Billions poured into foreign aid by Britain is doing harm, casting doubt on the PM's pledge to spend 0.7% of national income on overseas aid

The billions Britain pours into foreign aid are actually doing harm by making corruption worse in many parts of the world, a damning report reveals.

It says projects funded by UK cash are increasing opportunities for bribery.

In some areas, they are even pushing poor people ‘towards corrupt practices’. After we spent millions on a scheme to tackle police bribery in Nigeria, locals said they were even more likely to have to pay backhanders, the report found.

It concluded that huge amounts of UK aid money is being wasted because we are either funding corrupt programmes directly or not doing enough to tackle the culture of bribery in many countries.

The findings come just days after it emerged human rights abuses in Ethiopia – where security forces are accused of burning, torturing and raping citizens – had got worse during a four-year period when the UK gave the country more than £1billion.

They will be hugely embarrassing for David Cameron, who has repeatedly been forced to defend his controversial commitment to spend 0.7 per cent of national income on overseas aid despite fierce opposition from his backbenchers.

The report was carried out by the Independent Commission for Aid Impact, the watchdog set up to scrutinise the Department for International Development.

Giving DfiD a poor ‘amber-red’ rating, it criticised the fact that only £22million of its £10.3billion aid budget was targeted specifically at fighting corruption.

The study found the department was not ‘up to the challenge’ of tackling corruption and, in many cases, help was not effectively targeted at the poor.

In Nepal, it said the poor were being ‘pushed towards corrupt practices’ by having to pay bribes or forge documents to receive funding through a local governance project backed by British aid.

Labour accused Justine Greening, the Secretary of State for International Development, of being ‘asleep at the wheel’.

Graham Ward, chief commissioner at the ICAI, said: ‘We saw very little evidence that the work DfID is doing to combat corruption is successfully addressing the impact of corruption as experienced by the poor.’

The Coalition has massively increased Britain’s aid budget in recent years in a bid to plough 0.7 per cent of national income into overseas development. This happened despite savage cuts to public services at home and opposition from Tory backbenchers.

The ICAI report found corruption blights the everyday lives of the very poorest and thwarts global efforts to lift countries out of poverty. It said while DfID claims to recognise the need to tackle corruption, it ‘has not delivered an approach equal to the challenge’.

The study also found the department was often lax in tackling corruption as it was worried about offending local politicians. ‘DfID’s willingness to engage in programming that explicitly tackles corruption is often constrained by political sensitivity,’ it said.

Labour accused Justine Greening, the Secretary of State for International Development, of being ‘asleep at the wheel’

‘In Nigeria, petty corruption touches virtually every aspect of life and is accepted throughout society as normal and necessary. We heard stories of parents paying bribes to teachers in order to educate their children; students paying bribes to administrators to take exams; workers paying bribes to get jobs and to receive their salaries; and pensioners paying bribes to receive pensions.’ The report found that in Nepal, there is a ‘growing sense of acceptance of corruption across society’. Where once bribes were paid out of sight, they are now paid openly.

Britain gives money direct to the Nepalese government, despite the risk of corruption.The report said: ‘This degree of engagement with a host government can be challenging, given the extent to which issues of corruption touch the government.’

It added: ‘Very few of DfID’s activities we reviewed in Nepal, Nigeria and elsewhere explicitly focus on the everyday corruption experienced by the poor.’

The report added: ‘Disappointingly, we found that at least one programme supported by DfID appears to have increased the opportunities for corruption in society.’

Alison McGovern, Labour’s spokesman for international development, said: ‘This damning report should send shockwaves through David Cameron’s government. Justine Greening should have zero tolerance of corruption – especially when it is hitting the poorest – but instead the Independent Commission has found her asleep at the wheel.’

A DfID spokesman said: ‘We have anti-corruption and counter-fraud plans for each country that we give bilateral aid to.