Examination of Witnesses (Question Numbers
80-99)
DEPARTMENT FOR
INTERNATIONAL DEVELOPMENT
30 NOVEMBER 2009
Q80 Mr Mitchell: But we get less
credit for it?
Dr Shafik: I think if you went
to Malawi you would hear lots of good things about the UK and
DFID but we do not put flags on projects.
Q81 Mr Mitchell: I am sure when you
give tax credits here people do not say thanks to the Labour Government.
They think the Inland Revenue is giving it to them from the generosity
of its heart. I cannot see that in Malawi the British Government
is going to get the credit for something that is coming through
their government.
Dr Shafik: I think the government
of Malawi would acknowledge the contribution we made. I had a
Sir Humphrey-like dinner with the various permanent secretaries
in the government of Malawi and they were incredibly open about
the fact.
Q82 Mr Mitchell: I am sure the Malawi
government will be grateful but I see from figure 8 that Malawi
staffing is now close to the African average. Surely this is wrong?
Malawi is definitely the poorest of poor and needs more individual
attention, more staff attention. You have not got the staff relevant
to the task in Malawi that you once had.
Dr Shafik: As Gwen said, the nature
of the staff have changed. We now have more higher skilled staff
and many of the previous staff we had before were doing things
like maintaining the buildings and things which we no longer need
on our staff, we can get those services contracted out, so I do
not think we have compromised on staff quality.
Q83 Mr Mitchell: Mr Gallaher said
with typical Treasury ingenuity that they give the money and the
staffing levels are up to you. That is the usual Treasury attitude.
Do you feel under any general compulsion from Treasury to reduce
staff numbers in Malawi?
Dr Shafik: The Treasury gives
us an overall administration budget and it is up to us how we
spend that, be it on staff or—
Q84 Mr Mitchell: Yes but do you feel
under any pressure to reduce staff numbers?
Dr Shafik: They do not specify
anything on staff numbers—
Q85 Mr Mitchell: You are doing it
out of the keenness of your enthusiasm because you think doing
it through the government rather than through our staff is beneficial?
Dr Shafik: I think that is correct.
Sam, do you want to say something?
Q86 Mr Mitchell: Mr Sharpe, you were
holding your pen up in class.
Mr Sharpe: Just on the agreement
we have reached with the Treasury. We have said this to the Committee
before. It is worth remembering that in the three-year settlement
they agreed with us they agreed, along with all other government
departments, reductions in our administration costs. They also
ring-fenced some resources for our front-line administration costs
overseas which they did not reduce at the same rate, so we have
agreed with the Treasury that we need an adequate number of front-line
staff overseas and that is part of our financial settlement for
these three years.
Q87 Mr Mitchell: I see from 1.13
that current DFID staff in Malawi question whether current staffing
is sufficient. Why would they be doing that?
Ms Hines: Obviously this was a
survey of the staff and it is for them to have their own opinions
on this, but over 50% of the staff I currently have in the office
have been with DFID through the transition. I am not denying the
transition—
Q88 Mr Mitchell: You mean they are
thinking of the old times when you had more staff?
Ms Hines: I think so and it is
something which the staff often raise with me.
Q89 Mr Mitchell: They are also surely
assessing the difficulty of doing the job?
Ms Hines: Absolutely and I think
it is also important to remember that the survey concerned which
led to that figure by the NAO was done in December last year.
December was a particularly difficult time within the office when
I think staff were demoralised.
Q90 Mr Mitchell: So you are telling
us that staff in Malawi in thinking the staffing was insufficient
are wrong and the Department here in thinking that it is better
to transfer more functions to the Malawian government is right?
That is what you are telling us?
Ms Hines: I think if you reran
the survey today you would get a very different number because,
as I was saying, I think December last year when the survey was
done was a particularly stressful time for the staff. If you look
at other internal staff surveys which we have done, such as the
one in February this year called the Pulse Survey, that showed
that 95% of staff actually know how their work contributes to
our objectives and generally the levels of staff satisfaction
in that were very high. We have just gone through another one
which will report next February. I will be very interested to
see what that says. I think that, yes, some people who were around
a long time before do prefer the time when there were two people
doing one job.
