The UK government has released new figures outlining how its international aid budget for 2025–2026 will be spent, with a clear focus on delivering value for money to taxpayers and achieving the highest possible impact for vulnerable populations overseas. This strategic shift comes in light of a planned reduction in the aid budget to 0.3% of Gross National Income from 2027. The figures, detailed in the Foreign, Commonwealth & Development Office’s (FCDO) annual report, represent the first release since the budget cut was announced earlier this year.
The new approach emphasizes targeted investments through effective multilateral organisations such as the World Bank and Gavi, the vaccine alliance. These institutions are seen as vehicles for achieving large-scale impact and will be prioritized for funding. The UK confirmed its continued support to the World Bank’s International Development Association (IDA), which is expected to benefit 1.9 billion people globally over the next three years. A revised payment mechanism will allow the UK to meet its commitments to the IDA while reducing overall taxpayer costs.
This aid reform follows a comprehensive review conducted by Development Minister Baroness Chapman, who assessed all existing programmes to improve efficiency and prioritization. The review preserved planned humanitarian aid and live contracts while ensuring responsible exits from underperforming programmes. Underperforming multilateral partners are set to face future funding reductions, with the UK gradually shifting from traditional bilateral aid to sharing technical expertise and supporting global public goods.
The UK also aims to retain its humanitarian leadership role in crisis zones such as Gaza, Sudan, and Ukraine. A dedicated reserve fund will allow rapid responses to emerging crises. Alongside humanitarian work, UK aid will increasingly focus on tackling global challenges like health threats and climate change, aligning with domestic and international security priorities.
Support for multilateral initiatives like Gavi continues, with recent funding expected to contribute to saving up to 8 million lives. The UK is also calling for reforms in the global multilateral system to enhance efficiency and ensure that investments translate into measurable impact. This updated strategy reflects a broader global shift towards partnership- and investment-based development, as advocated by various leaders from the Global South.
An equality impact assessment released with the aid figures confirms that the new budget approach will avoid disproportionate impacts on vulnerable groups. The UK government plans to publish indicative funding allocations for 2026–2029 in autumn 2025, offering further clarity on its international development direction.
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