Spring Budget 2024

Lord Bishop of Worcester Excerpts

Monday 18th March 2024 Lords Chamber

[The Lord Bishop of Worcester]

My Lords, I congratulate the noble Lord, Lord Kempsell, on an excellent maiden speech, which was thoughtful and brief—and, as we all know, concision is next to godliness.

I have learned a lot in this debate, including the operation of the VAT regime on nuts—probably more than I would have wanted to have known. However, I will not concentrate my remarks on that.

It is clear that the Chancellor had a difficult task in producing the Budget, as has been observed by one of his predecessors, the noble Lord, Lord Lamont, who knows better than anyone. I want to pay tribute to the many good things in the Budget: the continuation of the household support fund, the reform of non-dom status, the increase in public services spending by 1% above inflation, and the welcome reduction in national insurance, to name but a few. However, I was very disappointed by one lacuna, to which I want to address my remarks now. That is, that the aid budget was not increased.

The Government have consistently maintained that they would restore the UK’s aid budget to 0.7% of GNI “when fiscal circumstances allow”. I believe I speak for very many in expressing dismay that the Chancellor did not use any of his fiscal headroom to do so, thus restoring a manifesto commitment. The dismay is felt because of the impact of the cuts, which have been set out by the Independent Commission for Aid Impact. It noted that cuts have led to less focus on poverty reduction in trade programmes, and that programmes focused on gender equality in places where this is much needed have been heavily impacted.

The starkest impact of the cuts has been on least-developed countries. The amounts of bilateral overseas aid going to least-developed countries dropped by £961 million in 2021—that is 40%. That is far greater than those to lower- and middle-income countries, which received a cut of £339 million, or 29%, and upper-middle income countries, which saw reductions of £117 million, or 17%. Of the 10 countries that received the biggest cuts, six were lowest-income countries. This is surely a heartbreaking way to prioritise overseas aid spending. As if the cuts were not bad enough, we now know that they were focused on countries least able to respond to or mitigate a reduction in funding.

If the Government will not restore a manifesto commitment when fiscal circumstances allow, which surely must be now, I am not sure what they have in mind. The White Paper on development had some good themes and ideas, but without a funding boost it is extremely difficult to see how Britain can be re-established as a world leader with a great reputation for development—because that reputation has been severely damaged of late. The White Paper also does not promise any primary legislation, which left many in the development sector wondering what its purpose was.

The 0.7% of GNI commitment is not just about the actions we take but the aspirations we set ourselves and our reputation for sticking to our commitments. That 0.7% was and remains symbolic of our values and our commitments to some of the poorest people on the planet. We do them and our international reputation a disservice by continuing to break a basic promise in this way.