Global Policy Forum

By Charlotte Denny

Gordon Brown yesterday called for the war on terror to be accompanied by a war on poverty as he announced a scheme to boost global aid flows by $50bn (£30bn) a year over the next decade and half.

Rich countries would double aid spending to an annual total of $100bn by borrowing against future aid flows on international capital markets.

The goal is to provide a surge of funds to build schools, hospitals and sanitation facilities in the third world ahead of the 2015 deadline world leaders have set themselves for halving global poverty.

Mr Brown said that following the September 11 terrorist attacks, rich countries' security and prosperity depended on eliminating global poverty. "What has happened in Afghanistan and elsewhere raises global issues on terror to which we must respond with resolution but also about the integration of the poorest countries into our global economy."

The chancellor's scheme would require rich countries to commit their aid budgets to paying back the earlier borrowing over 30 years after 2015. In return, recipient governments would be expected to provide commitments to root out corruption and show that the money will be used to alleviate poverty, not line the pockets of officials.

"I believe that we need nothing more than a modern Marshall Plan," Mr Brown told a conference of non-governmental organisations and business leaders at Chatham House, London. "Poor countries need not just one-off emergency allocations that depend on the whims of donors, but long-term commitments to sustain lasting change."

UN estimates suggest that $100bn is the minimum amount needed to meet the ambitious targets for tackling poverty world leaders set themselves at the millennium summit two years ago.

On current trends most of sub-Saharan Africa will fail to meet the millennium development goals (MDGs), which include halving the proportion of people living on less than a dollar a day, getting every child in the world into primary school and reducing child and maternal mortality.

Mark Malloch Brown, the head of the United Nation's development programme, welcomed Mr Brown's proposal. "The estimated additional aid of $50bn a year needed to achieve the MDGs by 2015 requires bold, out of the box solutions. The chancellor has laid out just such an approach."

Aid agencies also welcomed the plan. "It breaks the deafening international silence about where the money is coming from to meet the millennium development goals," said Henry Northover, a policy analyst for Catholic aid agency Cafod. "If other G7 countries reject Mr Brown's idea they have to come up with an alternative way to fund the millennium goals."

Mr Brown said the IFF would provide a temporary framework to provide the additional funds that were now recognised as urgently necessary to meet the millennium development goals.

The EU and the US pledged to reverse years of declining aid budgets when they promised an extra $12bn for development at last year's UN summit in Monterrey, Mexico. Development experts are worried that the EU money is dependent on the performance of Europe's struggling economies, while the US has yet to allocate funds from the federal budget for its much trumpeted millennium challenge accounts.

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