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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 244-ii House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE INTERNATIONAL DEVELOPMENT COMMITTEE
DEVELOPMENT ASSISTANCE IN IRAQ
Thursday 10 March 2005 RT HON HILARY BENN MP, MR MICHAEL ANDERSON, and MR DAVID HALLAM Evidence heard in Public Questions 154 - 170
USE OF THE TRANSCRIPT
Oral Evidence Taken before the International Development Committee on Thursday 10 March 2005 Members present Tony Baldry, in the Chair John Barrett Mr John Battle Mr Tony Colman Mr Quentin Davies Tony Worthington ________________
Examination of Witnesses
Witnesses: Rt Hon Hilary Benn, a Member of the House, Secretary of State for International Development, Mr Michael Anderson, Head, Middle East and North Africa Department, and Mr David Hallam, Iraq Senior Programme Manager, Department for International Development, examined. Q154 Chairman: On Iraq we will produce a report for the end of this Parliament but it is unfinished business and who knows what will happen in the next Parliament, but I think the thinking of those in this Parliament is that the sort of work the Committee should do in the next Parliament is looking generically at post-conflict reconstruction which will then enable us not just to look at Iraq, although that is important work, but also to revisit in policy terms, not necessarily physically, places like Afghanistan, Syria, Rwanda and so forth. On Iraq it seems that DFID is doing two tasks. In the south, in Basra, you are doing reconstruction work and poverty reduction and in Baghdad you are doing political participation, good governance, and capacity building - slightly different things. You have now got Lindy Cameron who is trying to hold all that together. Do you see these almost as different programmes? How do you see the future? Is DFID's longer term role in Iraq going to be good governance and Afghanistan or is it going to be reconstruction or is it going to be a bit of both indefinitely? Hilary Benn: I would not say I see these as separate bits because what we are seeking to do in Iraq is about addressing particular needs that the country has got. It is a very complex situation for reasons everybody understands. We are certainly working towards a time when Iraq can do it for itself. That is what working on fixing the infrastructure is about. We are working in the south because there is a big issue of poverty there, and this is a country, of course, as we know, which has been impoverished as well as brutalised and traumatised by what has happened to it over the last 35 years, but it is also a country with an enormous amount of capacity, natural wealth and so on but has suffered grievously, and if the politics get fixed then Iraq should be able to get on with it relatively quickly. That is a big "if" because of all the factors that we are acutely conscious of. I think both of those are contributing to Iraq being a country that can do it for itself, but in the meantime dealing with the real consequences there have been in terms of increased poverty, increased infant mortality and, of course, in the south this is the part of the country that has suffered a lot and where poverty has been greatest. Q155 Mr Davies: Perhaps I can start off, Secretary of State, by saying that I had a fascinating trip there together with two colleagues. I was extremely favourably struck by two things and came back very encouraged by those two things. There are two other observations I am going to put to you which perhaps are more problematic. The first thing I was encouraged about was the progress being made in reconstruction and in helping the nascent Iraqi administration build up its own capability. I think those things are very encouraging from the point of view of achieving successful stability and democracy in Iraq in a reasonable timescale. The second thing that struck me, quite surprisingly but very favourably, was the very good co-operation on the ground between DFID personnel and the military. Both come from what you might expect to be rather different cultures and I was very favourably struck by that. In fact, one general told me that he would like to have someone from DFID on his staff at the beginning of the planning stage of such an operation in the future, which I think you should take as a compliment. The two things that I thought were a bit problematic were that both you and the MoD have budgets in the general area of reconstruction. The MoD spend theirs on what they call quick impact projects and they often have a force protection aspect, that is to say, to make people happy so you have got so many people lobbing bombs at our troops, but I suppose any successful reconstruction, development or even relief programme might lead to that so these distinctions are not absolute. Of course, DFID have their own programmes for consultancy, relief and reconstruction, as the Chairman has just said. In practice, because of the good working co-operation on the ground, there is quite a lot of flexibility I noticed, and at least on one occasion DFID was prepared to take over the funding of one of the programmes conceived and run by the military when that came to an end and that was splendid. I nevertheless thought that in principle this was a distinction which could lead to bad decisions, could lead to some muddle, and it meant that the British taxpayers' money which was being spent on Iraq was not being spent in a seamless way but was being artificially divided up into