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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 418-ii House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE International Development Committee
Making povery history? The promises of Gleneagles
Tuesday 25 October 2005 MR MATT PHILIPS, MR PETER HARDSTAFF, MR STEPHEN RAND, MR PATRICK WATT and MR SIMON WRIGHT Evidence heard in Public Questions 57 - 111
USE OF THE TRANSCRIPT
Oral Evidence Taken before the International Development Committee on Tuesday 25 October 2005 Members present Malcolm Bruce, in the Chair John Barrett Hugh Bayley John Bercow Mr Jeremy Hunt Ann Mckechin Joan Ruddock Mr Marsha Singh ________________ Witnesses: Mr Matt Philips, Make Poverty History campaign, Head of Public Affairs, Save the Children, Mr Patrick Watt, UK Aid Network, Senior Policy Officer, ActionAid, Mr Simon Wright, Stop AIDS Campaign, Head of HIV/AIDS team, ActionAid, Mr Peter Hardstaff, Trade Justice Movement, Head of Policy, World Development Movement, Mr Stephen Rand, Co-Chairman, Jubilee Debt Campaign, examined. Q57 Chairman: Good morning to you all and thank you all for coming in to exchange your views and thoughts on what certainly has been a busy campaigning year for you. Perhaps, if I can ask you Matt, if you would perhaps introduce your colleagues and then we can take it from there. Mr Philips: My name is Matt Philips. I am the Head of Public Affairs at Save the Children and I also have the privilege of being on the coordination team of Make Poverty History from its inception, which was originally kicked off, in planning terms, in October 2003, so it really feels like a very long campaign to me. I will ask my colleagues to introduce themselves. Mr Wright: I am Simon Wright. I work for ActionAid. I am representing the Stop AIDS Campaign which was one of the key partners in the Make Poverty History coalition. Mr Hardstaff: My name is Peter Hardstaff. I am Head of Policy at the World Development Movement and I am here representing Trade Justice Movement, and of course, Make Poverty History. Mr Rand: My name is Stephen Rand. I am the Co-Chairman of the board of Jubilee Debt Campaign, and I am part of the coordination team for Make Poverty History. Mr Watt: My name is Patrick Watt. I am Senior Policy Officer at ActionAid and I am here representing the UK Aid Network. Mr Philips: Just one short explanation is that Make Poverty History is comprised of individual groups but, also, all its policy is driven by these core networks and these are the four policy networks represented here on this side. Q58 Chairman: Thank you all for coming here today. As there are five of you, you may get asked specific questions, you may also think you want to come in on a reply; if so, can you just indicate you want to do so, do not feel inhibited if you want to chip in. As I said, by way of introduction, and you pointed to how long the campaign has been, you have had a very busy campaigning period, very high profile and certainly claimed by governments and other agencies that they have responded to that and delivered some real progress, yet a lot of you have been really quite critical and quite sceptical as to the outcomes. I suppose the first question to address is, given that, how realistic is it? It is a grand slogan "Make Poverty History", but how realistic is it? You are carrying huge numbers of ordinary members of the public who want to help you but in a big complicated arena with governments and international agents, how realistic do you feel your objectives have been and how are you going to reconcile the shortcomings with the people who you have carried with you on the campaign? Mr Philips: That is a very fine point and I might come back to just how big the campaign is in a moment because that is a very key point from our point of view. We started out on this with a full expectation that the issues, the policy components of what we are calling for, can be delivered if governments have got the political will to do so. I think the story of the year, from our point of view, is not over yet. We have the major event of the WTO Ministerial in Hong Kong about to come. The story of the year really is about how far governments have been prepared to go compared with what the public have demanded. The public have got involved in this campaign in absolutely unprecedented numbers, depending on whether you want the quality measures or the quantity measures, there are more than seven million people with white bands expressing their overall support for the campaign's objectives of trade justice, dropping debt and more and better aid. More deeply, there are hundreds of thousands of people who have been very expressly involved in frequently campaigning and there have been millions targeting MPs, but also, in particular, the Government, just in this country, to take action on those demands. We have mobilised huge numbers of the public. We took as our reference point originally the 70,000 people who went along to the Jubilee Debt Campaign mobilisation in Birmingham back in those days, and we hoped we would be able to emulate that effort. The real quality measure for us, above all others, is that to our surprise, delight and amazement a quarter of a million people participated in the Edinburgh rally. They travelled an awful long way to express how clearly they felt governments must take the necessary action to eradicate poverty. I think what we keyed into, politically, is a mood from the public that this toll of death, this degrading injustice of extreme poverty around the world must be ended and that leaders must take the unprecedented opportunity that 2005 offered to make that breakthrough. We measure our success really against what the international community did at the United Nations Summit, what the G8 governments, I guess, were prepared to do at Gleneagles and what the UK Government has done this year. Q59 Chairman: That is really the point I want to press you a bit further. I do not doubt for a minute your success in connecting with the public. We have all seen it, we see that in our own constituencies, there is no question about that and, as campaigners, you have every reason to be very satisfied with the campaign. A political point - and we are political politicians - how do you then measure the outcome and follow it through? There have been slight disagreements in public amongst yourselves as to you pushing people, you get some responses, and then you say "that is not good enough". How do you reconcile the campaign to the political outcomes in a way that does acknowledge what is achieved and how to take the steps forward because I think the millions of people who follow you want to know what happened, what did not happen and what to do next. Mr Philips: We feel a huge responsibility to be very honest with all of those supporters about exactly how far we feel the Government has achieved things and what we are doing is measuring against what we believe is necessary. We have derived our analysis and our assessment of what is necessary not just from cooking it up in policy heads in the UK but through our connections to civil society and our colleagues campaigners in the global call to action against poverty which is 80 countries strong now, as well as from our direct experience as organisations who operate in other countries. We have a very deep experience, and it is that experience which has given us a sense of what is necessary, and that is our campaign. Our campaign is about what is necessary and we will measure the Government against what we believe is necessary to achieve the real steps forward in progress that we believe the public want and that the public have shown they want. Now, we do know that they can do these things and all the measures that we can talk about in more depth today are entirely achievable either by the international community acting in concert or by individual governments in their own right, particularly with their own individual policy. 