First global aid cut in 14 years will cost lives

4th Apr 2012

Hundreds of thousands of poor people will go without life-saving medicines and many more children will miss out on school because of the first cuts in global aid since 1997, Oxfam warned today as the OECD published its annual report showing how much donors give to poor countries.

Oxfam said the figures showed the importance of the UK sticking to its commitment to meet the target of giving 0.7 per cent of national income in aid next year. The OECD's figures show a surprise fall in UK aid of $100m in real terms or 0.8 per cent between 2010-11.

Aid from rich countries was $133bn in 2011 - a real terms fall of $3.4bn.  Aid as a share of national income fell from 0.32 per cent to 0.31 per cent leaving rich countries as a group even further off-track to meet their 0.7 promise.

It is estimated that $1330 in aid is enough to save a child's life. Oxfam calculates that the missing $3.4bn would be enough to provide a full year treatment for half of the children infected with HIV.

Norway, Denmark and Luxemburg continue to meet their pledge to give more than 0.7 per cent of national income in aid, the UK remains on track to meet the target by 2013 and Germany, Australia and Sweden have increased their aid budgets.

Max Lawson, Oxfam Head of Policy, said: "This cut in aid is a global scandal. Rich countries are using the economic crisis as an excuse to turn their backs on the world's poorest at a time when they need help the most.

"It is more important than ever that the UK sticks to its promises. We are surprised and concerned the Government allowed aid to fall slightly last year. We have given our word to the poorest people in the world, it is vital that we keep it.

"Cutting aid is no way to balance the books. Even small cuts in aid cost lives as people are denied life-saving medicines and clean water. Aid is such a tiny part of budgets that cutting it has no discernable impact on deficits - it is like cutting your hair to lose weight."

Aid also places a vital role in providing the educated, healthy workforce, infrastructure and support for entrepreneurs that is vital to economic development.

At $133bn, total global aid spending is dwarfed by rich countries' $1trillion annual military spend and is less that is spent worldwide every and is less than a third of the $400bn that is spent worldwide every year on cosmetics. UK aid amounts to less than a quarter of military spending.

The biggest cuts were made by Greece and Spain, with Austria, Belgium and Japan also slashing aid budgets. And the picture is even bleaker than shown by these figures with Spain, Canada having already announced further aid cuts and the Netherlands, which currently exceeds the 0.7 per cent target debating further cuts.

Oxfam said the ability of some countries meet their commitments and increase aid showed that cutting aid was usually a political choice rather than an economic necessity. It called on rich countries to act urgently to reverse cuts and deliver on their promises to the world's poorest.

Lawson said: "Countries such as Spain, the Netherlands and Canada which are making severe cuts in their aid need to consider the human cost and immediately reverse their decisions.

"If future aid cuts are to be averted we also need rich countries like Italy, Japan and the US who currently give only a tiny proportion of their incomes, to do more to help the poorest." 

Failure of governments to meet their commitments to the world's poorest comes in stark contrast to the $18 trillion found to bailout the world's financial sector in the wake of the 2008 crisis.

The World Bank has said that tens of millions of people have been pushed into extreme poverty by the economic crisis.

Oxfam is calling for a Robin Hood Tax on financial transactions to help poor people hit by the economic crisis. The EC has proposed a Europe-wide financial transaction tax (FTT) that would raise €57bn-a-year.

Lawson said: "Governments have shown that they can find large sums of money to bail out banks but with notable exceptions - Denmark, Norway and the UK - most are failing dismally to find much smaller sums for the world's poorest people."

Contact:  Jon Slater +44 (0)7876 476403/ jslater@oxfam.org.uk
Note to editors:  Although aid reported by the OECD fell in 2007, this was due to exceptional debt relief for Nigeria and Iraq in previous years. This is therefore the first real fall in aid since 1997.