According to the Telegraph, the new UK Prime Minister Rishi Sunak may decide to freeze the nation’s foreign aid budget for an additional two years. The government currently spends 0.5 percent of its national income on foreign aid. Due to a significant financial hit caused by the Covid-19 outbreak, the nation was obliged to reduce its spending on international aid two years ago.
By 2024–2025, Sunak predicted, foreign spending would revert to its previous level of 0.7% of GDP. However, according to a story in the Telegraph, officials are thinking about pushing back the reduction in foreign aid spending by two more years, to 2026–2027.
Additionally, there is a possibility of tying future foreign aid spending for three years to inflation, along with even deeper cuts. Currently, the administration is planning expenditure reductions and reversing tax cuts. With the cost of mortgages rising and the price of food, fuel, and heating increasing, inflation is at an all-time high.
Sunak had earlier on Friday stated that tough decisions would need to be made to put the British government’s borrowing and debt on a manageable course. He said that he was sure he could turn around the economy.
“We face lots of challenges as a country, but I am confident that we can fix the economy,” Sunak told journalists during a visit to a hospital in south London.
“The Chancellor has already said of course difficult decisions are going to have to be made and I’m going to sit down and work through those with him … we need to do these things so that we can get our borrowing and debt back on a sustainable path.”