Monday 26 December 2016

Foreign Aid Contractors That Do Not Deliver Value For Money To Be Named-And-Shamed Under New Proposed Plans

Foreign Aid

Foreign aid contractors that make huge profits and spend taxpayers' money on lavish salaries will be named and shamed for the first time under Government plans.

Priti Patel, the International Development Secretary, has written to all her department's suppliers, demanding that they in future "deliver value for money" for taxpayers.

That will include giving a detailed breakdown of employees' salaries as well as profits being made by the company as a result of its contract with the foreign aid department.

Ms Patel has come under growing pressure in recent weeks following a series of revelations about wasted spending by her department.

It is understood that ministers' aim is to make the information publicly available, to ensure that voters are able to see how their money is being spent.

Ms Patel has come under growing pressure in recent weeks following a series of revelations about wasted spending by her department.

Senior Conservatives are demanding that Theresa May reviews the Government's legal commitment to spend 0.7 per cent of GDP annually on foreign aid. Britain currently spends more than £12billion annually on foreign aid.

However, hundreds of millions of pounds goes to countries like India and Mexico and critics argue this money would be better spent in the UK.

In her letter to all Dfid suppliers, Ms Patel said: "As a Dfid supplier you must be aware that we must deliver the best possible outcomes that help the poorest in the world and deliver value for money (for) UK taxpayers.

"We need to provide them with assurance that public money is being spent effectively, and that our aid delivery partners apply the highest standards in transparency and ethical behaviour. This has been brought into sharp relief by recent allegations in the media."

She added: "In the coming months we will be increasing our scrutiny of supplier spending, with a particular focus on: Full transparency of how Dfid funds are spent, including ensuring fair, reasonable rewards and profits. Open book breakdown of salaries, expenses, profit margins, facilities, materials and rates within tenders."

Ms Patel has also demanded "greater scrutiny and detailed breakdown of fees and expenses" and that suppliers provide a "declaration of UK tax status and compliance to all tax requirements".

Sources made clear that Ms Patel believes the new measures will drive competition and ensure that the taxpayer gets value for money.

The demand from Ms Patel that Dfid contractors disclose their profits is particularly significant. Ms Patel last week said that the bosses of charities and aid contractors who enjoy six-figure salaries and bonuses while they are handed millions of pounds in foreign aid to fight poverty are "profiteering".

During an appearance before MPs she warned charities that they must not forget that they only exist because of the "generosity and goodwill of people that contribute and donate to them". Ms Patel's comments came after it emerged that dozens of leading aid charities are giving their executives six-figure pay packages.

David Miliband, the former Labour MP who is now president of the US-based International Rescue Committee, receives £530,922. His charity has been given £3.6m in British aid.

Helle Thorning-Schmidt, the former Danish Prime Minister who is now head of Save the Children, receives a pay and pension package worth £246,750 a year.

The organisation was last year given aid contracts worth £104million by Dfid. In recent days it has also emerged that Britain gave £1.3billion in foreign aid to help people in the 20 most corrupt countries in the world in 2015, research claims.

Analysis of an annual index of global corruption compiled by the respected organisation Transparency International has shown the UK's spending on corrupt countries has increased from just over £1 billion last year. Aid rose by more than 50 per cent in Afghanistan to £300 million and by 11 per cent in Nigeria to £263 million.



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