Development Aid Budget
(6 years, 10 months ago)
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Baroness D'Souza
That this House takes note of the case for measuring the impact of the United Kingdom’s development aid budget.
Baroness D'Souza (CB)
My Lords, development aid is a subject of much discussion, debate and starkly different opinions. For example, it is said that development aid is good and necessary, but we should not have a mandatory annual budget; money, after all, could be misused in order to meet targets. It is said that development aid is good and necessary and a mandatory annual budget allows proper longer-term planning, and that it achieves economic growth, albeit in modest terms, while others assert that aid has had no positive effect on growth. There is a further important division on development aid itself—that which is carried out by experts exported to a developing country to run a programme, or that which funds a recipient country to develop the skills and capacities to carry out development programmes itself. The issue here is that none of these viewpoints can be wholly rejected or accepted unless we know more about the effectiveness of aid in the medium to long term, and this in turn requires clear objectives and evidence-based evaluation.
There has been no dearth of debate on this topic in both Houses. Briefly, the 1970 UN target of 0.7% of gross national income, amounting in the last financial year in the UK to £13.5 billion, was eventually achieved in the 2015 international development Act under the coalition Government. This put to an end a pattern of aid flows generously funded by one Government to be restricted by the next Administration, and so on. The Independent Commission for Aid Impact, or ICAI, was set up in 2011 to evaluate aid spending and its contribution to development results. Meanwhile, reports from the House of Commons International Development Committee, the All Party Parliamentary Group for Debt, Aid and Trade and the House of Lords Economic Affairs Select Committee in March 2012 all covered similar ground. But dissent continued. Last November, the Private Member’s Bill proposed by the noble Lord, Lord Lipsey, aimed to amend the annual expenditure of £13 billion to a five-year cycle to enable some rollover and avoid unplanned project overspend at the end of each financial year. One view is that a predetermined, and indeed statutory, aid budget may lead to uncontrolled spending and a distortion of genuine and lasting development, another that the amount spent is less important than the result achieved. While it is always easier to demonstrate failure rather than success, the literature is not filled with examples of wasted aid, but nor is it heavy with proper methodological impact surveys.
More specific conclusions on UK development aid overall include that the Department for International Development emerges as a worldwide-respected and effective aid agent; economic growth is the essential ingredient for reducing poverty; there should be greater clarity on the aim of aid programmes; and, while aid is not the main driver of growth, it can and does play a catalytic role.
Development aid, formally defined as financial aid,
“given by governments to support the economic, environmental, social and political development of developing countries”,
is a multibillion dollar business, which is changing, and we would do well to understand better what the longer-term implications are. I hope that this debate is not so much about aid spending but more concerned with the need to develop models that assess impact and, to paraphrase the noble Lord, Lord Judd, to ask how much aid adds to the creation of world justice, peace and stability.
A significant factor is the growing acceptance that giving aid is very tricky to accomplish, and even trickier to evaluate. It is difficult to make ambitious, large-scale aid work and especially difficult to improve the lot of the very poor. This is exacerbated by the fact that the goals of major aid programmes are often very different and sometimes inadequately articulated. These can range from reducing the incidence and prevalence of water-borne diseases, through increasing the income of a significant sector of the population to streamlining tax collection. The larger and more ambitious the development programme the more difficult it is to judge the outcomes, whereas focused and contained programmes that incorporate capacity building have effective long-term benefits, as is the case, for example, with immunisation programmes. However, the nature of aid is changing: budgets grow larger while, at the same time, there is reduced administrative support. I asked the Department for International Development to consider giving a grant to a school in Afghanistan, which would have met all DfID’s objectives, and was asked: “Can you handle £10 million”? Well no, certainly not, but the inference was that it was not cost effective for that department to manage small grants.
There has also been a massive increase in private sector delivery, which has advantages and disadvantages. The older model of development assistance—a form of so-called soft power—has been based on the gradual building of enduring individual and institutional relationships with officials, government and otherwise, in the countries concerned and a resulting trust and joint ownership of outcomes. Working at country level, DfID has always been especially good at this extension of its political and diplomatic influence. A study by the Institute of Development Studies pointed out that effective aid requires as much investment in relationships as in managing money. The need for neat results often ignores the reality that effective aid is too often untidy and even messy.
However, private sector delivery is less committed to oversight of aid programmes, and the multiplicity of freelance experts, subcontractors, and commercially confidential information makes impact evaluation virtually impossible, while longer-term evaluation may not be in the interests of the private contractor. It certainly limits knowledge of local cultures, and therefore the likely outcomes, of a major aid programme. The move towards technical assistance also reflects the changing nature of aid. Technical assistance, such as help in setting up insurance schemes to help farmers when crops fail, is best delivered by the private sector which advises and runs such schemes. Yet again, although there will be excessive scrutiny of planned and actual expenditure—down to the last bus ticket in many cases—there is far less, if any, scrutiny of the impact of these schemes, which are usually expensive and less amenable to detailed examination. The growth of a whole industry of private sector companies which exist solely to win development assistance contracts is alarming. Following the earthquake in Haiti, some $6 billion of aid was allocated to a country of 10 million people. Some 70% of the aid was delivered through private contractors and, as we know, the outcomes, or lack of them—notably the devastating cholera epidemic—are a continuing source of anger among the Haitian population.
Capital flows and trade far outweigh development aid, and the use of public money to incentivise private investment is fine and acceptable. However, this makes it far harder to assess how well money is spent, and aid delivered via other departments is harder to track. Despite these difficulties, it is nevertheless imperative that we do so. Since development deals with people, much cannot be reliably predicted, and all these variables make it extremely difficult to evaluate anything but the “simple” achievement of modest goals in proper time: that money has been spent roughly in accordance with the protocols and broadly within the timeframe set. Is this enough? Together with many others, I, think not and this is a legitimate question for the public to ask.
A search of the considerable literature reveals endless evaluation studies but very few long-term and reliable impact studies. A colleague cited an example which I think illustrates the kind of difficulties that arise: Lake Victoria Dam in Sri Lanka, a project conceived in 1978 and completed in 1985, aimed to provide hydroelectricity for a given population and thereby release them from the vagaries of fluctuating oil prices. Costs were astronomical but planned spin-offs included consistent irrigation for several thousand farmers downstream. After more than 30 years’ operation, it is clear that the power output estimates have consistently fallen far short of predicted levels and the irrigation catchment area has been significantly smaller than anticipated. Estimates of the irrigation plan did not take into account major factors such as the leakage or the evaporation rate of the reservoir, and there were adverse unintended consequences: an increase in the incidence of malaria in the below-dam population; poor water quality affecting lakeside settlements; and a failure to capitalise on other benefits such as fisheries and recreation facilities.
An evaluation funded by the UK concluded that the whole project would have benefited from more comprehensive planning and more extensive data at the outset, and:
“Short term and partial studies by consultants are neither a cost-effective nor a professionally adequate substitute”.
The evaluation report also concedes that proper studies would have required,
“a mass of hydrological, financial, agricultural, social and environmental data and computer models developed over a number of years”.
One could argue that the cost was unacceptable and that the spin-off benefits were unrealistic. Would it, for example, have been more cost-effective to put the money required for the dam on a money market, with a guaranteed return which would have paid for oil and provided a profit? But would it have been possible to predict the investment return rates over the course of the building of the dam, or the fluctuations in the price of oil? It is this unpredictability that tends to defeat long-term impact studies.
Systems are needed to justify projects and calculate the so-called return rates, but systems do not necessarily reveal everything and are liable to manipulation. We do not as yet have sufficiently sophisticated mechanisms to measure outcomes, but this does not mean that we should abandon the focus on impact. A well-informed, plausible narrative by reasonable people of good will based on statements from project recipients—so called self-reported impact—is not to be sniffed at. Distrust arises when there are discrepancies between what is claimed and what little evidence is produced. For example, ICAI reviewed cash transfer programmes and pronounced them significant in reducing poverty and vulnerability and,
“presented a strong value for money case”.
Many of these cash transfers took the form of microcredit and microfinance schemes, but the large literature on access to finance, especially by women, shows it to have a very poor record. One respectable study even went so far as to say that many of these projects were counterproductive in the longer term in that they built up unsustainable debt and, in some cases, reinforced the gender inequalities already present in the society.
