Examination of Witnesses (Questions 60-79)
MR PETER
HARDSTAFF, MR
MATT PHILLIPS,
MR STEPHEN
RAND, MR
PATRICK WATT
AND MR
SIMON WRIGHT
25 OCTOBER 2005
Q60 Chairman: We will obviously be
probing you on different aspects of those campaigns. Before I
bring in Joan, is there anything that any of you can identify
as a specific and conspicuous achievement, a success that we got
which we feel contributes to the campaign or a particular failure,
something that you feel you hoped for and did not get during the
campaign? That is not a summary of the whole campaign.
Mr Phillips: Absolutely. I think
what we would say is that we got useful progress from the UK Government
level on its policy around imposition of damaging economic policy
conditions. I think we would highlight the useful steps forward
in financing. These are real tangible steps forward which will
make a huge difference to people in the developing world. I think
we have seen some early chinks in the armour around international
policy-making on economics, however, nothing nearly enough to
deliver the justice that we are looking for. I think we have really
seen incremental steps on most of our issues but certainly not
all of them, and in particular, the package that comes under the
heading "Trade Justice" is where we see the least progress.
I think the debt deal looks like it is a really useful step forward,
it is just that we believe it is not the deal the public are demanding.
Q61 Joan Ruddock: I just wonder what
the public are demanding because I think that for a lot of people
the campaign has had quite a simple focus. I understand if you
are going to mobilise huge numbers of people you have to do it
in quite simplistic headline statements. Is there not a danger
that you presented it too simply, that actually it is about western
governments who produce loads of money and cancel debts and if
they do not do it all, the thing has been a failure—there
were setbacks, your website describes failures and setbacks—then,
in a sense, the public will feel well, what is the point. I think
there seems to be a lack of education perhaps about the responsibilities
of those who are to receive the funds and their capacity to use
those funds effectively. To some extent the campaign is focused
on half the picture and there is a great danger, if you have that
concentration and things do not improve, the Millennium Goals
have not been reached that the argument becomes, it is all the
fault of those who have not produced the money or cancelled the
debts.
Mr Phillips: I would challenge
very strongly one particular part of that. We are simply just
not about the financing agenda and we never have been. We are
as much, if not even more about the policy aspect.
Q62 Joan Ruddock: I am talking about
impressions and messages to the public.
Mr Phillips: I recognise that.
We have been part of the voice saying this is about justice and
not charity. It is not just about financing, it is also about
the trade justice policies, the economic policies which the developed
world is part of imposing on developed countries. We know there
is a partnership relationship that needs to happen and we know
there are real things that developing countries have got to do
as well, but a lot of those issues around governance are as much
about donor behaviours or the key issues which donors have got
to address as well as what developing countries have got to address.
What we really need to understand is the points of accountability
here, because what really matters to the people in the developing
world, who are experiencing extreme poverty, is that they have
to feel that the resources which are coming from the rich world
are being applied for poverty eradication, just as our taxpayers
want to feel the same. We are part of that, we are working with
those people, we are involved with them, we are campaigning with
them to make sure their governments are transparent as well as
ours, are delivering the resources to back what is necessary to
eradicate poverty. I think the story we have told this year is
about how the finances are a useful part of the picture and they
must be increased but that the policies also must be changed and
it is the lack of progress on these other policy areas, the policies
which will empower people in the developing world to hold their
governments to account and to achieve great strides in poverty
eradication. That is the package that we have tried to get across
this year. I think we have been dismayed at how much we have ended
up having to talk about financing too much and not enough about
some of the core policy areas because those are a bit more boring
and less tangible sometimes for people to hear. We have not let
go of the depth through anything we have done. We have tried to
get that across at every single stage. I think anyone who went
along, for instance, to the rally at Edinburgh would have experienced
a day of excitement and passion about the issues and a huge amount
of depth from the speakers, the people involved and a lot of people
came away very much more educated. The education process we have
taken people on has brought people into the issues and given them
an outlet, ways in which they can bring about some concrete contributions
to change. Mr Wright: I just wanted to add
a little bit about how we work with campaigners. Clearly, the
NGOs have a very large reach and that is what we have been able
to show this year. I think we have taken it very responsibly.
If you look at the communications we have been sending to supporters
throughout the year we have tried to, obviously, have a very clear
headline message which was about having to act on poverty this
year. With each of the successive events or the ups and downs
of the campaign, we have been communicating that to our supporters
and we will at the end of the year be communicating with an overview
of 2005; where we think we are at the end of it. I think we have
tried to be very balanced and you are absolutely right: if we
were to announce everything has been a disaster, what does that
do for people's hopes, what does that do for any campaign we try
to do in the future and we are taking that into account. When
we get to the end of the year if you look back over all of it,
you will see quite a balanced set of messages to the supporters.
Q63 Joan Ruddock: Is there anything
you would have done differently?
Mr Phillips: I think we would
have sought to go in, perhaps, more strongly earlier on because
I think had we known just how big we were going to be we would
have felt more equipped to put more pressure on at an earlier
stage. The story is not about how we have opened up people's excitement
and passion about this issue as much as it is about the difference
between what the public are demanding and what governments are
prepared to do. That is really the political point, it is that
distance between the aspirations and the expectations of the public,
who look at governments and see they can make progress and what
they have been prepared to do in practice has been far short of
what is necessary. Given the extra elements perhaps of a more
integrated global community, an awful lot of people we found involved
in the campaigning this year are one way or another connected
to people in the developing world. We have seen a very united
voice globally pushing for really systemic changes of the kind
that are necessary to eradicate poverty. I think that is the point
really which we would be grateful if the Committee could be pressing
the Government on, why did the governments not go further? The
public were really giving them all the public space and political
space they need, to move an awful lot further and much harder.