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 and say there is either a specific and conspicuous achievement, a success that we got which we feel contributes to the campaign or a particular failure that you feel you would hope for and did not get during the campaign? That is not a summary of the whole campaign. Mr Philips: 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 human 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 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 Philips: 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 Philips: 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 governments 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 all we have been able to show this year. I think we have taken it very responsibly, the responsibility which we have in doing that. If you look at the communications we have been doing with 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 successful events or the ups and downs of the campaign, we have been communicating that with the 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 Philips: 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 they 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 Geldolf 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 that danger 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 do could not deliver and what needs to be delivered elsewhere to make the progress that needs to be made on into the future. Mr Philips: 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 grabbling 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 like 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 Philips: 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 core. The global core 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 Philips: 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 Philips: 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 Philips: 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 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 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 of 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 and 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 Goal. 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 Philips: 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 local 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 Columbia 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; recently, I think we have 10 to 15 goals. Look at education, for example, if you are going to achieve 100 per cent enrolment by 2015 you need to start with 100 per cent 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 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 lady in McClough(?) 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 Philips: Correct me if I am wrong Patrick, I think the aid volume pledged raises it by 2010 from 0.34 to 0.37 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 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 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 about 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 served as 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 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 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 tension 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, risks watering down some of the environmental 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. MDGs have been a really useful tool and they continue to be a very useful tool to push the international community to much further 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 development 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 in there for 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 communiqué 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 per cent 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 the 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 per cent 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 got 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 per cent 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 - as little, 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 American Development Bank is not included. HIPC countries are paying significant amounts of debt stop on those issues 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. These 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 health care staff from developing countries. One of the issues we would identify as driving that has been the lack of spending 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 developing 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. Q80 Mr Singh: Given those responses, do you welcome DFID's change in terms of conditionality? Is that a model you will be pushing for with the World Bank and IMF? Mr Watt: We have welcomed the DFID HMT paper on conditionality and change of policy. It really is too early to say what impact, if any, it has had. DFID has not yet completed the operational guidance note that will go to DFID offices in developing countries to tell staff how best to implement the new policy. At the moment, the situation in terms of how DFID works on this issue is fairly chaotic. DFID undertook an evaluation earlier this summer to try to establish a baseline, so that it could measure progress on its new policy, and it found it was actually unable to establish a baseline because there were really no systematic rules across the countries where DFID works in terms of how conditionality is applied, in terms of what the criteria are for dispersing aid. I think one of the first things we need is a transparent and predictable system, in terms of making it clear to recipient governments where aid will be given and in what circumstances. Once you have it in place, you can then measure progress on this new conditionality policy. I think we have seen the pledge made this year but now we need to follow by looking at the implementation, and I think it is one thing that perhaps the IDC could usefully revisit at some point in 2006. Q81 Mr Singh: Your judgment is reserved, at the moment, on the new policy. Mr Phillips: I think we might just want to add, though, that we also need to see from DFID a strategy for internationalising this policy approach. The Government took the decision - for instance, the recent World Bank/IMF annual meetings - that it wanted to concentrate particularly on the debt deal, and some of the other issues which it might otherwise have pushed (in particular real progress, moving forward, on conditionality) was put on back burner for that period. There is much work to do to get the UK Government out of its bracket of feeling isolated on this issue, in terms of finding the alliance of countries within the Bank to internationalise the policy approach. Mr Watt: Perhaps I may add to Matt's point. It is an important one, that even if DFID steps back from the use of policy conditions in the same bilateral aid programme, an increasing share of DFID aid, particularly aid that has been provided as direct budget support, is effectively tied to World Bank conditions. It is very rare for DFID to provide direct budget support to a government if the World Bank is not doing so. We cannot just look at this issue in isolation; it really has to be looked at in the context of DFID's role as a close partner of the World Bank and in the context of the UK's role as a major shareholder on the bank board. Mr Rand: The British Government over the last few weeks has been expressing concern that they were the only ones who seemed to be raising the issue of conditionality, and they were looking for allies. We were encouraged - and I hope they were - that the new Norwegian Government, recently elected, said they would back the line on conditionality. We hope and think that is something to do with the fact that the Norwegian Debt Campaign have been emphasising this issue. It is always encouraging when campaigns pick up on an issue and governments are responsive, and I hope the UK Government will feel there is more they can do to find allies. Because it is one thing to say that no-one else is interested but there are always things we can do and things the Government can do to find more people who really want to work on this particular issue in the coming year, as it is a crucial one with the review going through the World Bank. Q82 Joan Ruddock: I would like to challenge you, really, and say: Is this not your job? Economic conditionality, we all agree, has been a disaster for so many countries and there are so many examples in which you can demonstrate this. Just to say: DFID must get around and persuade other countries; Britain must find other allies - yes, but surely this is where the campaign needs to be particularly internationalised in order to get to these international financial institutions. I think Stephen said at one point you have been monitoring this, but it seems to me that you ought to be more proactive. How optimistic are