Examination of Witnesses (Questions 155
- 159)
TUESDAY 20 APRIL 2004 (Morning)
CAMPAIGN AGAINST
THE ARMS
TRADE
Q155 Chairman: Good morning, Miss
Feltham. You have been before this Committee before, I think.
Ms Feltham: No.
Q156 Chairman: You have given us
evidence but you have never appeared?
Ms Feltham: Only written before.
Q157 Chairman: That is right. Maybe
we could try and establish where you come from. Would it be right
to say that your view is that the British taxpayer should not
subsidise the export of arms and other military equipment and
therefore the ECGD should not provide services in this sector?
Ms Feltham: That is absolutely
true. We certainly do not believe the taxpayer should be subsidising
the export of arms, and one of the big subsidies is export credits,
so we would very much like to see those credits stopped for arms.
We have no opinion on whether or not they should continue for
other goods.
Q158 Mr Evans: I have read your submission
with growing incredulity, I hasten to add. You say things like
you seek an immediate end to government assistance for the export
of military equipment—this would include cover for the construction
of military bases—and you would like the UK Government to
set an example to its overseas counterparts by taking this action
unilaterally. Can you imagine what would happen if we were to
do this unilaterally. Would you not expect that the ones that
would really love that would be the French, the Germans and various
other countries who would be giving support for its manufacturers
and Britain simply would not?
Ms Feltham: Obviously we would
like to see the export credits stopped by other Governments too.
In fact we worked through ECA Watch with our French and German
counterparts and others there, but there are several good reasons
why the UK should take a lead and obviously it would be better
if it was not unilateral, it was multilateral, but unilaterally
Britain is exposed, the United Kingdom is exposed to huge risks
for its military equipment, export credits. For instance, if—and
it is certainly not entirely out of the question—the Saudi
Arabian Government was overthrown, there is about one thousand
millions worth of export credits supporting military goods to
Saudi Arabia that would end up being paid for by the British taxpayer.
So that is a bad risk. Then, I think, rather than taking the lead
in ending export credits on arms exports, the UK Government is
almost taking the lead in the other direction. We know, because
the South African finance minister had an affidavit to
a court there where somebody is challenging a huge arms deal with
South Africa—we know from his evidence to that court—that
hugely favourable terms were offered by the ECGD and the Swedish
export credit department to underwrite the export package—hugely
favourable terms—and he said markedly preferential rates.
Research in the United States says that that deal led the US to
give better export credit deals for proposed military exports
to Poland than would have been the case. They were so afraid of
the British ECGD pushing more and more and giving better rates
for military exports that the others followed suit.
Q159 Mr Evans: But these are legal
items. Basically it does not matter that you say you prefer for
it to be multilateral, you are prepared to go unilaterally, but
it does put British companies at an enormous competitive disadvantage?
Ms Feltham: Well, so be it. We
are basically against arms exports.
| 
