The FCDO's approach to value for money

International Development Committee Closed Inquiry
Opened: 13 Nov 2024 Closed: 11 Feb 2026 Parliament page
In November 2020, the Government announced a reduction of Official Development Assistance (ODA) from 0.7 per cent to 0.5 per cent of Gross National Income (GNI), a “temporary measure” until a set of certain fiscal rules were met. In the 2024 Autumn Budget, the Government confirmed that the FCDO would … Read more
10 Recommendations
28 Conclusions
1 Report
3 Oral sessions
3 Letters
3 Events
Activity timeline 11 events
11 Feb
2026
Report published
29 Oct
2025
Report published
17 Jun
2025
Oral evidence
17 Jun
2025
Formal meeting (oral evidence session) · Room 8, Palace of Westminster
27 Mar
2025
Correspondence
25 Mar
2025
Oral evidence
25 Mar
2025
Formal meeting (oral evidence session) · The Thatcher Room, Portcullis House
14 Mar
2025
Correspondence
11 Mar
2025
Correspondence
11 Feb
2025
Oral evidence
11 Feb
2025
Formal meeting (oral evidence session) · The Thatcher Room, Portcullis House
Oral evidence sessions 3 sessions
17 Jun 2025
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FCDO's Approach to Value for Money
Alex Hurrell · Verian Group UK Ltd Anisa Berdellima · MSI Reproductive Choices Dr Brendan Whitty · St Andrews University Mark Henstridge · Oxford Policy Management Sinead Magill · Palladium Group
25 Mar 2025
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The FCDO's approach to value for money
Rt Hon Andrew Mitchell · House of Commons Sarah Annable-Gardner · Action Through Enterprise
11 Feb 2025
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The FCDO's approach to value for money
Abdoulaye Fabregas · OECD Dianne Stewart · The Global Fund to Fight AIDS, Tuberculosis and Malaria Jennifer Armitage · LAMP Development Shamik Dhar · Deer Run Advisory Stefan Dercon CMG · University of Oxford
Title HC No. Published Items Response
7th Report – Assessing Value, Ensuring Impact: The FCDO's Approa… HC 422 29 Oct 2025 38 Responded
Recommendations & Conclusions
15 results
Clear
1 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Limited public information and guidance on FCDO's value for money approach concerning equity.
DFID was a global leader in its approach to value for money (VfM), and the Committee are pleased to hear that some of the core foundations of DFID’s framework have transferred into the FCDO. However, it is concerning that there … Read more
Government Response
The government disagrees with the concern, stating that its Programme Operating Framework (PrOF) and internal PrOF Guides already provide rules and guidance on Value for Money (VfM). It plans to update existing guidance, share good examples, and roll out VfM training for staff instead of creating a new strategy.
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2 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Publish a clear strategy and framework for FCDO’s approach to Value for Money.
The FCDO must publish a clear strategy and framework regarding its approach to VfM, as had previously been done by DFID and other Government departments. This should include: a. A clear definition of VfM; b. The FCDO’s core VfM principles; … Read more
Government Response
The government rejects the recommendation to publish a new, clear Value for Money (VfM) strategy and framework. It asserts that existing documents like the Programme Operating Framework (PrOF) and PrOF Guides already cover these aspects, and it will focus on updating this existing guidance.
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8 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Reducing ODA to 0.3% will have devastating consequences, undermining UK soft power and security.
The UK’s planned reduction of ODA spend from 0.5% to 0.3% of gross national income will have devastating consequences across the world. The Committee recognises that increased defence spending is needed and is to be welcomed. However, to do this … Read more
Government Response
The government disagrees with the conclusion, reiterating its commitment to returning to 0.7% ODA when fiscal circumstances allow, based on OBR forecasts, and notes these conditions are not met within this Parliament.
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9 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Repeated UK aid budget cuts damage reputation and hinder long-term Value for Money.
Guaranteed, long-term funding for programmes is essential for ensuring that VfM is achieved, and that the impact of FCDO work continues to be felt long after the end of a programme. In the last five years, the UK has significantly … Read more
Government Response
The government disagrees with the conclusion, reiterating its commitment to returning to 0.7% ODA when fiscal circumstances allow, based on OBR forecasts, and notes these conditions are not met within this Parliament.
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10 Recommendation Rejected
7th Report – Assessing Value, Ensu…
Require Government to return ODA spending to 0.5% GNI with a clear rebuilding schedule.
The Government must make every effort to return to spending 0.5% of GNI on ODA at a minimum, as soon as possible. The Government should produce a clear schedule for rebuilding aid from the interim level of 0.3%, with defined … Read more
Government Response
The government explicitly rejects the recommendation to return to 0.5% ODA, stating its commitment is to 0.7% when fiscal circumstances allow, and notes these conditions are not expected to be met within this Parliament.
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12 Conclusion Rejected
7th Report – Assessing Value, Ensu…
High in-country refugee costs are disproportionately classified as ODA, diverting funds from global poor.
The Committee notes the continuing badging of high levels of Government spending on refugee costs within the UK as ODA with dismay. Whilst the Spending Review commits to ending the use of asylum hotels in this Parliament, the level of … Read more
Government Response
The government disagrees, stating the FCDO's ODA budget is no longer automatically exposed to in-donor refugee costs and that measures are being taken to reduce asylum costs to ensure more ODA can be spent on overseas development.
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13 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Excessive in-donor refugee spend, especially hotel costs, contravenes ODA's development spirit.