you, given this long, long history, that countries are going to have the freedoms to follow their own economic policies? I assume you are saying DFID's emphasis on good governance is entirely acceptable to governments. There is a difference obviously between some of the aspects of good governance and pursuing economic policies. Mr Phillips: We would point out that difference. I think that brings us back to that debate about what it is going to take to change the international institutions and the international community in terms of what they are prepared to do on these kinds of issues, and there clearly is a big block there. In the public around the world, there is one issue that has been extremely strong from the South - we have been listening to those voices for an extended period and sharing the analysis there has been over these issue - and this is where we really feel the governments are going to have to listen. I do not disagree that the campaigning has to be even stronger in years to come, but we should not let the world's institutions and governments, including this one, get away with saying that there has not been any pressure, because there has. There are plenty of examples out there, so how come they are continuing to pursue the policies in the way they are? Q83 Hugh Bayley: Could we for a moment look at the other side of the argument. What should a developing country do if its budget, including the aid it receives, is not in balance? It will build up more and more debt if its public sector is spending more than it is gathering in taxes and receiving in aid. Mr Hardstaff: A huge amount depends on the individual country circumstance. If you look at the UK and what we have done, this Government has broken the mould, in some respects, in the UK in terms of deficit spending. It is reverting back to what some call Keynsian economics, but the Government in this country has spent a deficit in order to invest. Obviously the situation is different in many developing countries, but you have to look at the individual circumstance, and deficit spending is not necessarily and always a bad thing and not balancing your budget is not necessarily and always a bad thing. This is one of the key problems we have seen with the IMF and World Bank, that there is not that recognition that it is possible to spend in deficit and invest. Q84 Hugh Bayley: How long would the business cycle be in your example? Brown has made it very clear that there are periods in the cycle when you can borrow so long as in the business cycle as a whole you are raising as much as you are spending. Otherwise, you have problems of high inflation and a depreciating currency, which is devastating for so many developing countries in terms of trade. Surely you have to look at the macroeconomic picture. Mr Hardstaff: This is where you have to look at individual country circumstance, but the problem we have seen is that the IMF and World Bank do not seem to do that and they impose fiscal austerity and balance budgets on every country no matter what situation they are in. I would argue that in some circumstances deficit spending can be useful over a period, to invest in the economy and to attempt to grow it. I am not saying you should never try to balance your budget; I am also not saying you should always try to balance your budget. It is a question of country circumstance, from my perspective, and the ability to be flexible about that. We have not seen that degree of flexibility from the IMF and the World Bank. Q85 Hugh Bayley: But you have to address the problem, do you not? If you fail to address the problem, you have economic disaster. Mr Hardstaff: Each government has to address its problem in the way that it sees best. Mr Watt: Clearly there comes a point where putting aid into a country which is macroeconomically fundamentally unstable is not going to achieve a great deal. If you look at a country like Zimbabwe, providing direct budget support to a country like that would achieve very little. So there are extreme cases out there. There is a question about the extent to which donors should be using aid and loans as a lever, to try to put in place what they see as appropriate macroeconomic policies - partly for the reasons Pete has just mentioned - and to what extent donors should take a step back and perhaps be more selective about where they provide aid. So, rather than try to use aid and loans necessarily as a lever to achieve policy change, be selective in how and where they give aid. If you are looking at a country where the macroeconomics are fundamentally skewed, there are ways of raising that in a dialogue with the government without having to make it a rigid condition. If the government is not interested in listening, then probably you are not going to change their mind anyway, in which case you probably need to be exploring different ways of providing aid to that country -perhaps providing it through some society organisations to local government or whatever. I think in extreme circumstances you can see situations where donors would step back from funding a government directly, but I think those are extreme circumstances. If you look across low-income countries, there is a fairly strong consensus about basic macroeconomic stability. I think the problem has been, as Pete was saying, that the Bank and Fund have been taking an unduly rigid approach to deficit, a zero deficit approach, and that has been a problem in a number of countries we have been working with. Mr Phillips: If I might add to that the useful work that the Commission for Africa did in this regard, where it was really talking about the concept of fiscal space in economic cycles. That would be quite revolutionary in the Bank and the IMF in terms of getting them to move on that. The Commission for Africa said that that should be taken to the World Bank and the IMF this year or the beginning of next year and should be turned into changes in policy, but that strategy seems to have not moved anywhere. So, your point is well made, but generally speaking we do not want to see hyperinflationary Latin American economies of the 1970s either. We know those do not work for poverty eradication. Fiscal space is a crucial point and over economic cycles is worth exploring as one of the options, but remembering just how much investment is needed in the developing world when you have a majority of the population in Africa, for instance, who are under 18. You really need to spend on public expenditure, like health and education, at a proportion of your government spending which is much higher than is needed in the developing world, just simply to break the cycle of poverty and invest in your human resource to be enabled to participate in global economic progress. That requires investment at levels which are different from what should be expected in the developed world, and that is why we need a different approach to the fiscal space, which works for poverty eradication and which is not about imposing a one-size fits all economy. Q86 Chairman: We are going to be meeting these international institutions next month, so we will have some opportunity to explore the balance of those arguments. Mr Rand: Part of our concern in the Debt Campaign has been about what is done in the process of dealing with debt now to make sure there is not a new debt crisis in the future and that relates too to this issue. One of the problems is countries are taking new loans to solve expenditure gaps. We would maintain, again on a country-by-country approach, that it may be there has to be a consistent grant process, for exactly the reasons Matt has explained, but one of the concerns is: Where is the process for making sure that new lending, new grants are actually not going to deliver a new debt crisis in the future? That is a big issue. Q87 John Barrett: I would like to move on to trade. We are very close now to the WTO ministerial in Hong Kong in December and I would like to introduce three issues which are all linked. The first is the ending of export subsidies; the second is the pace of opening up markets in developing countries; and the third will come to me when I have gone through the first two. Europe and the United States have set the date of 2010 as the realistic date for ending export subsidies. Do you think this is realistic? The phrase "smoke and mirrors" has been used by some civil society groups regarding the US comment on the 2010 date. In your view, is the political will there to end export