Questions over rise in funds to ministries outside Department for International Development, with little clarity on value for money

MPs have criticised a “dramatic increase” in aid spending in ministries outside the Department for International Development, because they have not put in place adequate measures to assess value for money.

A report, by the House of Commons public accounts committee, questioned the doubling of the Newton Fund, managed by the Department for Business, Energy and Industrial Strategy, to £735m, despite the department’s “weak understanding” of how funds were spent, where and with what results.

The criticism follows Boris Johnson’s announcement that £1bn in aid money will be spent by BEIS and DfID on efforts to tackle the climate emergency.

Meg Hillier, the chair of PAC, said: “As we highlighted with the Newton Fund, the danger is that it becomes the case for spending money where we cannot determine effectiveness.

“They haven’t got a system in place yet for overseas aid that is going through other routes. We have to be careful aid is going to those in greatest need. We’re not convinced there are measures in place to look at impact in departments other than DfID and we need to have this in place before we throw money in other directions.”

Asked about Johnson’s announcement on Sunday, Hillier said: “A promise is the headline. Effectiveness is the delivery on the ground.”

The PAC report, published on Monday, raised questions over the dramatic increase in aid spending by the Foreign and Commonwealth Office – from 6% of its budget in 2010 to 50% next year. The FCO has spent 45% of its overseas development assistance on “frontline diplomatic activity”, mostly in sub-Saharan Africa, the report said.

MPs said more needed to be done by the government to show the £14bn spent on foreign aid is effective. DfID is the only department to meet the government’s transparency targets, it said.

The report also highlighted a “significant risk” to value for money of the £1.4bn of aid the UK currently contributes to the EU’s development budget under a no-deal Brexit.

“If the UK leaves the EU without a deal, the government may need to redistribute quickly up to £1.4bn to meet the ODA spending target in 2019 – a situation which would create a risk to value for money,” it found.

Dr Alison Doig, head of global policy at Christian Aid, said Johnson’s announcement was “like robbing Peter to pay Paul, when in reality new and additional money is needed in the face of the climate emergency”.

“We very much welcome news of promoting and spreading UK scientific knowledge abroad, but our hope is that it will be implemented in the right way and not end up as tied aid that is expensive and undermines the capacity of scientists in developing countries.”

Earlier this year, a report by the One Campaign found 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. It found only 5% of the £765m spent by BEIS and 16% of the £1.05bn spent by the FCO went to countries that needed it most.

The UK is one of only a handful of countries to meet the UN target of spending 0.7% of national income on aid. About 70% of the UK aid’s budget is spend by DfID.