Q64 John Barrett: It was certainly
a unique event during the summer, not only were there a quarter
of a million people there in my home city, and I was one of them,
dressed in white forming a band around the city centre but you
also organised sunshine from the start to the end, which again
is a unique achievement. One thing which concerns me is that there
was a huge amount of media coverage in the UK and abroad, people
in the streets were talking about it, but it was a simple message—it
gathered people's attention—Make Poverty History. We saw
Bob Geldof on television saying if the leaders of the G8 Summit
just agree we can Make Poverty History. The worry I have is that
people will feel let down because no matter what the leaders agree
there will still be erratic weather conditions, there will still
be corruption in a lot of the developing countries, there will
still be conflict which keeps a lot of people in poverty. I wonder
is there the danger that people will be accused after the event
of over-simplifying the message and therefore a lot of people
feeling disappointed because, I put it to you, that even if the
G8 leaders had agreed on everything everyone in the Make Poverty
History campaign had wanted them to, you would not have made poverty
history.
Mr Rand: I am speaking from the
experience of Jubilee 2000, which is one of those things you say
with some trepidation, but a number of the questions already asked
this morning relate to that. First of all, we were told in 1996
debt was too complicated so we had to make a simple message, people
were surprised you could even do that. There is a sense in which
Make Poverty History was the simple slogan at the top, and we
know many people related and responded to that. Underneath that
part of our responsibility is to make sure there is a greater
understanding of what the issues are and inevitably the further
you go down less and less people understand those details. Part
of the responsibility is to keep trying to raise that awareness,
as we have done with Members of the House, Government and ourselves
and with our campaigners. There is always that process of trying
to deepen the understanding of what needs to be done to make that
kind of difference. I think then when you come to the end of the
year, back to the question about what will happen, what will people
think, one of the overwhelming things is the need for clarity
about what has been done and what remains to be done. We went
through the process where there was a general assumption that
debt had been dealt with in 1999-2000. I think it is interesting
in 2005 significant numbers of our supporters are still back there
trying to pursue the matter of debt with trade and aid as well
because they know that there has been progress but more needs
to be done. One of the things I think we have discovered, the
Jubilee Debt Campaign, is that as some of you have discovered
from people in your surgeries is when people get hold of this
they do not let go of it. What they need is clarity, I think we
need that and you need that, we all need to know what has been
done, what has been delivered and what has not. Then, I think
there is a basis for making the kind of progress on into 2006
which recognises that in 2005 there have been particular opportunities
that are particular to governments to deliver some of the things
that need to be delivered. There will be other opportunities in
other years but this was a year when, with the G8 coming here,
with the WTO in December and so on, there were those specific
opportunities and yes, we need to be clear to people what those
delivered and we need to be clear what they to could not deliver
and what needs to be delivered elsewhere to make the progress
that needs to be made on into the future.
Mr Phillips: Can I add one thing.
I think what is really clear to us is that all the policies that
we have proposed are achievable and they are quite practical and
they would make a big difference towards eradicating poverty.
You are quite plainly right, you cannot eradicate poverty overnight
and a lot of the policy issues that we have been grappling with
and the marrying of the trade issues with the finance issues has
been about an injection of investment now, a removal of the damaging
policies and the establishment of policies that will empower developing
countries and people in developing countries to climb out of poverty.
That is the package which we have presented this year. We believe
that makes an awful lot of sense because adjusting the trade policies
now will remove a lot of the problems but there is still a lag,
a period of time before those will kick in sufficiently. Huge
numbers of people in the most extreme poverty in the world are
simply too poor to benefit from trade opportunities just yet,
there does need to be this investment package that comes in. That
is the proposition we have made this year, it is a joined-up story
about economic justice and economic policy-making that we believe
is highly appropriate and would make huge differences. You are
right, there are other issues which have an impact on international
development and a lot of the organisations here work on those
issues. This year, we felt that the real opportunity was to focus
on the economic justice agenda because of our observation and
our experience that the economic policies have been the biggest
barrier to escape from poverty for people around the world.
Q65 Ann McKechin: Matt, you mentioned
that the policies which you advocated were achievable, but clearly
there is a distinction between the role of the UK Government,
the role of the European Union and the role of multilateral institutions
because all three have to be involved in achieving those results.
Perhaps I could say, there has not been a distinction of what
each could achieve and what was achieved in each. There is a limitation
about how much the UK Government can achieve at European level
and at multilateral level where clearly we have to reach a consensus
with other parties. I wonder if perhaps you could be a little
more critical of your own campaign as you are being critical in
turn of the actions of the Government, in the fact that you were
very weak as a coalition group in terms of your international
action. You had a quarter of a million people in Edinburgh but
you had nothing equivalent in America, bar one pop concert or
two, and you had nothing in Japan. Both of these are very major
figures in terms of multilateral agreements and in terms of the
G8. Where is the worldwide coalition to eradicate poverty and
surely, let us be honest about it, if you are going to have a
campaign to eradicate poverty it has to be a global campaign and
not just based here in the UK.
