The UK government has unveiled extra details on its international development budget up to March 2030 in the recent Spring Statement. This move comes after the Prime Minister announced plans to increase defense spending to 2.5% of the country’s Gross Domestic Product (GDP) from April 2027, which will be funded by reductions in the Official Development Assistance (ODA) budget.
According to the Spring Statement, the UK’s international development spending will decrease from 0.5% of the country’s Gross National Income (GNI) in the current financial year (2024/25) to 0.3% by April 2027. This reduction will be implemented gradually over three years to facilitate a smooth transition.
To optimize the impact of its international development efforts, the UK government will accelerate plans to modernize its approach. This involves prioritizing partnerships and mobilizing private capital for development and climate projects by strengthening ties with the financial sector and international partners.
Another key change announced in the Spring Statement is that the UK will set annual aid budgets in cash terms from 2027 onwards, based on GNI forecasts at the Spending Review. These budgets will not be adjusted for GNI fluctuations in future years. Minister for Development Baroness Chapman emphasized that this change will bring more stability and certainty, increasing the predictability of international development budgets.
Baroness Chapman also highlighted the importance of the UK’s development work, stating that it is critical for the country’s interests and helps create a safer, more secure, and better world. She noted that the government is committed to modernizing its approach despite having less funding, working with partners in new ways to maximize impact.
In a letter to the International Development Committee (IDC), Baroness Chapman outlined the changes and confirmed that the Foreign Commonwealth and Development Office (FCDO) will no longer hold the ODA ‘spender and saver of last resort’ role. This shift aims to provide greater certainty and stability, enabling the UK to deliver the best value for taxpayers.
For the 2025/26 financial year, the FCDO plans to continue critical development work, honor existing contractual agreements with partners, and fulfill the Prime Minister’s commitment to maintaining a key humanitarian role. The UK’s development investment is seen as a crucial aspect of its hard power, helping build a stable international environment that strengthens the country’s safety, security, and prosperity.
In addition, Baroness Chapman announced a new review of cross-government development programming to ensure it aligns with UK objectives and provides the best value for money. This review demonstrates the government’s commitment to transparency and accountability in its international development efforts.