The mantra “aid works” repeated by the aid agencies is a bit like saying Brexit is Brexit. Of course aid works. The question is how well does it work, and whether,
“you might have to wait for your grandchildren to tell you”.—[Official Report, 18/11/16; col. 1668.],
according to the noble Viscount, Lord Eccles, when questioning DfID aid channelled through the Asian Development Bank. Does the bald fact that 166,000 households out of several million were supplied with water tell you as much as you need to know? How much did it cost? How well is the water flowing? What are the maintenance costs? Are maintenance skills being taught? What is the consequent reduction in disease?
Does it matter? Should we spend even more millions on monitoring and evaluation reports and yet more consultants winging their way to underdeveloped countries? One can define good aid as the art of spending modest amounts over long periods in careful co-ordination with recipient Governments, in step with the ability to meet recurrent costs. On the whole, aid is benevolent and beneficial, but we need to dig deeper. “Bad” aid is bad for communities for many reasons, some of which are: it can preserve the status quo and release Governments from undertaking reform and development; it can create further divisions between the poor and the not so poor; it may protect corrupt Governments—in one example, the revenues of a World Bank-funded oil production project were used to buy arms; it will result in repeated ill-conceived programmes; and it may promote expensive self-interest purchasing on the part of donor countries to the detriment of local industries in recipient countries.
In a democratic country such as the UK we should have utter transparency on major expenditure in our name, and question whether aid is used for political purposes. Understanding based on evidence as to why some interventions work and others do not in different communities is crucial to ensure that aid inputs achieve desired results, or at least do not make things worse. In conclusion, therefore, it does matter that the long-term impact of development aid is systematically assessed and published.
Lord McConnell of Glenscorrodale (Lab)
My Lords, I thank the noble Baroness for tabling this Motion for debate here this afternoon. It is the first specific debate of our new parliamentary Session and a very appropriate and timely topic to choose. I also welcome the Minister back in his post following the election. I think we all appreciate his knowledge of and commitment to this subject and to the department, and we look forward to working with him.
I was for many years a sceptic about the idea of putting the 0.7% target into legislation. At one time, it seemed that it was perhaps an unnecessary gesture which was detracting from the real debate that needed to take place. However, as the debate developed over the years and the department’s budget grew, I became absolutely convinced that passing that legislation was essential, not just to secure the UK’s contribution to a better world but, perhaps even more importantly, to allow us to move on to a debate about how we spend the money rather than how much money we are spending. I therefore welcome this debate in your Lordships’ House, at the first opportunity in the new Session, on how to tackle some of these important issues.
I also welcome many of the initiatives over recent years of the last two Governments, both the coalition Government and the solely Conservative Government. The establishment of the Independent Commission for Aid Impact was a very good initiative; it was timely, necessary and appropriate, and it has produced some excellent reports that perhaps both we and the department should take more account of. The establishment of the Building Stability Overseas Strategy was also a very welcome initiative. However, like many other initiatives of the Government, I have some concerns about the way in which these initiatives are consistently followed, and about the subsequent impact of that on the impact of our aid and development spend.
I strongly believe that our development finance should increasingly be concentrated on the least-developed and the conflict-affected and fragile states rather than on those that are already making significant progress or which could easily do so with better governance. I also believe very strongly that we should be investing in capacity, particularly of the business environment in countries that need more jobs and better businesses, but also in the capacity of individual countries to run, manage and improve their own services and support their own communities rather than relying on finance and expertise from elsewhere.
As I said, I am concerned that the Government’s overall commitments of 0.7% to effective international development spend, to engaging in the international arena on these issues, and to the new rules—as we discussed in the House earlier this afternoon—on overseas development assistance, which were welcome last year, are somehow not translated into updating and making as transparent as possible the expenditure of now both the Department for International Development and the other departments that are involved in overseas development assistance expenditure.
For example, since the Building Stability Overseas Strategy was agreed in, I think, 2011 and launched by the then Secretary of State, Andrew Mitchell, we have seen the development of the biggest conflict in the world today—in Syria—and all the implications that that has not just in the neighbouring countries but in Europe and beyond. We have seen the rise and fall of better governance in Libya and all the implications that that has in the wider areas in north and west Africa. We have also seen dramatic changes in Myanmar and more recently in the Philippines and south-east Asia, with a constantly changing conflict there. Therefore, our support for peacebuilding strategies needs to change as a result. We have also seen changes in the United Nations, yet we still have the same Building Stability Overseas Strategy as we had in 2011. In that time, the Government’s commitment to expenditure on conflict-affected and fragile states has gone from 33% to over 50%, yet we have the same old strategy. It is out of date and should be updated to ensure that that increased expenditure, both in volume and percentage, is targeted in the right way on peacebuilding initiatives and conflict prevention in the right parts of the world.
Since 2010 we have seen the agreement on the millennium development goals—we have actually seen it since we debated in your Lordships’ Chamber putting the 0.7% target into legislation—and we have seen the agreement on the sustainable development goals. Those goals are very different from the MDGs. They encompass better governance and economic growth and investment in the sort of infrastructure that creates economic growth. Those were never mentioned in the millennium development goals but are now part of the SDGs. Goal 16 is a commitment to the institutions that promote peace and justice for all. These fundamental changes in the global goals—the UK was integral both to the debate and to the final agreement on them—are not yet fully reflected in the expenditure plans and strategies of the department two years on, and undoubtedly they are not yet given full regard in the other departments that are spending overseas development assistance. Yet again, that is an example of a need for clarity and a published strategy by the Government, as well as a linking of expenditure to the new framework—the SDGs—that is not yet transparent enough.
Specifically on the subject of impact, I notice yet again—even in the information that we each receive from those who contact us when these debates are about to take place about the impact and the effectiveness of UK aid—lists of figures relating to the number of children now going to school or the number of people who have had vaccinations or have access to clean water. These statistics get bandied around on these occasions. I appreciate that and welcome it, and I have seen it in action in different parts of the world. It is good news, and it is good that Britain makes its contribution to it, but to me it is much more important for us to look at the long-term impact that UK aid is making.
Where are we investing for the long term? Last year I saw projects in northern Nigeria and in Mombasa in Kenya that were investing in the life opportunities of young Muslims coming out of school with an inadequate education and no hope—they were being recruited by al-Shabaab in one case and by Boko Haram in another—yet through British aid they were getting an opportunity of an apprenticeship or of starting a business, with the necessary skills, support and mentoring that allowed them to do so. This is an impact that will not be seen next week or the week after or even next year or the year after but in five, 10 or 15 years’ time, both in the life opportunities of those young people and their children and in the safety and security of the communities in which they live.
Also in terms of impact, I think that in many individual expenditures we realise the opportunity that we have, but when we talk about this we underestimate the opportunity to catalyse investment from others as well. I think our impact is not just the schools that we open, the teachers that we employ, the volunteers that we send or the vaccinations that British taxpayers pay for. It is the way in which that then catalyses all sorts of donations both from other Governments and from international organisations and private donors too.
I would like to see in the measurement of impact not just the individual numbers that make us feel good on the occasions when we have these debates, but a measurement that has some indication towards the long term and a measurement that indicates how we are catalysing the resources of others who share the objectives that we seek. I hope that in each of these areas the Minister will be able to give us a response.
Lord Purvis of Tweed (LD)
My Lords, it is always a pleasure to follow the noble Lord, Lord McConnell, as there is such common ground between us on these issues and he speaks a great deal of sense. I agree with him that we are lucky to have the opportunity, courtesy of the noble Baroness, Lady D’Souza, to raise these issues today in a full debate in Parliament. In doing so, I also, from these Benches, welcome back the Minister to his brief and welcome the noble Baroness, Lady Sugg, to her Front Bench role as a Whip covering this department. I wish her well.
There is no doubt that, when it comes to spending more than £13.5 billion of public money, there should be full and relentless scrutiny of how, where and on whom it is spent. This is a public duty on us as parliamentarians. Full accountability needs to be applied to Ministers or officials, too, if any of that money is misspent or misdirected. Focusing on these questions, rather than whether we should meet the 0.7% target, is a point on which I agree with the noble Lord, Lord McConnell, very strongly indeed. There is a wide consensus on this. This was shown during the passage of the International Development (Official Development Assistance Target) Act 2015.
