By Megan Rowling

Nov 25 (Thomson Reuters Foundation) — Britain's decision to cut its aid budget will likely dent its reputation on the global diplomatic stage and may weaken a push for other wealthy governments to find more funding to help poor nations tackle climate change, aid groups and think-tanks said.

UK finance minister Rishi Sunak told parliament on Wednesday that during a "fiscal emergency" sparked by the COVID-19 pandemic, "sticking rigidly to spending 0.7% of our national income on overseas aid is difficult to justify".

The temporary reduction to 0.5% of gross national income in 2021 will see aid spending drop about £3 billion ($4 billion) from this year, to £10 billion.

How that money is allocated across government departments will be decided in an upcoming review, the Treasury said.

Stephanie Draper, head of Bond, a UK-based network of development NGOs, said the move was "a tragic blow for the world's most marginalised people" and would cost lives, with Britain's aid spending already down this year as the economy contracted due to the pandemic.

She and others said 2021 was intended to be the year that re-established Britain as a global player, after a messy withdrawal from the European Union and as it hosts the COP26 UN climate conference in November and the G7 summit.

Greenpeace UK's head of politics, Rebecca Newsom, said the decision to cut the aid budget would "fundamentally undermine the UK's climate leadership".

Abandoning aid target sends the wrong signal before COP26, writes former UN secretary general Ban Ki-Moon https://t.co/XF4vcL68Lrpic.twitter.com/NMKr1aR0Z1

— Red Box (@timesredbox) November 26, 2020

"It will hinder poorer countries' ability to tackle and adapt to the climate emergency, and sour the UK's diplomatic relationships in the run-up to the crucial Glasgow climate conference next year," she added in a statement.

Andrew Norton, director of the London-based International Institute for Environment and Development, urged the government to stick to a promise made in 2019 to double its international climate finance to £11.6 billion ($15.5 billion) for the period 2021-2026.

The language in Wednesday's spending review suggested that may still be the plan, noting 2021 funding provided through the review "will help developing countries limit their greenhouse gas emissions and adapt to the impacts of climate change".

A Treasury spokeswoman said only that "further detail" on the climate finance allocation for next year "will be confirmed in due course".

But Norton added that even if the government honours its climate funding commitment in the next five years, the overall aid cut sent a "terrible signal" in terms of encouraging others to give more.

We’ve joined almost 200 other charities to call on the PM not to cut the #UKAid budget. Women and girls are hardest hit by COVID-19, humanitarian and climate crises. With the UK hosting G7 and #COP26 we must support women who are leading the response: https://t.co/L5PZvljnnn

— ActionAid UK (@ActionAidUK) November 20, 2020

It could also engender some "distrust" due to "wriggle room" on how and when the UK climate cash will be delivered, he told the Thomson Reuters Foundation.

Business minister Alok Sharma, who will preside over the COP26 climate talks, said at a summit of the world's development banks this month that donors had "much further to go" to meet a goal of mobilising $100 billion a year in climate finance for poorer nations from 2020 onwards.

"Our COP26 presidency will focus on working with others to mobilise funds and improve access for adaptation and resilience," he added.

But in a letter to the Guardian newspaper on Tuesday, the heads of 17 aid agencies, green groups, and think-tanks said the planned aid cut would "fail" the poorest countries who are "at the frontline of a climate crisis they did not cause".

"It has never been more important that UK aid and climate finance work together to build resilience in the face of climate change and the COVID-19 crisis," they wrote.

Going back on the 0.7% aid promise also risked failing to fulfill Britain's commitments to the Paris Agreement on climate action, including meeting existing aid and climate finance pledges and raising ambition, they added.

In a time when #LDCs need support more than ever, #ODAfunding cuts take us in the wrong direction. With global problems of #COVID & #climatechange, we need more solidarity - not less. As @COP26 President, we call on the UK to lead, not retreat @hmtreasury@FCDOGovUK

— LDC Chair (@LDCChairUNFCCC) November 24, 2020

Sonam Phuntsho Wangdi of Bhutan, who chairs the group of 47 least-developed countries at UN climate change talks, tweeted on Tuesday that at a time poor nations needed support more than ever, the aid cuts "take us in the wrong direction".

"With global problems of COVID and climate change, we need more solidarity — not less. As COP26 president, we call on the UK to lead, not retreat," he added.

(Reporting by Megan Rowling @meganrowling; editing by Laurie Goering. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org/climate)