Examination of Witnesses (Questions 40-59)
MR DOMINIC
WHITE, MR
TOBY QUANTRILL
AND MS
SALLY NICHOLSON
23 MARCH 2006
Q40 David Howarth: When
you say in your memo that the environment is not a strong suit,
not a forte of DFID, that applies to other governments in other
parts of the world as well; it seems the whole business of interaction
is one where the environment is not at the table.
Ms Nicholson: It is very, very
often the environment department within governments that is the
weakest department, has the weakest voice, because the environment
is not necessarily costed into the national accounts and therefore
it can often be sidelined. Clearly, this has shown up very much
in the poverty reduction strategy papers whereby governments have
decided on their priorities, which are often very short term and
of course completely right in terms of achieving health targets,
food security targets, poverty alleviating targets and it is much
easier in a political sense to think about achieving those things
and sending the money for that than possibly some of the longer
term environmental trade-offs that might occur because that is
going to be further down the line.
Q41 Chairman: The last
of the nine documents that David mentioned was DFID's approach
to the environment, published in February of this year. What is
your view of that document?
Mr White: There was consultation
on the development of that document through the BOND network and
I must say we feel that earlier drafts, perhaps, more strongly
represented some of the issues that were necessary to be addressed.
It is still a very good articulation of a lot of those issues
and DFID have shown a lot of good intent in the text that they
have presented. We are anxious that, rather like a lot of these
past documents that have come through which have articulated the
discussion around environmental development, it will go the same
way as that which we described before. There is very little capacity
to really see through some of the commitments made in that document
and if this is upheld in their policy on environment then, unfortunately,
we do not hold out much hope that actually they are going to be
able to implement half of what they say in that paper as well.
Q42 David Howarth: On
that there is a view, as you have just mentioned, that through
the progressive draft document even that document seems to be
watering down the environmental commitment. Do you think that
is a conscious decision or do you think it might even be taking
into account the problem of implementation that we have been talking
about and that perhaps they are just being more realistic about
what they can achieve, given their past record?
Mr White: Which may be cart before
the horse, because what we need is the firm commitment in the
narrative about what is required (to achieve sustainable development)
and then the capacity to follow suit. Not "we cannot have
any staff because we have got number cuts and therefore we cannot
do development properly because of the staffing issue"; they
need to say this is how we need to achieve development sustainably
and therefore we need the staff capacity and competence to follow
that. I would hope it was not for that reason that it appears
to be somewhat diluted.
Q43 David Howarth: It
would be absurd if it were.
Mr White: It would.
Q44 David Howarth: Just
going back to the point about how to get the environment at the
heart of policy-making within DFID, what can be done? You have
mentioned an appointment at director level, what other change
in structure and policy could be carried out to bring the environment
into the heart of government decision-making?
Mr White: Within DFID I have described
some of the internal issues which I think could be addressed to
at least ensure that DFID was not just making the right policies
on paper but also being able to follow them through in terms of
having the expertise and capacity to do so. In national countries
where environment is weak often it is an extremely difficult challenge
because of course you are dealing with ministries that preside
over the management of a lot of extensive natural resources which
have intrinsic values which are easily mismanaged, and often these
ministries are subject to quite a lot of corruption as well. The
Government's issues around environmental resource management are
extremely challenging and underpin, for example, the whole development
dilemma in the Congo which is actually largely down to fighting
over natural resources. The conflict issue that arises from the
natural resource base does not lend itself very easily to delivering
development work through those ministries which are embroiled
in the conflict surrounding the management of these resources.
Q45 David Howarth: What
about domestically here, is there a problem with, for example,
the 2002 Act which makes poverty reduction the aim and does not
seem to mention anything else, or with the Millennium Development
Goals themselves? Does there have to be a public announcement
of a change in direction, something firmer than just ministerial
speeches that might help?
Ms Nicholson: The Act does talk
about promoting sustainable development but it does not go on
to define it.
Q46 David Howarth: That
is a problem.
