The Economic Impact and Effectiveness of Development Aid

18 May 2011


The House of Lords Economic Affairs Committee today invites contributions to its new inquiry which will ask what impact official development aid has on the economic growth and development of recipient countries.

The inquiry will not address humanitarian aid.

More money is now spent on development aid than ever before. In 2010, donors worldwide spent US$129 billion . The UK’s contribution of US$13.7billion (£8.4billion) amounted to 11% of the total and 0.56% of UK Gross National Income. The Department for International Development is one of the few UK Government Departments whose budget the Coalition Government has not cut.

The Committee will ask whether this is money well spent.
• Do recipient countries’ economies develop and grow as a result?
• And how does their economic performance compare to that of countries which don’t receive such aid?

It will also examine what impact British official development aid has had, what makes aid effective, and whether the British Government can improve the effectiveness of its development aid.

Committee Chairman, Lord MacGregor of Pulham Market, said: “The UK and other countries spend large amounts of taxpayers’ money to help less well-off countries develop and grow. It is essential that such development aid is well targeted, effective and achieves its objective.

“I welcome contributions from everyone who knows about making official development aid work. My Committee, which brings together a wide range of economic and financial experience, depends on knowledgeable people giving us the benefit of their expertise.  Together we hope to make a real contribution to this important subject. ”

Written evidence must be received by 30 June.

Notes to Editors

1. This figure applies to members of the Organisation for Economic Co-operation and Development’s Development Assistance Committee according to OECD figures available online: www.oecd.org/dac/stats/data. These figures do not include aid provided by non-member donors such as China, India, Brazil and Russia.

2. For the full Call for Evidence, list of questions, and information about how to send in evidence, please see the website. Evidence should be sent by 30 June, preferably by email to economicaffairs@parliament.uk.

3. The Committee expects to hold public meetings for this inquiry from late June. Journalists and members of the public are welcome to attend. A regularly updated schedule of meetings will be available on the website. Please contact the Lords press office or subscribe to news alerts if you would like to be kept informed.

4. The House of Lords Economic Affairs Committee is charged with considering economic affairs and is one of five permanent investigative committees of the House of Lords. For more information about this Committee and its inquiry, see the website.

5. The Committee’s Members have served in roles including Chancellor of the Exchequer, Chief Secretary to the Treasury, FTSE 250 chief executive, professor of economics , chairman of Ofcom, deputy chair of the Competition Commission and economics editor of a national newspaper. The Committee also includes the current Chairman of Lloyd’s.

6. The Economic Affairs Select Committee is chaired by Lord MacGregor of Pulham Market. To arrange interviews or other media activity with the Committee please contact Catherine Day on +44(0) 20 7219 8659.

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