subsidies from the EU by 2010? Mr Hardstaff: On the issue of the political will, it is not at this stage clear whether the political will exists in Europe as a whole. We have seen a memorandum from 15 countries, including France, suggesting that they have concerns about whether or not the Trade Commissioner has overstepped his mandate. What we have on paper appears to be that commitment, so, yes, I would like to think that there is the political commitment by 2010, but behind the scenes we have seen a certain amount of politicking in Europe. We wait to see really. We will only know once they have made that final commitment, as it were, in the World Trade Organisation. On paper, we do seem to have that commitment, so that is useful. Q88 John Barrett: I remember that the third issue was: What do you expect to see come out of the ministerial? We have seen discussions in the past collapse because sometimes people have thought that "no deal" is better than a "bad deal". One issue that crops up again and again is the pace and scale of opening up a market in still developing countries. Clearly, if export subsidies ended at the same time, we would still have regulations relating to the food that gets into our supermarkets. Ending export subsidies on their own is not suddenly going to allow beef from Sudan into Tesco, because there are other issues as well as the financial subsidies. I would like to tease out the pace and scale of opening up of developing countries' markets. How do you see the developed countries pressurising? Is it forced liberalisation? Are we putting on too much or too little pressure? Are we heading in the wrong direction? Jumping forward to that ministerial in Hong Kong, is there a danger that a bad deal will be agreed? Is a bad deal worse than no deal? Mr Hardstaff: In terms of the pressure that is being exerted on developing countries within the WTO, there are a couple of striking examples of that. One is that Europe, with a number of other countries like Australia, Canada, New Zealand, I think, in the WTO, has been pushing what is called "benchmarking" in the General Agreement on Trade and Services. We have been told that the GATS is a flexible agreement; that countries only make commitments if they want to; and that they only commit to the extent that they feel is necessary and in line with their development circumstances. That has now been abandoned, seemingly, by the European Union, which is pushing for a series of minimum standards for liberalisation commitments from developing countries in this current negotiation. That essentially is forcing developing countries, if this benchmarking system is agreed, to make a certain level of commitment. Previously we had been told it was a very flexible, development friendly agreement. That is completely going against, first of all, the rhetoric we have heard on GATS, that it is flexible, and, secondly, this whole idea that this is a development round and that the interests of developing countries are taken into consideration. That agreement, for its flaws, had the potential to allow countries to go as far as they want. The second is the whole issue of the deal. It has been made very clear by the Prime Minister that the only way that developing countries will get a deal on agriculture is if they do what Europe wants on industrial tariffs and on services. Developing countries must open their markets to European multinationals in services and they must open their markets to European industrial products and that is the trade off that is being demanded. That, I think, is a fundamentally flawed perception of what the development round should be. It is also flawed in terms of the idea that this is somehow a commensurate, comparable trade-off. Europe is telling the developing world that in return for the political and perceived economic pain that we will go through with further agriculture reform, in return they must implement policies that will cause them infinitely more difficulty in terms of their development prospects. That kind of deal is fundamentally anti-development. The real problem that we face in the run-up to Hong Kong is the idea that, in return for something that we should have done a long time ago that will probably be of benefit to our environment, hopefully consumers and the wider public, we are asking them to do something that will undermine their development prospects in the future. This is where we have a major problem in terms of Europe's approach in the WTO. Q89 Chairman: You are quoted as saying, "The UK is forcing liberalisation on poor countries by pushing for a system of compulsory benchmarks." DFID are saying: "Benchmarking is designed to lower the conditionality; indeed, we are trying to clarify what it means but it is just trying to set a framework." Are you not slightly overstating the position? Mr Hardstaff: I think we may be talking about two different things. The DFID quote on benchmarking may be in relation to the World Bank and IMF. Or is it in relation to GATS and the WTO? Q90 Chairman: No, it is in relation to their own guidelines for their own aid. Mr Hardstaff: These are two separate things. DFID aid and the benchmarks that are attached to DFID aid is a separate issue. Q91 Chairman: You are saying that the UK is forcing these benchmarks. Mr Hardstaff: Benchmarking in the General Agreement on Trade and Services in the WTO is something that Europe, with the agreement of the UK, is pushing to get developing countries to sign up to, a minimum set of liberalisation ---- Q92 Ann McKechin: Could you define what the developing countries are? I understand there are only a very small number of requests made and they are actually more interested in countries like India, Brazil, South Africa, rather than sub-Saharan African countries. I wonder if you could define that for us. Mr Hardstaff: In the benchmarking proposal, the EU has said of the least developed countries, more or less, "Do what you can." To the rest of the developing countries, which includes India, Brazil, China, and it also includes extremely poor countries like Bolivia, Pakistan, Papua New Guinea, Nicaragua, Honduras - it s a very wide category we are talking about in terms of developing countries - those countries will have to meet a minimum set percentage of sectors to be signed up to under GATS. That is completely disregarding what has been said before on the flexibility of each of these countries to choose whether or not to make commitment and the extent to which they should make commitment. Q93 Chairman: That creates a huge complexity in the negotiations, does it not? You are also in a movement whose slogan is "Trade justice, not free trade." That implies you are against free trade. In Stop Forced Liberalisation - and we are engaged in a real discussion about what we mean by that - you say: "Our call for trade justice stems from the evidence that the free trade model has been responsible for increasing poverty, harming the environment, and eroding labour standards across the world." That is a pretty devastating indictment of the whole free trade movement of the last 30 years, is it not? Mr Hardstaff: Sir, the Trade Justice movement is against free trade. It is calling for trade justice, not free trade. Free trade is getting rid of every single tariff, every single trade-effecting subsidy, every single trade-effecting qualification, requirement, technical standard, environmental health and safety regulation. We are against that. The Trade Justice movement is for managing trade to benefit the people in the environment. Q94 Chairman: I think that is your definition of free trade. Mr Hardstaff: You could ask anybody for their definition of free trade and you would get it. Q95 Chairman: Perhaps I could ask you more specifically. The whole point about Hong Kong is nevertheless to move to a freer trade environment after, rather than before, on a negotiated basis. The implication, following John Barrett's question - and I do not want to put words into your mouth, but this is my impression - is that you do not want to deal with Hong Kong issues. Mr Hardstaff: Sir, we are calling for Europe to do what it should have done decades ago in terms of agricultural reform. At the moment, we are seeing Europe not doing that. In fact, there is a major concern that the mandate of the European Trade Commissioner on domestic subsidies goes only as far as existing CAP reform. At the moment, the European Trade Commissioner does not have the mandate to go beyond existing CAP