Ms Nicholson: Clearly the UK Government
has recently done a revised sustainable development strategy and
has defined it, that it is about human well-being within ecological
limits, so it is something that is a cross-cutting commitment.
Clearly, DFID should not be doing any development that is not
sustainable and I think there are good examples to look at, perhaps,
in other countries, for example Sweden, where they have legislation
which promotes coherence across government so that they are integrating
the environment into all of their policies and they have a separate
unit reporting to the prime minister on this. There are other
examples one can look at on the way to do it, but whether it requires
rewriting the International Development Act, I am not sure.
Mr Quantrill: As we have already
heard from Christian Aid there is consensus among the development
agencies and I do not think there is any reason why the existing
Millennium Development Goals should not include an emphasis on
environment because we see the two things are so closely linked.
What we would like to see, perhaps, is DFID acknowledging that
more strongly and more publicly, bringing the development lens
as it were to a number of other debates around trade and so on.
For instance, climate change was a big one where we saw, from
our perspective, listening to Radio 4 a public fallout between
DTI and Defra over climate change but we did not hear DFID's voice
on that, yet they of all departments in government should be representing
the voice of the poor, the people who are going to get hit by
climate change. Where was their voice on that? In terms of what
they should be doing, publicly linking these issues in the public's
mind more and more would be good, and they are going to see the
NGO community, the civil society, doing that increasingly and
they need to start thinking how they are going to be taking that
step themselves.
Q47 David Howarth: Can
I just bring us back to another specific example of a backward
step that you have mentioned and that is environmental screening,
the million pounds plus projects that are screened for their environmental
effects and guidance issued. You mentioned that this seems to
have gone backwards, that it seems to have increasingly become
a bolt-on project. Can I just ask you to comment first of all
whether that is a correct interpretation and, secondly, why it
has happened? Is this yet another example of the requirements
appearing to DFID to be too onerous and therefore the aspirations
have been reduced to meet what they think are realistic possibilities?
Mr White: DFID set out a pretty
comprehensive guide to environmental screening which was designed
to be addressed up-front at the beginning of what they call concept
note stage in the design of programmes and projects that they
were getting involved with. What we do understand now—and
it is difficult for us to have a full picture of this—is
that the screening is seen very much as a tick box exercise and
in fact has been branded by some of the internal staff as an environmental
screaming exercise, which I think somewhat reflects the misunderstanding
and the discomfort that traditional economists may have, for example,
with having to consider someone else's agenda. The thing about
cross-cutting issues is that everyone has to consider the environment,
human rights or governance agenda you cannot get away from them.
What we now believe is that there is a tick-box exercise which
people see as a hoop that they have to jump through at the end
of the process, very much feeling that it is in line with risk
management and having to consider that thing called environment
at the end of the process, rather than looking at the positive
opportunities that the environment may present to a development
strategy which could actually lead to a much more long term, sustainable
solution for the poorest, developing itself around environmental
limits and considering the safeguards but also being able to develop
sustainably from that. There is the question again, why is it
not being seen? To be fair, we are aware that DFID are in the
middle of a screening review, to look at the screening process
and see how they could perhaps strengthen and improve it, we hope.
We are not sure what the outcome of that review will be but we
would hope that they are able to reinstate the importance of it
in terms of DFID developing long term sustainable developments.
In terms of why there is this perception, I suppose some of it
just comes back to personal beliefs and priorities within the
department that actually environment can be dealt with later.
Q48 Chairman: Is the view
still held—and a lot of it was denounced as inappropriate—that
if you have development then you can do the environment at a later
stage, which is very old-fashioned. Do you think that is still
an important ideological position within the department?
Mr White: Unfortunately, that
may well be the case. The Secretary of State does not think that,
he has underlined that several times in his recent speeches for
the White Paper. So perhaps there is that disjoint in that view
and that we do not have a department that perhaps follows some
of the thinking of the Secretary of State in that respect.
Q49 David Howarth: The
final point, you mentioned the individual country offices and
the lack of any expertise in a wide range of them. Would it be
a solution to have regional expertise, would that be an adequate
compromise, if each individual country had someone at least inputting
environmental concerns on a regular basis across a number of different
categories?
