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Mr. Dale Campbell-Savours (Workington): My right hon. Friend will know that, in many of those countries, economic development is very much dependent on transport infrastructure. She will also know that transport infrastructure is a major British export to many of those countries, to the extent that it is supported by the aid and trade provision. She has, moreover, announced a review of the ATP programme.
My constituency is dependent--in some industries, it is very much dependent--on ATP. To take one specific example, we export railway lines around the world. Railway lines are very important in the development of many third-world countries.
Will my right hon. Friend give an assurance that, if decisions are taken on the ending or running down of the ATP programme, the firms that are directly involved--often employing thousands of people--are fully consulted? Does she also agree that what really matters is not the ATP programme per se but that the programme is available only for projects that pass elementary tests of development soundness? If the projects pass those tests, surely we can maintain the programme.
Clare Short:
I am grateful to my hon. Friend, and I can assure him that the representations that he has
My hon. Friend has put his finger on an important point. I am reviewing our entire aid effort, to ensure that our entire effort is aimed towards eliminating poverty and helping the human development of the poorest people. It could be argued that ATP is a part of a previous philosophy in which any beneficial economic development was thought necessarily to result in the development of poor countries. That belief will have to be re-examined. We intend to focus on the need for human development of the poorest people.
Such development might require transport for access to market for very poor rural people, although it probably will not include big, sophisticated transport projects. Regardless of how we approach the matter, some projects are unlikely to be included if we are to redirect our efforts towards poverty elimination. Discussions will continue, however, and a full review will be conducted. The firms in the constituency of my hon. Friend the Member for Workington (Mr. Campbell-Savours) will, of course, be able to make representations--[Interruption.]
I do not know why the hon. Member for Hertford and Stortford (Mr. Wells) makes cynical remarks. We are debating a very serious matter. ATP was introduced by my illustrious predecessor, Judith Hart, to engage British firms in the development effort, and there is nothing cynical to be said about it. If it is true that we must redirect our efforts into poverty elimination and human development, there will be big implications for ATP. Everyone should take that into account. As I said, much of the research suggests that ATP is neither commercially nor developmentally beneficial. We must consider and examine that argument.
I was describing the duties of a modern state to its people in the developed or developing world, and the duty of a state to provide conditions to enable people to live a decent life and to improve their livelihoods for themselves and their families.
People must also be provided with opportunities to play an active role in their society at all levels, including national level, through transparent and accountable institutions. That should lead to a virtuous circle in which social development leads to, as well as results from, economic development.
Part of my Department's role will be capacity building. We shall be pragmatic and not dogmatic in our approach. We shall not say, "Public sector bad, private sector good," or vice versa. We recognise that context and circumstances matter. With many services, it matters less whether they are provided by the state or the private sector than that the state retains responsibility for ensuring that the service is provided, and, where necessary, regulated.
On that basis, we support and welcome the recently published world development report of the World bank, which advocates the development of the sort of state that I have described to achieve the development that the world needs. We shall therefore often give support--we are doing so now--to Governments who wish to reduce in size a bloated public sector, but at the same time we shall support also the build-up of the state's capacity to supply essential services effectively and efficiently, and the development of its capacity to regulate the private sector.
Above all, I want to work in partnership with Governments who share our commitment to poverty elimination. Our role should be to support, complement and enlarge the capacity of developing countries to meet the needs of their people. Ideally, our partnership will be based on an open and agreed agenda, involving Government and civil society as well as other donors.
Where poor people are suffering from a Government who offend human rights and are not interested in poverty elimination, such partnerships will obviously be impossible. In those countries, we shall show our solidarity by supporting non-governmental organisations that can deliver direct to the poor and oppressed. Our preference, however, will always be to work with states, for only they can deliver universals such as primary education for all, better health care for all, and clean water and sanitation for all.
I hope that this work will help to create the conditions that will increase private investment in the poorest countries, but it is clear--everyone must be clear about this--that, whatever the private investment flows, the poorest developing countries will depend for some time to come on substantial resource transfers to create the capacity to generate sustainable development.
It is very regrettable that the resources that the international community is making available to support the process that I have outlined are declining. We know the price tag of poverty elimination and how we can contribute, because the human development report gives us the figures. That is why I am pleased to reaffirm this afternoon the Government's commitment to the 0.7 per cent. of gross national product target and to reverse the decline in the aid budget, which has fallen shamefully, from 0.51 per cent. of GNP and rising, when Labour left office in 1979, to just over half--0.27 per cent. of GNP.
Mr. Crispin Blunt (Reigate):
The Minister has praised the public-private sector mixture of provision. Is the right hon. Lady aware of the United Nations target of 1 per cent. of transfer of wealth from the developed to the developing countries? Is she aware also that the United Kingdom is at the top of that league, not at 1 per cent. but at 1.38 per cent. in the last year for which there are figures? That is surely a much more effective measure of our achievement in creating development in the world than merely relying on the public sector.
Clare Short:
Clearly, increases in investment flows to developing countries are welcome and to be encouraged by everyone. I do not know whether the hon. Gentleman knows it, but the overwhelming bulk of investment flows come from the richest 12 of the developing countries, and that the poorest 50 countries receive none of them. That is why investment flows are not an alternative to development assistance. We need development assistance to create in the poorest countries the sort of development and economic arrangement that will give them the capacity to attract private investment flows. It is not one or the other, but both.
Mr. Peter Luff (Mid-Worcestershire):
Will the right hon. Lady set a date for achieving her target of 0.7 per cent. of GNP?
Clare Short:
In Yorkshire, they call that brass neck. Could we hear some shame and humility from the hon. Gentleman about the record of the Government he supported? I am coming to our plans.
I am reviewing all expenditure in my Department. I want to be certain that all our spending contributes towards a sharply focused poverty eradication agenda. I shall redirect any spending that does not contribute towards our key objective of promoting sustainable development.
I shall then be in a strong position to ask my right hon. Friend the Chancellor of the Exchequer for additional resources at the end of next year. I believe that I shall be able to demonstrate to him that we can make a measurable difference with those funds. First, however, I have to do the redirection job, because a lot of what we are spending now is not going directly into poverty eradication. We want to make sure that every farthing is better spent.
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