Policy Exchange today publishes ‘Global Britain, Global Challenges: How to make aid more effective’. The report makes a strong case for the importance of overseas aid and supports the Government’s commitment to spending 0.7 per cent of national income on aid. However, it also argues strongly that aid can and should be spent more effectively and that the development community should embrace trade and capitalism as vital to reducing poverty and disease.

In this paper, we look at the big questions about international development:

• What are the most important global challenges? Where can Britain make the biggest difference?
• What is the role for aid in meeting global challenges? How should the public’s worries over corruption be addressed?
• How well targeted and efficient is the current UK aid budget? What is known about its impact, and where are there gaps in our knowledge?
• How can the effectiveness of the aid budget be improved? What new opportunities are created by Brexit?

The report has a foreword by Scottish Conservative leader Rt Hon Ruth Davidson, MSP in which she says:

“As this report argues, there is a strong centre-right case for putting overseas aid at the centre of a Global Britain, working alongside our commitments to strong defence and becoming a global champion for free trade. To defeat poverty, we will need to support both aid and trade, markets and global public goods – not create an artificial dichotomy between them.”

The report proposes four principles to ensure that resources are spent most effectively and go still further to help Britain take a leading role in tackling the world’s most important challenges:

1. Maintain the commitment to a Global Britain
   • With aid and defence spending levels guaranteed, there should be a greater focus on achieving outcomes rather than cash spent.
   • The Government should commission a short-term update to the 2015 Aid Strategy. This should take account of post-Brexit circumstances, and look at a wider development strategy which includes trade, agriculture and security.
2. Create a more efficient and innovative aid budget
   • The Government should create a new Office for Aid Effectiveness to collate and commission evidence. Working with DFID, it should ensure that all major new programmes are at least as effective as cash transfers.
   • Over the medium term, the Government should substantially raise the proportion of the ODA budget going to Global Public Goods like public health or R&D.
3. Stand up for democracy, the rule of law and a free press 
   • There is a strong correlation between economic development and open institutions such as the rule of law, a free press and fair elections. While aid is increasingly likely to be concentrated in fragile states, the UK should be careful not to prop up authoritarian states or enable predatory elites.
   • New due diligence criteria for engagement should be adopted to ensure that funding and recognition are not given to those whose views and practices are antithetical to democratic principles and the rule of law.
4. Reduce trade barriers with the developing world and act as a global champion of free trade
   • Elements of the NGO community still fail to recognise that aid and free trade are complementary ways to alleviate global poverty. The UK should go beyond the EU’s duty-free and quota-free approach for developing countries.
   • The Government should substantially reform the Common Agricultural Policy after 2020, creating a new British Agricultural Policy that focuses on supporting the local environment rather than food production or protectionism.