Mr Quantrill: Perhaps you need
to look at the type of development that is being proposed and
see where is the volume of effort required and being taken by
DFID, whether it is on a country basis or on a regional basis.
What we do not want to do is just stretch the environmental expertise
so far through any region that they are actually not able to do
the right job properly, and highlight opportunities as well as
safeguards in terms of the development and interventions that
are being pursued. That may help, certainly where we have got
regions where DFID does not have any capacity at all, but I would
not necessarily say that is the only way to look at it.
Q50 Ms Barlow: You have
been critical of DFID's increased focus on rapid economic growth
as a way of ensuring rapid poverty reduction. Can you go into
some more details?
Mr Quantrill: I think we would
echo quite a bit of what Christian Aid has already highlighted,
that we are not opposed to economic growth per se; we recognise
that most of the poorest countries in the world desperately need
increased economic growth if they are going to be able to meet
even the most basic human rights of their people. What we are
worried about is perhaps the potential contradictions between
a single-minded focus on macro-economic growth and some of the
environmental imperatives that we perceive. What we are looking
for is answers as to how some of the extremely strong rhetoric
around the need for extra sustainable growth coming out from the
Secretary of State is going to be put into practice; our worry
is given the staffing issues, given the current mindset perhaps
of elements of DFID, they will do what they know how to do best
which is creating the economic growth at state level and perhaps
not be in a position to be able to ensure that that growth is
properly distributed, such that it can actually cause poverty
reduction and ensure also that it takes account of the environmental
issues. Just to give a couple of examples, we talked about the
fact that DFID is not investing in the capacity of environmental
ministries in countries necessarily, yet governance of natural
resources can drive economic growth and it can drive growth that
is far more equitable and sustainable. For instance, a recent
report from the OECD on illegal and unregulated fishing showed
that sub-Saharan Africa is losing over a billion dollars a year
as a result of illegal fishing off their coast. A huge amount
of catch has been taken out of those countries as a result of,
essentially, weak governance and weak capacity to manage those
resources appropriately, and also international issues. I was
reading in the Financial Times a couple of days ago that
water allocation and poor water management governance globally
is costing 1% of estimated global GDP estimated. Huge amounts
of money have been taken out, all of which could be used for paying
for education, health and so on. If you miss that environmental
aspect and miss the opportunity to develop the capacity to manage
these resources appropriately, you are missing an opportunity
to promote macro-economic growth but also to turn economic growth
into equitable and sustainable growth which is obviously what
we say we need.
Q51 Ms Barlow: What about
trade-offs between growth and environmental degradation? Is that
a concern to DFID?
Mr Quantrill: There always needs
to be an open dialogue. There are not necessarily the trade-offs
that people seem to think, most people would say that the trade-off
debate is held on the assumption that environment is a barrier
to development, a barrier to growth, but I hope we have demonstrated
that we do not believe that is the case, it can actually be a
promoter of growth, a promoter of development. In most cases that
trade-off is probably a false assumption, but where there are
potential trade-offs—and there are some out there that we
ourselves are debating—the important thing is that you bring
both issues to the table and you have sufficient capacity of analysis
and data to make the right and informed choices, and that those
choices are being made by the countries that have the greatest
stake in them. That is why we emphasise the importance of developing
the capacity of countries to get their analysis right, understand
their own wealth in terms of what wealth they hold in their own
natural resources, how they govern that wealth and how that wealth
can create growth. When they have that benefit you can have that
dialogue and decisions need to be made locally, but we are confident
that those decisions would then become potentially quite different
from the ones that you have talked about taking.
Ms Nicholson: You can use strategic
environmental assessments which help create a discussion and a
transparent, open decision made because people are informed about
the different options, the very short term options and the long
term options.
Q52 Ms Barlow: Do you
think that DFID is engaging in that dialogue effectively?