reform. That is a major concern. Secondly, we would like to see that developing countries have the ability, the flexibility, to use a whole range of different trade policies to achieve development. As we have seen with China, South Korea, Thailand, Malaysia, those countries that have successfully developed, they have used a mix of import tariffs, subsidies, investment regulations, weak intellectual property law - a whole range of different policies - to achieve development. We are fighting for developing countries to continue to have that flexibility, and for some of the poorest countries to increase their flexibility because they have been undermined by World Bank and International Monetary Fund policy conditions. Q96 John Bercow: Of course you are perfectly entitled to define free trade in the terms that you do, but I would have thought on the whole it is probably a good idea to have regard to the need to avoid excessive eccentricity, and, if you will forgive me for saying so, simply to say free trade means getting rid of all environmental regulations, all health and safety ----- Mr Hardstaff: No, I did not say that. Q97 John Bercow: You did. You said, all environmental ---- Mr Hardstaff: I said trade-effective. Q98 John Bercow: I beg your pardon? Mr Hardstaff: Trade-effective. That is what the agreement on sanitary and phytosanitary measures is about. It is about getting rid of trade-effective environmental health and safety regulations. It is about regulating governments. Q99 John Bercow: Okay. We can have a debate about that. I think there would be a general view that there is a distinction between 19th century liberalism and its interpretation of free trade and the connotation of the term in the modern political debate. In a sense, the argument is between those who want to see freer trade and those who do not - and the Chairman can argue his own point of view - but for those of us who are sympathetic to a gradually extended liberalisation, the motive force is not some hidden agenda to get rid of all social protection, rather it is to try to ensure that over a period markets are freer. If you genuinely do not agree with that, then so be it, but I think the historical evidence on the effectiveness of markets is pretty clear, and their superiority over command economics is loosely demonstrated. When you talk about policy space and the right for developing countries to pursue their own journeys, is that, in your mind, an absolute, or is there any sense that that policy space needs to be time limited? Could I just put it to you that if you want the developing world to be part of an international system in which there is some sense of global responsibility and global interdependence, it seems to me you cannot credibly have it both ways. You cannot on the one hand say, "We want the help of others in the spirit of mutual concern, on the basis that the rich world has a responsibility to the poor and we are all in this together, we are one world and one set of human beings," and on the other hand say, "By the way, we will take all your aid, we will take the debt relief, we will take the benefits of extended access to western markets, but at no stage in our lifetime do we envisage these developing countries will have to open up their own markets." Quite apart from the fact that I think that would be politically unrealistic, do you think it might also be a source of considerable economic sloth? Mr Hardstaff: There are various issues bound up with your question. First, yes, I agree, there is a distinction between freer trade and the concept of free trade and what that means and how that is defined, whoever defines it. The Trade Justice movement is calling for "managed trade". In some cases, that means liberalisation, because I have already talked about CAP reform being an obvious one. In some cases, that may mean regulating trade. That may mean using tariffs, subsidies, regulating investment and so on. In relation to the issue about time-limited policy space, the difficulty, if you like, is the differentiation between developing countries. What you were talking about is that, surely, in return for aid and loans and debt relief we should be demanding that these countries engage in the international system and make these commitments. The poorest developing countries already have. They already have liberalised. And it was a disaster in Africa - an absolute disaster. Deindustrialisation in countries like Zambia because they opened up to imports. We have to differentiate between them and China, Brazil, India. However, I would point out that those targets that Europe and the US most covers - I would say, China and Brazil, India, Indonesia, South Africa, for example - have about 1.5 billion people living on under $2 a day, so to suggest that these are somehow legitimate targets for radical liberalisation I think is mistaken. These countries have huge problems still and I still argue that these countries need the range of flexibility that has helped them get as far as they have done. Now, in terms of the poorest African countries, the difficulty we are now facing is that these countries are being asked, demanded, to lock in the policies that they have been told or forced to implement by the IMF and World Bank, to lock in those policies through the WTA, to legally bind them. That is putting them in a straitjacket. If what we have seen in the 1980s and 1990s is anything to go by, that is seriously calling into question their ability to pursue development and achieve the Millennium Development Goals. There was talk earlier about: Can we achieve the NBGs? and I think it is really worrying that for countries in Africa, Asia and Latin America that have de-industrialised due to liberalisation, those policies will get locked in and they will not have the space to get out. Q100 John Bercow: It may well be that this is a case of the irresistible force meeting the immoveable object, and, if that is the case, so be it, but, if I may put it this way, that, from the vantage point of somebody who is keen on freer trade and gradual liberalisation, it seems to me that you want to object to one-size fits all when it suits you by saying the policies of the World Bank and IMF have been deeply destructive because they have been based on the supposition that a rigid market fiscal probity approach must be applied in every case and on an indiscriminative basis without regard to local or national circumstances, but where, if I may say so, your ideological prejudice is in favour of policy space by individual developing countries, you seem to think that in a sense a one-size fits all perhaps approach is appropriate. I do not in any way wish to do violence to your argument, but could I put to you that it would be good if there were a consensus that overall the objective should be to create a situation in which developing countries would gradually open up their markets - for their own benefit, not just for ours; not for some rich western capitalist benefit but for their own benefit - fully accepting, of course, that the pace at which that can realistically be expected to be done would significantly vary between different developing countries. Is there then some sort of consensus? Yes, it may have to vary a lot, but it is surely a good idea to have some sort of end-date in mind, because otherwise you are simply saying to that country's domestic base, "Don't worry, you will never face competition. You will not have to reform your practices; you will have no incentive to become more efficient," and in a way that seems to me an unnecessarily soppy attitude because in the end those countries will suffer if they do not reform, develop, improvise, innovate and become more efficient in the way that the rest of the world will tend to do. Mr Hardstaff: What I am advocating is not one-size fits all. It is for policy flexibility, it is for countries to pursue their own development path, whatever that may be. There are countries that have gradually, in their own way, liberalised - often under no pressure from the WTO or the international community - because that government thought it was a useful thing to do and in some cases that has yielded benefits. I am not arguing against that. Those countries have in different ways formulated economic policies liberalised in different ways and also regulated. I am not in any way arguing against that. I question whether or not the WTO is the place where the pressure has come to do that. The problem that we see