I wish to update the House on the progress of the cross-Government prosperity fund (PF) for the financial year 2017-18.
Created two years ago, the £1.2 billion prosperity fund runs over seven years from 2016 to 2023. It forms an integral part of the UK’s aid strategy, and official development assistance commitment of 0.7% of GNI.
The prosperity fund is grounded on the premise that economic growth, when sustainable and inclusive, can raise welfare and prosperity in middle income countries. It can also benefit trade and investment with partners such as the United Kingdom. Middle income countries present huge untapped economic potential, yet are home to around 60% of the world’s poor. They often seek our partnership and expertise, and opportunities to trade and grow out of poverty rather than traditional aid.
As the Prime Minister set out during her visit to Africa in August this year, we need to work with these countries; sharing our skills, our experience and our resources to tackle the challenges we face, and to deliver prosperity and security for everyone. The prosperity fund is a key driver of this. It removes barriers to trade, builds prosperous partnerships, and enables international and UK business to seize new opportunities. All whilst helping to meet the United Nations global goals for sustainable development and deepening the UK’s relationships with countries across the globe.
Following a review of the cross-Government funds, undertaken as part of the national security capability review, ministerial oversight of the prosperity fund and the conflict stability and security fund is now the responsibility of a sub-committee of the National Security Council. The sub-committee, which I chair, ensures that both funds deliver effectively on national security priorities and UK aid objectives. The cross-Government approach of the two funds allows them to deliver interventions that draw on expertise from across Government to tackle today’s stubborn global challenges.
The prosperity fund’s second annual report details progress made in 2017-18 towards development of the full portfolio: 26 multi-year programmes operating until 2023, across investment in infrastructure and human capital; innovation and technology; increasing trade; financial and economic reform; and ease of doing business. Priority countries and regions include: Mexico, Brazil, Colombia, Nigeria, South Africa, China, India and southeast Asia.
In 2017-18 the total spend for the fund was £63 million, of which £7 million was for non-ODA activities. Several programmes are already delivering, like the DFID led Centre for Global Disaster Protection which is building developing countries’ financial resilience to natural disasters to reduce economic and social impacts. Others have been allocated initial funding, like the FCO led global future cities programme, which is providing support to Cape Town to better mitigate against climate-related shocks, such as their recent severe drought, which threatened jobs and growth in the region. The remainder are going through final stages of approval or procurement before they begin.
A copy of the 2017-18 prosperity fund annual report has been placed in the libraries of both Houses. The publication of the report reflects the Government’s continued commitment to transparency in the delivery of official development assistance.