Mr Phillips: Technically we consider
ourselves in the land of NGO jargon as the national platform of
the Global Call to Action Against Poverty. This mobilisation is
now in 80 plus countries and most of those you will know are in
the south and they have been fighting to ensure that their governments
do the things that a lot of people up here talk about in terms
of delivery, transparency, accountability and government issues,
as well as pushing for the international community to deliver
the investment that is needed and stop the imposition of damaging
policies, in particular moving on trade policies. They are active
in their countries in the style that is relevant and an awful
lot of countries have not had the same traditions that we are
more familiar with in the UK. We have been active in the global
call. The global call has represented, frankly, an unprecedented
voice from around the world for action on extreme poverty or poverty
more generally and ensuring that it is eradicated. People have
been active in the course of the year in their tens of millions
around the world. This has not been attracting a huge amount of
media interest here because media interest here has been pretty
much more interested in what we are doing and what has been happening
in the UK scene. Globally, that is an extremely important measure
to understand. In the US, for instance, they have been mobilising
hundreds and hundreds and hundreds of thousands of people now
behind the campaign in the US which is called the One Campaign;
likewise Japan has seen steps forward in popular campaigning of
a type that has never been seen before. I think it is wrong to
dismiss that because that is a new, coherent and coordinated voice
which has been part of this effort this year but, I think we all
know there are limits to how far governments are prepared to listen
to their own populations in terms of how far they are prepared
to move on these policy issues. In the end, because we have seen
this unprecedented voice which has been entirely unified between
the rich world and the poor world in terms of the voices of the
campaigners that united voice has not moved governments sufficiently
enough and the question really is, is that the fault of the campaign
or is it the failure of the governments at this point.
Q66 Ann McKechin: You are surely
not saying that the civic society movement in Japan, for example,
is anything to the extent it is in the UK?
Mr Phillips: No, I am not claiming
that at all.
Q67 Ann McKechin: Do you not agree,
from your point of view of campaigning you need to work harder
in these key countries to gather support—
Mr Phillips: Yes, we do.
Q68 Ann McKechin: —if you want
the political action that is going to cause multilateral change
that you are seeking to achieve the policies?
Mr Phillips: Sure. I think it
would be quite wrong to say that nothing has happened in Japan
because it has. It is not my particular country of great expertise
but I will point to other countries like countries in the south,
a country like Sierra Leone which has seen a popular campaigning
movement emerge of a type which is totally unprecedented in Sierra
Leone on these issues.
Mr Rand: Just to add to that,
I think Japan has been a difficult country but we have worked
hard with the time that we have to support and encourage the campaign
and you will be aware there is also a proper reticence about the
UK telling other countries what to do. There has been real support,
some of the agencies involved in Make Poverty History, international
agencies, have given real support to campaigns in those countries.
I have just got the note here, 30 million people have taken action
in the Global Call for Action Against Poverty and in the United
States one particular vote for the One Campaign had over one million
people participate. I think in the United States you can see distinct
evidence that the administration has moved and changed its opinion
because of the campaign. It has not changed it as much as we might
have wanted it to. I have sat in meetings in this House in the
past with people saying "What is going to be done about getting
people campaigning in the States" and I think people will
look back on 2005 and say it was a significant shift forward in
terms of a popular campaign in the United States and the administration
has responded to that. I think we can look at areas where more
could have been done. I think at the end of 2005 we will be able
to go around countries in the north and south and say the awareness
of the popular campaign on poverty has moved forward significantly
in almost every country because of the Global Call for Action
Against Poverty and Make Poverty History.
Q69 Mr Hunt: Can I say something
contrary to the tone of the discussion this morning which is I
really want to congratulate you on a fantastic year. I am a newly-elected
MP and I would not have imagined that the whole question of extreme
poverty could become as central to the national debate as it has
done this year. I think it is incredible how that has been achieved
this year. I think you are all to be congratulated on the progress
you have made in the UK. I have a concern though about this emphasis
on economic justice as opposed to economic growth because it seems
to me if you look at countries in the world that have managed
not to eradicate extreme poverty but give you a sense of optimism
that they will be able to eradicate it—places like Bangladesh,
India, China, where there is a lot of terrible poverty but somehow
we think they probably will crack that problem in the next 20
or 30 years—they have done it not because debts have been
dropped, not because of massive increases in aid, they have done
it through getting the fundamentals right to develop a competitive
growing economy and that argument was not heard at all in the
Make Poverty History campaign. I think my concern is something
I share with Joan which is that the way it was portrayed is that
extreme poverty is the rich world's fault. I think as human beings,
of course, we have a responsibility to do something about extreme
poverty, but we also need to recognise that to give developing
countries self-respect and to really give them the best likelihood
of defeating poverty, they need to feel that this is a problem
that they can also solve themselves. I think there is a real danger
of not recognising that there is a great deal of aiming to do
and we can be the facilitator and the catalyst but we cannot necessarily
be the people who solve the problem.
Mr Hardstaff: I think if you look
at the economic history of the countries that have successfully
achieved levels of economic growth and then transfer that into
some degree of poverty reduction over the past 20 years, what
you tend to find is those countries are ones that have had a degree
of freedom in the economic policies that they pursue. You point
out China, that country has pursued a range of economic policies
that are far different from what you would call the Washington
consensus, the rather homogenous set of policies that have been
imposed on many of the poorer countries by the IMF and the World
Bank. I think it is absolutely key that Make Poverty History and
all the organisations in it are able to communicate the fact that
economic justice is about the freedom and the ability of countries
to pursue their own path for development and that is something
that I think we have done, but as has already been mentioned there
is a communication issue in terms of the degree of complexity
you get into. When you look at the materials that Make Poverty
History has produced, and the range of organisations that are
in it have produced, then you find there is this explanation of
the need for greater economic freedom for these countries. That
has to go alongside addressing problems like lack of aid and debt
cancellation for those counties where it is relevant but it is
not relevant for all. We have to point out the range and complexity
and diversity amongst countries in the global south and that is,
I think, what Make Poverty History is trying to do in, if you
like, the suite of policy demands and issues that it has covered.
