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Debt Relief
3. Julia Drown (South Swindon) (Lab): What steps for further debt relief he will be pressing for at the spring meetings of the International Monetary Fund and the World Bank. [164983]
The Chancellor of the Exchequer (Mr. Gordon Brown): Twenty-seven countries have already received debt relief under the highly indebted poor countries initiative, worth over $70 billion. In recent months, two more countries, Nicaragua and Guyana, have reached completion point, and more are expected to complete the process in the coming months. We have persuaded other donors to provide top-up assistance for Niger, and at the spring meetings of the International Monetary Fund and the World Bank I proposed that we extend it to Ethiopia and other countries so that they do not exit the HIPC initiative with unsustainable debt levels.
Ms Drown: I welcome my right hon. Friend's response, but does he agree that if sustainable debt relief is to be provided for the poorest countries, the attitude and ability of the IMF's new managing director will be important? My right hon. Friend will know of fears that the managing director will be appointed through horsetrading, behind closed doors. Does he agree that a key appointment of this kind should be made in a fair and transparent way, and that applicants from developing countries should be encouraged?
Mr. Brown: As my hon. Friend knows, I have taken some interest in the appointment of the managing director, purely in my capacity as chairman of the advisory committee—the International Monetary Fund Committee. She is absolutely right. After the appointment of the last managing director, who has resigned to become President of Germany, it was agreed that a number of procedures would be followed that would make for a more transparent process.
In my capacity as chairman of the IMFC, I am contacting all the countries and regions affected by this decision. We are sounding them out and asking them how they think we should proceed. I stress, however, that under the IMF's constitution the decision is made not by Finance Ministers but by the executive board of the IMF, which will itself decide when to trigger the process. We are trying, and will continue to try, to ensure that it involves more transparency.
Tony Baldry (Banbury) (Con): Those of us who are fortunate enough to visit countries that have benefited from debt relief can see the transformation that it is already bringing about. However, we must find ways of communicating better to colleagues in Congress and other Parliaments in Europe our enthusiasm for these initiatives, and initiatives such as the international finance facility, otherwise there is a danger that we will merely talk and agree among ourselves. Does the Chancellor agree that we must somehow work out, as a Parliament, how to enlist the support of other parliamentarians throughout the world?
Mr. Brown: I know that, as Chairman of the International Development Committee, the hon. Gentleman has taken a huge interest in these matters, and has been responsible for the sending of a message around the world about the importance attributed by all of us in this country—Churches and non-governmental organisations as well as politicians in all parts of the House—to getting debt relief to work properly, and ensuring that international aid is well spent. I hope he will agree that organising a conference in Paris next week, to which 73 countries have been invited—we think that 50 will attend—is a step forward. I have spoken to the Commonwealth Parliamentary Association, of which some of us are members, about how it might convey the message to parliamentarians throughout the world. I shall be happy to meet members of the International Development Committee, or the hon. Gentleman personally, to discuss how we can make further progress. Let me again applaud the Committee's efforts to get the message across.
Mr. Harry Barnes (North-East Derbyshire) (Lab): Will my right hon. Friend answer the question that he himself asked at a conference on 16 February in talking about the Tobin tax and special drawing rights, which relate to debt issues? He asked whether there was sufficient will in the richest countries to agree to these profound changes. Presumably there is sufficient will in this country. What responses do we get from elsewhere?
Mr. Brown: I raised the Tobin tax and special drawing rights—the proposal of George Soros—and asked whether other mechanisms such as an arms tax or energy tax might make it possible to increase the amount of development aid. I concluded at the conference that the proposal with the best chance of success was our proposal for an international finance facility.
In each case, as my hon. Friend says, it depends on political will. For the first time in 20 years, international aid is rising rather than falling; that has been as a result of pressures from all over the world. Debt relief is now happening and there is a recognition that we have a duty and a responsibility to help with the health and education problems of the poorest countries. Progress is being made but, as a result of the Monterrey conference and the breakdown at Cancun on trade, people will be looking for another signal from the richest countries that they are prepared to do more. He is right that that is the signal that the conference next week—and other meetings, such as those of the IMF—must now give.
Sir Nicholas Winterton (Macclesfield) (Con): I was immensely encouraged a few moments ago when the Chancellor mentioned the role that the Commonwealth Parliamentary Association might play in this area. The chairman of the UK branch, myself and our secretaries met the Chancellor recently. How does he believe that that organisation, representing more than 50 countries—some very wealthy, some very deprived—can help to contribute to a reduction in world poverty and to debt relief?
