Foreign Secretary urged to rethink funding cuts to the World Bank and UN following new UK aid watchdog report

The Independent Commission for Aid Impact (ICAI) has today published its report on the Foreign, Commonwealth and Development Office’s (FCDO) support to the World Bank’s International Development Association (IDA) – the world’s largest source of finance for low-income countries and fragile states.

It concludes that UK aid channelled through the World Bank instrument for the lowest-income and most fragile countries provides “good value for money”. Until now, the UK has been IDA’s largest donor for over a decade, with approximately £1 of every £12 of UK aid channelled through it – approximately £1billion a year. In 2021, the UK announced it was to reduce its next contribution to IDA by about half compared to its previous funding commitment.

Earlier this month, Foreign Secretary Liz Truss laid out plans to significantly cut funding to multilateral agencies – such as the World Bank and the UN – and make UK aid 75% bilateral by 2025.

Abigael Baldoumas, policy manager for aid effectiveness at Bond, said in response to the report:

“This proves that channelling funds to multilateral agencies can be an effective use of UK aid that aligns with UK priorities. The UK government should therefore rethink its decision to reduce support to multilateral agencies and focus on evidence for what works to tackle poverty.
“It must use its influence to direct UK aid to where it’s needed most, working with the World Bank to improve its focus on climate change and the promise to ‘leave no one behind’.
“While it’s good the Foreign Secretary has confirmed plans to restore the UK aid budget to 0.7% of GNI, this must be done without delay to ensure the option of cutting multilateral funding – which will cost countless lives – is taken off the table.”