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Session 2000-01
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Standing Committee Debates
International Development Bill

International Development Bill

Standing Committee B

Thursday 15 March 2001


[Mr. Joe Benton in the Chair]

International Development Bill

Clause 4

Supplementary powers

9.55 am

Mrs. Cheryl Gillan (Chesham and Amersham): I beg to move amendment No. 10, in page 2, line 17, leave out `(wholly or partly)' and insert `wholly'.

The Chairman: With this it will be convenient to take amendment No. 11, in page 2, line 18, leave out `(wholly or partly)' and insert `wholly'.

Mrs. Gillan: Good morning, Mr. Benton. I welcome you to the Chair and I hope that I will give you no more trouble than I gave your co-Chairman, Mr. Butterfill, on Tuesday.

The substance of the Bill is extremely serious and the Opposition have no fundamental objections to the principles behind it. Through amendment No. 10, which was tabled by my hon. Friend the Member for South-West Devon (Mr. Streeter) and myself, we are trying to probe the thinking in the Department for International Development and raise some of the issues that we have not had an opportunity to discuss over the past four years, in the absence of any substantial debates on the Floor of the House.

Let me at once set the Minister's mind at rest—

The Parliamentary Under-Secretary of State for International Development (Mr. Chris Mullin): My mind is already at rest.

Mrs. Gillan: Well, that is a matter of opinion. Far be it from me to accuse the Minister of having a lazy mind, but I think that he had better wake up quickly. This is a probing amendment, and if the Minister puts his brain on alert, he might be able to answer some of my questions. The spirit of co-operation during the previous sitting was amazing: the Liberal Democrat spokesperson joined the official Opposition in a vote on an amendment. That may happen again—who knows just how far I could take the hon. Member for Richmond Park (Dr. Tonge)?

The amendment is designed to ensure that this country does not make any subscription to an agency that does not subscribe to the same development principles as the United Kingdom Government. It would stop subscriptions to organisations that only partly work towards poverty reduction. The Minister will know that the explanatory notes to clause 4 state:

    ``This clause provides (in subsection (1)) for the Secretary of State to undertake activities or enter into arrangements which, while they might not in themselves meet the tests set out in clauses 1, 2 and 3, are preparatory to, or will facilitate the provision of, assistance under these clauses. An example of such activity is the commissioning of research.''

I query why, in the explanatory notes, only one example is given—that of commissioning research. The Minister and the Secretary of State have laid so much emphasis on the poverty reduction focus that it is quite surprising suddenly to find that little let-out clause—actually, an enormous let-out clause that drives a coach and horses through the main purpose of the Bill. The Bill is intended to confine and focus the activities of the DFID to poverty reduction—an aim that we all regard as commendable—but clause 4 allows it to do everything else.

10 am

I query the underlying rationale for the legislation. On Second Reading and in some interesting Committee debates we have had the opportunity to question the Minister and probe the Department on the rationale for the Bill's introduction. We do not resent its introduction, but it seems to be a piece of gratuitous legislation at the end of a Session. It is ridiculous to lay such emphasis on the poverty reduction focus and then to add a substantive clause whose effect is to allow the Department to forget the rest of the Bill and do what it wants. If the Government decide that poverty reduction should be the overriding goal of development, it is contradictory for them to take out subscriptions to organisations that do not wholly contribute to that goal.

We are concerned that the word ``partly'' may be construed too broadly. Only the Minister can tell me what his understanding of ``partly'' is, but I believe that it might lead to the use of the aid budget to support agencies and organisations that do little to contribute to poverty reduction.

    ``An example of such activity is the commissioning of research.''

presumably means any research in any country, so the Secretary of State will at any point be able to spend valuable aid money and DFID budget money on commissioning focus groups and research data from MORI or some other organisation. We need to know what the Minister believes is meant by ``the commissioning of research'', as mentioned in the explanatory notes.