If I have one area of slight disagreement with the noble Baroness, Lady D’Souza, it is that I think it is still not the case that everybody agrees that aid works. There is still a school of thought that does not believe that overseas development assistance works and that development comes purely from private sector sources. I am not of that school, but many of those who hold that argument like to peddle a myth that the bulk of UK ODA is frittered away or wasted on corrupt programmes. When asked to provide evidence, they usually point to an individual programme that they happily mispresent in the process. Because it is impossible to deliver such a large budget without some errors or some programmes along the way that fail, these are used in vain against UK ODA over all. However, I suspect that that will not be the focus of this debate this afternoon, which is welcome.
Section 5 of the International Development (Official Development Assistance Target) Act 2015 covers the independent evaluation of the extent to which UK ODA,
“represents value for money in relation to the purposes for which it is provided”.
I agree very much with the noble Baroness, Lady D’Souza, that this is hard. Given the breadth and the complexity of ODA across many different fields, it is often easier to calculate a numerical output for some aid programmes and harder to calculate outcomes, especially when many of these programmes are delivered in very difficult circumstances. It is also harder when UK aid programmes are delivered in a certain way that is not always consistent with the in-country way of budgeting and of delivering public services.
It is 10 years since I served on the Finance Committee in the Scottish Parliament. We had regular debates there about delivering services in the UK, when it came to public sector intervention, and about what outcomes were delivered, rather than simply outputs from the financial inputs. However, I am pleased to say that, since the passage of the Act, the structures in place for Parliament to scrutinise this work are proving effective. Indeed, in the most recent review of its own procedures, the Independent Commission of Aid Impact, which has been referred to, highlighted not only the number of reports it has carried out but also the fact that the Government listen to its advice. Many of the recommendations made by this independent body have been taken into consideration by DfID and acted on. Indeed, through the sub-committee of the IDC Committee in the Commons, the accountability to Parliament is also here.
I have no deep-seated objections to UK ODA being delivered by departments other than DfID, but we have to be cautious. The ambition of 40% of ODA being delivered outside DfID has had little debate in this House. I cannot recall since I have been a Member having a full debate on ODA in government time considering these issues. I do not doubt the commitment of the Minister when assurances are given that, for example, the department will not be subsumed into the FCO, and I hope that that will not allow any mutterings from those who argue for this to be the case. That is a distraction. In last week’s debate on the Queen’s Speech, the noble Lord, Lord Dannatt, questioned whether it would be better simply to amalgamate all development, diplomatic and security presence around the world into one, so there are still some voices. However, I hope that they are in the minority and do not distract us from where we really need to focus.
We have also seen growing global UK leadership on transparency and the calculation of effectiveness and delivery. In many respects, it is the delivery standards of DfID that are now being seen across the world as the leading approach. The 2015 Act requirement on government to demonstrate value for money and effectiveness is deliberately broad enough to ensure that all Whitehall departments have to be scrutinised by ICAI and be equally accountable to the IDC and not only to their own scrutiny committees in Parliament. Can the Minister assure the House that all necessary agreements are in place across Whitehall to ensure that that can be done properly and that there are no barriers to ICAI doing its work?
This is important not only to demonstrate to our own public that money is being well stewarded but because across the world we want to see the growing UK leadership in this respect being carried on. In the Global Fund’s Aid Transparency Index, the UK, with its full government department, is the only country in the world that has retained its top status since the global transparency index of 2013. Other countries have looked to DfID as the exemplar and have copied our approach. In 2013, there were 26 donor countries in the very poor category of transparency; in 2016, there were only five. This is welcome. Interestingly, while the UK scored 88.3% on aid transparency, Italy scored just 16%, France 9.2% and China a derisory 2.2%. Given the extent of the delivery of trade and concessions for aid from China, Africa and elsewhere, a level of scrutiny on their programmes is almost impossible to carry out.
There is no question that the UK is a leader overall. It was therefore with more than a little concern in that regard that I read the Conservative manifesto, which pointed to a slight differing in the direction going forward. In his response to the noble Lord, Lord Collins, in Questions today, the Minister indicated only part of the commitment in the Conservative manifesto. It states:
“So we will work with like-minded countries to change the rules so that they are updated and better reflect the breadth of our assistance around the world”—
which is what the Minister said. However, the following sentence states:
“If that does not work, we will change the law to allow us to use a better definition of development spending, while continuing to meet our 0.7 per cent target”.
This begs the question whether the Government have ruled out unilateral changes to our approach on ODA. We have not only complied with the DAC rules but have been a leader in their delivery. Can the Minister rule out any unilateral moves away from that?
Which are the like-minded countries referred to who also wish to change the rules? What changes are the Government seeking? Can the Minister give examples of specific projects that are not currently covered under OECD rules that the Government would like to see counted as aid? What assessment have they done of the impact that increased links between defence and aid may bring about—if, indeed, this is the Government’s intention? I hope the Minister will have an opportunity to address some of these points.
Finally, on the basis of the continuing and very welcome wide consensus in this House, I have said that the UK comprises just 0.6% of the world’s population but that we punch considerably above our weight on the international stage. I feel that this may well be diminished by Brexit, but that is a separate issue and for a different debate. The UK is a global citizen and we demonstrate leadership around the world, so if the Prime Minister’s tagline of a “global Britain” is anything, it is indeed that British aid works, that UK leadership is gaining results and that we should do nothing to undermine it.
The Lord Bishop of Truro
My Lords, I am grateful to the noble Baroness, Lady D’Souza, for initiating this debate on such a very important and topical issue.
As no doubt we will hear from other speakers, the UK is known around the world as a leader in international development. It has achieved great results during the past two decades. I have no doubt of the importance of the case for measuring the impact of our development aid. I want to underline that case and also, perhaps more importantly for me, to ensure that we try to measure the right things if we can and do not understand aid only as a financial investment which can be measured simply in financial terms. I fear that too many people in our debate will go immediately from talking about aid to talking about money and finances rather than going back and thinking about what the word “development” might mean. It seems that development is in itself a fascinating idea in our world today with perhaps an assumption that other countries are less developed than we are. We must be careful about the assumptions and presuppositions we make when we use the word.
For more than 40 years, the Church of England has campaigned for the UK to spend 0.7% of gross national income on aid and has applauded the commitment made by the Government back in 2013. Despite pressure to drop aid spending, it has been reassuring to see that all the major political parties have again recognised its importance and continued with the commitment to allocate 0.7% of our GNI to overseas aid.
Aid is not expensive. It costs the average taxpayer less than £1 a week to support some of the poorest and most vulnerable people in the world. This money can be used effectively to prevent the arrival of larger and more expensive problems further down the line, again showing the difficulties around how we measure impacts. The Church sees the benefits of aid money through its extensive international links. The Anglican communion is one of the largest international networks and has supported DfID over the years effectively to channel money into the poorest communities worldwide when other avenues are not available. Church networks complement the work of the aid agencies and are often able to reach further, especially in areas of conflict or where natural disasters have disrupted established communication and infrastructure links.
When I served as the Bishop of Sherborne, I had the privilege to visit what was then Sudan in my capacity as chair of the Salisbury Sudan Link. I was able to visit several areas of both Sudan and what is now South Sudan, which sadly is covered by people fleeing the continuing and terrible violence. Tribalism and poverty make for a toxic cocktail. Almost 3.5 million innocent people in South Sudan have been forced from their homes and are desperately in need of food, safety and hope. Christian Aid is partnering with the Episcopal Church of Sudan and South Sudan and other local partners to provide for the practical needs of some of the most vulnerable.
Back in February, when famine was officially declared, the UK Government announced substantial funding for humanitarian relief in the form of food, clean water and healthcare. Without that aid, and the work of agencies such as Christian Aid and their local partners, the situation for many of those affected would be even more unbearable. I was delighted to see today that the Minister of State, the right honourable Alistair Burt, is out in Myanmar seeing at first hand how our aid money is supporting vaccination programmes and farming communities. In the previous coalition, we saw the Government promoting the positive stories about UK Aid Direct, and we need to see more of this. Of course, it is not perfect and there is always room for improvement, but there is a great deal to be proud of and to build on. Despite what we read in some of the more populist press, aid has high levels of support in this country and needs to be seen as a positive contribution to the world, especially in the new climate of Brexit in which we currently find ourselves.
Our changing climate is also one of the biggest factors shaping the future for many of the world’s poorest people. It is affecting everything from harvests to clean water, causing drought and extreme floods and the spread of diseases. One important way we can use aid is to boost access to clean energy, especially given that nearly 1.1 billion people in the world still have no access to electricity. Without power in schools, hospitals and businesses, it is very difficult to combat poverty. In sub-Saharan Africa, around 70% of people have no access to electricity—80% in rural areas. It is important that we ensure access to energy for people, but also ensure that it is clean energy so that we do not contribute towards increasing climate change—another example of how complicated it is to assess impact.
