Fraud investigations involving foreign aid have quadrupled over five years as more public money is given to “fragile” countries, Whitehall’s spending watchdog has found.
Reforms introduced by David Cameron to increase funding and assign it to unstable nations have increased the risk of wrongdoing, according to the National Audit Office.
In a report released on Thursday, the NAO said it was “particularly challenging” to detect fraud in more than half of the spending of the Department for International Development (DfID) spend because the money was routed through other international organisations, such as the United Nations or World Bank.
Financial crimes in UN organisations are believed to be under-reported and the problem could be “significant and endemic”, the report said. Auditors also outlined the difficulties facing officials when operating in countries where bribery can be seen as a “cultural norm”.
Under Cameron, the government committed to spending 0.7% of national income on international aid, which came to around £12bn last year. As part of the 2015 Strategic Defence and Security Review, DfID was ordered to spend at least half of its money on “fragile states and regions” until 2020.
This was seen as a significant shift among the aid community, which was worried that the UK government was raiding the aid budget to bolster defence and security.
In strongly worded conclusions, auditors said the reforms may well have increased the risk of…