Ms Nicholson: We believe that
certainly they have been promoting the use of strategic environmental
assessments very strongly at the international level with other
donors, at the OECD level; it is not clear to me how they are
currently being used within DFID, their environment policy paper
suggests that that is a tool that is encouraged—which is
the word that is used—but I have not seen on the website
an example of how it has been used, an SEA on a particular policy
or programme. In fact, under EU recommendations, EU law, SEAs
are required for large governmental projects, so this is something
that DFID has been encouraging but it is again something that
does not seem happening within the department.
Q53 Ms Barlow: Can I move
on to DFID's position on the extractive industries? You have been
quite critical of this but can you go into more detail?
Mr Quantrill: It is not my specific
area, but we certainly are concerned that DFID has been involved
in funding, whether directly or through multilateral agencies,
large scale extractive programmes that are contradictory to its
position on climate change potentially and also are contradictory
to its goals in terms of development and poverty reduction. There
is a very good report which I would recommend to you entitled
Pumping Poverty by Plan B which again has got quite a large
buy-in from a coalition of different agencies; that highlights
the fact that often these large scale programmes, while on paper
may look to be economically positive, the overwhelming impact
on poverty, on people's lives at the local level is negative.
If we are going to be talking about a withdrawal from funding
and support for such things we do need to be looking at alternatives,
we recognise that, so it is important that any withdrawal or reduction
in support for these large-scale programmes is matched by additional
resources for investing in alternatives, alternative economics
and alternative energy sources. That would be our clear[2]
position, but we would like to see a much closer scrutiny of the
way in which these programmes are planned and I think the strategic
environmental assessments would be a part of that.
Q54 Chairman: I am just
wondering if you can you mention one or two examples which illustrate
this issue, perhaps on fossil fuels?
Mr Quantrill: The one that I know
we are working on at the moment would be Sakhalin, the oil programme,
but beyond that I would not want to go into detail in particular.
Ms Nicholson: There was a case
called the BTC—again I cannot remember what it stands for—which
is the construction of a pipeline across the Caucuses and Turkey
which clearly had DFID support but clearly the proper safeguards
have not been put in place, both environmental and social. We
were very concerned about their support for that which seemed
to kind of go ahead without a proper public dialogue. The World
Bank had an extractive industries review which was a stakeholder/expert
process that was set up, rather like the World Commission on dams,
to look at what the World Bank should do about extractive industries
in the future in terms of investment, and we were surprised that
DFID were not being much stronger in terms of pushing for the
World Bank to be investing far more in renewable technology and
energy efficiency but were still suggesting that the World Bank
should continue, almost business as usual, in terms of hydrocarbons.
Q55 Ms Barlow: Staying
with the extractive industries, do you think DFID's position on
these industries is affected by other government departments such
as the DTI?
Ms Nicholson: It possibly could
be, but we should be looking at a holistic government approach,
and going back to the climate change issue, as well as our own
mitigation here, the thing that we should be investing in is clean
energy because we have a responsibility in terms of the energy
that we are investing in and promoting now. The Export Credit
Guarantee Department, for example, which is very much part of
the Government, any support it should be giving should be for
sustainable programmes. At the moment they have a target of 20%
or something to actually ring fence for clean renewables, but
I think everything that they should do should be along these lines
and for all of international credit finance.
Q56 Ms Barlow: You have
talked about the effects of climate on the poor in particular
earlier. Do you think there is a clear distinction by DFID on
how it factors climate into its work, in that it is happy to accept
the need to adapt against climate change but appears unwilling
to accept the need to minimise those effects which you have spoken
to so far?
Mr Quantrill: Are you talking
about mitigation issues in terms of action?
Q57 Ms Barlow: Minimise
the climate impacts on the poor, as you have mentioned, on the
very people that you are trying to help, minimise really the effects
of how it spends its money. Do you think this is fair?
