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Huge part of UK foreign aid goes as consultancy fees  

Monday June 09, 2014


"An accountant by training, Justine Greening is said to be going through the Department for International Development’s budget ‘line by line’ and has demanded explanation against apparently extravagant spending and ordered a full report by end of the month.”


HNF Bureau


It’s just one month since the team of British parliamentarians gave a certificate of deep satisfaction over the utilisation of UK development aids in India that a recent audit by the new International Development Secretary Justine Greening has revealed, in the name of development and free market promotion, ‘poverty barons’ are making millions in consultancy fees from the foreign aid budget. This has raised doubt over the expected increase in the UK aid fund.

As per the report ‘The fat cats of foreign aid: Ministers 'to target consultants paid 500m by the taxpayer', published in UK’s Daily Mail, ‘Nearly 500million was paid out last year to firms that work on Third World programmes. Some give their directors seven-figure salaries.’


An accountant by training, Miss Greening is said to be going through the Department for International Development’s budget ‘line by line’ and has demanded explanation against apparently extravagant spending and ordered a full report by end of the month.

Quoting a source, the report in Daily Mail said, ‘Justine will be sure to bring an accountant’s eye to DfID and will be looking extremely closely at every single area of spend to ensure value for money for the British taxpayer.’

The London based consultancy Adam Smith International, which promotes the free market in poor countries, has received contracts worth tens of millions of pounds in a single year and is listed in the report as the top beneficiary of the aid budget. The works of Adam Smith included building schools in Pakistan, developing the free market in Nepal and reforming the tax system in Afghanistan.

Another UK based firms thriving on people’s tax money allotted for development have been a subsidiary of the Marie Stopes abortion rights charity that carried out work in India, Africa and Nepal. The firm was paid around 6million from DfID last year.

Maxwell Stamp raked in 16.4million for its work on legal services in Bangladesh and discouraging child marriage in Ethiopia.

Not only UK based firms, foreign organisations like Search for Common Ground, The Clinton Foundation have also cashed in.

However, the issue raised by the new International Development Secretary is that a huge part of the British tax payers’ money is being used as consultation fees than reaching the targeted poor. So, may be, this particular aspect would be taken more seriously while allotting funds for various UK aid development programmes to ensure value for tax payers’ money. This may result in a slash in funds granted for different programmes with only a reasonable amount as consultation fees.

After these facts came in UK media, there has been some public reaction in UK. Commenting on the aforementioned report of the Daily Mail, British people like Tim, Brighton writes, ‘Just shows where the money really goes, and how stupid it is to spend more’ while another online user timetostopit, London comments, ‘Until our deficit has been erased all foreign aid should be stopped, we should have an aid revolution people should take to the streets, to make the politicians do as the people want, not what they want, its outrageous, we put them in power and they ignore public opinion, they do not know better, pure arrogance.’

Mentioning how the bureaucrats of aid receiving third world countries grab their cuts before the aid money reaches targeted people, Jones the Cable, Liverpool, writes, ‘At last someone has woken up to the excesses of Overseas Aid as well as these Consultants. What about the Tin-Pot Dictators in the countries we are trying to help, they and their Bureaucrats take their share before any of it reaches the people it is destined for. As someone has already said Charity begins at Home, sort out our own problems and then the rest of the world, "fit your own mask before helping others" to quote the plane safety briefing. Let’s hope Ms Greening stops this waste and the 15 Billion can be better spent at home.’

The growing pressure in the country may force the UK government to set a mechanism for effective monitoring of utilisation of its foreign aid funds. While David Cameron has pledged to increase the aid budget to 0.7 per cent of national income of GDP by 2014 that would see DfID’s budget rise from around 8billion to more than 12billion, that pledge has yet to be enshrined in law and Miss Greening’s appointment could make it less likely that it will be fulfilled, said the report.


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