billion). Since 2015, the government has been legally obliged to meet the target. 

The 2015 UK Aid Strategy set out that more ODA expenditure would come from sources other than the Department for International Development. In 2013, expenditure by the Department for International Development contributed 88% of the total; in 2015, it contributed just over 80%. 

As part of the Spending Review in November 2015, HM Treasury took an evidence-based approach to allocating ODA budgets to departments which bid for new activities that could be funded with ODA. It collected information on, for example, the objectives of their planned programmes and their eligibility to count towards the target. However, it did not fully assess each department’s capacity to manage the increase in spending. 

The Department for International Development supported other government departments as their ODA budgets increased. It provided advice on issues such as the eligibility of ODA expenditure and support to build their project management capacity. Those departments and cross‑government funds put in place arrangements to oversee their ODA expenditure and have taken positive steps to build their capacity to spend their larger ODA budgets. The NAO found that they also experienced similar challenges to those the Department for International Development faced in 2013, the first year the target was met. For example, five of the 11 bodies the NAO examined spent more than half their ODA budgets for 2016 in the last quarter of the calendar year.  And many of them faced issues accurately forecasting their expenditure. 

The Department for International Development has improved its management of its ODA budget since the NAO last reported on this issue in 2015. For example, a smaller proportion of its spending is in the last two months of the year. And it has a pipeline of projects with a value in excess of its budget, creating choice and opportunities to consider value for money. 

To date, government has focused on making sure the target is met. It has taken important steps to support cross‑government working by, for example, creating a senior officials group to support the target’s management and delivery.  

Amyas Morse, head of the National Audit Office, said today:

“The government has decided that departments and cross-government funds other than DFID should have responsibility for expenditure which makes up the 0.7% aid target. This means that meeting the target has become a more complex undertaking and the resulting gaps in accountability and responsibility require more effort to manage.

“HM Treasury and DFID, together with other relevant bodies, should now focus on developing ways to demonstrate the overall effectiveness and coherence of ODA expenditure.”

Key facts

Notes for Editors

1.      In 2010, the coalition government committed to spend 0.7% of UK gross national income on overseas aid - known as Official Development Assistance (ODA) - from 2013 onwards. 0.7% is the proportion of a nation's income that the United Nations has said developed countries should aim to spend on overseas aid.

2.      In 2015, ODA expenditure was £12.1 billion, 0.7% of gross national income. The United Kingdom therefore met the target for the third year in a row, having met the target for the first time in 2013. Because of increases in gross national income, the UK had to spend 3.7% more than in 2014 to meet the target, and 6.4% more than in 2013. As part of the Spending Review 2015, the government estimated that ODA expenditure will be £16.3 billion by 2021. This figure is updated when there are significant updates to economic forecasts.