6. There is need to give greater attention to our overall development strategy within the whole UN and Development Bank system. The wider political, as distinct from technical or administrative, dimensions need to be taken more seriously and
re have to come to terms with the increasing pressure to see aid in a broader context of economic relations as a whole between the developing and industrialised countries.
7. The cuts in the Aid Programme of £50m in 1977-78 and £55.4m in 1978-79 (both at 1976 prices) mean that it will be more difficult to make progress with implementing the aid strategy. They do not require any major change in that strategy; there will be less resources to allocate and it therefore becomes even more important to ensure that a high proportion of them should go to those who need help most.
8. Future Strategy
Our agreed long term objective is to help promote the economic and social development of the developing countries, particularly the poorest among them. A large part of the aid programme must be committed well in advance if the funds available are to be disbursed effectively. Any modifications are likely therefore to have only a limited impact at least in the immediately following two years. This coupled with the fact that the value of the aid programme will not increase substantively in real terms before 1979-80 means that 1977 is not the occasion for any material departures from existing policies although there will be room to accommodate relatively small changes which help to achieve a more appropriate balance in the aid programme as a whole.'
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9. The three main considerations which should govern the planning and management of the Aid Programme were set out in the Minister's Statement. They are repeated here for convenience:
"Although there will sometimes be difficulties in finding our way through competing considerations to an agreed Government line, there must be three dominant considerations:
i. A continuing emphasis on the poorest developing countries and on improving the productive capacity of the poorest groups within them;
ii. Increasing support for multilateral efforts and international
initiatives, particularly those which accord with our aim of helping the poorest; and
iii.
Within the context of our departmental priorities to consider ways in which development aid will also contribute to strengthening the British economy, recognising that without economic strength there will be very limited prospects for fulfilling our development objectives."
10. In applying these principles, departments should pay particular regard to the following:
i.
Bilateral Aid: India apart, the pattern of bilateral allocations is now broadly acceptable. In the richer countries (generally those with 1975 per capita incomes over $500) the emphasis of our programme should shift towards technical cooperation, with increasing emphasis on pay technical cooperation arrangements to be negotiated with the recipient governments. Programmes in those countries which we consider to be unimportant or over aided, and where we have no special interest, should be closely reviewed.
ii. Project Aid: The first priority for project aid will remain the search
for, and implementation of, good rural development projects. However it may
not be easy to achieve the balance of aid allocations we would wish for and at the same time give overriding priority to rural development projects. In these circumstances departments should consider allocating funds for infrastructure projects in non-rural sectors, particularly where these are regarded as important by recipient governments with poverty oriented programmes.
iii. Multilateral Aid: We should seek to extend our commitments to multilateral
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