13.1  |  Resources

• Reconstruction could cost between US$2bn and US$10bn a year over a two to

three‑year period, depending on the impact of the military conflict, the level of

forgiveness secured on debt and other claims, and oil revenues.

• If the UK provided 5.6 percent141 of the total humanitarian/reconstruction costs

(in line with the UK’s share of OECD GNI), the UK’s contribution to “total

humanitarian/reconstruction costs” could reach US$640m (£400m) a year for

the next three years, under a “high case military/low case oil revenue scenario”.

222.  The draft paper stated that DFID had, ‘‘traditionally’ (Balkans/Afghanistan)”,

contributed between eight and 10 percent of total relief/reconstruction costs. On that

basis, under a high case military/low oil revenue scenario, the UK contribution could

be in excess of US$1bn a year.

223.  The official also provided advice on how to raise awareness across the UK

Government about the potential costs of a major humanitarian operation, “without

committing DFID’s budget at this stage or jeopardising other programmes”.

224.  The official recommended that DFID should continue to discuss funding with other

departments at official level, but seek to postpone discussions on the detailed financial

implications for DFID until its 2003/04 spending plans had been agreed. DFID’s Iraq

team and DFID’s Finance Department would continue to work closely together “on

tactics to avoid early discussion about the implications [of a UK contribution] for DFID’s

budget, bearing in mind Mr Lowcock’s earlier advice”. The Treasury would be keen to

share the burden across the international community, to minimise the UK contribution.

225.  Ms Short commented on that advice:

“Let us be clear … we have [a] Contingency Reserve of £100 mill[ion] and all our

systems strained [we] cannot take money from other poor countries. We are not

asking for or promising money. DFID prob[ably] has no more than £50 mill[ion].

If HMG wants to provide more – so be it but DFID limited.”142

226.  Ms Short wrote to Mr Blair on 5 February to provide an update on humanitarian

planning.143 In that context, she advised that a “fair share” for the UK of a major

humanitarian/reconstruction operation would be around 5.6 percent, equal to the

UK’s share of OECD GNI. Under one scenario, that could equate to £440m a year for

three years.

227.  The letter did not describe that scenario or provide a cost for any others.

228.  Ms Short also advised that DFID’s resources and those of the international system

were already under severe strain.

141 Rather than the 5.5 percent used in Mr Fernie’s minute of 28 January 2003 to Ms Short.

142 Manuscript comment Short on Minute DFID [junior official] to PS/Secretary of State [DFID],

31 January 2003, ‘Iraq: Cost of Humanitarian Relief/Reconstruction and Potential UK Contribution’.

143 Letter Short to Blair, 5 February 2003, ‘Iraq: Humanitarian Planning’.

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