Memorandum submitted by the Rt Hon Clare
Short MP, Secretary of State for International Development
During the hearing on the White Paper on 29
January, I promised to follow-up some of the issues raised. I
therefore enclose:
— a note from the Department of Health
on the National Health Service procedures for recruiting staff
from developing countries (Q22);
— a note on auditing accountancy firms
working in developing countries (Q28); and
— a copy of my letter to the Speaker
on why the White Paper was launched before copies were made available
to the House (Q39) (Not printed).
We are also in touch with the Treasury for an
update on the UN Commission looking into the Tobin Tax, in response
to Mr Colman's question (Q30). We will write to the Committee
on this issue as soon as possible.
NATIONAL HEALTH
SERVICE PROCEDURES
FOR RECRUITING
STAFF FROM
DEVELOPING COUNTRIES
The NHS is also extremely concerned about the
potential for recruiting from developing countries. Guidance issued
in November 1999 clearly states:
"It is essential that all NHS employers
ensure that they do not actively recruit from developing countries
who are experiencing shortages of their own. The only provisos
to this policy are if: nurses or midwives from these countries
are seeking development by the relevant Governmental authorities
in the country concerned."
The above is specifically intended for NHS employers
who have established mutually beneficial links to developing country
healthcare systems.
NHS Trusts should not be actively recruiting
from developing countries and certainly there is no known recruitment
from the Caribbean. This position will be reinforced throughout
England by the newly appointed Director of International Recruitment,
whose job it is to oversee and co-ordinate all recruitment activity
involving medical and dental staff, nurses and midwives, and allied
health professionals. Furthermore, a section will be specifically
included in the Code of Practice which will be published shortly.
Naturally, healthcare professionals around the
world have the absolute right to apply as individuals to any vacant
NHS post for which they are qualified. The NHS already responds
appropriately to these applications and the process is currently
being streamlined in discussion with NHS Careers.
AUDITING ACCOUNTANCY
FIRMS WORKING
IN DEVELOPING
COUNTRIES
The global accountancy firms have had a lot
of adverse criticism in recent times. Some of this has been linked
to the standards of accounting and audit carried out by national
subsidiaries, and the supervision by the centre of firms using
their marque around the world.
It is much more difficult to draw a causal link
between this and the Asian financial crisis. The lack of consistent
standards for accounting and audit are not the major cause of
such crises, they are contributuory and, once a crisis hits, certainly
make it harder to see what is going on. There is a view that some
quite sophisticated economies with well-developed professions
were let down by poor standards (eg Malaysia and Hong Kong), quite
apart from those with weaker professions (eg Thailand and Malaysia).
The Big 5 have accepted quite a lot of the analysis
which followed the crisis (undertaken by the World Bank and others)
and are taking action to improve standards generally, and—in
a related but separate initiative—to develop global accounting
standards. This has led to the strengthening of institutional
mechanisms such as the International Federation of Accounting
Companies (IFAC), the Forum of Firms, and the International Accounting
Standards Committee. The DTI has been strongly supportive of these
initiatives, not least because of their relevance to the situation
in other European countries.
From DFID's point of view, with the focus of
our work in developing countries, there are two areas of concern:
professional capacity and professional regulation. The first is
well understood (numbers, qualifications, opportunities etc).
The second derives from the fact that in this global industry
shake-up, the regulation and determination of standards is slipping
from the professions and their associations (of accountants and
auditors) and from governments, to the Big 5 themselves. The problem
is that, especially for Least Developed Countries, there are not
many prepared to fund the sorts of programmes needed to improve
standards and achieve some global harmonisation of standards well
above the lowest common denominator level. We will look into these
issues further with the DTI.
Rt Hon Clare Short MP
Secretary of State for International Development
February 2001
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