This report provides a summary of the recent contribution of the Department for International Development to delivering the Millenium Development Goals. It includes details by country describing progress made and DFID's contribution. It discusses aims for bilateral and multilateral aid and the statistical information on monies spent

In the 2010 Comprehensive Spending Review the Coalition Government announced its decision to achieve the internationally agreed target of providing 0.7 percent of Gross National Income as ODA from 2013. This will involve spending an additional 2.5 billion pounds in 2013-14 to make the total DFID budget 11.3 billion pounds in that year. There will be a large increase in spending on fragile and conflict affected states and it will be difficult to ensure that every pound is well spent in such war-torn environments. When scrutinising DFID's accounts the MPs were also surprised to discover that the Pope's visit was paid for in part by money supposed to be for overseas development aid (ODA). The Committee expects a response from the Government as to what the £1.85 million, transferred to the Foreign Office for the papal visit, was spent on and an explanation as to how this was ODA compliant. The Comprehensive Spending Review (CSR) announced reductions in DFID's running costs to 2% of the total budget. If achieved, this would make DFID the most cost-efficient development organisation in the world.This is to be achieved by a large reduction in back office administration costs (which excludes front-line staff) of £34 million over the CSR period. The International Development Committee supports the proposals to make savings in back office staff, but the MPs are warning that Ministers must ensure that reduced administration budgets do not affect the ability to deliver aid programmes on the ground. While declining as a share of total costs, running costs will increase in real terms over the next four years because the total budget will rise so much.

DFID is right to focus more resources on fragile states if global poverty reduction goals are to be met. However, this report highlights a number of concerns about DFID's capacity to meet this and other new policy directions set out in the 2009 White Paper (Cm. 7656, ISBN 9780101765626), based on analysis of the Department's performance in 2008-09 (the Department's annual report 2008-09 published as HC 867-I,II, ISBN 9780102962154). Climate change, another key White Paper focus area, threatens progress on poverty reduction and will hit the poorest people first and hardest. The outcome of the Copenhagen Conference in December 2009 was disappointing and real progress needs to be made before the next conference at the end of this year. The White Paper also indicates that DFID will channel more funding through multilateral organisations including the EU, the UN and the World Bank. This offers the prospect of more coordinated delivery of aid, but only if these bodies increase their effectiveness and their poverty focus. The report also argues for speedier reform of the governance of the international financial institutions. The recession has had a significant impact on developing countries. It is estimated that an additional 90 million people will be affected by poverty as a combined result of the global food, financial and fuel crises over the last few years. Donors, including the UK, have responded and have sought to identify specific needs in developing countries, though many donors are failing to meet the aid commitments they have already made.

On cover and title page: House, committees of the whole House, general committees and select committees

This report finds that Bangladesh has reduced poverty levels from 57 per cent at the beginning of the 1990s to 40 per cent in 2005 but much more needs to be done to help the country's poorest people. Despite a steadily growing economy, Bangladesh's potential to achieve more widespread poverty reduction is held back by its poor record on governance and high levels of corruption. Successive governments have failed to respond to the needs of poor and marginalised communities and instead state power has too often been used for personal and partisan ends. Bangladesh is the fourth highest recipient of UK bilateral assistance. DFID's programme there in the current financial year is worth £125 million and will rise to £150 million in 2010-11. The report praises the innovative non-governmental organisations (NGO) community in Bangladesh which plays an important role in delivering basic services in areas where state provision is limited. Gender inequality continues to be a significant problem in Bangladesh: an increase in the number of girls attending primary school contrasts with insufficient progress in tackling maternal mortality and women remain marginalised and excluded from key decision-making processes. Bangladesh is likely to be adversely affected by climate change and the poorest people will be hardest hit. The report adds large parts of the country are low-lying and susceptible to more frequent and intense floods and cyclones. Bangladesh will need assistance to cope with the effects of rises in sea levels and increased salinisation.

Incorporating HC 945-i, ii, and iii of session 2007-08. The DFID annual report 2009 published as HC 492, session 2007-08 (ISBN 9780102953664)