with the WTO is that generally we have arbitrary timeframes of implementation. New developing countries must implement x agreement in ten years or five years, and that obviously takes no account of their development circumstances and what actually happens in the intervening period. If a system could be constructed whereby, based on a range of development criteria, you have countries changing their policies over time, that is a whole different ball game. At the moment we are an institution that imposes arbitrary timeframes, and our own governments within it, in the EU, are pushing for a level of liberalisation and implementation that I think will damage these countries. Q101 John Bercow: Within the Doha development round, is the G20, in your judgment - and I ask the team - a help or a hindrance to developing countries? Whose interests do you think it is defending? Mr Hardstaff: The G20 is, I think, a useful development because it basically demonstrates that developing countries are clubbing together. I do not think any organisation within Make Poverty History would disagree with that. It is a demonstration of developing countries coming together and putting forward proposals and opinions. In terms of who they represent, then the G20 represents the G20. I think that is a relatively basic statement. I do not think the G20 would purport to represent the rest of the developing world. G20 represents the positions and interests that the G20 can agree to, and then other groupings of countries come together to represent those interests. Q102 John Bercow: I suppose really the subliminal part of the question was whether, in representing the interests of the 20, it is acting in a way that is adverse to the interests of, for example, the G90. Mr Hardstaff: It will vary for different policies. It is impossible to say that, yes, they always will benefit all developing countries or they will not. It is such a complex negotiating landscape across the different issues that you cannot really argue that the G20 either represents everyone or is benefiting everyone or is not. Mr Wright: We have seen some very positive examples where middle-income countries have stood up for the rights of developing countries to access medicines under TRIPs agreements. Because Brazil and India have the capacity for manufacture, then they also have an interest in supporting developing countries to get those imported, so we have seen them weighing in on those examples. There are positive cases. Q103 Mr Hunt: I would like to move, if I may, on to HIV/AIDS. Obviously it as one of the great breakthroughs of the G8 summit that this 2010 goal was announced. Do you feel that DFID and the other G8 countries have any real understanding of the logistical challenges of getting anti-retroviral treatment out, particularly to Africa, and the fact that it is not just getting medicine out but you need to have a proper nutrition regime, a proper testing regime. Even that is difficult in a country like Kenya, but when you go to countries with less stable regimes it becomes even more of a challenge. Do you have confidence in UNAIDS as an agency that will be able to deliver on that? Do you have any sense about when they are going to publish their report and as to how they are going to get there? Mr Wright: I meant to jump in earlier really, when we were talking about the clear tangible successes from the G8 and those where certainly the campaign had contributed to their achievement. I think the commitment to AIDS treatment from the G8 was exactly that. It is something that was not strongly on the agenda before the campaign; at the end of the G8 it was there as a very strong commitment. That commitment has carried through. Some of the US amendments to the Millennium Summit Declaration appeared to try to take that out but it ended up in the final communiqué, which was very good. Clearly, it is a very, very ambitious target and I think it is right to have set that ambitious target. One of the reasons why we could have some conflict about it has been that the "3 by 5" initiative from the World Health Organisation showed that it is possible to dramatically increase treatment access It did not achieve exactly what it was working for - and we will find out at the end of this year exactly what their analysis of the year is - but the massive increase, particularly in sub-Saharan Africa, in people having access to anti-retrovirals has been very successful and it has changed very much the whole environment of the debate. I did some work for this Committee about five years ago when it did an inquiry into HIV and the language we used about treatment then was entirely different. There was no conception that these life-saving medicines which were working in rich countries could possibly work in poor countries. Now it is very strong. The issue is about what they have put in place to make sure that the delivery follows that. We would see ownership coming from the World Health Organisation and from UNAIDS, but we also want to see the British Government carrying on the spearheading of this. It was a very important piece of work by the UK to make sure that was in the G8 communiqué and we would be concerned if we felt that maybe DFID were not continuing to take a very close interest in it. There is a blueprint being developed by WHO at the moment. They met last week and we would say that DFID's participation in that meeting was not adequate, it was not of the right level, it would not have shown the right interest in that meeting. There are a lot of questions. We are looking at funding, of course. We said the first test of that G8 would be the Global Fund Replenishment Conference held here in London at the beginning of September. Our view would be that that conference failed because it did not deliver the money that is needed, and is needed now, to set up the systems, to support healthcare infrastructures, in order to deliver that target. We have concerns about whether the G8 countries are going to follow through with that commitment and our campaigning is going to continue to push with that. You asked a question about UNAIDS and UNAIDS capacity. Particularly on treatment, it has been the World Health Organisation that has done a lot of the running on that - and that is probably right, that WHO take a particular interest in treatment. It must fit within a much wider package and UNAIDS from our point of view have given very good leadership, particularly on prevention, particularly on providing the evidence base for what works and the right approach. There are of course concerns at the moment that that consensus that existed for a long time about using evidence, about harm reduction approaches that were realistic about people's lives, is slipping somewhat under the influence of the US and what they call the PEP farm scheme, which has a lot of conditions attached to it for the 14 countries that have been identified as recipients of PEP farm funding. We are starting to see some very worrying developments in particularly African countries that are responding to the very censorious moral agenda coming from the US around condoms, around sexual behaviour, the pushing of the idea of abstinence in a very simplistic way. What is worrying me most about that is that we are starting to see a response to that from African countries and African leaders who previously were listening to the UNAIDS consensus and we want to make sure that the British Government and the Europeans, along with other key allies, are continuing to be a counterbalance to what the Americans are doing through the international system. But the UNAIDS approach is one that we would back strongly, but I think they need support. Particularly for the treatment target, WHO will need funding from the donors, and they will need it put in place very early if the treatment target is going to be achieved. Q104 Ann McKechin: You mentioned your concerns about US policy in terms of prevention. Do you have a concern that the focus of the summits this year is on treatment rather than prevention? Could you give some comment about whether you think donors and also African nations are doing enough to tackle the gender issue in terms of sexual health. Mr Wright: I have mentioned this Committee's report that was done five years ago. For a long time the consensus was that the only thing that is cost-effective, that is possible to be done, is prevention, that the only thing is to try to keep the next generations free from infection and that is