Q91 Mr Mitchell: I am sure their
morale is higher because they were under pressure then, but I
think I would prefer to trust the view of the staff on the ground
about what staffing levels need to be than somebody sitting in
London. However, let me move on. I see from 1.4 that there was
an agreement on division of labour between the donors, and DFID
decided to spend more in social sectors such as health and education
rather than economic growth, and yet it goes on later in that
paragraph to say that DFID's own analysis showed that through
a focus on agriculture it would be likely to deliver peak growth
as early as 2009 but the focus on the social sectors would deliver
equivalent levels of income per head only by 2019. That seems
to be a crazy choice. As Mr Curry said, the emphasis in this situation
needs to be on agriculture and developing agricultural production,
so why did you take the harder path?
Dr Shafik: I think the NAO also
says that DFID has made well-informed choices on the design of
the programme and part of what we do with other donors is to agree
a division of labour. We cannot do everything. We focus on the
sectors in which we are most effective.
Q92 Mr Mitchell: You cannot do everything
but why did you take the most difficult part?
Dr Shafik: I do not think we took
the most difficult part. We took the sectors where we think investments
in education and health are investments in growth. The other sectors
like infrastructure and energy were ones in which we thought the
World Bank had a comparative advantage. It was not that we were
neglecting them altogether but we were dividing up the work among
us.
Ms Hines: It certainly is not
a question of all or nothing because, as we have already said
to the Committee, we do fund agriculture in Malawi. We fund it
to the tune of £5 million per year in addition to what we
provide through budget support, but it is a question of where
DFID as an organisation, relative to the World Bank or the EC
or another organisation, focuses its own effort. We have agreed
with them that we will focus on health and education where we
have most to offer. It is also worth noting that Malawi did achieve
peak growth last year. 9.7% is absolutely unprecedented in Malawi
so through our combined efforts and the Malawi government's efforts
they did achieve growth.
Q93 Mr Mitchell: Let me ask you just
in passing, what is the EU aid effort in Malawi? Where does that
go?
Ms Hines: They are very heavily
involved in agriculture.
Q94 Mr Mitchell: Are there any barriers
in the European Union against agriculture because it is a notoriously
protectionist device? Does agricultural protectionism in the EU
damage Malawian agriculture in any way?
Ms Hines: Malawi is a least developed
country—
Q95 Mr Mitchell: That was a yes?
It was a vigorous nod. I would like it to be a yes.
Dr Shafik: All of Africa suffers
in terms of its agricultural development because the Common Agriculture
Policy is reducing opportunities for export. I think that is a
fact.
Q96 Mr Mitchell: So on the one hand
the EU is helping agriculture in Malawi and on the other hand
it is hindering agriculture in Malawi?
Dr Shafik: I think in the specific
case of Malawi because it is a subsistence agricultural system,
it is not on the cusp of exporting to Europe, to be candid. Other
countries like Kenya—
Q97 Mr Mitchell: But if it were it
could not?
Dr Shafik: Yes, but it is sort
of hypothetical.
Chairman: I warn you that the Treasury
man is getting very worried now by your answers because you are
attacking the EU so just watch it!
Mr Mitchell: They are very interesting
answers, Chairman.
Q98 Chairman: They are very interesting
answers.
Mr Sharpe: We do also need to
remember that the trade barriers into the EU are very heavily
differentiated between least developed countries like Malawi and
more developed countries whose agriculture is more affected by
it.
Q99 Mr Mitchell: Yes, but we are
contributing to EU aid and that is concentrating on agriculture
which the EU—Let me move on because I see that we gave more
in direct food aid in 2006 than we have contributed to the maize
subsidy over a four-year period.
Dr Shafik: That is correct.
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