Government spending foreign aid money to promote fracking in China

Exclusive: ‘It is a flagrant misuse of the UK’s aid budget to fund the fossil fuel industry overseas when the priority must be shifting to low carbon energy and boosting climate resilience’

Taxpayers’ money earmarked to support overseas development has been spent on supporting China’s fracking industry, The Independent can reveal.

The government is required to spend 0.7 per cent of its national income each year on foreign aid.

But even with climate change threatening the developing world with droughts, flooding and heatwaves, millions have been spent on fossil fuel investment abroad over the past two years.

This includes two schemes aiming to “export the UK’s expertise in shale gas regulation” to China, as controversy about new drilling sites rages back in Britain.

“Global efforts to tackle poverty are now taking place in a rapidly changing climate which is driving more extreme weather, more acute disasters, and hitting the poorest first and hardest,” said Tom Viita from Christian Aid.

“It is a flagrant misuse of the UK’s aid budget to fund the fossil fuel industry overseas when the priority must be shifting to low carbon energy and boosting climate resilience.”

In a report seen by The Independent, energy watchdog Platform revealed £2m from the government’s Prosperity Fund for overseas economic development has been used to expand the oil and gas sectors in nations including Brazil, Mexico and India.

This cross-departmental fund was set up to “remove barriers to economic growth in order to reduce poverty ... and [support] the United Nations Sustainable Development Goals”.

While the fund is allowed to be spent on fossil fuel development, given that one of those UN goals is to urgently combat climate change, campaigners questioned why it was financing 16 projects extracting these high-polluting fuels.

They also criticised the use of money explicitly set aside to “reduce poverty” to build projects that offer a helping hand to UK businesses.

Theresa May announced over the summer that money from the foreign aid budget could be spent on boosting the British private sector abroad.

Twelve of the 16 fossil fuel projects supported by the Prosperity Fund between 2016-2018 made references to creating opportunities for companies in other nations including the UK.

Anna Markova, who authored the report, said this hinted at why certain projects had been chosen, with British firms like BP known to be exploring shale gas extraction in China.

“They are kind of going: ‘well, where are the big oil and gas deposits that British companies want to access – OK, let’s go there’,” she said.

Kate Osamor, the shadow international development secretary, said: “The Tory government using the UK’s aid money to help their friends in the oil and gas industry get rich is a disgraceful misuse of the UK aid budget.

“It is an insult to the British public and our climate change commitments to be doing this at the same time that the world’s leading climate scientists are warning that we only have a matter of years to halt a climate catastrophe.”

Ms Markova said the funds should instead be exclusively supporting a global transition away from fossil fuels towards renewable sources.

“They are kind of shooting themselves in the foot, because they know their mission is to support the transition to a zero carbon economy,” she said.

China has one of the world’s largest reserves of shale gas, but extracting it would require fracking on a massive scale. This would have enormous water requirements in a nation already facing a national freshwater shortage.

With a total spend of over £13,000, the two UK-backed projects were intended to export British expertise to kick-start proceedings and see pilot projects established in China within three years.

Given the local opposition, legal troubles and environmental issues that have plagued British fracking, campaigners questioned the government’s involvement in operations overseas.

“It is quite unbelievable that the UK should have the hubris to suggest that it can export a regulatory system that is clearly not fit for purpose,” said Barbara Richardson, a spokesperson from Frack Free Lancashire.

Energy minister Claire Perry has emphasised the importance of shale gas as a relatively clean “bridge fuel” that will allow the transition to a low carbon economy, but critics are dubious about this goal.

“With fracking and any other form of fossil gas, there is a huge risk of lock-in – which means that it won’t get up and running fast enough, and when investors are putting money into these operations they are putting it in for 40 or 50 years,” said Ms Markova.

“In 40 years’ time we should not be using any fossil fuels whatsoever.”

To meet its commitments under the Paris climate agreement, she concluded that the UK must stop financing any more fossil fuel extraction in foreign countries.

Rose Dickinson from Friends of the Earth, who collaborated with Platform and Christian Aid to produce the report, said: “Our government’s claim to be climate leaders cannot be taken seriously while it continues to push fracking at home and abroad.

“We need to be moving away from fossil fuels, not showing other countries the best way to dig up more.”

Responding to the report, a spokesperson from the Foreign and Commonwealth Office said: “The UK’s aid investment is creating a safer, healthier and more prosperous world and is in the UK’s interest.

“Gas has the potential to be a reliable energy source as countries transition towards a clean energy future, and these programmes are aimed at sharing UK expertise to help ensure that their exploration or development of resources like natural gas is done to high environmental standards.”