The EU’s fake news on overseas aid

Brexit Facts4EU exposes the latest fake news from the EU: it is claiming to be the world’s leading donor of overseas aid, when in fact it only ranks fifth in the world, behind the UK. This is an edited version of Brexit Facts4EU’s original two-part report, which can be read here and here.

 

The EU Commission has issued yet another statement saying the EU is, ‘The world’s leading donor of Official Development Assistance (ODA)’.

This is not and has never been true, and yet the EU has been claiming this for years. Each year Brexit Facts4EU.Org calls out the EU on this, and each year the EU Commission continues to produce blatant and highly-misleading propaganda in an attempt to present themselves as something they are not.

‘Official Development Assistance’ (ODA) is what most people know as ‘foreign aid’ or ‘overseas aid’. The OECD is the official body adjudicating and monitoring overseas ODA, and its official figures place the EU in fifth place.

The OECD says that ‘The United States continued to be the largest DAC donor of ODA (USD $34.6 billion), followed by Germany ($23.8 billion), the United Kingdom ($19.4 billion). As an organisation the EU spent $14.8 billion on ODA in 2019, meaning it ranks fifth, not first.

 

The EU’s fake news

So how does the EU come up with figures that are so much higher than the official ones published by the OECD? Simple: it takes the amounts which its individual member states distribute through their own overseas aid programmes, and counts it as EU money. It then adds this to monies collated and distributed by the EU institutions, and claims the whole lot as ‘EU donations’.

The EU should simply report its own donations from its own donor programme. Even that might be argued to be disingenuous, as the European Union is not a country and the money it donates comes from the individual member states.

Each year the UK gives billions to the EU for official EU budget contributions and also for ‘off-budget’ EU funds. Last year (2019) the UK gave $2.32 billion of this to the EU’s foreign aid programme, on top of what the UK gives unilaterally to poorer nations around the world. This $2.3 billion is suddenly transformed from ‘UK Aid’ into ‘Funded by the EU Humanitarian Aid’.

If this isn’t ‘fake news’ from the EU, what is? If a commercial company produced advertising leaflets such as the ones the EU Commission regularly produces, they would be subject to all manner of legal actions from the authorities. We see no reason that the EU Commission should be exempt from these standards.

 

Inflating the national figures

The United Kingdom can stand very tall when it comes to ODA: it is one of only five OECD countries worldwide which meets the OECD’s minimum target for ODA of 0.7% of GDP. Moreover, the UK was the only major EU country to meet this target in 2019 – and has been for years. Germany doesn’t come close – even when it includes its $3.1bn spend on in-country migrants as ‘overseas aid’.

Many countries inflate their ‘generosity’ by including huge loans instead of grants to poor nations. To use Germany as an example, $4.1bn of its 2019 ‘aid’ was in fact in the form of loans or other ‘non-grants’ – around 20% of the total. The figure for the EU was also around 20%. In contrast, the UK included only $0.07bn of non-grants in its ODA figures – less than 0.5% of its total aid.

Loans increase the debt burden of poor countries – grants do not. They represent true overseas aid and this is what the UK currently gives – unlike the EU and other countries.

Another way some donor countries inflate their ‘generosity’ is by including their spend in their own country on migrants. In 2019, according to Germany’s figures $3.1bn of its ‘aid’ was actually spent in-house. The UK included only $0.6bn of in-country spend in its ODA figures.

Below we show the reality of ‘overseas aid’ if you strip out loans (not gifts of aid) to poor countries and if you also strip out monies which a donor country spends in-house on its migrants. In other words, we are showing a closer picture of what true ‘overseas aid’ really looks like.

 

Is it finally time to re-evaluate the UK’s generosity to the EU and to the world?

Firstly, we hope that the government dept responsible for overseas aid, DFID, is rapidly moving to stop all payments of this kind to the EU. Huge amounts go to the EU from DFID each year, only for the British people’s generosity to be re-badged by the EU as ‘EU humanitarian aid’ when it arrives in the recipient countries.

Secondly, we hope there is currently a major re-evaluation of the UK’s foreign aid programme underway. We generally prefer not to single out individual countries, but the UK is continuing to give ‘development’ aid to India – a country whose economy is now larger than the UK’s and a country which even has its own space programme. Surely this aid must be stopped immediately?

Thirdly and above all, we would like to see a very strong statement from Mr David Frost and his team of Brexit trade negotiators that going forward, the UK will make its own decisions on British generosity towards poor and developing nations. These decisions should be made without any reference to the EU, and without UK aid being re-badged by the EU any longer.