By Nick Mann | 11 December 2012
The UK must increase its oversight of the £1.4bn aid it channels through the European Union every year, the Independent Commission for Aid Impact said today.
Almost a fifth (16%) of the total aid budget of the UK’s Department for International Development is spent via the EU, its largest aid partner, the watchdog found.
However, the department does not have the same level of assurance over how the money is spent as it does for other multilateral organisations it channels aid through, such as the World Bank, its second largest aid partner.
Examining the DFID’s oversight of the EU’s aid in Mozambique, Tajikistan and Uganda, the commission found there was no effective performance management system. It added that the EU’s scale and influence as the world’s second largest aid donor – behind the US – was not being ‘effectively harnessed’.
The commission said the lack of oversight was particularly important given the scale of the UK’s contribution and the limited discretion it has about the EU as a route for aid. The UK’s aid spend via the EU is largely allocated in proportion to its total contribution to the EU budget, which is agreed in negotiations led for the UK by the Treasury.
The commission rated the DFID’s oversight of the EU aid ‘amber-red’. This means the programme performs relatively poorly overall against the ICAI’s criteria for effectiveness and value for money, and improvements should be made.
In particular, the department was urged to set out how and when it would be able to provide the same level of assurance on its contributions to the EU as it achieves elsewhere. ‘This should include improvements to the performance management of EU aid and better access to EU information,’ the report said.
To ensure a better combined impact from UK and EU funds, the department should also take a more ‘joined-up’ approach on the ground in recipient nations by giving its country offices better guidance on how they should contribute to EU country strategies.
The DFID should also take an active role in strengthening the EU’s risk management, the watchdog added. Weaknesses in this area were a ‘significant obstacle’ to improving the performance of its programmes and projects, the watchdog added.
ICAI chief commissioner Graham Ward said the scale and coverage of the EU’s aid spending provided a considerable opportunity for the DFID to contribute to aid programmes worldwide.
‘This report shows that, despite making good headway in influencing EU aid policy, the DFID needs to push the EU for a better account of where taxpayers’ money is going and to engage further with EU projects and programmes at a country level to ensure that it is spent to best effect,’ he added.
A spokeswoman for the DFID highlighted International Development Secretary Justine Greening’s commitment to increase scrutiny of how EU aid is spent.
‘We agree that the EU needs to raise its game,’ she said. ‘That’s why Justine Greening is already pressing EU institutions, MEPs and other member states to improve performance and results. Nothing in the EU happens overnight but we are determined to get better value for money on behalf of the British taxpayer.’
