Examination of witnesses (Questions 120
- 126)
TUESDAY 1 FEBRUARY 2000
THE RT
HON RICHARD
CABORN, MR
VIVIAN BROWN
and MR JOHN
R WEISS
120. Are you intensively lobbied?
(Mr Caborn) By backbench MPs, yes.
121. That was not the question.
(Mr Caborn) I gave the answer to that question, which
is every night when I go into the lobby.
122. Mr Brown is not in the lobby.
(Mr Caborn) He is not the Minister, I am the Minister,
and that is the question that was asked.
123. Is the Department intensively lobbied?
(Mr Brown) That we should become a separate agency?
124. By large corporations?
(Mr Brown) No, we are not excessively lobbied on our
support for the customers with whom we write business. Primarily
what we are concerned about is the way in which they place contracts
to small and medium sized companies. Mr Weiss has talked about
the range of activities we are undertaking and many of the large
contractors with whom we are doing business are not United Kingdom
based contractors, they are large internationally based contractors
and the UK is seeking to persuade them to place a wide range of
medium and small sub-contracts in the UK and we are successful
in that.
(Mr Caborn) Can I just say, Mr Chairman, that ECGD
is there to promote British business. I accept all the constraints
that are placed upon that, I accept that fully, but it is there
as a tool to help enhance the wealth creating base of this nation.
That is what it is there for, primarily defending the taxpayer
as well. Let me also say that we have some very, very professional
staff who give every confidence in the ECGD. I do not agree with
all of the judgments they give me but I have to make that judgment
as a Minister and so does Stephen Byers. It is a very professional
lot down there. It is one of honesty and transparency of doing
business of which we as politicians ought to be proud. They will
work under the direction of politicians and they do that very
professionally indeed. As far as I am concerned, I think ECGD
has got to be looked at. That is what the mission statement is
about. The status has got to be looked at. We have to make it
a proactive tool forgood when it is sometimes portrayed as a tool
for bad. As far as I am concerned, that is my job as Minister.
Do not forget that it is there to promote British interests and
British wealth creation and well-being. If it is not doing that
it is not a tool we ought to be using.
125. What about the ECGD Advisory Council
(Mr Caborn) The ECGD Advisory Council is there to
advise on the professionalism of the judgments people make. Its
members are professional people and they give of their time free
and come along and work in the interests of United Kingdom Limited,
as indeed many Advisory Committees do in British Trade International
on Regional Selective Assistance. We have a very good rapport
with the private sector, who offer real professionalism and bring
that professionalism by and large in the interests of United Kingdom
Limited.
126. You gave a very interesting answer in a
question in Hansard on 24 January where you were asked to list
for each member of the Advisory Council how much ECGD business
has been undertaken in respect of which the respective members
had a declared financial interest.[10]
Two members of the Advisory Council are employed by banks which
have interests of more than £1 billion worth of ECGD business,
David Harrison of Lloyd TSB had £281 million of business
and David McLachan of National Westminster plc had £794 million.
To somebody reading that, that looks like a conflict of interest.
(Mr Caborn) There is a conflict of interest all round.
One could go through pretty well every advisory body and say if
they are not giving advice from the quarter or experience that
they work in why have their advice? We do that with Regional Selective
Assistance and a whole series of advisory boards. There are very
clear ground rules laid down as we have with declarations of interests
for MPs. There are clear Chinese walls put up. In terms of any
involvement of their bank in a country or country assessment,
which is the thing that we actually involve them in most, then
they would not take part. I will ask Mr Brown to say exactly how
that operates.
(Mr Brown) What we are talking to the Advisory Council
for is to give their professional view from the point of view
of banks and exporters, particularly in emerging market exports,
about whether or not we are assessing the creditworthiness of
countries accurately and the underlying system of also trying
to take account of corporate risk and portfolio risk and following
best professional practice. I think your answer about the conflict
of interest is that there are no papers going to the Advisory
Committee as a group which are about individual projects. We consult
individual banking persons, including Mr Harrison on a bid or
planned project to see whether or not the judgment we have made
about underwriting accords with their own judgments. We make absolutely
clear and sure that the project on which we are consulting them
are not ones in which their banks are involved.
Chairman: We will leave it there, Minister.
Thank very much, and Mr Weiss and Mr Brown, for answering our
questions. We would hope to give a big input into your reassessment
of the Mission Statement of the ECGD and we hope we will be helpful
to you in coming to a conclusion on those discussions and also
of course on the issue of the Ilisu Dam, which I do not think
we have heard the last of.
10 H.C. Deb, 24 January 2000, cc.41-2W. Back
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