The Government is failing to tackle corruption levels in international aid programmes it is funding, an independent watchdog has found.
At least one programme supported by British cash appears to have actually "increased the opportunities for corruption", according to the Independent Commission for Aid Impact (ICAI).
It warned that the poorest were suffering most as a result of so-called petty corruption but said political sensitivities were constraining the Department for International Development's (DfID) willingness to directly tackle the problem.
Graham Ward, ICAI chief commissioner, said: "We saw very little evidence that the work DfId is doing to combat corruption is successfully addressing the impact of corruption as experienced by the poor.
"Indeed, there is little indication that DfId has sought to address the forms of corruption that most directly affect the poor: so called 'petty' corruption. This is a gap in DfId's programming that needs to be filled."
Dfid's anti-corruption effort was given an amber-red rating, which means it is classed as performing relatively poorly and significant improvements must be made.
The report looked closely at the situation in Nepal, where there is a "growing acceptance" of corruption across society.
" Disappointingly, we found that at least one programme supported by DfId appears to have increased the opportunities for corruption in society," the report said.
The ICAI said the poor were being " pushed towards corrupt practices" by having to pay bribes or forge documents to receive funding through a local governance project backed by British aid.
It also found that DfId was aware that funds on one scheme in the country were frequently released 11 months into the financial year giving citizens an "untenable" one month - during monsoon rains - to undertake projects.
The watchdog said it was " highly problematic" for the department to support government systems and structures that are known to be corrupt, especially if that increases the perception that corruption is a necessary and legitimate way of acting.
It called on the Government to set out detailed plans for tackling corruption and include more programmes that target the everyday incidents experienced by the poor.
DfID should also set up a centre of excellence focusing on anti-corruption, it recommended.
Lead commissioner Mark Foster said: "The UK should take an ambitious stance with respect to tackling corruption around the world as experienced by the poor. We have recommended that DfId should develop an approach to fighting corruption that will be an integral part of the UK Government's wider efforts. DfId, in partnership with the Foreign and Commonwealth Office, could be a beacon for anti-corruption internationally."
A DfId spokeswoman said: "ICAI's report rightly highlights some of DfId's work which reflects our zero tolerance approach to fraud and corruption. We have anti-corruption and counter fraud plans for each country that we give bilateral aid to.
"While these plans are tailored to the individual needs of each country, they are based on a common principle that tackles the root causes of corruption by building strong institutions and requiring good governance.
"Additionally, DfId funds UK police units and crime agencies to investigate the proceeds of corruption by foreign officials through the UK. Internationally, the UK is leading the drive to clamp down on corruption through the G20, World Bank and IMF programmes."
The chair of the Commons International Development Committee, Sir Malcolm Bruce, said the ICAI report was "a matter of concern".
Sir Malcolm told BBC Radio 4's Today: "There are specific and potentially serious allegations which the committee will certainly want to explore more deeply.
"The trouble is you have to use agencies in countries where corruption is endemic, and what the report is saying is that DFID needs to be much more applied in ensuring that where they are involved that doesn't happen, but much more to the point that they actually use their influence to try to ensure this petty corruption is dealt with."
The executive director of anti-corruption campaign Transparency International UK, Robert Barrington, told Today: "Amongst the international donor community and NGOs (non-governmental organisations) DFID has a very good reputation on corruption issues.
"But there's certainly more that can be done, and I think this report is saying DFID is doing quite well in looking at corruption in its immediate sphere of influence, but it needs to take its efforts to a new level to look at the wider operating environment.
"That is politically very challenging and quite a big ask of a government, but honestly if we are going to tackle poverty, that needs to be done."