It is my belief that aid should continue to focus first and foremost on poverty reduction and the alleviation of suffering, and not be diverted by, for instance, security or other geopolitical considerations. Of course it is right that we develop the right measures for the impact of our aid investment and improve it all the time so that every penny is spent as effectively as possible. However, I question how we do that and what measures we can use. As a framework, the sustainable development goals are very useful for this. I would like to know how the Government propose to deliver the SDGs at home and overseas. I ask the Minister: what will the Government do differently to meet the new SDGs and will they regularly report to Parliament on their progress?
There are other ways UK aid can be made even more effective. Not all UK aid meets the highest transparency and effectiveness standards. Regardless of which department spends it, these standards should be met. Will the Government continue to commit themselves to transparency and accountability, especially when other departments spend DfID money, as other noble Lords have mentioned?
There is already much to affirm and encourage in the UK’s response to the needs of the world’s poorest people. We must not, however, be complacent: there are pressures from many directions on the levels of aid, how it is spent, and, as we are debating, how we can assess impacts. The UK must not pull back from its leadership role; if anything we should aim even higher, demonstrating to our G7 and G20 partners that it is possible to meet our international commitments. It is a question of morality, justice and basic humanity.
My final point is that talk of impact should not always assume we are considering money or financial aid. I fear we live in very individualistic times and our society is more and more atomised. If we are not careful, we equate development aid simply to financial benefits or losses. Development aid in fact should mean that we all consider what it means to achieve development. We are partners with others around the world and part of the impact we measure should be what effect other people and places have on us. I mentioned the privilege I had of travelling on several occasions to Sudan and South Sudan. The real need in South Sudan is for help in governance and capacity.
There is an undeniable case for measuring the impact of our development aid, but it should not be a measure simply in numbers or focusing on only financial investment. It must be a measure that understands the sophisticated issues behind development and the interdependence at the heart of working with others.
Baroness Verma (Con)
My Lords, I join all noble Lords in congratulating the noble Baroness, Lady D’Souza, on securing the debate. It is a great honour to follow the right reverend Prelate the Bishop of Truro. I agree with him that this is not just about measuring aid in financial terms. However, most of the data we collect have to have an output somewhere—and, as often as not, it is measured in financial terms.
I had the privilege of serving as a Minister in DfID. I reassure noble Lords that the Government I served in were mindful of the way the media reported on how aid from the UK was spent. I can tell noble Lords that under Justine Greening—and, I am sure, under the current Secretary of State—there was a real pressure on all of us to justify how we funded programmes. However, it is important that we also acknowledge that, unless we collect data and then have the ability to measure outcomes, it will always service those people who have a negative or less favourable view on the impact of aid.
We talk about development aid as we used to talk about it 30 or 40 years ago. The world has changed dramatically in terms of the countries that we now support or the countries that support us in helping others. Our approach and narrative need to change with it. I refer noble Lords to my own interests as declared in the House of Lords register. I support a platform that encourages working with the UN on collecting data through blockchain to measure how the private sector works with Governments and the third sector, and to see how money put in is spent and what outcomes can be measured. For far too long, we have allowed the third sector and the corporate sector to operate on their own. We need to encourage work across all three parts of the equation, so that government, the third sector and the corporate sector are accountable to the people whom we all desperately want to help.
We also need to ensure that the agencies that we support reform and work better together. I had the task of looking at the agencies in the UN and the EU. Often, they did not talk to one another. If we look at the SDGs and focus just on women and girls, we see that they have multiple challenges. It is not that they have challenges in respect of just one SDG; the SDGs have an impact on them across an age spectrum, an ability/disability spectrum as well as all the other challenges that women and girls face. We need to make sure that the department continues to press hard and that the agencies that we fund deliver to the standards that we expect of them. However, there must also be transparency and they must show that they are not working completely in silos.
I want to encourage those of us who make a difference to the third sector to ask those in it to work better together so that their data are gathered collectively and we can have much more of an ecosystem response to the impact of what third sector agencies do. Agencies themselves often operate in silos. It is important that they come together and demonstrate that they can work collectively across multiple facets that have an impact on individuals in developing countries.
I am really pleased that the department is making available funds for smaller organisations, because it is the grass-roots, face-to-face impact of smaller organisations, particularly those which innovate within the development space, that we do not always manage to measure from some of our big organisations.
I encourage my noble friend to look at the whole ecosystem of how we deliver aid and not to look at it as a stop-start process. We often forget that, throughout the cycle, many challenges face older people within developing nations. I was horrified to find that all data collection for women stops at the age of 49. I hope that that is being challenged and that, as aid works and as people live longer in developing countries, we are able to measure beyond the age of 49. I hope that we are able to support the United Nations convention on older people.
I worked incredibly hard within the department to look at inclusive societies. While some countries still sit outside a number of areas that this country is proud to support, I hope that we will not stop with our gentle, soft diplomacy as well as some of the hard conversations that other departments can have. I hope that we will not take our foot off the pedal on making sure that we continue to work on our mission of inclusive societies.
I come back to the measurement of data. It is critical and crucial that, when we get negative stories, they are countered quickly. A lot of our departments deliver aid—the Foreign Office, the Department of Health and the Ministry of Defence—and it is absolutely critical that those departments have the same measurements and transparency tools that we had, which I saw and that the Minister is absolutely aware of in DfID. Unless we have that consistency across all departments, we will continue to firefight some of these rather ridiculous stories that come out in the press now and then.
We should be incredibly proud of the fact that we are a country committed to the poorest people on the planet. That does not mean that we should not also fight hard to stop the discriminating tariffs that prevent these countries from developing economically on their own. It is really important that we help them economically build up their own marketplace and infrastructure in their own countries. As the noble Lord, Lord McConnell, said, in doing that we should also focus on capacity building. The reason we have a lot of issues around young people in developing countries is because they have a dividend of young people. It is a great advantage to have those young people if they can be engaged in meaningful education and employment in their countries.
If anything, we should really try to work harder on this—not only ourselves but other countries, too. That is not just like-minded countries; I worked incredibly hard with unlike-minded countries. At the end of the day, they have a very different vision of what they see as aid. They were looking to the UK for support in delivering their aid programmes. So it is about looking at new partners and old, but not forgetting that we have been a world leader. Our narrative needs to remain that we are a world leader. Sometimes, we need to stand up even more firmly to those who try to change the goalposts simply because it is politically astute to do so in their home countries.
Baroness Warwick of Undercliffe (Lab)
My Lords, I thank the noble Baroness, Lady D’Souza, for introducing this debate and giving us a timely opportunity to make the case for the importance of UK aid and of continuing to spend it effectively.
First, I echo what others said in recognising the tremendous work the UK has already done and continues to do on the international aid front. We do it quite simply because giving aid is the right thing to do. More than 700 million people today live in extreme poverty. The challenges they face include food shortages, disease, natural disasters and conflict. Limited access to healthcare and education compounds and continues the cycle of poverty. We can help—and we do. The UK gives aid because it makes a difference. UK aid is effective. The charity ActionAid reminds us that UK aid has helped to immunise more than 55 million children against preventable diseases and provides 60 million people with access to water, sanitation or interventions to promote hygiene.
My noble friend Lord McConnell pleaded persuasively not just for such clear, immediate outcomes—good as they are—but for longer-term commitments that deliver wider-scale outcomes. I cite one particular programme that seems to exemplify this: in humanitarian aid, the UK led the way in tackling the Ebola crisis in west Africa. I have mentioned before in this House the expertise at King’s College London, which contributed so much to the UK’s role in helping Sierra Leone conquer this terrible disease. King’s strong background in global health and the creation of the King’s Sierra Leone Partnership meant it was able to step up its work in response to the Ebola outbreak, enabling it to treat an estimated one-quarter of the Ebola cases recorded in the country. But since then King’s has contributed enormously to healthcare capacity building in the region, demonstrating the vital role that university health partnerships can have in creating sustainable healthcare systems for the long term and globally. We should be able to demonstrate sustained benefits for the longer term in all our aid programmes.
