The Government is committed to returning to a target of spending 0.7% of Gross National Income (GNI) on ODA. Today the Government has confirmed this will happen when the independent Office for Budget Responsibility’s fiscal forecast says that, on a sustainable basis, the UK is not borrowing to finance day-to-day spending and underlying debt is falling. This provides a clear measure, assessed against independent objective forecasts to inform the return to 0.7%, underlining the commitment to the International Development Act 2015.

Due to the economic and fiscal consequences of the Covid pandemic, the UK has suffered the biggest recession in 300 years. Last year, the Government borrowed nearly £300 billion – nearly 15 per cent of GDP – the highest since the Second World War, which is why the decision was taken to temporarily reduce the ODA budget to spend 0.5 per cent of Gross National Income on overseas aid in 2021. Other measures taken were an increase in corporation tax, freezing income tax personal thresholds, and adopting a targeted approach to public sector pay.

Spending at 0.5 per cent of Gross National Income for this year means the UK will still give more than £10 billion to improve global health, fight poverty and tackle climate change. The UK is currently the third largest donor in the G7 as a percentage of GNI. It is also the third largest bilateral humanitarian donor in the world. The UK is investing more than £400 million on girls’ education in over 25 countries, delivering £534 million of bilateral spend on climate and biodiversity, and committing £548 million to COVAX to provide vaccines for poorer countries.

The UK is also a moral and humanitarian leader, spending money on causes on top of the ODA budget. This includes peacekeeping, where the UK is currently the fifth largest contributor to the UN peacekeeping budget, defence, where the Government announced the largest boost to the nation’s defence in the last 30 years last year, and diplomacy, where the UK has the third biggest diplomatic network in the world. Also on trade, where UK tariff reductions on imports from certain developing countries save exporters from those countries around £1 billion each year, and on research and development, where the UK is spending nearly £15 billion this year. The UK Government has also invested over £85 million to develop and manufacture the Oxford-AstraZeneca vaccine, with the agreement that the vaccine would be made available without profit to the world.

At the upcoming Spending Review the Government will set the ODA budget for 2022-23 (and provisionally for later years) in line with these tests and the latest fiscal forecast. Each year, the Government will review, in accordance with the International Development Act 2015, whether a return to spending 0.7% of GNI on ODA is achievable against the latest fiscal forecast. If it expects to meet the fiscal tests in the following financial year, the government will increase overseas aid spending above 0.5% of GNI to 0.7% of GNI.

Once the Government has spent 0.7% of GNI as overseas aid in a given year, these tests will no longer apply to overseas aid spending and the government will return to spending 0.7% of GNI on ODA year on year.

A motion will be tabled by the Government alongside the Written Ministerial Statement published today, asking the House of Commons to consider and approve this approach. A vote is expected to take place tomorrow.

Further information

• The Written ministerial statement is available here

• The International Development (Official Development Assistance Target) Act 2015 clearly envisages situations in which a departure from spending 0.7% of GNI on ODA may be necessary; for example in response to “fiscal circumstances and, in particular, the likely impact of meeting the target on taxation, public spending and public borrowing”.

• Last year the UK borrowed nearly £300 billion – equivalent to 14.3 per cent of GDP – the highest since World War II. Debt as a percentage of GDP has reached nearly 100 per cent, the highest since 1962. This year the UK is forecast to borrow the second highest amount on record during peacetime – second only to last year.

• Gross national income (GNI) is defined as gross domestic product (GDP), plus net receipts from abroad of compensation of employees, property income and net taxes less subsidies on production

• GNI is an alternative measure of a country’s income, which includes income earned from abroad. GDP measures the total value of goods and services produced within the UK. GNI is therefore a broader measure of a nation’s income than GDP, since it captures investment income or money transfers to the UK, regardless of where they came from.

Step 4 of the Roadmap will proceed as planned on Monday 19 July, the Prime Minister has confirmed.

Moving to Step 4 is a balance of risks and the public should continue to be cautious. The majority of covid restrictions will end on 19 July and guidance will emphasise personal responsibility.

The latest data and modelling show that the government’s “four tests” for easing covid restrictions have been met.

The four tests are:

• The vaccine deployment programme continues successfully
• Evidence shows vaccines are sufficiently effective in reducing hospitalisations and deaths in those vaccinated.
• Infection rates do not risk a surge in hospitalisations which would put unsustainable pressure on the NHS.
• Our assessment of the risks is not fundamentally changed by new Variants of Concern.

Cases will continue to rise as set out from the start of the Roadmap, but the vaccination programme has substantially weakened the link between infection and serious illness or death.

Hospitalisations and deaths will continue to rise over the coming weeks and months, but both are far lower than the previous wave. The current data does not suggest that unsustainable pressure will be put on the NHS but all data will be kept under constant review.

As of 12 July there are 28,421 new positive cases in England. 461 people were admitted to hospital with covid and there are 2,352 patients in hospital. The latest ONS estimates show that 1 in 160 people have covid in England.

The move to Step 4 was delayed by 4 weeks so more adults could be vaccinated. Nearly 7 million vaccines have already been administered during the delay.

By 19 July two thirds of adults will have received two doses and every adult will have been offered a first dose.

The delay to Step 4 has also moved the end of restrictions closer to the school summer holidays.

All adults should take up the offer of two vaccine doses, to protect themselves and others against covid. Analysis from Public Health England (PHE) and the University of Cambridge suggests that vaccines have so far prevented an estimated 8.5 million infections and 30,000 deaths in England alone.

Data from PHE suggests that one dose of either the Pfizer-BioNTech or Oxford-AstraZeneca vaccine is 80% effective against hospitalisations with the Delta variant, increasing to 96% after two doses.

The Prime Minister has today emphasised caution and the expectation for a gradual easing of restrictions, based on informed choice and personal responsibility. Last week he set out a five-point plan to manage the risks while learning to live with covid.

The vaccination programme will continue and all adults will be offered two doses by mid-September. Dependent on final JCVI advice the booster programme will begin from September, offering additional protection to the most vulnerable.

The majority of legal restrictions will be removed and people will be expected to protect themselves and others through informed choice. The government expects and recommends that face coverings are worn in crowded and enclosed spaces, such as public transport, when mixing with people you don’t normally meet.

While the government is no longer instructing people to work from home, a return to the workplace should be gradual and businesses should follow the published guidance.

Organisations and large events will be supported and encouraged to use the NHS COVID Pass in high-risk settings to help limit the risk of infection in their venues.

Positive cases and contacts of positive cases identified by NHS Test and Trace will still be legally required to self-isolate, to help break chains of transmission. There will be an isolation exemption for contacts of positive cases for under 18s and for double vaccinated adults from 16 August. School bubbles will end from 19 July.

Quarantine rules will remain for all those travelling from a red list country, and for amber list countries unless double vaccinated.

All data will be kept under review, and contingency measures will be retained to manage periods of higher risk, such as winter. Guidance will be strengthened if needed, but restrictions will be avoided if possible due to their significant economic, social and health costs.

The government will review the current guidance in September.