Slash and burn: how the UK government is cutting aid while propping up fossil fuels

Climate Home News

“It’s a very sad day for British leadership”. These were the words of former UK Cabinet Minister Andrew Mitchell, bitterly condemning the government’s decision to cut its aid to Yemen by more than half. In the grip of the world’s worst crisis, 400,000 children in Yemen are at imminent risk of starvation.

He’s right: it is a sad day. But it is also one half of a story about British leadership – one that reveals the truth about how it conducts itself overseas. We now know that while the UK government doesn’t feel able to help stop thousands of children dying overseas, it is able to find hundreds of millions of pounds to invest in polluting fossil fuels.

Four months ago, the UK Government attracted almost universal praise for its announcement that it would stop directly funding overseas fossil fuel projects. It came after Boris Johnson came under sustained pressure for his inexplicable decision to finance a gas project in Mozambique via UK Export Finance.

Hidden in the detail of the government’s proposals is a loophole that could see the UK continuing to pour hundreds of millions of pounds of British cash into fossil fuels. Money that’s badged as ‘development aid’ will leave Britain through the government’s development bank, CDC Group, which is not governed by Boris Johnson’s proposed policy. While the CDC has published its own policy and guidance, which politicians defend as “well aligned” with the UK policy position, it does little to allay concerns that CDC will continue to invest in new fossil fuel projects overseas – with direct investments in the case of gas-fired power generation, and indirectly through its large investments in financial institutions.

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