Will the Future EU Budget Water Down the Consensus on Poverty Reduction and Sustainable Development?

By Amelia Hadfield and Simon Lightfoot

The European Union (EU)’s draft Multiannual Financial Framework (MFF) for 2021-27 is currently under negotiation. If approved, the EU’s development cooperation budget would increase by 30% despite Brexit. Given the possible political sensitivities around these discussions, the most recent peer review of the EU’s plans by the OECD’s Development Assistance Committee (DAC) did not swerve the issue and made a number of recommendations relating to the political context of the MFF negotiations. The peer review was carried out by development experts from Canada and Japan and is the standard OECD DAC method of reviewing the development cooperation of the DAC members. Their recommendations are a form of soft law and as such have political rather than legal weight.

Of the many recommendations within the peer review, a major concern appears to relate to the proposed changes to the development budget and their implications for the future of development cooperation, especially in light of the 20017 European Consensus on Development. The consensus sets development as the soft power centrepiece for the EU’s Global Europe strategy, including both its 2030 Agenda (covering sustainable development) and the 2016 Global Strategy (covering external action more broadly). It even goes so far as to argue that it – as a strategy – will “contribute to the requirement of ensuring consistency between the different areas of EU external action, and between these areas and its other policies.” In turn, the MFF 2021-27 includes a proposal for a comprehensive financial instrument, which the European Commission sees as a main implementing tool for the consensus

Will development be subordinated to broader foreign policy concerns?

The proposal is that, during the budget period, the amount dedicated to development will be €123bn, including the addition of €30bn European Development Fund (EDF), which was previously outside of the budget, and was an instrument controlled by member states. The next MFF therefore presents itself as an opportunity for the EU to ‘distil a common vision into concrete plans’. However, the DAC review team sees a lack of operational guidance on how the 2017 consensus’s focus on poverty reduction and sustainable development will actually be kept up in light of the MFF negotiations. Such guidance, however, might be necessary to clarify ‘how EU actors and member states will work coherently, particularly in focusing on the poorest countries and leaving no one behind’.

The peer review comments chime with those raised by a number of NGOs and think-tanks when the Commission proposal was first announced in the summer. The Commission’s plan was to create a single instrument called “the neighbourhood and international cooperation instrument”, which will pool the resources of existing separate instruments, such as the European Neighbourhood Instrument (ENI), European Development Fund (EDF), Development Cooperation Instrument (DCI), and European Initiative on Democracy and Human Rights (EIHDR). The Commission is clear that this will simplify external spending, avoid duplication and offer more flexibility, while maintaining that ‘poverty eradication remains the broad focus’ and that ‘the policies remain the same’.

Despite this statement the plan to create a single instrument has prompted concerns that the EU’s focus on security and migration would undermine its focus on partner countries’ long-term development needs, particularly by increasingly designing development co-operation programmes with their impact on security and or migration in mind. CONCORD, a European NGO confederation for relief and development, is concerned that issues like human rights or gender will no longer receive the attention and visibility they deserve and will be relegated as secondary priorities in a large instrument focused on forging partnerships with neighbouring and other countries to tackle EU migration, security and economic challenges. There is also a fear that integrating the EDF into a single instrument will weaken the EU’s relationship with the African, Caribbean and Pacific (ACP) group of states, especially the low-income countries. This is because recent evidence shows an increased share of ODA going to middle income countries in the EU’s neighbourhood, especially Turkey, Morocco, Serbia and Tunisia, with the proposed neighbourhood budget growing by 43%. According to the peer review, ‘the risk of subordinating development objectives to broader security and migration concerns, then, remains a key challenge for the EU, as it does for other DAC members. In the EU’s case, this challenge might be exacerbated by the proposed streamlining of instruments in the upcoming MFF if appropriate safeguards are not included’.

The peer review highlights that the EU has shown leadership in its efforts towards reaching global agreements on sustainable development and climate change. It also praised its extensive use of budget support and variety of delivery instruments which it notes enhances ownership and inclusiveness in partner countries. Finally, the review praised the joined efforts to build global citizenship across Europe. However, without the external affairs budget reflecting the wider policy priorities of development cooperation these positives may not be enough for the EU to maintain its position as an effective development actor. Despite some cautiously optimistic conclusions at a recent EADI event on EU development cooperation about the future of the EU ODA budget, the future for the broader development budget looks less certain.

Amelia Hadfield is Professor of European and International Relations and Head of the Department of Politics at the University of Surrey

Simon Lightfoot is Senior Lecturer in European Politics at the University of Leeds and co-convenor of the newly created EADI working group on the EU as a development actor.

Photo by Christian Dubovan on Unsplash

One Reply to “Will the Future EU Budget Water Down the Consensus on Poverty Reduction and Sustainable Development?”

  1. Speculative concerns are difficult to address except through legal guarantees and effective action. The action will come later, during the programming and implementation phases of the 2021-’27 budget, but the newly proposed legal framework under the NDICI (Neighbourhood, Development and International Cooperation Instrument) should already give some reassurances on top of the efficiency gains resulting from simplification and increased flexibility:
    – as rightly pointed out, the 2017 European Consensus on Development puts the 2030 agenda and the SDGs at the heart of its development policy. The new instrument repeats that commitment very explicitly, building on the European Consensus;
    – minimal DACability of 92%;
    – minimal safeguarded allocation to Sub-Saharan Africa where a majority of LICs (and unfortunately an increasing share of the world’s extreme poor) are concentrated;
    – minimal thematic allocations: 25% to meet climate objectives, 20% for social inclusion and human development;
    – when discussing security and migration (including a minimal allocation of 10%), the emphasis is clearly on the root-causes of conflicts, irregular migration and forced displacement and those are, as we all know, development and governance-related. The consolidation and support to democracy, rule of law and human rights therefore very explicitly remain overarching specific objectives of the new instrument in line with the Treaty objectives.
    The initial exchanges with the EU Member States and the European Parliament confirm the shared development focus and above guarantees are definitely not expected to be weakened during the final negotiations of the instrument, rather on the contrary.
    With the safeguards built in the legal framework, there is no reason to think that the “streamlining of instruments” will exacerbate the perceived risks of subordination of the development objectives to broader external policy concerns which would undermine the achievement of those objectives and the achievement of the SDGs.
    Again, the test of the pudding will be in the eating, but while it is important to be vigilant, let’s give minimal credit to the EU’s good faith at the start of the exercise.
    In this context let me congratulate EADI for the initiative of creating a dedicated working group on the EU as a development actor. Ready to engage…

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