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Tories Accused Of Raiding Aid Budget To Pay For Climate Projects

Labour has accused the coalition of plotting to redirect funds from Britain’s overseas aid budget to pay for international climate change projects run by the energy department.

David Cameron has promised to increase real terms spending on overseas development aid, devoting 0.7 per cent of national income to development, in spite of a squeeze on public spending.

But Whitehall insiders said plans were being drawn up to reclassify energy department programmes as “overseas development assistance”. The knock-on effect could be a squeeze on funding for other priorities within the Department for International Development (DfID).

Whitehall officials are revisiting rules on the definition of overseas development aid, which Britain interprets more narrowly than in other European countries. One change under consideration is lifting a Labour-imposed cap on climate finance spending by DfID, which from 2013 will prevent the department spending more than 10 per cent of its budget on carbon reduction. The cap was backed by the Liberal Democrats in opposition but the coalition agreement made no such commitment, leaving open the option of either transferring the Department of Energy’s £250m annual budget for international climate finance to DfID, or redefining the spending as overseas development aid.

The template for reclassifying projects as development aid could be replicated across Whitehall, expanding Britain’s aid programme to include various Foreign Office and Ministry of Defence programmes.

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