The Secretary of State supported the general point when she said on Second Reading:

    ``In all Government systems, people regard the development budget as a residual to fund their particular concerns. Those may be completely proper and honourable matters, but they are not always to do with the reduction of poverty.''—[Official Report, 6 March 2001; Vol. 364, c. 173.]

By so saying, she has driven a coach and horses through the first three clauses of the Bill, by saying, in effect, that spending on matters that do not contribute to a reduction in poverty, no matter how noble, should both be found and not be found out of the aid budget. I hope that the Under-Secretary of State will make clear which of the two emphases is correct and on what purposes he plans to spend aid money in future.

As the Minister knows, the clause is about subscriptions and agencies' funds, which are dealt with by amendments Nos. 10 and 11 respectively. The Government fund subscriptions to at least two agencies that are not classed under official development assistance. They are the United Nations Educational, Scientific and Cultural Organisation, better known as UNESCO, and the United Nations Food and Agriculture Organisation, which is known as the FAO—I suspect that we will sink in all the initials. Those two organisations were given DFID funding of about £13 million last year, which did not count as aid.

According to departmental statistics on international development for 1999-2000, only part of the United Kingdom subscriptions to the FAO and UNESCO are defined by DAC—the development assistance committee of the Organisation for Economic Co-operation and Development—as official development assistance and shown as multilateral contributions to developing countries. The subscriptions in question have to be accounted for as ``non-aid multilateral''. We need to question how the Government can justify funding the relevant subscriptions from the aid budget if they are not wholly related to poverty reduction, given that such action contradicts Government policy and the objectives of the Secretary of State, who has said that the development budget should not be regarded as a residual to fund particular concerns, but that it exists to contribute to a reduction in poverty.

I studied the departmental report that some Committee members helpfully pointed out to me earlier in the week. It was suggested that I was not in possession of the report, but, sadly for my accusers, I had it in my papers, so the challenge passed me by. I refer to pages 136 and 137—[Interruption.] I shall give way if a Labour Member wants to speak.

Mr. Tom Clarke (Coatbridge and Chryston): I apologise—my hon. Friend the Member for Wolverhampton, South-East (Mr. Turner) and I were just discussing how much we admire the way in which the hon. Lady expresses herself.

Mrs. Gillan: Labour Members do not say much in this Committee, but when they do, they speak beautifully and with style.

I read pages 136 and 137 in that extremely weighty and glossy document, the departmental report 2000, to find out about the organisations to which we pay a subscription. I know that I am capable of getting things wrong, so I hope that the Minister will confirm that I have the full list of organisations to which we pay a subscription within the terms of the Bill. I hope that the relevant names are those that are marked ``(Subscription)''. As we know, Government Departments have recently made quite a few mistakes and that there has been little joined-up government—I refer to the quadripartite Committee report published yesterday, which mentioned factually inaccurate replies from the Government. Therefore, I hope that the Minister will forgive me for wanting to check the detail of the report.

I hope that the Minister will confirm that the four relevant organisations are: UNESCO, on which we shall spend the not inconsiderable sum of £12,431,000 this year; the United Nations Industrial Development Organisation, UNIDO, on which we shall spend £3,900,000; UNFAO, on which we appear to be spending £12,400,000; and the European Bank for Reconstruction and Development, EBRD, on which we shall spend £11,680,000 this year. Those are considerable sums, so it is right to ask the Minister for confirmation. Are those currently the only organisations in the relevant category? Will the Minister assure the Committee that before next year, even closer evaluation of the work of those organisations will be carried out? Next year similar amounts will be spent, although we are to reduce our spend on UNIDO from £3,900,000 to £3,300,000.

I hope that I have read the figures correctly: although I wear glasses for seeing things in the distance, I do not yet use them for reading, but the print in these publications, which have cost a great deal over the years, was very difficult to read. Will the Minister confirm that the sums that I mentioned are being spent on those four organisations—and that the money is increasing next financial year? I should also like to see the four organisations shown clearly on a separate table as they are specifically mentioned in the legislation.

