Hidden costs of sending 'aid' money back to Africa

 

African workers in London send home on average £130 per month to support family members in their country of origin, with some individuals sending more than a quarter of their income. And many of these workers are taking on two or three low-pay jobs to make ends meet.

The figures are contained in a new report by Harriet Harman MP on remittances amongst the African community living in her constituency in Southwark.

One in five respondents to the survey reported sending back more than 20 per cent of their monthly income, with one resident sending over forty per cent. The report illustrates the vital, and largely unseen, contribution that remittances play in tackling poverty and development in Africa.

The survey also revealed that:

  • Forty percent of respondents earn less than £12,000 a year, but send home an average of £130 a month.
  • Some people are paying more than 30 per cent in administration costs to send money home, with an average cost of £7 for every £100.
  • Remittance payments are made out of taxed, or 'net', income.
  • Many respondents often relied on two or more low-paid jobs in order to provide for both their family in the UK and send money home. This meant long, unsocial hours often at minimum wage level.

The Government has estimated that the total annual remittances to the developing world from people living and working in the UK to be £2.3 billion.

Harriet Harman said: “The families and individuals involved in sending these much-needed funds back are the hidden heroes of international development.  Most of the families are making a real sacrifice often under great duress from working long hours at low-paid jobs. It is clear from the report, that remittances play a vital role in Africa, helping children go to school, ensuring care for the elderly and supporting community services such as health clinics. 

The Government has already shown great leadership by the priority it has given to international development. The Treasury also highlighted the problem of remittances in the 2005 pre-Budget Report.  By listening to the experiences of local diaspora communities and working together we can strengthen this approach even more.”

“The money you send is so vital; they need it for their everyday life”

Honorino Domovaud

“When you send £50-100, there is a charge of £14 – it is too much, so you have to send even more. It’s not easy”

Nicole Opeli

“I send money every month to help my family – the money means a lot as it means my family can buy food, pay the rent each month and my brother’s children can go school”

Simone Bouabre

 

Notes

  • The London Borough of Southwark has the largest community of African origin in the UK. The report details where money from Southwark is sent to, with: 27 per cent to Nigeria; 26 per cent to Ghana; and 24 per cent to Somalia.
  • As a result of the large African community in her constituency, Harriet has visited Sierra Leone in March 2004, Nigeria in September 2004 and Tanzania in May 2005. The reports of Harriet’s visits can be seen on www.harrietharman.org
  • The Select Committee on International Development held a meeting in Harriet’s constituency when undertaking its enquiry into migration and international development. The evidence gathered at this meeting of the Select Committee was a substantial contribution to the report ‘Migration and Development: How to make migration work for poverty reduction’ which can be viewed via the Parliament website via the link below. Southwark residents’ contribution is acknowledged on page 7, and the evidence gathered at the committee meeting held in Southwark Town Hall is used throughout the report.

http://www.publications.parliament.uk/pa/cm200304/cmselect/cmintdev/79/79.pdf

  • People who send money to family in Africa and contributed to Harriet’s research are available for interview on request – contact 0207 219 2057
  • Harriet is also available for interview – contact 0207 219 2057

                                                                                                                             

  • Copies of the report: ‘The Hidden Heroes of International Development: Remittances from the Southwark African Diaspora to families and villages in Africa’ are available on request to harmanh(at)parliament.uk or 0207 219 2057 or can be viewed on www.harrietharman.org

 

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