British-funded aid group under fire for spending on flights

by Emma Batha | @emmabatha | Thomson Reuters Foundation
Friday, 4 July 2014 12:35 GMT

A passenger watches airplanes from Terminal 3 at Heathrow Airport in London July 3, 2014. REUTERS/Luke MacGregor

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Britain's spending watchdog says DFID failed to keep account of how funds were spent

LONDON (Thomson Reuters Foundation) - Board members of an international aid group took 15 flights costing over £5,000 ($8,500) each at British taxpayers' expense, according to a report by the government’s spending watchdog.

The National Audit Office said Britain’s Department for International Development (DFID) had failed to keep proper scrutiny of how the Private Infrastructure Development Group (PIDG) used its donations.

The aid group, which invests in infrastructure projects in developing countries, also built up a £27 million surplus after the British government increased its funding five-fold in 2011, the report said.

DFID had given PIDG £414 million by the end of last year, representing 70 percent of the agency's funding. This has funded projects such as a steel foundry in Nigeria and a Ugandan hydropower scheme.

The report said PIDG had this month banned the use of fully flexible business class fares except in exceptional circumstances.

But Margaret Hodge, chairwoman of the parliamentary committee that scrutinises public accounts, was quoted by the BBC as saying:  "It's outrageous that 15 flights were booked from 2011, each costing over £5,000 … DFID should get a grip on administrative costs like this."

DFID said it has been working to tighten the travel policies of the organisations it supports, in line with the government’s austerity measures.

The audit office also said PIDG had not regularly published or monitored its total administrative and operational costs, which it estimated at around £23.8 million in 2012.

Britain ramped up funding for the agency in 2011, as part of its policy of encouraging private investment in developing countries but the audit office found DFID had handed out money well before it was spent.

Amyas Morse, head of the audit office, said PIDG was “providing important benefits to poor people in difficult environments, but DFID does not have enough good evidence to show that funding PIDG is the best option.

"Furthermore, DFID's financial control has been lacking, allowing the PIDG Trust to hold nearly £27 million worth of DFID funding since 2012.”

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