Is the list complete? Which organisations are in line for subscriptions and which other organisations could join the list? Can a separate schedule be produced? On what grounds and under what terms and conditions would DFID cancel or reduce subscriptions to those organisations? What criteria would be used when making the decision to subscribe to an organisation or to remove it from the list? Who audits the organisations to find out how they contribute to poverty reduction? While the Bill is being scrutinised, it would be helpful to hon. Members to learn about the internal workings of the Department and how such decisions are reached.

Labour Members have remained silent, apart from the odd intervention, so I feel as though I am asking questions of the Government on their behalf. The organisations I am discussing are very worthy, but there is a special clause to separate them out and to enable us to pay money to organisations that are wholly or only partly involved in poverty reduction. We need more details about our involvement, the sums we spend on such organisations, how we can remove ourselves from their lists and how we analyse and evaluate their performance. I hope that my probing amendment, No. 10, will give the Minister the vehicle he needs to enlighten us about his Department's thinking.

Amendment No. 11 was also tabled by my hon. Friend the Member for South-West Devon and myself. We were advised by the Clerk who helped us to draft our amendments that it would provide a similar vehicle for discussion. The purpose of the amendment is to ensure that the UK does not provide assistance to any fund that does not subscribe to the development principles of the UK Government. It limits the resources that can be allocated to funds that only partly work towards the Government's objective of poverty reduction.

The same tenets apply as to the previous amendment. It is reasonable to ask why the aid budget should be used to support a fund that only partly contributes to a reduction in poverty. We should like more information about which funds that only partly contribute to a reduction in poverty the Government envisage supporting. The phrase ``wholly or partly'' is far too broad: it could mean that substantial amounts of UK aid were placed in funds that do not share the Government's objectives. That would be unacceptable to hon. Members on both sides of the Committee. I hope that the Minister will enlighten us. Clause 4 appears to allow the Government to ignore the fact that poverty reduction should be the sole aim of development assistance. That is inconsistent with the Secretary of State's remarks, so an explanation is necessary.

10.15 am

Page 136 of the departmental report 2000 lists the funds to which the Government subscribe. I hope that the Minister will go through the figures and tell us what falls within the ambit of the clause and what criteria are used to decide how much money should go to the various organisations.

The African Development bank, for instance, does not receive a large amount. In 1996-97, the Conservative Government put in only £71,000, but no more money was put in during the first three years of the present Government. Now, suddenly, £860,000 is being paid in, and the same amount is envisaged for next year. The African development fund will receive a more substantial sum—more than £29.5 million. The Asian Development bank will receive £910,000, but the Asian development fund will have about £25 million. The Caribbean Development bank will have nothing, but the Caribbean development fund will receive £2.6 million. The United Nations Children's Fund, UNICEF, will receive £13 million and the International Fund for Agricultural Development will have £3 million.

It would be extremely helpful if those organisations and funds could be identified in the Bill. There seems to be a pattern in the layout of the information on pages 136 and 137 of the report, but the Bill may change the way in which we consider the funding of some of those organisations. Will the Minister examine the way in which the information is presented?

What will prevent those funds from departing from a poverty focus? Once the Bill is enacted, and we are happy that the Department's spending should focus on the reduction of poverty, what guarantees does the UK taxpayer have that those funds will partly or even entirely be used for other purposes? It will be too late: we shall have given them the money. What safeguards do we have to ensure that our money is spent on those who most need the aid? What is the minimum poverty reduction requirement that would allow the Secretary of State to provide development assistance to support it?

Are the Government content that they will not be acting illegally by using aid money for such funds if the funds do not fully contribute to poverty reduction—or even depart entirely from that function? We do not want to discover that action can be taken against the Department and the Secretary of State. How will they be protected?


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