Mr Watt: Just to add to Pete's
point, firstly, there is an important caveat that there are lots
of countries you can point to that are growing without either
making any progress on poverty reduction at all or having done
a very poor job of translating that efficiently. If you look at
Uganda, for example, for the last five years Uganda has grown
steadily by about four to six per cent a year but poverty has
increased, so clearly growth is important, it is a necessary condition
of reducing poverty, it is not a sufficient condition. It is very
important that as well as looking at growth we also look at the
distribution of growth and the distribution of economic opportunities
and that is where the justice agenda comes in. In terms of the
question about why we focus here in the UK on aid, debt and trade,
I think we are focused on those issues because those are the issues
that the UK Government has significant scope to act on, we campaign
on different issues when we are in the South. One of the reasons
we did not campaign on governance as a major issue was because
we felt that was primarily an issue for developing country governance.
If you look at partners in the Global Call to Action Against Poverty
in the South, governance is one of the key planks of their campaign.
It was very much about focusing on specific concrete steps that
we thought the UK Government could take in support of a broader
set of measures that needed to be taken to make progress.
Q70 John Bercow: I would like to
focus on the possible disparity between public expectations on
the one hand and the likely reality on the other. The G8 countries
have made their pledge to inject an additional $50 billion in
aid by 2010, somewhat less than the demand you have stipulated
but nevertheless perhaps better than nothing. Of course, that
commitment to increase funding over a five year period is made
against the background—the background of which those countries
are very well aware—of many of the intended beneficiaries
being a million miles away from achieving the Millennium Development
Goals (MDGs). The first question that I want to put to Matt and
the team is very simply will the arrival of that aid, even if
it is on time in five years' time, be too late for those beneficiaries
to have any realistic chance of reaching the MDGs on time?
Mr Phillips: I will pass over
to Patrick but our general view is that the United Nations Summit
saw the adoption of a plan which will be insufficient to achieve
the Millennium Development Goals and given that is a fundamental
plank, for instance, in the UK Government's international development
strategy, is a real strategic issue which we feel that the UK
is now going to have to grapple with.
Mr Watt: As Matt was saying, our
view is what happened on aid over this year was significant. There
was not enough and really what we have got in the pipeline at
the moment is too little, too late. It is very unlikely before
2008-09 that we will see significant additional aid coming on-stream
in the system. Over the next three years $10 billion of global
ODA figures will be accounted for by Iraqi debt. A significant
proportion will be accounted for by Nigerian debt. If you look
at the real cash transfer to poor countries over the last few
years we have seen aid increase from $50 to almost $80 billion,
the real cash transfer to low income countries has barely shifted
over that period for a variety of reasons, partly to do with debt
relief, partly to do with aid going to strategic middle-income
countries like Iraq and Colombia rather than to the poorest countries.
There are good reasons to be doubtful about how much aid is really
going to materialise between now and 2010. I think, also, it is
too late in terms of achieving the MDGs, not least because a lot
of the MDGs require investment over a long period of time; in
order to achieve the 2015 goals. Look at education, for example,
if you are going to achieve 100% enrolment by 2015 you need to
start with 100% student intake from 2007-08 so it works its way
through the system. If you are not seeing significant additional
resources coming on stream until 2009-10 you are left with real
problems for countries that are off-track in terms of achieving
the progress that is needed.
Q71 John Bercow: I do not want to
over interpret your answers nor do I want to be pessimistic but
I am worried and within the privacy of this room, I am sure the
secret will be closely guarded. I am seriously quite anxious because
it comes back to this question of public expectations and likely
outcome. All of us in this room who are involved in public affairs
must be worried about the cynicism which is pervasive within our
electorate and other electorates around the world about what politicians
say, the promises they make, and what is likely to happen. If
I can put it this way, I do not know whether other colleagues
from my benches would see it in the same terms: I feel on the
one hand, as a Tory, very suspicious of the grand over-arching
schemes and elaborate theories and huge announcements of intended
new construction because very often, I think those are triumphs
of rhetoric over reality. I tend to think, like the late Iain
Macleod, that we cannot really aim for Utopia, it is better to
concentrate on delivering something modestly better than the present.
On the other hand I can see that it would be probably disastrous
for your objectives, our agreed objectives of securing international
development if we were just to walk away and say the goals cannot
be delivered and therefore let us abandon them. I strongly suspect
you will agree with that, I think it is very unlikely you would
want to abandon them. Just to put you on the spot, if aid levels
continue as presently intended, and there is a modicum of progress
on the trade justice agenda and you must decide what you think
constitutes that modicum. What is the earliest realistic date
at which the eradication of extreme poverty and hunger in sub-Saharan
Africa can be expected to be achieved? Was the Chancellor right
in 2003, in front of this Committee, to be concerned that on present
trends, 100 years, 150 years and more would be how late it would
be beyond the 2015 date?