Whilst the Committee recognises that in-donor refugee spend is allowable under DAC rules, in a world of rapidly decreasing aid budgets it is not in the spirit of what ODA should be used for, which per the OECD is spending … Read more
Government Response
The government disagrees, stating that the FCDO's ODA budget is no longer automatically exposed to in-donor refugee costs and measures are being taken to reduce these costs, thereby allowing more ODA for overseas development.
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14 Recommendation Rejected
7th Report – Assessing Value, Ensu…
Cap Home Office in-donor refugee costs at a fixed percentage of total ODA.
The Government should consider that Home Office in-donor refugee costs should be capped at a fixed percentage of total ODA spend to protect a rapidly diminishing envelope of funding. This should include formal review points if projections breach 80% of … Read more
Government Response
The government explicitly rejects the recommendation for a cap on Home Office in-donor refugee costs, stating the FCDO's ODA budget is no longer automatically exposed and measures are in place to reduce asylum costs.
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15 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Require HM Treasury to reallocate all future unspent ODA back to the FCDO.
The FCDO must make formal representation to HM Treasury that any unspent ODA allocated to other Government departments is channelled back through the FCDO to continue its vital humanitarian and development work, and to ensure that overall ODA spending does … Read more
Government Response
The government rejects the recommendation, explaining that ODA Department Expenditure Limit totals will no longer be adjusted for GNI fluctuations, meaning the FCDO's budget is no longer automatically exposed to other department's spending, thus providing greater predictability.
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16 Conclusion Rejected
7th Report – Assessing Value, Ensu…
FCDO's leadership position offers opportunity for consistent ODA value for money framework.
VfM approaches differ between Government departments, including in relation to ODA spend. The Minister’s announcement that the FCDO have been granted a greater leadership position in the way that ODA is spent across Whitehall is an opportunity for the FCDO … Read more
Government Response
The government disagrees with the premise that the FCDO should exert leadership over other departments' ODA spend, stating that individual departmental Secretaries of State remain accountable, and the Minister for Development already provides cross-government oversight.
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17 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Mandate FCDO's value for money framework for all ODA spending with formal FCDO oversight.
Achieving VfM for every pound of ODA is now more vital than ever, and it is essential that one consistent framework is applied across all aid spending. Given that the FCDO is the largest administrator of ODA, its published framework, … Read more
Government Response
The government disagrees with applying one consistent VfM framework across all aid spending and formal oversight by the FCDO's Second Permanent Under-Secretary, stating that departmental Secretaries of State are individually accountable for their department's spending.
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28 Conclusion Rejected
7th Report – Assessing Value, Ensu…
FCDO faces potential loss of in-house expertise due to long-term private contractor engagement.
We are concerned about the potential loss of expertise within the FCDO as a result of engagement with private contractors, particularly where contracts have been ongoing for many years, where in-house expertise could have instead been used. (Conclusion, Paragraph 90) Read more
Government Response
The government disagrees with the committee's concern, stating that existing robust governance, performance reviews, and contract management processes already provide sufficient oversight and accountability, thereby preventing loss of expertise.
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29 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Perform audit of FCDO private contractor engagements exceeding 12 months, assessing performance alignment.
The FCDO should perform an audit of all individual private contractor engagement longer than 12 months or approaching renewal. This must assess whether extended tenures align with performance outcomes and original mandates, with findings with clear recommendations for terminations or … Read more
Government Response
The government rejects the recommendation for an audit, stating that existing robust governance, performance reviews, and contract management processes already provide sufficient oversight and accountability, making additional audits unnecessary.
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35 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Previous ODA reductions detrimentally impacted FCDO's vital Monitoring, Evaluation and Learning budget.
As a global leader in promoting VfM across development spending, it is vital that the FCDO protects its MEL budget. MEL should not be optional; it is a core function that underpins effective, accountable and adaptive programming. Without appropriate and … Read more
Government Response
The government disagrees with the implied recommendation to protect MEL budgets or ringfence MEL spend. They state that ringfencing is inappropriate as FCDO needs flexibility to prioritise resources, though they remain committed to proportionate and strategic MEL and will make monitoring mandatory.
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36 Conclusion Rejected
7th Report – Assessing Value, Ensu…
Ringfence Monitoring, Evaluation and Learning spend within programme budgets to protect accountability and impact.
It is essential that the FCDO ringfences MEL spend within programme budgets and protects these throughout the reduction of ODA to 0.3% of GNI. Further cuts to MEL threaten to undermine the very assessments that sustain the accountability and impact … Read more
Government Response
The government rejects the recommendation to ringfence MEL spend within programme budgets, stating it is not appropriate in the current fiscal landscape as FCDO requires flexibility to prioritise resources. They remain committed to proportionate and strategic MEL.
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Government Response AI assessment · 38 of 10 classified
Accepted 8
Accepted in Part 12
Acknowledged 3
Rejected 15
Total 10 recs + 28 conclusions
Correspondence 3 letters
27 Mar 2025 Correspondence from the Minister of State for International Development, Latin America and Caribbean relating to Initial 2025/26 Official Development Assistance (ODA) allocations and the Spring Statement, 27 March 2025
Parliament page
14 Mar 2025 Correspondence from the Minister of State for International Development, Latin America and Caribbean relating to Preparations for the reduction in UK Official Development Assistance (ODA), 14 March 2025
Parliament page
11 Mar 2025 Correspondence from the Minister for the Indo-Pacific relating to the decision not to move from Abercrombie House, East Kilbride to Glasgow, 6 March 2025
Parliament page