two different budgets. Finally, and this is also a problematic phenomenon which I will put to you, it is quite clear to me that a lot of the money being spent by DFID is quite inconsistent with the principles in the 1998 Act of Parliament which governs your existence, which says that you can only spend money on poverty reduction because a lot of the money is being spent, and I think very sensibly spent, on capacity building, that is to say, advice, consultancy to the Iraqi administration. The Adam Smith Institute, for example, has a contract from DFID to help restructure some of the Iraqi ministries, in fact physically restructure them, even suggesting how the minister's office should be laid out, I discovered, but, most importantly, of course, what kind of tasks, what kind of functions, what kind of capabilities were required and giving advice on decision-making procedures and so forth, but it is not poverty reduction except by an extraordinary leap of the imagination. Equally, there is a park being built in Basra. It is very nice. It is a heritage kind of project in the sense that hopefully years hence this particular facility will be associated with the British presence there. It was not exactly poverty reduction. I am extremely glad in practice that you are not being hidebound by the Act which supposedly governs you but as a parliamentarian I have to point out to you the anomaly between the theory and the practice. Hilary Benn: First of all, I would not accept that we were doing anything, indeed I would be very alarmed as Secretary of State if it were suggested that it was the case, that was inconsistent with the International Development Act and, secondly, with respect, I would not agree with the suggestion that capacity building has got nothing to do with poverty reduction. Indeed, if one looks at DFID's programmes, not just in Iraq but in lots of other places, we do a huge amount of capacity building. Why? Because having states that work, states that function, governments that can do their job, is absolutely fundamental to improving services and the lives of poor people. One of the consequences of 35 years of trauma and brutalisation in Iraq is the very limited capacity of government to do that. We see very clearly the impact on poverty in terms of some of the social indicators I was talking about, the fact that 60 % of Iraqis were dependent on the food ration system. That tells you a lot about how the country has suffered. The other very strong argument for doing the capacity building work is, as this money is available, not just from the UK but from other international donors, the thing that has not yet been got right is for there to be a system within Iraq that enables the political system to divide that money up and to use it for the purposes that people want in different places. In other words, the connections are not yet there between, say, the governor of a province, who wants to be able to get access to the international money to help with reconstruction, but that is not yet in place. I hope that following the elections on 30 January there will be a clear understanding of the need to build that but I make no apology at all for doing capacity building work because I think it is fundamental to tackling the basic problem, particularly in the south, which is that of poverty, and I am grateful for what you say about the other observations to do with what you think is working well, particularly the relations with the military, which I would concur on. Q156 Mr Davies: We totally agree, Secretary of State, that the capacity building job is a very necessary one and a very useful one and it contributes to stability and, of course, the extent to which it contributes to better government there may be some impact on poverty. My point is this, that the 1998 Act was supposed to represent a change, indeed a sea change. It was supposed to be very limiting in terms of the things that DFID and previously the ODA could spend money on. In actual fact, any international aid agency would wish to be involved to some extent in relief work, in development work, in capacity building work, and that was the case with the ODA beforehand. It continues to be the case that pragmatically you do a very wide range of things. I do not think the 1998 Act in fact has changed anything at all. It has not restricted, thank heaven, and I am very glad, your capacity to do things which only indirectly or at one or two removes can be regarded as being relevant to the relief of poverty. That is the point I am making, so if you like you should take it as a compliment that you have not been constrained by this Act in the way that the propaganda at the time the Act was passed would have indicated you might have been. Hilary Benn: I do not think it was a question of propaganda at the time. It was about focusing our effort and in particular what the Act has closed off, of course, is taking decisions to give aid in the interests of Britain where, as we know in one particular very famous case which went to court, you end up being hopelessly confused as to why you have taken decisions. Was it because that was what the country needed based on an objective assessment, or was it because that was what was in Britain's interests to do at the time? Of course, the other big change there has been the untying of our aid which we did in April 2001. I think we would have a different interpretation of what the Act was about and I think capacity building is very important. Mr Colman: Can I say that I was one