It is to this Government’s credit that they have pledged to continue to meet the UK’s target of spending 0.7% of our gross national income on official development assistance—ODA, as it is normally referred to. This is entirely in line with the promises we made at the 2005 G8 summit. Of the 15 EU countries that made the pledge in 2005, only the UK and Germany have risen to the challenge since then. The UK was the first to meet that target—in 2013, before it became a legal requirement in 2015. As others have observed, the UK was one of just eight countries to meet that target last year. Indeed, eight of the 15 have actually reduced their ODA spending as a proportion of GNI since 2005. To meet our commitment, our ODA spending nearly doubled between 2005 and 2016, from £7.4 billion to £13.6 billion in today’s terms. To continue to meet that commitment, we will need to increase our ODA spending by another £1 billion from now until 2021.
As we have heard, most of our ODA or foreign aid spending is done by the Department for International Development. Between 2010-11 and 2016-17, spending by DfID rose by 24%—at a time when budgets for departments other than health, education and defence were cut by an average of 28%. It is worth noting that bilateral aid makes up almost two-thirds of UK ODA. This means it goes to specific countries, regions or programmes, and spending is controlled almost entirely by us as a donor, unlike multilateral aid, which is channelled through organisations engaged in development work, with little condition on exactly how the funds are spent.
The recent IFS report, The Changing Landscape of UK Aid, highlights the fact that the UK—specifically, the Department for International Development—is seen internationally as,
“a leader in shaping the global development agenda”.
Importantly, the report also notes that despite being one of the smallest areas of government spending, it is one of the most scrutinised. The International Development Committee, the National Audit Office, the Public Accounts Committee and the Independent Commission for Aid Impact all have a monitoring role to ensure that overseas aid is properly spent. DfID is rated in the highest category in the international Aid Transparency Index, and the most recent peer review of the UK aid strategy by the OECD in 2014 was largely positive about the UK’s performance. No less a philanthropist than Microsoft founder Bill Gates has said that DfID is,
“one of the most effective, efficient, and innovative aid agencies in the world”.
I was filled with alarm, therefore, when I realised that the strategic focus of the UK aid commitment has shifted to support aid “in the national interest”. This approach seems to mean that when Britain is determining how it will meet its responsibility to the world’s poorest, it will make a judgment based on what,
“best serves and protects its own security and interests”.
So while we are reducing poverty, we are also looking to improve the business climate and create international business opportunities for UK companies. I suspect that there will be huge challenges in the evaluation of the impact of these two very different aims. I cannot help but also feel that in our relationships with our partners overseas, it will be counterproductive. The noble Lord, Lord Purvis, raised similar concerns, and I will listen very keenly to the Minister’s response to his questions.
Money is being diverted to other government departments which may not be subject to the same scrutiny as DfID, as we have heard already. Between 2014 and 2016, there was a 12 percentage point drop in the proportion of the ODA budget received by DfID. In 2017-18, 20% of the UK’s ODA is due to be spent by departments other than DfID or by cross-government funds. That is set to rise to 25% by 2019-20. I feel this should be a matter of real concern, particularly in relation to evaluation, because while DfID is a world leader in delivering aid, the aid spent by other departments does not meet the same high standards. Where DfID was rated very good, the highest category in the Aid Transparency Index, the Foreign Office was ranked poor and the MoD very poor. How can we be sure that the Government will live up to their promise that all departments will follow the same high standards as DfID on fighting poverty? How can we be sure that they will remain transparent and accountable?
A further concern is the recent indication that international definitions of development assistance will be changed to,
“better reflect the breadth of our assistance around the world”.
Redrawing the definition of what constitutes foreign aid to include work that the UK already does abroad but which cannot currently count towards the 0.7% target has worrying echoes of the changes to the definition of child poverty a couple of years ago. The Government have built on a great track record of generosity from the UK and a strong reputation for effective aid. Will the Minister tell the House how he will ensure that this is not put at risk by poor evaluation of the impact of spend from other government departments?
Lord Bruce of Bennachie (LD)
My Lords, I, too, thank the noble Baroness, Lady D’Souza, for giving us the opportunity to have this debate. I found her opening speech interesting and a little challenging. Having had the privilege of being chair of the International Development Committee when ICAI was set up, seeing that process proceed and working with the National Audit Office, I agree that we have got to a much better system for accountability, but there is always room for improvement. In the beginning, ICAI was accountancy-led, but it became much more understanding of the complexity of development and therefore more effective. There is certainly justification for transparency, but we also have mechanisms in place that can improve it. The noble Baroness identified that there is a danger that if we call for too much we will create a whole other industry of evaluation and monitoring that might get in the way of delivery. I draw noble Lords’ attention to my interests as set out in the register.
Not surprisingly, given my background, I am a strong believer in the effectiveness of UK aid and its impact. I have had the privilege of seeing it in action in many parts of the world. However, I recognise that the way aid is carried out and its objectives are not well understood, certainly by the wider public. As many people have said, we should do it, because in spite of all our problems we are a rich country and, frankly, people living in this country cannot really comprehend how you can live on less than $2 a day.
I also accept that it is perfectly reasonable for the Government to want to offer practical examples of positive results and to show that aid is justified by altruism—there is nothing wrong with that—but it also serves the national interest. There is nothing wrong with using aid to strengthen the economic capacity of developing countries so that they can grow their income and tax base and lift their people out of poverty. On the contrary, in the end that is how we can achieve sustainable development. It is also in our interest to ensure that as countries industrialise, which the right reverend Prelate mentioned, they do so in the cleanest and most environmentally sensible way, which is not necessarily the cheapest, so it is perfectly legitimate for them to look for some assistance.
Most of us welcome the cross-party commitment to delivering 0.7% and wish it to continue and to continue to be pro poor. I hope that the Government will continue to resist calls to cut the aid budget—as, for example, this weekend, in order to fund ending the cap on public sector pay. That would be raiding the poorest people in the world in order to fund easing relative poverty at home and would be a shameful misuse of resources.
It is also worth noting that, contrary to what many critics believe, the aid budget is under pressure. There is an idea that we cannot get rid of the money and that somehow spending it is difficult. The refugee crisis has led to unprecedented sums being spent supporting displaced people across the Middle East. The UK can be justifiably proud of that response, but it has come at the expense of longer-term development funding. Clearly, the devaluation of sterling in the past year has reduced the purchasing power of the UK aid budget. The exchange rate differential between the UK and developing countries has altered by more than 20% in many cases. Can the Minister give any indication of how many programmes have or are having to be cut as a result? People in the department have told me that that is clearly happening.
The IDC recently reported on the role of contractors and partners. NGOs, private sector contractors, think tanks and private businesses are all legitimate and important partners, but the recent report on that use of private contractors led to a focus on Adam Smith International, which was severely criticised for co-ordinating its evidence to the Select Committee. Although there is no evidence that the evidence was actually fraudulent, it was certainly not particularly well constructed. As a result of that, my understanding is that DfID has halted or cancelled a significant number of ASI programmes, leading to about a third of the staff in that company being made redundant currently. That is unfortunate, because it is the dedicated professional delivery staff who are losing their jobs as a result of mismanagement at senior management level. Again, this could have implications for the delivery of programmes if they are terminated before they are followed through or completed. Can the Minister indicate how many programmes have been disrupted and what action is being taken to ensure that the aims of these programmes can still be achieved? I make it clear that I have no interests in ASI and no connection with it; nor have I spoken to it. This is only what I see and hear.
Can the Minister also explain how DfID monitors and works with the impact of ODA spending by other government departments? A number of noble Lords have raised this point. We have had indications or hints in the past of a turf war, with some Ministers being reportedly, not publicly, less respectful of the role of DfID in ensuring that ODA is compliant with both UK and international law and that it meets genuinely pro-poor development objectives. I am in favour of joined-up government, and there is nothing wrong with ODA being spent by several government departments as long as it is co-ordinated and coherent and the same rules apply across the piece. The noble Baroness who spoke before me mentioned King’s and the Ebola crisis in Sierra Leone, which was a good example of cross-government and cross-departmental work that helped to deliver a solution to a problem that got out of control.
Generally speaking, the Foreign Office and DfID can work well together, especially where they are collocated in our embassies overseas, which mostly they are. Indeed, that is a virtue, because it is good to get the political environment and development objectives co-ordinated and not operating in separate silos. I am certainly in favour of that.
According to the Library briefing, the business department is the department that accounts for the largest share of non-DfID ODA. Again, this is not necessarily a problem, but I do not think many of us are really quite clear exactly what the business department is doing with that ODA money. Most of it may well be going into the climate fund and/or the prosperity fund, but, again, could the Minister, either now or subsequently in writing, give more details of the main development objectives in the business department? That would reassure people who are concerned and give us a better understanding of how the departments work together.