Mr Phillips: Correct me if I am
wrong Patrick, I think the aid volume pledged raises it by 2010
from 0.34 to 0.37% of GDP or something like that, it is not a
very substantial step forward so the Chancellor's predictions
are going to be a little more pessimistic. Mr Watt:
I think the first thing to say is the Millennium Development Goal
on poverty calls for a halving of extreme poverty by 2015, not
the eradication. Even if that were to be achieved, which is a
very tall order in sub-Saharan Africa, in particular where poverty
rates have been increasing in the last ten years, even were that
to be achieved, we would still have something in the order of
two or three hundred million people living in extreme poverty,
just in sub-Saharan Africa. There is clearly an enormous challenge,
even if the MDGs are reached it is a staging post, it is not the
final destination. I think the Chancellor's predictions are probably
roughly right if there is not much more concerted international
action on getting the countries that are significantly off-track
on the goals back on track. This obviously is not just about financing,
but financing again is a necessary conditional approach towards
the MDGs and if you look at the order of magnitude of the estimates
for financing, the UN Millennium Project report that came out
this year estimated that just in 2006 a scaling up of aid by about
$50 billion was going to be needed in order to get countries on
track to achieve the MDGs. If you see what has been agreed this
year is going to deliver almost no new aid whatsoever in 2006,
that underscores the scale of the challenge we face.
Mr Rand: I was going to add to
that, if you look at a prospective of the year, we mentioned about
the figures that we said were needed, part of the issue is that
the Millennium Development Goals were agreed in 2000, governments
themselves work out the resources that are needed to meet them.
We had looked forward to the UN Summit, this year we told people
it would be the point at which progress on the goals would be
assessed, and one of the things that notably failed to come out
of the UN Summit was any real assessment of what progress had
been made and what needed to be done. In terms of managing public
expectation there is just the deep fear which is that governments
of the world have made the pledges, they have costed them, they
have got to the point where they realise what the gap is and suddenly
everyone goes silent about the growing gap between expectation
and the government delivery. I think one of the challenges at
the end of 2005 is the extent to which, again, the clarity word
I used, we felt the UN Summit was a really missed opportunity
to be absolutely clear about what had not been done that needed
to be and therefore what needed to be done to get back on track,
and that was missed pretty drastically. Our concern is that it
has been missed by the governments who made the pledges. It is
back to the issue about public expectation and we feel part of
our job is to say these are the promises that were made and this
is what has been done. Many of the figures from that have emerged
out of the work the governments themselves have done to say what
is needed to make that achievable.
Q72 John Bercow: We have talked about
the importance of increasing aid but not, so far, about the priorities
for its distribution. I would like to get a feel from you of the
downside risk of putting the money in the wrong direction. Very,
very simply—and I am probably oversimplifying the process—there
is a debate, is there not, between those represented in Make Poverty
History, who think the whole of the funding should go to basic
needs, to the expansion of health and education services in the
developing world, and those heavily represented, as far as I can
see, in the publication of the Commission for Africa report, who
think the focus should instead be on infrastructure projects—presumably,
rather better than some of the failed projects of the past. There
is a very important conceptual difference there. If you stick
by the view that it should mainly be about basic needs but that
is not what happens, how disastrous will that be?
Mr Watt: I think we would be deeply
concerned if there were a diversion of political attention away
from basic needs. I do not think we should assume that basic needs
are currently adequately taken care of in terms of where aid is
distributed. If you look at global aid flows, about two cents
in every dollar of aid globally is going to basic education and
about three cents in every dollar is going to basic health care,
so I think it would be difficult to argue that they are being
overspent on by the donor community. There is perhaps a slightly
false dichotomy between infrastructure and basic needs. I think
there are a lot of basic needs that can only be met through investment
in infrastructure. Water would be one very obvious example. Often
infrastructure can be critical in terms of people's ability to
go to school, for example, or to obtain health care. I am thinking
of a village in Ghana I was in a couple of years ago on the banks
of the River Volta. When the river was in full spate, children
were simply unable to cross the river to the other side to get
to their primary school, so for several months of the year they
did not get a primary education. If you had a bridge over the
river, those children would be able to get to school. That is
an infrastructure intervention that is needed there which would
enable children to meet their basic need for an education. I think
we need to keep a balance and recognise that you need both. Infrastructure
does have a critical role in fostering growth, going back to the
question about growth. It is clear, for example, that rural roads
have a major influence on the price of agricultural inputs like
fertiliser, they have a major impact on the price that farmers
can get for their goods when they go to market, and, if you can
boost rural incomes, you can boost people's ability to obtain
basic services. I think there are lots of synergies (an unfortunate
word) and also synergies which need to be built on and properly
understood. We would maybe have some concern, particularly on
the part of the World Bank, that the drive to increase spend on
infrastructure risks watering down some of the environmental and
social safeguards that have been quite hard won in recent years.
There is clearly a drive, particularly in middle income countries
within the World Bank, significantly to increase infrastructure
investment, particularly in large-scale integrated infrastructure
projects. The International Finance Corporation, the World Bank's
private lending arm, at the moment is reviewing its environmental
and social safeguards, and I think there is a very real concern
there that, in order to make infrastructure lending more attractive
to developing countries, there will be a weakening of some of
these safeguards that have been introduced in recent years to
ensure that communities on the ground do not suffer from large-scale
infrastructure projects.
