Over 20% of EU & UK ODA spending inflated by in-country refugee costs, CONCORD report finds

Today, Wednesday 18 October, CONCORD, the European Confederation of NGOs working on sustainable development and international cooperation, has released its annual AidWatch report.

The report reveals that reporting on Official Development Assistance (ODA) spending was inflated by the UK and across EU countries in 2022, with the staggering increase of in-country refugee costs taking up the majority of this inflation, and accounting for over EUR 13.9 billion across Europe.

Despite record-high ODA spending figures in 2022, AidWatch analysis has found that a significant proportion (over 22%) of UK and EU ODA is not meeting the most basic criteria of what qualifies as ODA.* This means close to EUR 20 billion – more than 1 euro in every 5 from the ODA budgets of the UK and EU Member States combined – never reached the intended communities in the majority world.

In-country refugee spending trends:

    • For the UK, nearly 30% of the UK’s ODA budget was spent on refugee costs in the UK in 2022 which made the UK the country receiving the largest proportion of UK bilateral ODA spend in 2022.
    • Reporting in-country refugee costs in their ODA figures is a policy decision made by countries. Countries such as Luxembourg have consistently opted to keep these figures out of their ODA reporting, while Belgium, Hungary and Slovakia chose specifically to exclude costs for Ukrainian refugees.
    • In 2022, only three countries, Luxembourg, Sweden, and Germany, met the collective commitment made in 1970 to allocate 0.7% of their GNI to ODA, as per reported figures.
    • Denmark, for the first time in four decades, fell short of the 0.7% target in 2022.

 

The AidWatch report calls for ODA inflation to be reduced by reforming the current ODA system to prevent certain items being counted as ODA including in-country refugee costs, student costs and debt relief.

In reaction to the report, Gideon Rabinowitz, Director of Policy and Advocacy at Bond, the UK network for NGOs, said: 

“It is wrong that the UK and EU countries are prioritising their ODA budgets for their own domestic and geopolitical interests, rather than using ODA to support the needs of the most marginalised communities around the world.

Skyrocketing in-donor refugee costs have made the UK the largest recipient of its own ODA for a second year running and shows that the UK government has lost its grip on the UK’s ODA budget. The government must stop uncontrolled spending of ODA by other departments like the Home Office and prioritise those who need it most.”

Tanya Cox, Director of CONCORD said: 

“The AidWatch 2023 report demonstrates how ODA can be a powerful tool for reducing inequalities if used strategically. It advocates for ODA allocations that prioritise partner countries’ needs and objectives, rather than responding to donor countries’ geopolitical or economic interests.”