I will raise another issue quickly. Can the Minister provide an update on DfID gender policy and the prioritisation of disability in our aid objectives? Canada has just published its new development strategy—I have a copy here—which it explicitly defines as feminist. There is no doubt that the low status of women and girls in many countries is the single biggest barrier to development. I know this issue is dear to the heart of the noble Baroness, Lady Tonge, who is speaking after me. Access to effective family planning and safe abortion is craved by millions of women, along with freedom from violence, from female genital mutilation, from child marriage and from exploitation. Lack of legal and financial rights also holds development back.
The Canadian example contrasts sharply with the Trump policy, which really is trying to deny women access to these services. The Government have a very good record on this, but now that the Netherlands and Canada have stepped up to the plate I wonder whether it will be pushed even further up the priority list in their new development strategy.
Can the Minister give us any update on disability commitments, which my noble friend Lady Featherstone championed when she was a Minister, as she did the issues of violence and female genital mutilation? I have a particular interest in deafness, but I believe that standing up for the rights of all disabled people in poor developing countries is something that donors such as the UK should prioritise. Too often they are swept away, ignored and stigmatised. Challenging stigma and encouraging all policymakers to champion a positive approach to supporting disabled people should surely be an integral part of development programmes.
I conclude by saying that providing women with legal rights, access to contraception and better maternal and child healthcare has been shown to have a positive impact on reducing poverty and limiting potentially explosive population growth. Back that up with better education and skills training and the seeds of successful development are sown. Let us not be diverted by cutting our aid budget or redefining it in ways that reduce the impact on ending poverty. Let us do what we set out to do, which is to use our aid budget to make the quality of life of the world’s poor better and to eliminate poverty by 2030.
Baroness Tonge (Non-Afl)
My Lords, it is a great pleasure to follow my erstwhile colleague. I was going to say “late colleague” but he might have taken that the wrong way. At one time he held the most coveted position in the House of Commons—or at least most coveted by me—as chair of the International Development Committee.
I also thank the noble Baroness, Lady D’Souza, for securing this debate. It is always important to bear in mind, when congratulating ourselves on our commitment to help the poorest people in the world, that we should ensure its effectiveness and monitor its impact, particularly in relation to the sustainable development goals, which were mentioned by the noble Lord, Lord McConnell. Aid to the poorest people in the world does not just benefit them, if properly spent, but will benefit us in the longer term by reducing migration and expanding our markets. Do not forget that it is also the right and moral thing to do, as several noble Lords have already said. People sometimes forget that, so it is worth reminding ourselves of it.
I remember Justine Greening pledging to scrutinise the aid budget like never before when she became Secretary of State—and Priti Patel is doing the same thing. That is what they do, and of course they should. However, this country’s record is second to none. We have an all-party commitment to 0.7% of GNI to be spent on development aid, and it is worth noting that the International Development Committee, the National Audit Office, the Public Accounts Committee and the Independent Commission for Aid Impact all scrutinise the aid budget more than any other, it would seem. Added to all this scrutiny, as we have heard from the noble Baroness, Lady Warwick, Bill Gates, who is to be admired, has said:
“DFID is widely recognised as one of the most effective, efficient, and innovative aid agencies in the world”—
while the campaign for aid transparency Publish What You Fund rated DfID as “very good”, the highest category in its aid transparency index.
There is a long list of what UK aid has helped to do. For example, it has saved the lives of 103,000 women in childbirth, enabled 9.9 million more women to access family planning and provided safe abortions, especially for women raped in conflict. There is no greater impact we can have on development—here it comes—than empowering women, and the best way of doing that is to give them power over their own bodies in the form of family planning. This issue is so misread, and it frustrates me terribly that it is not number one on everyone’s list. If you want a country to develop economically you have to empower women, and to empower them you have to give them access to family planning. That is crucial. Alongside that, bed net distribution has halved the number of deaths from malaria; children are being vaccinated; there is more education, clean water and sanitation—the list goes on and on. There is our impact.
For aid to be effective, though, the recipients must have consistency and reliability, and this is currently at risk under the new Government. Governments of developing countries need to be able to plan and carry their projects forward. NGOs cannot plan if they do not have consistency of funding. I pick out as examples Marie Stopes International and the International Planned Parenthood Federation, which no longer receive core funding from DfID and have been waiting for guidelines since last autumn to know how to apply for funding—not how to get it but how to apply for it—for the family planning and safe abortion work that they do among women and girls, particularly for the large cohort of young people that we have heard about in some of the most marginalised communities in the world. This work has already been held up for nearly a year.
Will the Minister please tell us when this matter will be dealt with? Women and girls are suffering because of indecision at DfID under the new regime. It seems that everyone from the Secretary of State downwards is saying the right things and supporting development, but there is no action on funding for big NGOs such as those I have mentioned.
I understand that in 2017-18—again, the noble Baroness, Lady Warwick, mentioned this—20% of the aid budget is to be spent in other departments, which will rise to 25% the year after. Will the Minister confirm this and also that these departments are not rated as efficient as the Department for International Development? It is very worrying that the Foreign Office and the Ministry of Defence will be receiving DfID’s money when we know that they are not very efficient at spending the money they have already. The Minister should reassure us on this point.
Finally, on a matter very close to my heart and related to the Foreign Office budget, for how much longer will our aid budget be spent on providing health services and education for the people of Palestine, who could well provide it themselves if they were free to do so and their economy was functional? What impact are the grants to UNRWA to assist Palestinian refugees having? Why is it that we are—and have been for 50 years—supporting and funding the occupation of Palestine by another country, a rich country to boot, while doing nothing to resolve the situation that makes the aid necessary?
Have we ever done this before in our history? The occupying power under international law is responsible for the welfare of the people it is occupying. For 50 years, we have been shoring it up. To use our Department for International Development budget to help pay for Israel’s illegal occupation over 50 years surely makes us also complicit in breaking international law. Considering the length of time for which this outrage has been allowed to continue, it is an extremely ineffective way of using our aid budget—which is what this debate is all about.
Lord Judd (Lab)
My Lords, I join all those noble Lords who have thanked the noble Baroness, Lady D’Souza, for having introduced this debate. It is terrific to see her in her emancipation leading so forcefully on such a vital issue.
I declare an interest because of my past ministerial responsibilities at the Ministry of Overseas Development, as it then was, at the Foreign Office and at the Ministry of Defence, and because of a great deal of my life spent voluntarily and professionally in organisations in the voluntary sector.
I have one worry underlying this debate: I wish we would stop using the word “impact”. We are talking about development; development enables people to take control of their own lives and take them forward, and enables Governments and communities to take charge of their own affairs and carry them forward. “Impact” is not the right language for doing that; we should talk about contribution or, as my noble friend Lord McConnell put it, effectiveness. Those are the sort of words that we should be using.
The other thing that we should watch carefully is the contrast between long and short term—and, of course, “impact” lends itself to the short term. We have seen that in conflict situations, when the army liberates an area and wants to see something done quickly. DfID may have reservations and say, “This is not going to be sustainable—it’s not the best thing to do in the long run”, and we have to look at that. It is also about empowerment, which means prioritising education; it means, of course, income generation, and sweeping up the gender issues in that income generation. But it is not just about women; it is also about too many millions of young men, idle in their community, unemployed and prey to extremism. We really have to think about that very hard.
It is also about multilateral agencies. If my life has taught me anything, it is that competitive aid is doing harm. We need to co-ordinate our efforts with others, sometimes running joint programmes—but not necessarily just that; it is about co-ordinating the priorities that we share. It is also about refugees and displaced people. The difficulties and issues that we face at the moment in this sphere are child’s play by comparison with what is going to happen in future if one looks at climate change alone. That demands a global strategy on how we meet these challenges. What exactly are the Government doing to develop those global strategies; how far are they working closely, hand in glove, with UNHCR in this context?
It is about justice. We love to talk about the rule of law, but justice costs money. How do you establish effective systems of justice in the poorest countries in the world? They do not come cheaply. It means that a great deal of resources have to be targeted and provided. And it is also about having security sector reform, because nothing will progress without peace and stability, and the security sector is vitally important. It has to be a sector in which people and communities have confidence, operating to the highest standards of integrity and with a real commitment to human rights.
