This House of Lords Library Briefing examines current UK expenditure on aid and the mechanisms by which it is spent, including through the European Union institutions, and how these might be impacted post-Brexit. The paper examines the Government’s proposals for the UK-EU relationship post-Brexit and reviews what other commentators have suggested about the implications of Brexit for both UK and EU development assistance.
Brexit: Overseas Development Assistance (331KB PDF)
The UK Government is committed to spending 0.7 percent of the UK’s gross national income (GNI) on overseas aid; the target is written into the International Development (Official Development Assistance Target) Act 2015. The Government uses the definition of overseas aid developed by the Organisation for Economic Cooperation and Development, who use the term Overseas Development Assistance (ODA).
In 2016, the UK spent £13.4 billion on ODA. The UK channelled approximately £1.5 billion of ODA through the European Development Fund (EDF) and the development section of the EU budget. This represents approximately 11 percent of all UK ODA.
Following speculation in the wake of the 2016 referendum the Prime Minister, Theresa May, confirmed in April 2017 that the target of 0.7 percent on ODA would remain, but argued that the Government would need to “look at how that money will be spent and make sure that we are able to spend that money in the most effective way”. The Government will need to decide how to spend approximately £1.5 billion of ODA which is currently channelled through the EU. The implications for the EU, which faces a substantial drop in development resources post-Brexit are also the subject of some debate. Some commentators have suggested the UK could continue to play a role in EU development policy, for example through continued voluntary contributions to the EDF. The UK Government has stated that it would seek “a deep and special partnership with the EU that goes beyond existing third country arrangements” and would seek to collaborate on “a case-by-case basis […] [with aid] subject to UK’s standards on full transparency, accountability, risk and assurance, results and value for money”.
Brexit: Overseas Development Assistance (331KB PDF)
The Sovereign Grant Bill is a government bill which would amend how the sovereign grant is set. This is a grant paid to the King to support the work of the sovereign. The bill would enable the size of the sovereign grant to be reduced following the completion of a 10-year works project on Buckingham Palace. The bill received cross-party support and was not amended in the House of Commons.
The Financial Services and Markets Bill [HL] is a wide-ranging bill that aims to reform the way the UK financial services sector is regulated. This briefing provides a summary of the bill’s second reading and committee stage in the House of Lords ahead of its further consideration at report.
![Financial Services and Markets Bill [HL]: Progress in the Lords](https://lordslibrary-parliament.studio24.dev/content/uploads/sites/2/2020/09/Economy-568x426.png)
The Taxation (Energy and Vehicles) Bill is a money bill that would implement three tax measures as part of the government’s package of support to tackle increased energy prices. The bill would increase the electricity generator levy, increase the rate of tax-free mileage allowance for employees, and provide a 12-month vehicle excise duty exemption for HGVs.
