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6.25 pm
Mr. David Heathcoat-Amory (Wells) (Con): We are debating what is supposed to be a reform treaty—that is what it was called before it became the treaty of Lisbon—and no area is more ripe for reform than the policies connected with international development and aid. The aid budget is part of the general EU budget, which is, as the House knows very well by now, a byword for inefficiency, mismanagement and waste. It has been subject to qualification by the auditors for 12 years in a row. No private sector organisation would have survived that. If the EU were a private company it would long ago have collapsed or been taken over, and the directors would have been sacked or in prison. If this really were a reform process, it would have tackled the lack of accountability and poor management at the heart of the European Union in its budget.
We know that the Government share those misgivings, particularly on the aid side. The European Scrutiny Committee receives reports on the EU programme, and on one occasion last year it was, in its measured and diplomatic way, very critical of EU procedures. I will quote, almost at random:
“in general, evaluations point to long delays in implementation and highlight the rigidity and slowness of Commission procedures”.
Many hon. Members who have been more intimately connected with the Department know full well that there is something seriously wrong with the delivery of aid at EU level.
No reform was carried out, and instead the treaty centralises more powers. I strongly agree with my hon. Friend the Member for Banbury (Tony Baldry), who described the process of capture in relation to the Foreign Office provisions of the treaty. The Government need to explain why, when this country has moved its aid programme away from the Foreign Office, the treaty moves in exactly the opposite direction. That need not have been done; it is a result of last year’s secretive negotiation process. The Government would have got support from the House in opposing this if we had known about it, but the critical decisions were made in secret by officials in the early part of last year. The treaty text was then presented to member states only two days before the European summit in June, at which it was all politically decided.
My hon. Friend the Member for Banbury is right about the politicisation of aid that will result from this, which is bound to undermine historical and traditional British priorities about aid and where it should go.
Mr. Gareth Thomas:
Will the right hon. Gentleman at least acknowledge that the treaty represents a significant step forward in terms of development
co-operation, in that it enshrines the fact that the primary purpose of EC development spending should be fighting poverty?
Mr. Heathcoat-Amory: No, I am afraid I cannot agree to that. The existing Maastricht treaty text specifies
“more particularly the most disadvantaged among them”—
a reference to developing countries, and where aid should go. The explicit intention was to direct aid to the poorest countries in the world. That article was repealed by the Lisbon treaty, and it was not replaced by similar wording about the direction of the aid budget. I am afraid I do not agree with the Under-Secretary.
Indeed, the treaty reinforces the move towards expenditure on things such as the neighbourhood policy. There are obviously deserving countries on the borders of Europe, but they are by no means the poorest countries in the world. It is not clear to me why we should distort the British aid programme, in ways of which I know the Government disapprove, by swinging it away from the poorest countries to those politically important to the EU.
Running right the way through this treaty is a sort of “little European” attitude, which sees everything through the prism of continental Europe. That is completely out of cue with our historic and traditional concerns and responsibilities, which are global. Our horizons are much wider. It has been alleged in a puerile way that we in my party are somehow isolationist. Quite the reverse: we are the true internationalists. We believe that our responsibilities go much wider than Europe. Of course we are concerned with continental Europe. This country has often gone to war in the past to stop the continent falling under the domination of a single power. But we are also a maritime, global country with historic responsibilities that go much wider. That state of affairs will be undermined and distorted by this treaty.
The other aspect of international development is trade. Trade has an enormous ability to lift countries out of poverty, and many studies have shown that even quite modest increases in trade flow have a much more benign effect on the lifting of countries out of poverty than even the most generous aid programmes. Trade rewards efficiency, and it creates a self-sustaining mechanism for economic lift-off. Many countries, such as South Korea, Taiwan and Singapore, have followed that path. Aid, by contrast, reinforces dependency and invites corruption.
I am a trade liberaliser; liberalisation is very important, as was recognised in the millennium goals of eight years ago. Tragically, not enough has been done since then to liberalise trade. The Doha round has stalled. The additional tragedy is that we are trapped; there is nothing that this country can do. We are quite unable to do anything on our own, and we do not have a trade policy. Hon. Members might remember that we used to have a Board of Trade. It does not exist any more. There is no expertise in this country; very few officials and practically no Ministers engage in trade policy at all, because we have handed over trade policy to our ex-colleague Peter Mandelson. He twice left the
British Cabinet in disagreeable circumstances, and is now in an unelected body that meets in secret, which has a monopoly on trade policy. It is he who decides, not us.
The reason for that is the fact that we are stuck in an old-fashioned customs union. The rest of the world has gone in the completely different direction of creating free trade agreements. That is the modern way; that is what more prosperous parts of the world have done. They have not created customs unions where everything is concentrated in an over-regulatory centralised system. They have created free trade areas that enable individual members to do bilateral deals and make agreements with other countries, including poor countries. We are unable to do that. Instead, we have the prospect of the European Commission bullying poor countries by trying to impose agreements on them that they often feel they do not want.