of the three members that went to Iraq. Mr Davies, of course, you have heard from, and the others were Ann Clwyd and myself. I would like to thank everybody in DFID in Iraq and in the MoD in Iraq who did so much to facilitate our movement around Iraq and what we could see. Can I say to you, Chair, that Lindy Cameron was doing considerably more than trying to hold together, if you like, I think those were your words, the situation between Baghdad and Basra and there was in fact very strong co-ordination and very strong leadership from her. She is on a well-deserved holiday at the moment but we were extremely impressed by her and her staff. The argument, Secretary of State, that has been put forward, perhaps gently, by Mr Davies we explored fully when we were there and Miss Cameron made it very clear that she was operating within the International Development Act of 1998 and those of us who were there other than Mr Davies concurred with that. I perhaps saw it from the other end of the telescope which was to see, extraordinarily, that the work of the MoD was very much pro-poor development. The example that was given by Mr Davies of DFID was of taking over a particular operation in Al-Amara, which was in fact the appointment of street sweepers, the very poorest of the poor, where it was important to have a bridge between the MoD financing of the street sweepers and the local elected authority taking over responsibility for those street sweepers, was a very good example of the MoD operating on a pro-poor policy and we continue in a pro-poor policy. Mr Davies is smiling, I think in concurrence of that, and clearly the park in Basra was very much for the poor of Basra. It was certainly not for the wealthy. Chairman: We have established that. The accounting officer is not going to have any objection about where this money has been spent so far. Q157 Mr Colman: I have a question for the Secretary of State which is that perhaps one of the things which we found very interesting there was the way that the MoD had in fact worked on a pro-poor development programme over the recent years and months in a way that amazed all three of us, to see the excellent work they were doing, and clearly they were highly influenced by the work of DFID and is this in fact one of the very good outcomes coming out of Iraq? Hilary Benn: I think it is. Let us be absolutely straight about the situation that we found ourselves in. DFID has come into Iraq and done things that traditionally we would not do. Let us be honest. Why? Because that was what was required in the circumstances. We had to dust down some skills and the Post-Conflict Reconstruction Unit is one of the lessons from this: can we be more effective in future? That is the first thing. We genuinely value the working relationship with the MoD. I think we have learned things from each other. You are reflecting some of the DFID experience rubbing off on the MoD. One of the things that I have learned abut the MoD very forcefully is that they have got this fantastic capacity to get on and do things. It is an intensely practical, extremely able organisation. We need each other; that is the third lesson. This is a difficult and dangerous place to work. One of the things we have had to spend a lot of money on, of course, has been security for our staff. Immediately after the UN bombing the first thing I did was to take decisions about buying more armoured vehicles and armed guards, absolutely right and proper, and some of the things we have not been able to do have been because of the security situation. Therefore, we have had to reflect and find other ways to spend the money, other things to get on with. It is a quite unusual set of circumstances but I do think that we have a lot to learn from each other and I think that that kind of close working relationship with the MoD is to everybody's benefit because you work out in the end that whatever stereotypical views one had of the other and vice versa is not the case and if we understand what each of us is trying to do we are going to have a better outcome than would have been the case if we did not. Q158 Mr Davies: Secretary of State, it may be a little bit early to ask this question but I am sure you are already thinking about how we are going to measure the impact of our activities in Iraq and see what value for money we have been able to generate. As you say, security has been very expensive. I think about a third of the budget has been spent on security, which obviously reduces the amount which can be spent on purchasing direct outputs for the benefit of Iraqis. I just wondered what sort of criteria you were going to use to see how we were achieving good value there and also what you felt about sustainability. Do you feel that we have now made sufficient progress with the programme which we announced in Madrid? Do you think that at the end of that programme we will still need to be in Iraq? Do you think that some of the consultancy or development work will require more than two or three years to come to fruition or do you think that we shall be able to hand over entirely to the indigenous Iraqi administration, and hopefully within that timescale the military will then no longer need to be present in Iraq? Indeed, if I can make this final observation, it seemed to me to be extremely useful when discussing matters with Iraqi politicians to say as British politicians that one of our concerns was to get back our troops as soon as possible, because that changes the argument altogether. Once