Committee of Public Accounts Press Notice

Department for International Development: Tackling rural poverty in developing countries

Publication of the Committee’s 1st Report, Session 2007-08

Edward Leigh MP, Chairman of the Committee of Public Accounts, today said:

“Three quarters of the world’s poor live in rural areas but the rural poor in developing countries receive less aid per head than other poor people. The Department for International Development will not be able to meet its objective of contributing to the UN aim of halving world poverty by 2015 unless it seriously addresses this short-changing of the poorest of the poor.

“To do that it needs better information on the costs and benefits of its aid programmes. DFID currently has a poor grasp of how much of its assistance reaches the rural poor and the extent to which they benefit. It must rapidly improve its understanding of the complex relationship between aid and developments in rural poverty and use that as the basis for action on a wide range of fronts.

“This should include much greater emphasis on the sustainability of benefits to the rural poor after aid projects have been completed. It should include the department’s own professional staff spending less time at their desks and more actually out in the more remote areas where the rural poor live. And it should also include DFID’s using its new responsibilities for UK trade policy to help the rural poor.”

Mr Leigh was speaking as the Committee published its 1st Report of this Session which, on the basis of evidence from the Department for International Development (DFID), examined how the Department is tackling rural poverty in developing countries

The World Bank has estimated that 1.1 billion people worldwide live in extreme poverty, some 75% in rural areas. Even with trends towards urbanisation, two thirds of the poor will still live in rural areas by 2015. The Department for International Development (DFID) manages the UK’s contribution to achieving the United Nations’ Millennium Development Goals to halve poverty by 2015 and has set its own targets to contribute to this goal. If it is to meet its targets, its aid will need to help make significant reductions in rural poverty.

The livelihoods of the rural poor are often exposed to risks such as poor harvests, and those in remote areas find it difficult to access infrastructure and markets. Service providers may incur higher costs per head to reach rural areas, so the rural poor are often marginalised and excluded from development gains.

A range of DFID assistance benefits the rural poor to some degree, including bilateral country programmes, contributions to multilateral institutions, DFID-commissioned research programmes and its work to influence global polices in areas such as trade reform and climate change. This report covers three themes:

The importance of the rural poor. DFID needs to tackle rural poverty if it is to meet its own targets but it does not assess how much of its assistance benefits the rural poor. Current funding disadvantages the rural poor both in bilateral assistance (where the rural poor receive less direct funding per head than the non-rural poor), and in its contributions to multilateral institutions which do not target the rural poor or which have limited capacity.

Designing DFID country programmes. DFID is increasing its support for government budgets. But developing country governments are not always efficient at reaching the rural poor or fair in their expenditure allocations. Greater use of well designed projects, and working through civil society organisations, may be needed in such cases.

Monitoring and evaluating effectiveness. Despite difficulties in data collection, DFID’s current monitoring of the value for money of aid to rural areas needs tightening. Current management practices do not give sufficient insight into the real needs of the rural poor.