'Too few checks' on UK aid funds

Tanzania is among the counties where the UK sends aid

There are insufficient checks to ensure UK aid is spent effectively when it is given to Third World countries, the National Audit Office has said.

The watchdog warned most of the nations receiving funding from the UK last year had major problems with corruption.

It called for improvements in the way the £461m budget was managed.

But International Development Secretary Douglas Alexander said risks were "assessed carefully" and safeguards were preventing "the misuse of funds".

The auditors acknowledged that aid was an important way of allowing countries to improve their services direct, as it enabled them to have direct control over their resources.

But they stressed it was not clear whether this process was any more effective than channelling money into specific projects.

And this was very much dependent on the way developing countries were run, the report from the National Audit Office (NAO) said.

'Taken on board'

Governments in such nations "may not be capable of using UK funds efficiently and effectively, or may misuse them for political reasons or through corruption", the watchdog told the Department for International Development (DFID).

"DFID has played a leading role in developing and using risk-assessment tools, which pay specific attention to corruption, but could be clearer in setting out the extent of risk to UK funds," auditors added.

"If things go off track we take action," Mr Alexander stressed

In response, Mr Alexander stressed that aid "helps governments provide more health and education services for their people, and have more ambitious plans and programmes to reduce poverty".

"It also helps build stronger government systems. This means that poor people get access to the basic services that are their right, and we help to build a future where governments can deliver these services without our help."

He went on: "We assess the risks carefully and have safe-guards to prevent the misuse of funds. If things go off track we take action. If necessary we reduce or suspend support or deliver it in a different way.

"Many of the points made by the NAO, and other evaluations, have been taken on board."