CGD Calculates UK Aid Budget Faces £400m Deficit in 2027

The Center for Global Development reports that UK international aid spending will fall short of its 2027 target by an estimated £400m. The research indicates that the central forecast implies aid levels will be £410m lower than originally planned. This gap would reduce spending to 0.29% of national income, failing to meet the 0.3% goal set by the government.

Ian Mitchell, a senior fellow at the CGD, described the difference as a material shortfall in the spending power of UK aid. He noted that closing a £400m gap would allow the government to halve planned cuts to Africa. Mitchell warned that the current trajectory likely costs thousands of lives and acts as a de facto exit from the south and east of the continent.

The researchers identified two main drivers for the deficit. Inflation has exceeded expectations, resulting in a larger national income than projected during the spending review. A policy change in 2025 affecting the Foreign, Commonwealth and Development Office budget also contributed to the lower spending capacity. The CGD urges ministers to add funds for international aid in this week's budget to avoid missing the target.

The 0.3% goal represents a reduction from the 0.7% commitment in Labour's election manifesto. Prime Minister Keir Starmer lowered the target to free up money for defence spending. Fleur Anderson, a former minister on the foreign affairs select committee, stated she wants to see higher aid spending in the upcoming budget. She argued that hitting the reduced target is essential to prevent abstract accounting issues from becoming reality.

Anderson pointed to specific consequences of falling short, including communities without clean water, girls leaving school, and undelivered vaccines. She also cited cuts to peace programmes in war zones. Charities have repeatedly warned that deep aid cuts damage children's education and raise the risk of disease and death in some African countries.

Figures released by the FCDO in September showed that cuts under the current government hit the world's poorest nations hardest. Funding to least-developed and low-income countries fell by 6.7%, or £118m. The UK's overall official development assistance budget dropped to 0.44% of gross national income in 2025, down from 0.5% in 2024, a decrease of £987m.

The government has prioritized funding through multilateral bodies such as the International Development Association and Gavi. An FCDO spokesperson said that moving to a fixed budget reduces volatility and provides stability for high-impact aid programmes. The multi-year allocations published in March 2026 are based on gross national income figures from the 2025 spending review.