We have great NGOs in this country—I can say that from personal experience—and their briefing is always invaluable, based as it is, invariably, on the authority of engagement. I have listened to this debate so far and seen that the briefing has not been lacking; it is clear that the NGOs are at work.
Fifty percent of DfID’s budget goes to fragile states. We need to hear more precisely about how in such fragile states, often in acute conflict, DfID and the Government’s commitment—our commitment—to human rights, sustainable development goals and poverty alleviation is being sustained and developed.
I can see very great potential advantages of interdepartmental co-operation and, similarly, of interdepartmental ministerial appointments. But it is not just about intellectually seeing it as a good idea; it is about how it is actually helping in these situations. Are the principles, priorities and commitments of DfID really being upheld? Is it really in the driving seat? Otherwise, we must worry that public funds and taxpayers’ money may be going to activities which cannot be justified by the aid programme.
There is a disturbing rise in civilian casualties in conflict areas, particularly in siege situations. We need to ask how, in situations where people are really suffering—and, as has been discussed, they are doing so at this moment—DfID’s priorities and the Government’s professed objectives are being upheld and the standards fulfilled. It is going to be tough and complex but we need to know how it is being done. In general, we also need to know how closely DfID and the Foreign Office are really working together in the application of human rights. In the immediate situation for refugees—not least those in the central Mediterranean area—how are we ensuring that commitments to human rights and the protection of children are being upheld? I am alarmed to hear stories about border patrols, which we may be financing, arresting children who then end up in prison. We need to watch things like that and it would be good to hear more from the Minister.
In conclusion, it is refreshing that Bond, the global forum of our NGO community, has reminded us of the words of the former Archbishop of Canterbury, Rowan Williams—the noble and right reverend Lord, Lord Williams of Oystermouth—in April this year. He put it extremely well, saying that,
“aid is not about creating dependence but helping people become valued partners and co-workers for a safe and equitable world”.
Lord Alderdice (LD)
My Lords, the House knows, and was reminded again this afternoon, of the depth and length of the commitment which the noble Baroness, Lady D’Souza, has to these matters; it is indebted to her again for this debate. I declare an interest as chairman of the Centre for Democracy and Peace Building and of the Centre for the Resolution of Intractable Conflict at Oxford.
It is a source of considerable pride and satisfaction for many in your Lordships’ House and for our country that, with the initiative of Mike Moore and my noble friend Lord Purvis of Tweed, we now commit 0.7% of GNI to international development as a legal commitment, as well as a moral one. Coming from my background, I regard this as a kind of tithe—a commitment we make to show our generosity of spirit and determination to make a better world. It is not purely a question of assessing effectiveness, but it is important to evaluate what our money goes to. In DfID and the British Council, we have two organisations that our country uses internationally and which are much better appreciated abroad than they are at home. They are singular organisations with a global and positive impact. I do not want what I say to take anything away from the very positive things that DfID does, but we are here to try to hold the Government to account and I will touch briefly on four issues.
On the question of evaluation, one has to be a little careful to evaluate the right thing. For example, in the case of Northern Ireland, there was an assumption that the problem of the conflict was one of socioeconomic disadvantage. So even during Mrs Thatcher’s time, when money was tight here, lots of money was put into Catholic nationalist and, indeed, Protestant loyalist, areas of Northern Ireland. If you had measured how much went in and some of the economic impacts, it would all have looked very good. However, it did nothing to resolve the conflict. It created upwardly mobile Provos, but it did not stop the conflict because it was not about economics but about other issues. Therefore, when we evaluate, we need to think what we are evaluating and whether it is the purpose for which we are giving the money. That is often not the case because of the dominance of an economic view of humanity and its difficulties. Economics is important, but it is not the sole driving feature and, in resolving economic problems, economic aid is not always the best or only way to address them.
First, I touch on the question of conflict. The first paragraph of Article 1 of the charter establishing the United Nations states that it was set up to address conflict. Many years later, it has produced 17 sustainable development goals. Number 17 is about implementation. The issue of conflict does not arise until SDG 16, and it is there with two or three other issues. Why is that? It is because many of the member nations of the United Nations did not want it there at all. Yet the fact is that not a single one of the other SDGs can be achieved without resolving the question of conflict. Noble Lords have mentioned Syria, Iraq and Libya as examples. How can any of the other SDGs be satisfactorily resolved while those conflicts are continuing? They cannot. Therefore, it is crucial that some of our thought, resource and funding goes to understanding conflicts, what makes them and what resolves them. I appreciate all the difficulties about money for peacekeeping, but I am not actually talking about peacekeeping. I am talking about understanding why we have conflicts and finding ways of intervening, because if we do not do that, to be honest—the noble Baroness, Lady Tonge, adverted to this in some of her comments—we are simply subsidising conflict rather than trying to resolve it, and we will not be very effective in making the kinds of changes that we want. Therefore, addressing the question of conflict is absolutely essential.
Secondly, when it comes to addressing economics, the best way, of course, is for communities themselves to develop the education and, indeed—as I will say—the culture that enables them to progress. It became clear to myself and a number of colleagues, particularly Martti Ahtisaari, the former Finnish president, that you can never develop a serious economy in a country, or proper governance, unless you develop institutions of higher learning, and you will never get those if people are never educated beyond a master’s degree. Yet, when we have proposed PhDs for young people from Africa and the Middle East, we have found it impossible to get funding from DfID or any other government or EU agency, because the only thing to which they want to commit money is primary and secondary education. That is perfectly reasonable and good, but we will never get anywhere unless there are people educated in those countries to a level where they can develop institutions of higher learning that take their governance and economy forward. It is short-sighted to focus only on things such as primary and secondary-level education.
That leads me to another very problematic issue—the question of culture. I give an example. I was asked to go and see some Aboriginal people in Australia because, despite the fact that the Australian Government were putting in very large amounts of money, their situation was getting worse. Their health was getting worse. Their education was not improving and the degree of physical and sexual violence, alcoholism and drug abuse was increasing. Why was that? It was because understanding the need for cultural change was not part of the agenda. One needs to find ways of helping people, to engage with cultures where they are, but also of taking people to a new place where they can survive in a world which is very different. Let me put it this way: the Aboriginal people have a culture that goes back longer than any other civilisation, something like 60,000 years. For almost all that time, they have been hunter-gatherers. That means that when you find food, water or whatever, you eat as much as you can because you have no idea when will be the next time you will get something. That is fine until McDonald’s and Kentucky Fried Chicken come along, and then, if you go in and eat all you can, you end up with diabetes and all sorts of other problems. That is exactly what has happened. The cultural change has not taken place. Why? Because people who are sensitive to addressing people’s needs say, “No, no, we mustn’t change their culture. That’s their culture. It’s neo-imperialism to get involved in that”. Yet it is a fact that if we keep their culture preserved in aspic, they will die out as a people. So there are complex, difficult issues to be addressed there.
My final point is on the question of the size of organisations. The noble Lord, Lord Judd, quite rightly sang the praises of the large international NGOs, which are very important and deliver a lot of help. However, there are problems with them, one of which was referred to by the noble Baroness, Lady D’Souza. They gobble up the resources almost in total—a large amount of paperwork needs to be filled in and there is a lot of bureaucracy—and that is very difficult for small NGOs. Yet the small NGOs, with a particular idea and commitment, are the ones that will produce something new. Noble Lords often comment about international norms. But those are what we believe now—they are not good enough for the future. If we are to develop things further than where we are now, we do not need international norms alone. We need the small, piloting NGOs that will take a little money and do a lot with it with some new ideas. Can the Minister look again at this question of whether some of the money that goes to the large NGOs and the degree of bureaucracy that they have to create to manage the large number of people they work with might be better spent by taking us forward with the new ideas that some of the small NGOs may help us to create and exploit?
The Earl of Sandwich (CB)
My Lords, it is a privilege to join this debate, not only because it is a fascinating subject in itself but because we are at last entering a period in which we can make a proper assessment of aid impact. I congratulate my noble friend on recognising this so soon, and I agree with her analysis and comments on the private sector. I did not agree with her about women in microcredit; we have to have a private discussion about this, because they have a high level of repayment in some countries.
