Foreign, Commonwealth and Development Office

Matt Rodda Excerpts

Wednesday 4th March 2026 Commons Chamber

[Noah Law (St Austell and Newquay) (Lab)]

The Government are cutting our aid budget by a third, from 0.5% to 0.3% of gross national income, by 2027—the steepest reduction in a generation, driven by the defence spending review. Much has already been said on this matter, and I am not here simply to oppose the cuts or argue that, in the current climate, we must instantly reverse them. Perhaps it is precisely the right moment in the arc of economic history to ask how we can do more with less, what we are actually buying with this money, and how we can get to the point at which we can say, hand on heart, to our constituents that we know the impact of our spend.

The FCDO’s stated aim remains

“alleviating poverty and stabilising countries to enable them to go on that journey themselves”.

That is the right ambition, but the model we have used to deliver that has been confused for far too long. We often hear of the financing gaps—the trillions that must be filled to meet the sustainable development goals and to overcome the challenge of climate change—but the reality is that overseas development assistance cannot so much as touch the sides in all this.

Furthermore, we know that our developing country partners across the world primarily want investment, not aid, and partnership, not paternalism. To unleash that investment, we must ensure that we level the financial playing field and build capital markets, both public and private, that ultimately drive growth and prosperity in those countries. Global debt reform, an area in which the City and the English courts could play a globally leading role, is just one of many ways in which we can strengthen the macroeconomic stability and financial capacity that these countries so desperately need.

Less aid need does not mean less investment overall; it means that we can no longer afford the luxury of, at worst, waste and, at best, a misallocation of resources. When done well, investment means trusting local knowledge, building local institutions, and empowering local businesswomen and businessmen, who are ultimately responsible for delivering economic growth that sustainably lifts people out of poverty.

[Matt Rodda (Reading Central) (Lab)]

My hon. Friend is giving an excellent speech, and some powerful points are being made. Does he agree that many development charities have made these points for some time, including Oxfam, the Catholic Agency for Overseas Development and many others? In their experience, this is a well-known approach.

[Noah Law]

I greatly welcome the advocacy work of the charities that my hon. Friend mentions, as well as the grassroots work of charities, which are increasingly not funded directly by ODA. I welcome the work that they do; it is really important that we build a coherent view of the financing, investment and donor ecosystem that we need to work within this constrained world.

As I have suggested, I very much welcome our Government’s shift from donor to investor, but I have a question for the Minister. At a time when we effectively have an in-built bias towards capital investment over resource spending in our Government’s fiscal policy, why are we not able to go further in capitalising on some of the very institutions that we know will deliver on the development and climate goals, and in helping to mobilise the vast sums that we know are needed to develop the world’s poorest economies? That capital could return to Britain’s public coffers, so that it can be put to future use.

First and foremost, overseas development aid must be allocated to problems that investment cannot solve, be they the world’s worst humanitarian crises or investment in public goods, such as climate adaptation, which cannot easily be monetised yet can save billions of dollars-worth of damage to some of our most climate-vulnerable countries around the world in the long term.

At a time when we have been considering cutting ICAI, why are we looking to create new bodies such as the ODA delivery board and the new Soft Power Council, rather than working to embed rigorously or incorporate better the assessments of value for money—an explicit, albeit qualified, return on our goal of raising the number of people lifted out of poverty for every £1 spent—in every aspect of the FCDO’s development work, so we can say to our constituents, hand on heart, that beyond all doubt the money is well spent, and show that, despite the smaller sums, the money is going further every year?

Let us be partners, not patrons; let us invest smarter, trust deeper and step back a little further where necessary; and let us measure success not by how much we give, but by how little is eventually needed.