Mr Quantrill: Yes, at the moment
there is a very strong rhetoric of adaptation, but we are also
seeing strong acknowledgement in recent speeches by the Secretary
of State that there is a responsibility from us with respect to
consumption; we have seen that, he has acknowledged that, we would
like to see how that gets turned into a set of policies. I have
talked about the voice within government; we would like to see
DFID, for instance, leading internally on its own carbon budgets,
becoming a carbon neutral organisation, which would no doubt be
a big thing. It should also be, for instance, pushing on Government
procurement policy; Defra has done a lot of work on greening the
public procurement policy, but there is a role there for DFID
to start talking in terms of making public procurement policy
a road to sustainable development as well, so also bring that
aspect into the dialogue there and it could be a very big push
in terms of helping to develop green technology in developing
countries and so on; for instance, not just saying you need to
make your procurement policy green, but saying we should be prioritising
procurement from developing countries. That should put out a strong
message and could be seen as a strong approach. There are a number
of ways in which they could push that agenda locally as well as
in the international programme.
Q58 Ms Barlow: Is there
any interest as far as you have seen in energy policy as one of
those areas, for example, is there enough emphasis on renewable
and on small scale solutions?
Mr Quantrill: They are working
in this area but we would like to see a lot more. One thing I
would like to flag up is the opportunity created by the clean
development mechanism under the Kyoto Protocol, and we think DFID
are not paying anywhere near enough attention to the opportunity
that poses as a development mechanism. At the moment it is seen
as an offset mechanism within carbon emission trading, but it
could actually, if it was tweaked in the right way and given the
right set of standards, become a very powerful mechanism for the
kind of development initiatives in terms of renewable energy,
but we are not seeing that. From WWF's perspective we promote
the gold standard in respect of these types of projects that can
be invested in under the clean development mechanism; we see that
Defra has taken that up in terms of its own voluntary carbon offsetting,
but we would like to see DFID push that, for the gold standard
or something like it to become part of a set of compliance policies.
There are potentially hundreds of millions of pounds of investment
flows going into clean technology. At the moment that is largely
a wasted opportunity, it is going into a whole variety of projects,
many of which we would be quite dubious about, and largely into
existing large emerging economies rather than into the very low
income countries, but it is a mechanism which could be given more
attention in that respect.
Q59 Ms Barlow: Finally,
there is a very strong emphasis within DFID on the importance
of liberalising trade for poverty alleviation, but there is quite
a wide spread of perception that trade liberalisation will have
a significant detrimental effect on the poor that you have mentioned,
particularly in developing countries and also on the environment.
Is wholesale liberalisation a blunt instrument from the point
of view of DFID and contradictory really to its focus on alleviating
poverty? How would you estimate the effects that this could have
on the environment?
Mr Quantrill: There are certainly
question marks over the pursuit of liberalisation as a blunt instrument.
We share the interest in the NEF report and that whole way of
thinking that Christian Aid has articulated, we would also be
looking at that because there is a big environmental perspective
to that argument that the promotion of macro-economic growth alone
is (a) not a particularly efficient way of producing poverty reduction;
and (b) potentially by the time you get anywhere near the type
of poverty reduction we are looking for, you would have had a
huge impact on the environment if you go down that road. So you
do have to take that into account and I give an example of an
area of concern: if you were to remove subsidies that allowed
a massive investment flow into commercial agricultural production—and
we are doing a lot of work on thirsty crops, on high water use
crops across the UK—if there was a massive expansion of
those crops, that could have huge impacts on downstream users
in areas where those crops are invested in upstream. You have
to look at those issues before you go down that road, not to say
that removal of subsidies is not the right thing to do, but just
that those issues need to be taken into account and the countries
involved need to have the data and capacity to make that analysis
and to make their own decisions about how they want to pursue
liberalisation—and we would probably share Make Poverty
History and so on around no forced liberalisation. The important
thing is that that whole process involves the right information,
the right analysis.
Ms Nicholson: Certainly it is
to do with thinking that trade is a tool—whether it is sustainable
development or poverty alleviation or economic growth—and
how it is used. There is not necessarily a one size fits all thing,
but we do need to think very much again about sustainability impact
assessments which is a legal requirement in terms of the EC which
does have competency on trade.
2 Witness addition: long-term Back
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