Concerns Grow Over UK Foreign Aid Cuts Amidst Defence Spending Increase
Cutting foreign aid to bolster defence spending raises alarms that the UK is on track to allocate a significant portion of its overseas development budget to address the ongoing Channel crisis, warns Sir Keir Starmer. The Prime Minister’s proposal to reduce the foreign aid budget from 0.5% of gross national income to 0.3% by 2027 indicates that a larger share of this funding may be diverted towards managing refugees and asylum seekers within the UK.
In 2023 alone, the UK allocated over £4.2 billion—approximately 28%—of its overseas development assistance to support refugees and asylum seekers in the UK and other donor nations. A staggering £2.5 billion of this amount was expended by the Home Office on accommodation, including the controversial use of hotels for Channel migrants.
If the aid budget is indeed capped at 0.3% of national income, it would result in around £7.2 billion available for overseas development. Experts suggest that unless the government can significantly diminish the backlog of asylum claims, reduce hotel usage, and lower Channel crossings, nearly half of this budget may be consumed by asylum and refugee-related costs.
Government insiders have acknowledged that the rising expenses associated with asylum seekers will increasingly draw from the aid budget unless efficiency measures are implemented. The Prime Minister has stated that improving the processing of claims will help to “bring those bills down.”
Sarah Champion, the Labour chair of the Commons Development Committee, expressed her deep concern, stating, “I’m extremely worried that unless the Home Office’s expenditures on refugees and asylum seekers decrease significantly, it seems likely that half of the remaining aid budget will be allocated to their hotel costs rather than to support the world’s poorest populations, which is the intended purpose.”
Mark Leonard, a member of the Foreign Office’s Soft Power Council and director of the European Council on Foreign Relations (ECFR), commended the increase in defence spending but urged for a strategic shift in development spending priorities. He emphasized the need to focus the majority of remaining development funds on urgent needs in countries facing crises instead of utilizing them domestically to address deficiencies in asylum policy.
Earlier in the Commons, Starmer remarked, “In recent years, the development budget has been increasingly directed towards managing asylum backlogs, including the costs of hotel accommodations. As we work to clear that backlog at a record pace, we anticipate efficiencies that will lessen the need to cut our overseas programme funding. However, it remains a cut, and I will not pretend otherwise.”
In a related warning, former Labour foreign secretary David Miliband cautioned that reducing the aid budget could exacerbate the global migration crisis. He stated, “The danger is that without essential humanitarian assistance, more people will be forced to flee their homes in search of safety.” Miliband, who now serves as President and CEO of the International Rescue Committee, highlighted that UK aid plays a crucial role in reducing displacement while also providing support to those vulnerable to conflicts, climate change, and extreme poverty. He lamented that the proposed £6 billion reduction in aid spending represents a “blow to Britain’s proud reputation as a global leader in humanitarian and development efforts,” warning of “far-reaching” and “devastating” consequences for the 300 million individuals worldwide in need of humanitarian support. “Now is the time to enhance our commitment to tackling poverty, conflict, and insecurity, not to further diminish our aid budget,” he added.
Gareth Redmond-King, head of the international programme at the Energy and Climate Intelligence Unit (ECIU), explained, “We rely on foreign imports for two-fifths of our food, much of which cannot be produced domestically in the UK. Approximately half of these imports come from regions particularly vulnerable to climate extremes, such as floods and heatwaves that devastate crops. Our dependence on these countries means that climate finance sourced from the aid budget is essential not only for the livelihoods of those farmers but also for our own food security. This reduction could significantly hinder our ability to meet climate finance commitments.”
Read Next
ActionAid, a charity dedicated to supporting women and girls living in poverty, described Sir Keir’s decision to slash the aid budget as “reckless” and expressed profound shock and disappointment with the Government’s stance. Similarly, Save the Children UK voiced its “stunned” reaction to the move, condemning it as a betrayal of vulnerable children worldwide and detrimental to the UK’s national interests. Water Aid characterized the shift in policy as a “cruel betrayal” of impoverished communities. The Government is optimistic about achieving £400 million in asylum support savings by 2024/25.