you say that they tend to say, "Do not go too soon, please. We need you", but if they assume that we are going to be there for ever of course the pace is relaxed and they do not necessarily take the difficult decisions that need to be taken to get their own operation up to speed. Hilary Benn: We can assess different things in different ways, obviously. There are the very tangible, practical outcomes of improving the water supply system or restoring electricity or the emergency infrastructure project, which we started in the autumn of 2003, because other things that had been promised from other sources did not materialise and we thought we had better get on with this and we put that together very quickly in those circumstances, and you can see the results. You have got additional generating capacity, power lines have been restored and so on, although there is a propensity on the part of some people to try and blow them up again. That is part of the difficult circumstances in which people are working. That is tangible. Also tangible are the days of work we are in the process of creating, job creation schemes, to try and deal with the very high level of unemployment. You can count those days, those we have already contracted that have happened and those that we are in the process of contracting. We are just about to start a further infrastructure project worth £40 million in the south to try and get better fuel distribution, more reliable electricity supply, practical things like that, so there is a pretty hard way of assessing those. With capacity building it is more a qualitative judgment. How do we do that? People go and visit and review. You will write, in the jargon, an output purpose review which will look at what you were trying to achieve with that and what has happened. We have been funding, for example, the training courses for judges and lawyers. We have had media training. There is a lot of civil society organisations that we have given capacity building support to through our two participation funds, so you can assess those. I think the most difficult question to answer is how is the government itself performing in being able to do the job that anybody looks to government to achieve. I have to say there that up until now there have been problems in making good connections between the international money that is available for reconstruction and people in different parts of Iraq understanding how they can get access to it. You have the Minister of Planning, who has been the focal point, the point of contact, between the Iraqi administration and the international donors, but I have found a lot of Iraqis that I have met will come and say, "We are not seeing that money. Can you come and do things with us bilaterally?". The case for capacity building is that in the end we do not want the system to work like that. We do not want people to come and have parallel conversations with lots of ministers from different countries. We want them to construct a system so they can have their own political arguments about how they are going to divide up the cash, like any country. That is not yet working effectively. One hopes that with the elections that took place, the emergence of politics, the formation of the new government, we are going to see that happen in time. As I said in answer to an earlier question, if that works and the violence subsides and so on, then there is no doubt that Iraq is a country that has the capacity to get on and do it for itself without the international community having to be there in the same way that we have had to be there up until now. Q159 Mr Davies: That is very convincing and very sensible. Meantime I think you are right to deal with local administrations. We saw it in Basra and Al-Amara where, incidentally, we met the governor, and you are dealing with him and not trying to go through the intermediation of Baghdad. Can I ask you whether, because of the difficult security situation, and you have told us about the measures you had to take, which inevitably means you have not been able to disburse money as rapidly as you might otherwise have been able to do and perhaps you have not been able to disburse it as effectively or do all the things you could otherwise have done, was it was sensible in retrospect to front-load the money that we allocated at Madrid quite to that extent and whether it would not have been better perhaps to have spent a little bit less or planned to spend a little bit less in the beginning and then increase the sums available subsequently? Hilary Benn: Obviously there was an understandable desire at the time to get support and help in quickly. Compared with that moment when the Madrid Conference took place, the security situation got worse subsequently, but we were not to know that was the case. With the money we are spending bilaterally I think we have been pretty creative in finding ways of using it to good effect, working through Iraqi companies and organisations. The security threat is not just for the international staff because there are also threats made against Iraqi partner organisations. Mr Davies: Very much so. Hilary Benn: And you will be very, very acutely conscious of that. Indeed, having mentioned the Planning Minister, of course there was the assassination attempt which has just been reported this morning. There are a lot very, very brave people: Iraqis and, of course, our staff who are all volunteers and do a quite magnificent job, I have to say. I think there is one area where there has