I believe in free trade, but it is not an ideology. It must be entered into only on terms acceptable to the countries concerned. If we had more freedom, as the fifth largest economy in the world, to help those poor countries and the poor people in them, we could do something to help them before the Doha round is brought into effect. But we cannot do that, because of the complete inability of the European Union to think in any other way than centralisation or the reinforcement of the customs union, which is practically unique in the world. It is not a model that has been followed elsewhere.
That argument was never examined during the so-called reform process that started in 2001. There was a fanatical resistance to any diminution in the powers of the central organisations.
Mr. Cash: I agree with every word my right hon. Friend is saying. Does he recollect that one of the problems was when President Sarkozy put his foot down and took the words “undistorted competition” out of the treaty? That wording could conceivably—although I doubt it in practice—have provided the sort of free trade that my right hon. Friend and I agree about. In fact, it is more likely, particularly given French influence in Africa, that there will be more protectionism, working exactly against the interests of the people whom we want to protect and want to see prosper.
Mr. Heathcoat-Amory:
I agree with my hon. Friend. Those dangers are real, and he is also right to say that we gave way far too readily to the French preoccupation with protectionism and the lack of competition. All the way through the Convention on the Future of Europe, we sustained defeat after defeat. For instance, at present we have a residual ability to sign international agreements bilaterally, particularly in the area of intellectual property and services. That ability is removed by the treaty. Indeed, the whole common commercial policy, which will include those areas, becomes an area of exclusive competence for the first time. That means that member states are literally forbidden to legislate in that area or to conclude any agreements with outside countries. Also included, and again the Government did not want this, is foreign direct investment—a huge area that will be transferred from national control to the EU. Again, the
Government tabled amendments and argued against that notion all the way through the Convention, and again they lost.
My other point on trade is that at the very least we should know what is going on, but we do not. I have tried many times to find out what is really happening in the EU Commission and Council with regard to the negotiations in question. In a parliamentary question a year or two ago, I asked for the details of the EC anti-dumping and anti-subsidy advisory committee. It was an important question, because the committee was imposing emergency tariffs on shoes to the detriment of companies in my constituency. I was told in the reply:
“The minutes of the Advisory Committee are not available to the public.”—[ Official Report, 3 July 2006; Vol. 448, c. 857W.]
The article 133 committee decides the details of trade matters. Again, I asked to see the minutes, and I was told that it meets weekly, that there are no formal minutes, but that it does publish outcomes. I got a copy of the outcomes, and for greater accuracy, I have brought a copy with me this evening. It is not helpful because everything has been deleted. The document details the outcome of a meeting of 17 February 2006, and everything of any interest has been deleted: there are 16 deletions. I want to know what is going on in those negotiations. There is a reference to aluminium being discussed, but that has been deleted, too. I do not know what they were saying about aluminium, but it might have been interesting. It says at the end:
“Over lunch the Committee discussed the following items...the Aid for Trade Task Force...and information by Denmark on the issue of cartoons.”
No other information is given. The committee obviously had a good lunch, but it does not tell us what was discussed, who said what, who decided what, who voted, or even whether there were any votes.
Not only is that whole area of policy secretive and in conflict with British aims, but we know that the Government did not want it at the time. The House should not accept it now.
6.40 pm
Mr. William Cash (Stone) (Con): I endorse what my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) has said. It is absolutely extraordinary that we are here and the House is virtually empty. The right hon. Member for Rotherham (Mr. MacShane) pops in every now and again like a little gadfly, and he occasionally speaks up. I wish that he would contribute to this debate, because I am sure that he has a great interest in such matters. He told us on the radio the other day that while I was droning on, as he put it, he had taken an approach of Lenten abstinence in these debates. Considering the fact that he has intervened on a number of occasions, I would be grateful if he would take the opportunity to do so today.
Mr. Cash: I am glad that I have managed to get a rise out of the right hon. Gentleman.
Mr. MacShane: I would rather not intervene.
Mr. Cash: I agree, as a matter of fact.
The problem is that this is an issue of enormous importance. I do not want to give the impression, any more than my right hon. Friend the Member for Wells does, that the Conservatives are not genuinely interested in the developing world and third-world problems. The Under-Secretary of State for International Development, the hon. Member for Harrow, West (Mr. Thomas), who is now in the Chamber, knows that I, and other Conservative Back-Bench Members, dedicate a great deal of our time to trying to deal with these questions.
The Secretary of State was kind enough to refer to my work on the all-party group on water and sanitation in the third world, of which I have the honour to be chairman. An early-day motion on that subject was signed by 250 Members of Parliament, while 310 supported my early-day motion on the reduction of third-world debt. Why? There is all-party recognition that the subject is incredibly important. It is utterly unacceptable that people should die needlessly in developing countries. It is appalling and disgraceful that a child dies every 15 seconds for lack of proper water. That is unacceptable, and it is essential that the Opposition, as well as the Government and the Liberal Democrats, should fight to ensure that we have policies that work.
Against that background, I am deeply worried about the manner in which the EU functions on aid. Irrespective of our belief that help and the eradication of poverty should remain at the heart of our policy making, the EU is not the mechanism for achieving that. All the evidence points in the other direction. We heard my right hon. Friend the Member for Wells eloquently express the fact that the documents that he elicited were left blank. We know that the European Court of Auditors has issued a number of reports over an extended period to demonstrate that the way in which EU aid is delivered is not good enough.
