Too much of Britain’s aid budget is being spent poorly by Whitehall departments on projects that fail the test of reducing poverty in the world’s poorest countries, a campaign group has said.

The One Campaign – an advocacy organisation set up by the U2 singer Bono – said the huge gulf in standards across government was undermining the battle to build public trust that taxpayers’ money was being well spent.

The UK is one of only a handful of countries to meet the UN target of spending 0.7% of national income on aid and around 70% of the £14bn a year budget is spent by the Department for International Development (DfID).

Romilly Greenhill, the One Campaign’s UK director, said that money spent by DfID scored highly for poverty focus, effectiveness and transparency, but the same could not always be said of the 30% of the budget spent by other Whitehall departments.

The campaign group’s new Real Aid Index said that only 5% of the £765m spent by the business, energy and industrial strategy department (BEIS) and 16% of the £1.05bn spent by the Foreign Office (FCO) went to the countries that needed it most.

“This index shows that while most UK aid does exactly what it’s meant to, some parts of government need to up their game. If they’re spending aid which doesn’t bring real change for people in poverty, should it really be called aid at all?” she said.

The report also found:

£1.5bn of aid was being spent with barely any transparency about where and how it was delivered.

At least £475m of aid came with strings attached so that is has to be spent through UK institutions, contravening Britain’s system of untied aid.

£115m of FCO aid was being spent to subsidise relatively affluent students going to university in the UK.

Three of the five largest (in cash terms) programmes within the Newton Fund – which aims to develop science and innovation partnerships that promote the economic development and social welfare of partner countries – were based in China and were not focused on global poverty reduction.

Britain’s aid budget has become increasingly controversial, since the higher spending necessary to meet the 0.7% UN target has come at a time when other Whitehall departments have faced stringent austerity. Some Conservative MPs believe the commitment should be scrapped.

Greenhill said: “The lion’s share of UK aid is poverty-focused, effective and transparent – it’s real aid that we can be proud of. But some parts of government don’t adhere to these principles – in short, they’re not delivering ‘real aid’.

“If their aid is going to richer countries or on programmes that don’t address poverty, then they’re not only failing the people it’s meant for, they’re letting down the UK taxpayer.”

Greenhill said the Treasury should take the opportunity of this year’s spending review to ensure the taxpayer was getting value for money and that aid spending was targeted at poverty reduction.

“As collaboration becomes the new normal for government departments spending UK aid, every penny must be ‘real aid’. As the Treasury is deciding who gets what in this year’s spending review, they shouldn’t allocate any more aid to departments which don’t deliver ‘real aid’,” she said.

A BEIS spokesperson said: “The government’s overseas development assistance focuses on countries where we can deliver the greatest impact, helping to build a safer and more prosperous planet.

“We are leveraging the UK’s world-leading research base to address global challenges including antimicrobial resistance, food security and building resilience to natural disasters. And through International Climate Finance we are focusing on countries that have the largest emissions growth to mitigate the impact of climate change for the most vulnerable.”