Mr Wright: We have focused quite
a lot on this point about public expectation and what British
citizens think is achievable. I think it is important that things
are realistic. Our view would be that the Millennium Development
Goals were realistic. They still are realistic. They are clearly
an analysis that shows that in certain basic areas and in certain
parts of the world achieving them would be incredibly difficult,
particularly for sub-Saharan Africa, but, unless there is an ambition
about the MDGs for their achievement, then the kind of drive that
we have and that was expressed by people this year about what
they wanted the British Government to do and the role they wanted
the British Government to play in trying to set the environment
for those targets to be achieved, would not have come about. I
agree with Patrick that there is not a difference particularly
about infrastructure, because the targets around healthcare and
HIV treatment rely on setting up an infrastructure for that to
be delivered across a country and to get to some of the worst
affected and poorest areas. The MDGs have been a really useful
tool and they continue to be a very useful tool to push the international
community to much faster action. They all signed up to it, they
all agreed them, and we have to try to push them further to make
sure they are delivered. Our view would be that what happened
this year is not yet enough and has not gone far enough to make
them achievable.
Q73 Ann McKechin: Given the fact
that DFID's budget is likely to increase substantially in the
next five years, there are going to be questions about where additional
UK expenditure is going to be concentrated. I wonder if I could
extend the argument about infrastructure a bit further, as to
whether or not the emphasis should be with a view that countries
are no longer aid dependent, that that should be the ultimate
goal, and that accordingly we are seeking a solution which provides
sustainable growth and income within a country to achieve that.
That, I think, would perhaps change the test to some degree, because
a lot of the problems you have talked about, such as economic
conditionality and donor harmonisation, relate to the fact that
people are so reliant on aid in the first place. Should there
be a new emphasis on how we release people from having to be dependent
on aid in the first place?
Mr Watt: All the agencies of Make
Poverty History would agree that the real test of aid effectiveness
is a country ceasing to need aid. The fact that so few countries
have moved away from a position of being aid dependent does raise
some serious questions about how the development system currently
works and whether it is really providing developing countries
with the opportunity to make a sustainable escape from poverty.
Clearly there is a problem in the aid system: there is an over-emphasis
on inputs and outputs and insufficient emphasis on outcomes and
there is a very short time horizon. I think that is partly to
do with incentives within donor agencies, that there is an impatience
to get results, to be able to attribute the donor's own intervention
to the results, and insufficient commitment to the long-term.
I think particularly in sub-Saharan Africa and other low income
countries, even if donors were to do a much better job of focusing
on a sustainable exit from poverty, you are still going to need
significant levels of aid for the foreseeable future. I think
there is a need for a more predictable aid system, better focused
on outcomes, but I do not think we can assume that at any time
soon the poorest countries are going to significantly reduce their
reliance on external assistance.
Q74 Chairman: Could we turn to the
debt relief package. First of all we had agreement on relief of
debt for 18 countries, subject to conditions, and there was a
little frisson that some countries outside the G8 would try to
unravel that but it would appear that the UK Government has been
fairly consistent on this and we have at least secured that. But
you are also calling for that debt relief to be extended to 60
countries. How achievable is that going to be? Some people are
saying that it should be unconditional, but, given that 18 countries
have secured their money because they have agreed to certain conditions,
how would that work?
Mr Rand: I think the first part
of your question is: Are we as confident as the UK Government
the deal will be delivered? I suppose the answer is they know
more about what is being said behind closed doors than we do.
We have talked to some of the campaigners in other countries where
there has been the objection. I suppose my answer would be that
we will be convinced it has been done when it has been done. The
signs are that the IMF side of the deal is slightly stronger than
the World Bank side of it, and we are still waiting—
Q75 Chairman: Is that not the more
important part?
Mr Rand: I think the interesting
thing is that the UK Government decided the two things hold or
fall together—which is also an interesting challenge. The
World Bank is the bigger side. We were first reacting to this
deal back in June and here we are in October with still not definite
news as to when it will be delivered. Part of the concern about
the timing is that, for the World Bank side, the earliest time
that this debt relief would then come into force is June 2006,
and, if the agreement is not made in the next no-one is quite
sure how many weeks, there is a danger that it will not even then
start in 2006. You will all be aware of the political consequences
of having announced something very boldly in June, repeating it
in July, and then not having the evidence of it having been delivered.
So there are still issues. We are working hard to monitor that
and we will follow it through. We see the delivery of that deal
as being a kind of first step for this year of achieving something
that was significant on debt. We have concerns about it, first
of all, I think, on the conditions. We have been absolutely clear
that there are conditions about how money should be used to combat
poverty which are reasonable fiduciary or accountability transparency
conditions. But the reality is that to get this debt relief the
countries are having also to agree to a whole package of conditions,
including economic policy conditions. Member agencies of Make
Poverty History have emphasised over years the bad impact that
those economic policy conditions have. You meet people from those
countries and some of them even seriously doubt whether the debt
relief is worth having because of the impact of the conditions
to which it was attached. One of the main planks of Make Poverty
History's concern about debt and trade has been about the imposition
of economic policy conditions, and we welcomed the paragraph in
the G8 communique« that countries should be set free to pursue
their own economic policies. That needs to be turned into reality.
It needs to be turned into reality by increasing activity at the
IMF and the World Bank. The conditionality review was postponed
because of concern about getting the deal through, and it is really
important that work continues on that and that there is real solid
achievement in that area. We will be watching and looking very
carefully. It is due to come back to the annual meetings next
year. There needs to be complete recognition that it is unhelpful
and wrong and anti-democratic to impose economic policies on developing
countries. You mentioned that we have talked about over 60 countries.