We know that the right hon. Member for Birmingham, Ladywood (Clare Short), when she was Secretary of State for International Development, was deeply critical of the way in which the EU functioned in relation to her responsibilities. I do not believe that what she said at that time had anything to do with the Iraq war. It was just an objective assessment of how she saw the operation being conducted under the aegis of the EU.
Why would I be concerned about the specific obligations imposed under the treaty? For example, as I said in an earlier intervention, and as my right hon. Friend the Member for Wells mentioned, the fact that the treaty arrangements provide for exclusive competence in this field is a retrograde step. Exclusive competence, for those who have the faintest idea about the EU—not for those who pretend that they do not know, allow these processes to continue and then pretend that our Parliament and our Government have some residual ability to legislate—means that states cannot legislate in that field. It means that the ability of this House and its better means of delivering the objectives that we all seem to share—with the proviso that we, for our part, would like to exclude exclusive competence, as the Government intended—are contracted out.
I wish that some Members of this House would be honest enough to realise that they are effectively conning the British people when they pretend that they are improving the lot of people in the third world, when this exclusive competence will mean that we will no longer be able to make provision to help the people whom we all agree need help.
Mr. James Clappison (Hertsmere) (Con): My hon. Friend is making a powerful point. Does it not follow from what he is saying that if the EU gains exclusive competence in this area, because it has a long-standing history of being very bad at spending aid, particularly on the less developed countries, and because the treaty does nothing to improve that, there is a danger that less aid will go to the very poor countries in future?
Mr. Cash: I agree. It is pretty extraordinary to hear the Government advocating a policy—we certainly are not advocating it—of more EU competence in this field. That is because—it is necessary to be blunt and direct about such matters, even if at times that is controversial and unpopular—some of the countries that are part of the EU have the most appalling record of behaviour in African countries. I would like to know, for example, whether the involvement of Belgium in Congo would be regarded as one of the great aspects of humanitarian aid and help to the people of Africa during the 19th century.
I do not think that we are without blemish but I will say emphatically that we created and helped a lot of those countries through education, infrastructure and development over an extended period, including in the old colonial territories. That work far exceeds anything that President Mugabe has done for his country. He has brought the whole edifice of Zimbabwe to its knees. I believe that the EU will not be able to provide the opportunities and facilities that will genuinely help the countries that need it most.
Africa is approaching a crisis. There are serious difficulties in South Africa and serious problems with AIDS. As I said when I intervened on the hon. Member for City of York (Hugh Bayley), with whom I have worked closely over an extended period, the difficulties of eradicating poverty are made 1,000 times worse by the inability to deal with the problems of corruption. They cannot be separated.
The Court of Auditors has often rejected the way in which the European accounts have been operating. Nothing in its reports suggests that it should have an exclusive competence over handling international aid in Africa. It is not best placed to secure proper anti-corruption policies such as those advocated in the Bill that I proposed last year, or many of the Department’s recommendations, which, on the whole, pointed in the right direction. I do not agree with everything that the Department has done and I do not believe that it has gone nearly far enough, but we have an absolute responsibility to bring forth the problems of transparency and accountability in our debates. I am not convinced that the European Union will do anything to improve the position.
The treaty does not refer to corruption. As my hon. Friend the Member for Banbury (Tony Baldry) said, it contains much motherhood and apple pie, but there is no evidence that it will deal with the seriously ingrained
problem of corruption, which is endemic in much of the third world. We have a responsibility to our taxpayers because the aid money paid to the European Union through tax mechanisms, and thereby from the European Union to the developing world, is our taxpayers’ money. We must ensure that it is used properly.
My hon. Friends and I are determined to improve the lot of people who live in appalling conditions. The way in which some people in the third world live is a form of modern slavery. It is inconceivable to us, sitting in the House of Commons, that people should live on such limited resources. That is mostly unnecessary and happens because there is no proper control. I strongly condemn the idea of transferring more and more functions to the European Union when we have a track record and our Government have tried, albeit not entirely successfully, to tackle those matters. I had a great deal of time for the right hon. Member for Leeds, Central (Hilary Benn), the Secretary of State’s predecessor, who is now the Secretary of State for Environment, Food and Rural Affairs. He worked incredibly hard and was truly dedicated. I say the same of the Under-Secretary, because I know that he wants to make things better. I simply do not believe that the European Union is the right way to go.
Leaving aside questions of aid and development, the infrastructure in developing countries can be improved only if they have the finances and resources to achieve that, as well as the expertise that goes alongside. The way in which the whole operation is currently conducted, including the enormous debts that those countries have been encouraged to incur and the amount of interest that they have had to repay, simply has not left them with enough money to invest in infrastructure. There is a new 1980s and 1990s generation of people in Africa and the rest of the third world who understand the problems that their countries face. They want genuine improvements, and I believe that the answer lies in proper free trading arrangements. I am appalled by the failure of the Doha round. The customs union and the way in which protectionism operates in Europe are detrimental to the third world, and I strongly believe that the powers should be repatriated.
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