been particular difficulty and that has been the trust funds. We put a significant amount of money, as did others, into the UN and the World Bank trust funds but both have had difficulty getting going because of the security situation. The UN, scarred by the bombing, is understandably reluctant. We have seen in recent times the UN money beginning to move after a long period. The World Bank money, in my view, is not moving with sufficient speed and currently we are engaged in quite vigorous discussions with the World Bank about what we are going to do in those circumstances because there is no point having money stuck, committed to projects that are planned but which you cannot deliver on the ground. I think it is perfectly legitimate in those circumstances to say, "Things have changed, you have got a difficulty. If you cannot spend it this way, can we find another way of doing it?" Mr Davies: I think that makes a lot of sense, Secretary of State. Perhaps I could be a bit less diplomatic than you need to be as a member of Government. I thought that the UN's attitude was extremely disappointing. I understand they were traumatised by the murder of Sergio Vieira de Mello and so forth but it seems to me that if, as you rightly say, there are a lot of brave people in Iraq - Iraqis, Americans and British doing a job, and we ourselves were in the Green Zone for a while, there are a very large number of British DFID employees and contractors working there - and if they are able to do that in those circumstances then for the life of me I really cannot see why the UN and agencies cannot be there. Frankly, I think if they do not go back there very soon they will be open to being accused of being excessively pusillanimous and really letting down the world by being excessively cautious and worried about the security situation when others have been setting a much better example, including us. Chairman: That leads in to a question from Mr Battle. Q160 Mr Battle: I welcome the comments you made about the trust funds because it may be the case of making other suggestions. If the UN cannot use the money perhaps you could get it back from them and spend it yourselves. If I could come to one other area of budgeting. DFID, as well as giving a substantial amount to the UN, also gives money to the British Council and has given them the task of administering the Civil Society Fund and the Political Participation Fund. Are you confident that is - how shall I put it - reaching the parts that it ought to reach and that some of the poorest groups which are trying to build up capacity are getting the benefit of that money? Are you confident in the distribution system of the British Council, if you like, to make sure that funding is spent well? Hilary Benn: If you look at the list of projects that have been supported[1], I think that money is being used to very good effect. There have been some difficulties in getting it going and running right, to be very honest with you, which I think we are in the process of overcoming. That was partly to do with having the right people in the right place in order to make sure that happened for some of the same reasons I have alluded to that created difficulties for other organisations. It was not perfect to start with but I think it is getting better. If you look at the list of organisations which are getting supported, I think that is very good use of the money in helping organisations on the ground. In this thriving civil society, which there is now in Iraq, and we tend to focus, understandably so, on all of the bad things that came out when the lid came off, there is a lot of fantastic good stuff coming out as people adjust to a new society in which there are things they are worried about but they do not have to be terrified about what traumatised them for 35 years. Q161 John Barrett: You mentioned in relation to the tsunami that one of the key things DFID had to do was to make its commitment based on an assessment of needs. Obviously there are different issues in relation to Iraq but one area that there has been a lot of controversy over is the counting of Iraqi casualties. There was a report in The Lancet which the Government dismissed because the Government said "We get our information from the Iraqi Ministry of Health", but is it not the case that there has been no great effort put into assessing the number of Iraqi casualties which is something DFID should have done in order to calculate just what impact DFID needed to have on the ground? Without that information DFID are not able to assess what would be their priorities. Hilary Benn: Of course there has been a great debate about that but I would not say that DFID needed to try to do that. It is a very difficult task for reasons that others much better qualified than I have explained. I do not think I would agree that this was a necessity in order to enable DFID to make a proper assessment of how we were going to spend our money. Regardless of the number of casualties there have been, and there have been a large number but nobody knows for sure, the need to get the water and power supplies back up and running, to provide employment, although there is good economic growth in Iraq and that is one of the other things one should note, putting money in to help schools and hospitals get back up and running, build capacity, all of those things are required regardless of whether there is an accurate count or not. John Barrett: Without an accurate count, apart from the Iraqi Ministry of Health, there