The reason we got to that number was simply taking the figures
of what is needed to meet the Millennium Development Goals. We
have argued consistently, for more years than I care to remember,
that the test as to the debt relief that is needed should be the
country's ability to meet the basic human needs of its population.
The whole HIPC initiative has been based on assessments of what
a country can afford to pay in terms of its export earnings. Our
argument has been that the test is what a country can afford to
pay in terms of what people do not have in terms of education
and health. That sort of principle is increasingly being recognised.
We just pushed the figures through and said, "If you are
going to find the resources needed to meet the Millennium Development
Goals, what needs to happen on debt?" When you do that, the
reality is that over 60 countries come up with needing to have
100% debt cancellation in order to have the resources. It is not
that we have claimed 60 countries need to have this; we have said
that is what the figures prove and therefore the test as to whether
the human need is going to be met is what needs to be done. In
that respect, these countries then need to have a debt relief
deal as part of a package around debt, aid and trade. One of the
other things that Jubilee Debt Campaign has consistently argued
is that these things do need to be done on a country-by-country
basis. Every country's debt profile is different from another
country's debt profile and it is then alongside what their needs
are in terms of trade and what their needs are in terms of aid.
The only meaningful way of making progress in poverty reduction
in those countries is to look at those things together, not in
isolation. Nonetheless, when you look at debt in isolation, the
figures are consistently showing that what has been offered in
2005 is not a 100% debt cancellation, even for the 18 countries,
and it is not sufficient to enable the goals agreed by the international
community to be met.
Q76 Chairman: Accepting that and
accepting your case as to why you have come up with 60 countries,
do you not agree that for those of us who are accountable not
only to the campaigners who want poverty reduced but also to the
taxpayers and other international institutions, that people want
an assurance that if the debts are released the benefit will go
to reducing poverty. However loose those conditions are, that
is a sort of minimum test. It would be helpful, would it not,
if we could work out almost an agreed pecking order of how we
get from 18 to 60? You can appreciate the difficulty we have:
you have 18 you are concerned that will be delivered, and the
next number is 60, all of whom are different, and that is a big
jump.
Mr Rand: There are intermediate
jumps, of course, because there are the countries which are in
between decision and completion point that would normally come
through. So there are different phases at which the countries
will come through. There is a sense—and it is a problem
for us, as it is for you—in which you react to the fact
that this has been offered for 18 countries, you look at who it
may be extended to, and you hold out . . . I was going to say
the vision, but it is not the vision it is the reality of what
needs to be achieved, and then you work out the steps to go. On
the question of ensuring that money is used for poverty reduction,
the interesting thing is that the research that was done after
the enhanced initiative in Cologne in 1999 did show that where
countries had received debt relief there was an equivalent increase
in budget expenditure in the areas that were identifiable as poverty
reduction. So the evidence of history over the past five or six
years is that pretty consistently debt relief money does get used
for the purposes for which it is intended. Therefore, our concern
has been that there is a danger that, because some countries are
feared not to be able to deliver it, those who can deliver it
do not get their debt relief. That seems to us to be a particularly
bizarre way of going about a process. That is why we are pleased
and have welcomed the principle of 100% debt cancellation for
the areas of debt concerned for these 18 countries. Those are
the countries that have demonstrated that they can do that. We
want to push that on. We want to see the ways in which countries
are able to demonstrate that they can use money in that way, can
be encouraged to do that. The important thing is that those countries
are given the opportunity. The ones who have already done it can
move forward and have more debt cancelled and more countries are
brought in. We are absolutely clear that it is possible to make
the distinction between the accountability conditions and the
conditions which are about how you have to run your economy in
order to get debt relief. Of course, the great advantage of debt
cancellation is that, once the debt stock is cancelled, it cannot
be used as a weapon to make those countries fulfil economic policy
conditions. People say, "If need be, can we not use it as
a weapon to make sure they fulfil accountability conditions,"
but there are so many different transactions going on between
those countries and the developed world that there are all sorts
of ways in which accountability can be maintained. We would love
to see more work being done on how every country can make more
impact on people who are poor, and, within those borders, it applies
to all sorts of countries.
Q77 Mr Singh: I am worried about
your concerns of delivery to the 18 countries already within the
HIPC process. If you have those concerns about delivery to these
18, where does that leave the countries who have not completed
the HIPC process yet or those completely outside that process?
Mr Rand: That is part of the concern
we have, and it is part of the balance we have to work out in
terms of where we make effort in terms of lobbying and campaigning
as well. Part of the frustration of the second part of this year
has been this feeling that a debt deal was announced which had
points that we really did welcome, but you get the impression
that there are a lot of places where even that minimum step forward,
as we have perceived it, has been resisted very strenuously. That
leaves concern about: Within the IMF and World Bank, how committed
are they to making this? Or is it about: What can they do—at
least, politically—to make this move forward? I think there
is an ongoing concern about that. I think one of the reasons why
we are concerned to see this deal go through is that if it goes
through it establishes a whole number of principles that then
can be built on. You could argue that maybe that is the reason
it is being resisted, because there is a recognition that some
of those principles do have implications as to which other countries
should be included and so on. As I say, it is a matter of concern
that the debt deal should be agreed. It will make a difference
immediately for the countries that are included, but it will also
give a basis for talking about further countries, further debts.