Mr. Brown: I applaud the work of the hon. Gentleman with the CPA, which involves 50 countries. Of the 110 million children who are not going to school every day, more than 70 million are in Commonwealth countries. Therefore, we have a special responsibility to enhance resources for education and to deal with the problems that prevent money from being spent on education, health and economic development. Following the Commonwealth Finance Ministers conference—my right hon. Friend the Chief Secretary has taken a keen interest in the Commonwealth Finance Ministers group—we can do more to get our message across to parliamentarians in the Commonwealth. I should like to work with the hon. Gentleman and his colleagues to do so. It is also true that we formed the Commonwealth education fund to celebrate the Queen's jubilee, through which money is going to education as a result of Government and private sector sponsorship under the chairmanship of the former Governor of the Bank of England, Sir Eddie George. There are many things that we can do and we are ready to work with the hon. Gentleman to achieve those goals.
New Deal for Skills
5. Mr. Barry Gardiner (Brent, North) (Lab): Pursuant to his announcement in the Budget on the extension of the new deal for skills, if he will assess the benefits of developing short-term loans for those on low incomes seeking to move into better jobs. [164985]
The Economic Secretary to the Treasury (John Healey): Alongside schemes such as our employer training pilots, adult learning grants, the new deal programmes and free training to gain a first level 2 qualification, the Government already operate a career development loan. We are looking at ways in which this can be developed through a new deal for skills so that we can help people into work and then get on in work.
Mr. Gardiner : My hon. Friend appreciates that the transition from waged to salaried employment can mean that people have a three-week gap in their income. Does he accept that this disincentive to move into a better job also has a detrimental impact in ossifying the lower end of the labour market? Will he look at making specific grants available—as they are for people who go into work—to people going from waged jobs into salaried appointments?
John Healey: My right hon. Friend the Paymaster General, my colleagues in the Department for Work and Pensions and I know how consistent my hon. Friend is in pursuing this point. He will know that existing survey data do not tell us conclusively that there is a
disincentive. He will know also that more families and working households are benefiting from in-work support through the working families tax credit and the child tax credit. These are improving the incomes of low and moderate earners and increasing their ability to save and to cope with just the sort of transition about which my hon. Friend is rightly concerned.
Mr. Henry Bellingham (North-West Norfolk) (Con): Does the Minister share my surprise that economic activity is at its current levels, compared with 1997? I have an interest to declare, because my electorate made me economically inactive in 1997. Could that level be connected with the fact that roughly 1 million people are claiming some form of sickness or incapacity benefit because they are unfit for work? What will this new scheme do to help those people back into work?
John Healey: No, I do not agree. The fact is that more people are employed than ever before. Unemployment has not been at these levels since the 1970s, and in a modern society, job security and career prospects for individuals increasingly depend on their having the skills that employers need. We simply will not scrap the new deal, which has helped more than 1 million people into work. We will build on its success, and offer the new deal for work and skills in the future. This is precisely the time to be investing in the skills base for the future. It is precisely the wrong time, for the future economic strength and prosperity of this country, to cut apprenticeships, cut university places, cut further education courses and cut workplace training, which is precisely what the shadow Chancellor plans to do in his public spending plans.
Miss Anne Begg (Aberdeen, South) (Lab): The Government have been extremely successful in getting people off unemployment benefit and incapacity benefit and into work, very often into entry-level jobs. If there is to be an answer to the question that the hon. Member for North-West Norfolk (Mr. Bellingham) asked, we have to make sure that those in entry-level jobs move up the jobs ladder so that those who are still on benefits can move into work and take advantage of the new deals. Will the Government put the same amount of energy into ensuring that people move up the jobs ladder into better jobs, which will then create entry-level jobs for those who are still out of work, who can fill the gaps? That is the only way in which we can get more people, including those who are more difficult to place, into work.
John Healey: My hon. Friend makes an important point. Our concern as regards the new deal for work and skills is precisely that which she raises. We are concerned about the 7 million adults in this country who do not have a level 2 qualification. We are concerned to help those who are unemployed into work and then to help them to get on in work. We are concerned to help those who are employed to get advice on the skills and training that might be available to them, to improve their career prospects. That is precisely the sort of challenge that my hon. Friend sets us. She will know from the unemployment rates in her area in Aberdeen that, as a
result of the economic measures that have been put in place since 1997, we are now closer than we have been for a generation to full employment in this country.
Mr. Andrew Love (Edmonton) (Lab/Co-op): I strongly welcome the new deal for skills, and I welcome my hon. Friend the Economic Secretary's statement about the need for training, not only for the benefit of the economy but for improved productivity. Does he agree that to achieve that, we need a greater commitment from employers to the upskilling of their work force?
John Healey: Employers have a critical role to play, and it is the Government's role to try to provide the support and incentives that will help them. I mentioned the employer training pilots that we have rolled out this year to more than a third of England. The first-year evaluation of those shows that 70 per cent. of the firms involved have fewer than 50 employees—precisely the sort of employer that it has proved most difficult to help in the past. Some 40 per cent. of those employers have never had any contact before with a Government agency. Most importantly, three quarters of the learners now taking up training opportunities under the employer training pilots left school at or before the age of 16. That is part of the way ahead, and it is part of the future new deal for work and skills.
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