all that can be done. Since then, there has been a worldwide movement for treatment, led on the whole with HIV in developing countries and responded to, perhaps quite slowly, by some of our organisations, but taken up in time, and a recognition that in countries where we are talking about perhaps one-quarter or one-third of the adult population being infected and therefore going to fall ill in the next few years, and countries where life expectancy has plummeted as a result of HIV, to ignore treatment would be a massive failure and would also damage the ability of communities to withstand poverty, to find the strategies that have kept families and communities going. So I think the shift in emphasis this year - and it did need a strong push around treatment - was absolutely right. I hope we are going to be in a situation where we can start to say now that there should not be any false dichotomy between the two, because it is not a case of either or. Prevention does not work unless you have the possibility of treatments to make people come forward for testing, to give people some kind of reason to disclose that they have HIV, rather than the kind of silence about it that drives the epidemic in so many countries. Similarly, treatment will not work unless it actually has a view. If we are going to continue to have a number of people infected and keep people alive, then that becomes unsustainable in the long-term. I think the balance is right. We need to look at what is coming out of international institutions, out of DFID and the UK Government, to make sure they are taking account of that balance. If there is going to be an EU Development Minister statement coming soon, we want that to be very strong about a European evidence-based approach to prevention but it must also make a commitment to Europe playing its part in the delivery of the treatment target. Q105 Hugh Bayley: I think we have made some important progress this year on aid and on debt. But what we have are pledges, and it is important to turn the pledges into action both from donor countries and in the South; compliance with the NEPAD Programme; making sure the Peer Review Mechanism is a useful tool to improving development success. If I have a criticism of Make Poverty History it is that it all seemed so simple: it was only a lack of commitment or will on the part of western leaders that was stopping poverty being made history, and, yet, if we stop to think about it, even if we had achieved everything we wanted from the various meetings this year, it still would have been a 20-year haul to make poverty history. One of the things we need to do as politicians is to campaign, to go back to the lobbying, saying, "If you really want to make poverty history, you are in it for 10 or 20 years." I am interested in how we create mechanisms which hold the feet of our governments in the North, and of the developing countries, African governments, in the South, to the fire, to make sure they deliver on what they have promised. The executive branches' forum is the Africa Partnership Forum and I am not sure it has the teeth to hold governments to account, but it is the vehicle we have to build on and strengthen because it is the one that is there. What would you like to see the forum doing in terms of reporting and publishing information in its annual report which it says it will produce? What role do you think parliaments North and South should have in calling debates and holding their own ministers to account for performance in relation to the goals set? What role can your organisations play, particularly in developing countries, to build the capacity in African parliaments to get these debates happening more often than they do now. Some countries in Africa are doing a good job, but others really have a long way to go. Mr Phillips: That is quite a rich question, with quite a few angles in it. Chairman: You need not pick up on the first half, because we have had that discussion already. Q106 Hugh Bayley: I beg your pardon. Mr Phillips: Yes, we did talk about that. Q107 Hugh Bayley: Starting from what should be required of a partnership forum and what role can parliamentarians play in strengthening that. Mr Phillips: We are coming from a perspective of requiring governments to be held to account, and that is by both civil society and by representatives such as parliamentarians. That is our starting point. With our Save the Children hat on, we are dealing with empowering children to be part of that process. Children are very much excluded routinely from those kinds of processes - indeed, there are very few children who are parliamentarians: I do not see any around the table here! Q108 Hugh Bayley: We just behave like that! Mr Phillips: There are points about those who are not included through traditional structures who also have to be part of scrutinising governments in the South, as well as here, about the commitments that they have made. We definitely see that implementation gap between the high-minded paper commitments and the actual delivery. We do not look at the G8, for instance, as having a very strong track record of delivering their policies. We saw a whole debate opening up about the MDGs in the course of this year and have not seen an action plan which is going to be sufficient to achieve those goals. That is a real key implementation issue. Our whole purpose from the campaigning point of view has been to mobilise people to hold governments to account, and to press them to move forward as they need to on poverty eradication. Whether all those answers are going to be wrapped up in the African Partnership Forum, I very much doubt, frankly. That may play a specific role in terms of the specific components of what the G8 talked about, the Commission for Africa talked about. We will keep an open mind on that. If we are part of the process of civil society North and South, alongside parliaments, working with parliaments and challenging parliaments, if we are in there being part of that scrutiny and part of that is the report-back process, then we will have a lot more confidence in it than if we are not. We will be able to expose it to the light of public scrutiny and get communities to hold their governments to account much more closely if we are part of the process and part of the process of transparency. That is really one of the big asks of civil society in the South, that money flows from the North, that decisions that are taken North and South are in the end exposed to their ability to hold their governments to account and our ability to hold our government to account. As organisations, we are not going to go away. Make Poverty History is a very diverse set up, made up of unions, faith groups, NGOs, youth groups. A whole range of organisations are involved. Some organisations are present in the developing world; some are just acting in solidarity and partnership with the developing world. That leaves us a great deal of ability to exchange views, to keep track of what is going on. We are part of the process of holding to account and we certainly are going to be here for the long-run. But we do need to see real solid mechanisms coming from governments, and governments introducing those kinds of mechanisms which really are scrutinising progress. Q109 Joan Ruddock: Obviously you are talking about being around for a long time, but, if we think about next year, 2006, what would be your top five things that DFID ought to do and what might be your five top things that you ought to do? Mr Phillips: Perhaps I might ask colleagues to intervene on this as well. There are a number of key points. We have not yet had the big progress that we need on the trade issue. We have got the big ministerial coming. We have yet to see what progress will or will not be made on that, so there is bound to be a whole range of issues around government approach to trade policy and about what the EU does in terms of trade policy and about what international progress is. I think that is going to be a package of issues which is going to come out there. In macro terms, looking at the financing side, we have not seen enough money in the course of this year being pledged and therefore the money that has come through has to work incredibly effectively for poverty eradication. If DFID now starts to concentrate wholeheartedly on pulling together international consensus on making aid much more effective, on tackling issues like conditionality issues, then it would be making sure that the