From one point of view, it is absurd that the Inter American Development
Bank is not included. HIPC countries are paying significant amounts
of debt to other institutions and that is not included. We hope,
when the deal has been agreed, that the next thing that will be
considered immediately is those HIPC countries who are paying
out debt service to other banks, and multilateral institutions
should have those considered. We feel we have to make that step
and secure that step—as I am sure the UK Government feels—but
then it needs to be built on.
Q78 Mr Singh: What type of economic
policy conditions concern you the most? Have they been applied
to the HIPC 18 countries already? If they are able to accept those
conditions, why are you concerned about their ability to respond
to them?
Mr Rand: The conditions apply
across a whole range of issues. Our concern particularly as a
debt campaign has been the conditions which have been applied.
We are particularly concerned about enforced trade liberalisation,
opening up borders to things coming into the country; about enforced
privatisation. Some of that has been clearly anti-democratic.
We have had situations where countries' parliaments have voted
not to do something and, within weeks sometimes, governments have
agreed to do the very thing. The reason is that the only way they
could get one million, two million, ten million pounds or dollars
of debt relief was if they overrode what the parliament had decided.
So I think there are real concerns about the democratic issue,
about the effectiveness of those things. There is a table in this
document of the different levels of conditions that have been
applied with debt relief. The evidence is that in many, many countries
they have been extremely damaging and particularly damaging to
the lives of people who are poor.
Mr Watt: To add to what Stephen
has said, a lot of our concerns about conditionality are not to
do with an ideological objection to liberalisation or privatisation
but to do with the evidence on the ground of what the poverty
impact has been, and the fact that we have seen in a large number
of countries, particularly in Africa over the last 15 to 20 years,
as a result of the shrinkage of the state, which has been very
strongly promoted by the World Bank and IMF, a significant deterioration
in poor people's living standards and poor people's access to
basic services, in terms of the quality of public administration,
in terms of the quality of infrastructure. Really that underpins
a lot of our disquiet about particularly these trade liberalisation
and privatisation conditions. But I think more generally there
is a question about whether donors really know best about what
is appropriate in recipient countries. I think donors do have
some areas of expertise that they are able to share but really
it is imperative that local knowledge, local priorities, local
needs are driving policy change in poor countries. A lot of the
time policy conditionality circumvents that. It short-circuits
that process that ought to be happening, that iterative, local
policy-making process. So there is real concern about the impact
it has on governance and the risk that it makes recipient governments
more concerned about their accountability to the donors than to
their own citizens. I think we need to be very careful that, in
trying to ensure that aid is well spent, which is a legitimate
concern, we do not create such onerous systems of conditionality
that recipients end up being responsive to donors at the expense
of being responsive to their populations.
Q79 Mr Singh: I am interested in
that in terms of possible ideological processes in liberalisation
policy. Would you not accept that India's growth and China's growth
has been precisely because they have taken different steps in
terms of what they did economically before, to a much more liberal
approach to growth and trade?
Mr Hardstaff: I think the important
thing to look at in terms of countries like China and India but
also previously countries like South Korea, Taiwan, Thailand and
Malaysia, is that those countries have pursued a very different
path to that which has been imposed on particularly countries
in Africa, but also those in Latin America and also some in Asia,
in return for loans, debt relief and aid. China and India have
opened up gradually, at their own pace, in their own way. They
have sometimes regulated investment and sometimes deregulated.
If policies do not work, they can reverse them. The problem with
conditionality from the World Bank and the IMF is that they have
gone into countries, particularly in sub-Saharan Africa but also
in other parts of the world. Through the 1980s and 1990s we have
had privatisation, trade liberalisation, investment deregulation,
fiscal austerity, a whole range of the same policies, and these
have not worked. The governments in these countries have not been
in a position to reverse them if they are not working. The parliaments
in those countries have not been in a position to reverse them.
It is denying a fundamental process of democracy. In this country,
our Government might come forward with a plan, but it then has
to submit that plan to parliamentary scrutiny, and sometimes those
plans get changed, sometimes they may even be reversed, and that
is a fundamental part of democracy. In countries subject to conditionality,
they are denied that possibility, and that is a fundamental problem
with the whole concept of imposing these economic policies.
Mr Wright: Another example that
concerns us a great deal is that fiscal austerity—the kind
of arguments of what a successful economy should look like—has
suppressed a lot of spending on public services, and one of the
impacts of that has been the decline in the health care systems
available in many African countries whilst they are facing terrible
health crises, including HIV. There is a lot of discussion rightly
in this country—because it is very much a UK issue and a
US issue as well—about recruitment of trained healthcare
staff from developing countries. One of the issues we would identify
as driving that has been the lack of funding available for good
quality wages to keep staff in their own countries once they have
been trained and why it is so much more advantageous for them
to travel to try to work in developed countries. The damage to
the healthcare system has been done by conditions imposed by the
IMF and the World Bank and their rigid idea of what a successful
economy should be like. That is one of the effects.
Mr Phillips: As you can see, we
have an awful lot to say about conditionality issues. I think
we mark as one of the successes of this campaign the exposing
of this issue to the light, because it really is absolutely fundamental
to the relationship between the rich world and the poor world
and where things need to go in terms of a more democratic form
of international governance that allows development to take place
in ways that will really work for eradicating poverty. If there
is one thing which must be the legacy of this year in terms of
scrutinising what governments do, I would say that this one really
needs to carry through into future years, very closely with parliamentarians,
in particular.
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