The Report
of the Iraq Inquiry
204.
The 25 and 26
January 2005 meeting of DFID’s Management Board “noted
that
the
anticipated reduction (£20m) of programme
spend in Iraq should
enable … LIC
commitments
to be met in
2005/06”.120
205.
A junior DFID
official advised colleagues the following week that the
Management
Board had
imposed a “cap” on Iraq expenditure for 2005/06 of
£65m.121
She
commented
that the
decision was “largely to ensure that we do not undermine the agreed
MIC/LIC
targets”.
206.
The official
also advised that DFID’s overall budget was “running very hot” and
that
DFID’s
Finance Department had “both eyes” on the £40m of Iraq’s 2004/05
budget that
had not yet
been allocated.
207.
The £65m
budget for Iraq for 2005/06 was formally confirmed on 14
March.122
208.
DFID’s Iraq
Directorate undertook internal exercises in February and March
to
prioritise
expenditure against the new, lower budget.123
209.
The March
exercise estimated that “commitments and plans” for Iraq for
2005/06
totalled
£123m (against the budget of £65m), of which:
•
£59m was
“firm”;
•
£55m was
high priority (including £40m for the planned Iraq
Infrastructure
Services
Programme);
•
£8.5m was
medium priority; and
•
less than
£1m was low priority.124
Following
the 25 and 26 January 2005 meeting of DFID’s Management Board,
DFID
reduced its
budget for Iraq for 2005/06 from £86m to £65m.125
DFID
expenditure in 2005/06 was £82m. That comprised:
•
£38m for “life
support costs” (accommodation, security, medical services and
other
services)
provided by the FCO and charged to DFID (and other departments
and
agencies)
under a Service Level Agreement. Approximately half of that
charge
related to
services used in 2004/05 and half to services used in
2005/06;
•
£35m for
infrastructure projects; and
•
£10m for
governance projects.126
120
Minutes,
25/26 January 2005, DFID Management Board meeting.
121
Email DFID
[junior official] to DFID [junior official], 31 January 2005,
‘Iraq: FINSTATS 3’.
122
Minute
Calvert to [DFID] Directors, 14 March 2005, ‘Resource Allocation
Round: 2005-08’.
123
Email DFID
[junior official] to DFID [junior official], 14 February 2005,
‘Iraq: Forecast 2005/06’;
Email DFID
[junior official] to Anderson, 11 March 2005, ‘2005/06
Commitments’.
124
Email DFID
[junior official] to Anderson, 11 March 2005, ‘2005/06
Commitments’.
125
Minute
Calvert to [DFID] Directors, 14 March 2005, ‘Resource Allocation
Round: 2005-08’.
126
Letter
Cabinet Office [junior official] to Aldred, 1 July 2011, ‘Iraq
Inquiry: request for further information
on
funding’; Paper DFID, 21 December 2011, ‘A Note on DFID Iraq
Programme Admin Spend for the
Iraq Inquiry’.
230