is no indication of the scale of that particular problem. Whether it is DFID pressure from the UK Government or the UK in conjunction with the US government, there seems to have been a lack of drive to pursue that particular issue. Chairman: I think the Secretary of State has answered that question. Q162 Mr Colman: Before I ask my substantive question, can I briefly return to John Battle's point. Ann Clwyd is not able to be here this afternoon, but she is immensely experienced in terms of Iraq and she has expressed to us again and again her concern that perhaps the British Council either were not the appropriate mechanism for disbursing aid, or that they could adopt new practices, particularly to ensure that Iraqi based NGOs were able to apply for help for their organisations. Secretary of State, could I perhaps ask for a paper to review this mechanism and you might want to come back to us before we publish our report because this was something which we pursued and were concerned that lessons should be learnt on[2]. My question is about donor co-ordination. After the United Nations withdrew from Iraq, what mechanisms did DFID develop to ensure co-ordination between itself and other donors in Iraq? What lessons have been learnt about donor co-ordination from DFID's experiences in Iraq? The example that we had when we were there was that DFID particularly did not work in a major way within the justice and human rights sector because previously they had been told that the Americans were going to put $20 million into this sector and subsequently they did not. Do you believe there are lessons that could be learnt in terms of how donor co-ordination should go forward? Hilary Benn: There are always lessons in those circumstances. There is the International Donor Committee, those are the meetings set up under the trust fund, and we are part of that. There is the core group of donors, those who pledged $150 million or more at the Madrid pledging meeting. There are the co-ordination mechanisms in the south, in particular the Southern Iraq Reconstruction Steering Group, and then there are the Iraqi mechanisms that have been put in place. They have worked reasonably well. Of course there have been some difficulties and I have referred to the problems within the Iraqi system of making sure that all parts of Iraq understand how the international donor assistance works and where you need to go to try and get hold of some of that money, and that is about internal politics. We have done quite a lot on human rights. Q163 Mr Colman: Justice and human rights, the training of judges, the training of magistrates. Hilary Benn: Yes, we have done quite a lot. I did not quite understand the premise that somehow we had steered away from there because we thought somebody else was doing it. Q164 Mr Colman: This has come up in our discussions. Hilary Benn: We have gone along and done quite a lot. I am sure you have a list of what we have done. Q165 Chairman: I know there are some Iraqi judges in the UK this week, are there not? Hilary Benn: And they are being trained. Q166 Mr Colman: Secretary of State, previously we were informed that $20 million was committed from the US but they withdrew that funding for that sector and that was the reason I brought it up. Perhaps you could ask your officials to look into this because clearly if we were wrongly informed then that is something we need to correct in our report. Mr Anderson: I can give you an answer now. The US has done quite a lot of reprioritising driven largely by security concerns and the inability to get people on the ground, so they have made an attempt to move money from programmes that are more difficult to implement to programmes which they can implement and this was part of that process. $20 million is quite a substantial sum when compared with the DFID framework. In our view, the amount of money we are putting into the justice sector and human rights at the moment is appropriate in the larger strategy we are pursuing. The decision by the United States to change their strategy did not invalidate the strategy that we were already pursuing. Q167 Mr Colman: I have to ask, were you consulted in terms of this change in the US strategy to be able to consider whether you wished to change our strategy as a result of that? Mr Anderson: We were in the core group, and there are telephone conversations every month among all of the larger core donors, and we were informed of the US changes in prioritisation. We did not go into detail in all of them because there were quite a large number but we knew that the decrease in funding for the justice sector would be one of them. We chose not to change our thinking because we did not feel that we had the extra funding to fill that gap. Q168 Chairman: Secretary of State, this is clearly unfinished business for us all. We have not really asked any questions about the Post Conflict Reconstruction Unit which I understand is not yet operational, so to speak, we would hope that the Committee in the next Parliament can focus on this. I think there are some issues we have not explored this afternoon, like what is DFID's role in Geneva Convention type stuff and after occupation and all those kinds of things but those are issues we can discuss later in the year, hopefully, depending on where we all are. Hilary Benn: Okay. Q169 Chairman: Secretary of State, thank you very much for having been here this afternoon. Hilary Benn: Thank you very much. [1] Ev [2] See supp DFID note, submitted just before session |