resources that are there can be used effectively for poverty eradication and we can start to get that investment package in place to allow developing countries to have sufficient numbers of their population who are literate, healthy, able to be productive members of international business and so on and so forth. We will see progress made through the investment package coming through. We are going to need that strongly focused on effectiveness. I think there are going to be other macro issues in terms of looking at what could be done now, given that the international community has not pledged the policy change and finances sufficient to deliver the MDGs. That is going to be quite a big structural issue that we will want to look at. Perhaps I could ask for one key thing from each of my colleagues. Mr Watt: I am not sure how far we are towards five things for DFID to do and five things for us to do. However, one thing DFID could do - and it has taken the lead so far, but it has not really managed to secure the backing of a lot of the other major donor countries - is to build momentum and give teeth to the aid effectiveness agenda in the OECD DAC. There was a series of commitments for the year 2010 made earlier this year - to improve aid effectiveness on a range of issues, from aligning aid with country budgets and procurement systems, to better coordinating aid, to untying aid - but those targets at the moment lack teeth. We have moved forward on that agenda in terms of tightening up the targets, ensuring that there is effective monitoring of those targets, and the data is published in a disaggregated way that enables civil society to hold donor governments to account for what they are doing in terms of the quality of the aid they are providing. I think that is going to be doubly important in the coming years, that we do see an increase in aid, that we have an aid system fit for purpose that can ensure that aid gets to the right destination. Q110 Chairman: More aid effectiveness. Mr Watt: In terms of what we should do, I would suggest that we need to do more work in terms of building the campaigning capacity of the partners of the South, working with the partners in the South to ensure that there is a very strong campaign in countries, particularly in Africa, to hold governments and donors to account. Mr Rand: I am going to cheat, because my one point is that we need to make more progress on debt, and then I can very quickly list what that would mean. It means delivering the current aid; extending it (more creditors, more countries more debts); ending incoming policy conditions; a new process for dealing with debt for the future which takes human need into account rather than financial criteria; thinking about issues about odious debt and the repatriation of stolen assets needs to be moved on. Those are all in my one. Mr Hardstaff: Matt has summed up very well on trade policy and all conditionality. In terms of a sub-set on trade policy, hopefully this year, but if it carries over to the next year, the key thing is to drop the European Union's proposed benchmarking proposal in GAT and also greater flexibility in industrial tariffs in poor countries. In terms of what we should do, obviously scrutinising the UK Government as we have already tried to do, and then, as Patrick has mentioned, working with campaigners in the Global South. Mr Wright: Particularly for HIV, apart from playing a role in sorting out things like TRIPs, I think DFID need to balance their present country ownership with the extent to which the could be accountable for delivery of internationally agreed targets. It would be wrong to see DFID saying, "We got the target and then we handed it over to international institutions and you cannot judge us by its delivery. We will play a part." DFID is very, very powerful, very influential, and, particularly on the treatment target, because it is so new and so ambitious, it needs to get behind it, bring all the UK Government behind it, to try to make it deliverable. For us, it is what has already been said really: we need to keep taking the campaigners with whom we can communicate on a journey that deepens their understanding about how development must be achieved, how the changes can be achieved. They are not quick wins. At the end of this year poverty will not have been made history, but steps are made, steps will be made next year, and we need to take them further and keep them engaged, rather than it just being a fashionable one-year "white band" thing. Q111 Hugh Bayley: Chairman, may I go back to my question because I do not think there was any answer at all. The question was: What role should parliamentarians North and South play in progress chasing? Could we look, perhaps, just at the South. I am slightly surprised at your agenda but you have not mentioned parliamentarians at all. They are the people elected to represent the people of these African countries. What role should parliamentarians in Africa be playing to check on how aid is used; to check at whether it is used effectively; to look at conditionality, whether these are appropriate conditions or not? Mr Phillips: I am glad you reminded us on that, because I put a note down and forgot to answer it directly. In the North, one of the key things we would like to see is the continued momentum of parliamentarians behind the campaigning and using the platform that campaigning represents to keep the issues high and to keep the pressure on what the rich countries and donors can do. You as parliamentarians supported Make Poverty History in unprecedented numbers, frankly, in the period before the election, for which we are hugely grateful. One of the key things we would really like to see happen is for parliamentarians to be working with other parliamentarians, working together to demonstrate to the governments that parliamentarians are talking to each other and strategising with each other and holding them to account and sharing information. Those kinds of things are really crucial. Secondly, it is linking with civil society and making sure that civil society voice has the opportunity to get through, so that the parliamentarians make sure that the voices of the poor get heard in the debates in their own countries and that those voices are facilitated through their parliamentarians, getting directly through, and that those parliamentarians actually listen to those voices and they hear the incredibly strong weight of mass popular opinion that has been expressed in the course of this year. If it does not happen every year, you are not allowed to forget it. You are allowed to say, "In 2005 we heard this voice and that sustained us through for an extended period," because it takes an awful lot of effort to get this number of people who have heard their voice expressed this year mobilised in a coherent way. We cannot do it every year, it has to be something exceptional, but we want you to continue using that and we want you to be building those links in connection with others. We do see parliaments as having an absolutely fundamental role in scrutinising in particular and in holding governments to account. We want to reinforce that, but we want to make sure the civil society voice is in there along with it, that they are not a forgotten part of the population, like children, whose voices get ignored in the course of the adult politicking. Chairman: It is the job of this Committee to ensure that it does not end at the end of 2005, and we do not intend to let it. We have had some fairly robust exchanges. There is agreement in this Committee that we want more aid and we want it to be more effective and we want to get solutions, but there is a clear need to ensure that we understand the mechanisms and the arguments and the intellectual rigour and the follow through. I think this exchange has been helpful to us. One particular thing I pick up from this is that you want us to put more pressure on DFID to put more pressure on international institutions to follow the lead that this government has initiated. I think that is something that we will want to take forward. Certainly when we are visiting these institutions I rely on my colleagues in this Committee to take some of your arguments to them and either get answers or get signs that we are helping to shift where we think it is relevant. The exchanges we are having with you and I am sure we will continue to have are really important to add into that. Could I say thank you all very much indeed. |