The former Secretary of State for International Development, the Rt Hon Andrew Mitchell MP, stopped payment of general budget support to Rwanda in July 2012.This was because of concerns about the role of Rwanda in the M23 rebellion in the Democratic Republic of the Congo. In September he re-instated half the aid as general budget support, and paid the other half directly to the education and agricultural sectors. Although there were concerns about the decision making process and whether the decision was correct. Mr Mitchell assured the Committee that he carried out consultations within the both Governments of the UK and Rwanda before making his decision. The new Secretary of State agreed that the decision-making process had been robust.As part of this process, the Prime Minister set out three conditions for the restoration of aid which the Committee believe to be reasonable and consistent with the aid agreement between the UK and Rwanda Governments. These were 1) Rwanda should engage constructively in the peace process, 2) it should publicly condemn the M23 Group and 3) there should be continuing ceasefire in the Kivus and practical support to the M23 should end.Among the main conclusions are : in the light of Rwanda's progress towards the Millennium Development Goal targets and its poverty reduction efforts, DFID should continue to provide aid to Rwanda; but as the Prime Minister's conditions have not been met, general budget support cannot continue; The Government of Rwanda should comply with all three of the Prime Minister's conditions before further general budget support is disbursed; Until then, DFID should consider alternative channels to deliver its aid.

Government response to HC 726, session 2012-13 (ISBN 9780215050861)

Includes statistics.

When the United Nations sanctions a humanitarian relief operation, how can the numerous and diverse UN, Non-Governmental Organizations and military elements be coordinated? What are the practical, political and institutional considerations and impediments? What can be learned from previous experience? This is a volume of practitioner perspectives: the views of distinguished individuals from all of the concerned professions, including former Special Representatives of the Secretary-General and Force Commanders, as well as senior UN officials and representatives of the NGO community.

Abstract: The inflow of large quantities of foreign aid into Rwanda since 1994 can have potential adverse effects such as aid dependency via a significant negative effect on tax efforts and on public investments. This paper carries out a theoretical and empirical study to examine these issues. The theoretical part develops a model in which the recipient government decides on the optimal level of tax and optimally allocates total government revenue between current expenditure and public investment. The theoretical model makes it possible to empirically test whether an increase in aid is likely to reduce the optimal tax rate and the proportion of public expenditure allocated to public investment. The econometric analysis uses time series data on Rwanda to show, in line with other studies in the literature, a negative relationship between increased aid and the tax rate; but the magnitude of the effects are extremely small. In the case of Rwanda, reforms to the tax administration and expansion of the tax base have had mitigating effects. As far as the effect on public investment, the overall effect was negative in the past; however, since 1995 the direction of this effect has changed.