We had a debate back in November 2015, during which various watchdogs involved in the aid programme were discussed. Other noble Lords have already explained the process, but it was already clear by 2010 that DfID was responding to a new international emphasis on aid effectiveness and transparency, added to which came value for money under the coalition, when Andrew Mitchell was Secretary of State and soon established the excellent ICAI. Aid dependency, people’s participation and sustainability were again under discussion. Noble Lords will know that many of these concepts are cyclical, and I can remember them back in the 1970s—I am sure that the noble Lord, Lord Judd, also does—and even earlier. But they were being drawn together under a new Administration, partly because of hostile elements in the media and the need to defend the aid budget during the 0.7% Bill campaign.
Our great advantage this afternoon is that we can draw directly on the first five years’ work of ICAI, the body created to report regularly, as we heard from the noble Lord, Lord Bruce, whom we are very lucky to have in this House, with his first-hand experience. Only last week, ICAI published an important document, the ICAI Follow-up Review of Year 5 Reports. In my experience, the most targeted aid goes not through government but through civil society, churches and faith groups, and human rights agencies. The Grenfell Tower fire is only the latest example of the way that local organisations can move faster and more effectively than government, especially in a crisis. NGOs do not always have a good press but, having worked with several of them, I am bound to say that they have been a most efficient channel of our aid money, including ODA under successive partnership schemes, started by the noble Baroness, Lady Chalker. I can think of many examples of good long-term development that I have mentioned before but will not repeat now.
Aid from all sources goes astray. There were very few examples of fraud during my time with Christian Aid: there was a land speculator disguised as a doctor, and an agent who absconded with money for an emergency in northern Iraq. But no one is surprised that the aid world is always vulnerable to criminals, cheats and liars, especially seizing their chance during emergencies, and some do get round the system. The failure to deliver aid in conflict zones such as Helmand or South Sudan are all too familiar examples. It was good to hear from the right reverend Prelate—Bishop Tim, as we remember him in Sherborne—especially hearing him talk about the importance of climate change, but we are primarily concerned with development aid.
Turning to ICAI’s reports, I was discouraged to read more criticism of the Conflict Pool, which is now reborn as the Conflict, Stability and Security Fund. Held up as a fine example of interdepartmental co-operation, the CSSF has now doubled its budget to £1 billion or more for conflict prevention and peacekeeping—here, the noble Lord, Lord Alderdice, made a vital point—but it still struggles to escape from an amber-red rating in a previous report. As it has wide implications for our foreign and defence policy, it was thoroughly examined by the Joint Committee on the National Security Strategy last February. It was not a satisfactory report, as the CSSF was still found to be wanting. In fact, some people have told me that the CSSF was simply in “a mess”. Perhaps earlier the noble Lord, Lord Bruce, was a bit too forgiving.
ICAI said bluntly two years ago that the FCO’s project managers were not equipped to handle such large sums. It said:
“The other government departments in question do not have DFID’s level of project management capacity and culture of managing for results. There is a risk that the expansion of CSSF’s budget will generate unhelpful competition between departments”.
To answer the point made by the noble Lord, Lord Judd, DfID is in the driving seat, but the Minister might like to comment on this because it has implications for all the other 14 departments now drawing on ODA, and especially for their relations with DfID. There are echoes here from our discussions of the CDC Bill. The Minister knows that there was a lot of concern about the rapid scaling up of CDC projects—many in the private sector—and whether DfID would be able to transfer skills quickly enough. Such overheating inevitably means that aid impact and delivery will be adversely affected in all these organisations.
The June 2015 report also mentioned the statistical boast common to all aid agencies in claiming the numbers of people they reach—the “Heineken factor”, or, in ICAI language, an overreliance on “reach indicators”, which specify the number of beneficiaries due to receive or to have received assistance. DfID’s new plan, which replaces its results framework, is not yet entirely satisfactory because there are no standard indicators. I am not sure that ICAI or anyone could ever reach a sensible solution because of the variability of data, but of course we must be glad that it is making the effort.
Again, I am reminded of our concerns during the CDC Bill that, although DfID was talking about so many “jobs created”, it turned out that it was counting “indirect jobs created”, and this was another important point picked up by ICAI. The NAO had concerns about this too. Why should the public be so misled on these issues? As the noble Lord, Lord McConnell, mentioned, education is a much surer measurement if we are looking at long-term impact.
A high priority for ICAI, following the theme of “no one left behind”, is the relationship between our ODA and the 17 new SDGs. This was well identified in the IDC’s recent report. It is of course to be expected that the new goals, which now have to come directly from the countries’ own priorities and, we hope, from their NGOs, will inevitably sharpen up aid impact and effectiveness. However, we are still not helping the very poorest enough and we should be doing more in African LDCs.
At this point in the debate, I feel I am something of an agnostic, because government—and indeed Parliament—may be prone to an illness described as “excessive monitoring”. We should not expect watchdogs to pretend to know everything. ICAI, thank goodness, is a relatively small, efficient operation and it cannot look at the entire aid programme. It already covers a vast number of projects and has become a vital link between the department and the IDC. I am full of admiration for ICAI, but equally I would not like overstretched DfID staff to be smothered by unnecessary double counting that may interfere with their essential work.
The cost implications of consultants coming and going have been mentioned by the noble Baroness, Lady D’Souza, and the noble Lord, Lord Bruce. They have to be taken into account. We all know that last December the Times reported that billions had been spent on consultancies while DfID’s own staff fell in proportion to the rising aid budget. I am among the first to defend the aid budget, but serious questions have been raised today, and I hope always will be, about aid effectiveness—the noble Lord, Lord Judd, was right to remind us about “impact” not being quite the right word. The Government, assisted by ICAI, are gradually addressing them, and I hope more Members of Parliament will go and see for themselves, maybe through the CPA and the IPU, the good that we are undoubtedly doing in many areas of the world.
Baroness Jenkin of Kennington (Con)
My Lords, imagine my disappointment on arriving in the Chamber today to find that, due either to technical incapability on my part or to a malfunction of the machine in the Whips’ Office, I was not on the list to speak after all. I am very grateful for the opportunity to speak briefly in the gap so forgive me for darting about a little bit with slash, slash, slash—it is not all that easy.
I join the noble Baroness, Lady Tonge and the noble Lord, Lord Bruce, in focusing some of my remarks—I make no apology for this—on the value of access to contraception and family planning programmes as a way to break the cycle of poverty. By empowering women to plan their futures and reach their fullest potential, voluntary family planning gives women and girls the opportunity to complete their education and take up better economic opportunities. We know that it transforms lives, creating more prosperous, stable societies, which is in the UK’s interest.
The UK is continuing its leading role by hosting an international summit on family planning in London next week and I very much welcome the Secretary of State’s personal commitment to prioritising this agenda. Working with the UN Population Fund and the Bill and Melinda Gates Foundation, the summit aims to boost global commitment to ensuring women and girls have access to family planning services. Can any of us here in the UK imagine not having this access and the choices it provides? The summit will procure a range of new commitments from developing countries, donors and other partners. These commitments will increase access to family planning services for women and girls in the world’s poorest countries, fix problems with supply chains and prioritise the needs of women and girls in humanitarian crises.
Jumping to the fact that the aid budget is taxpayers’ money, I will just illustrate this with two small stories. I had a conversation recently with someone who had been a consultant in one of the big consultancies where I was making the case that so many girls were now educated in a way they were not before. The consultant said to me: “How do you know? I have worked in remote areas in Pakistan and a girl will turn up once and the box will be ticked and she may never turn up again”. I encourage my noble friend to be aware of what is actually going on. In another story, a friend was looking at a project in Pakistan where they were feeding children and giving them lunch. A sign said that meat was included in the rice. My friend, understanding Urdu, heard the project leader say to a worker, “Where is the meat in this rice? I told you today we have important visitors coming and we need the meat in the rice”. That could be happening far more on the ground than we are probably aware of.
The noble Lord, Lord Alderdice, talked about small charities. I strongly endorse his point. Mary’s Meals, of which a number of noble Lords will be aware, gets not a penny from the taxpayer but provides fantastic value for money and feeds millions of children across Africa. The aid budget is taxpayers’ money and the Government have a duty to communicate to the UK public how this hard-earned money is spent effectively, delivers results for the world’s poorest people and is not subject to waste or corruption. They should continue to drive for greater efficiency and value for money and I commend the Minister for the work he is doing in this space.
Baroness Sheehan (LD)
My Lords, I add my congratulations to the noble Baroness, Lady D’Souza, on securing this important debate and I thank her for her thought-provoking opening remarks. I pay tribute to the contributions that we have heard across the Floor of the House and to the wonderful insight and experience that noble Lords present have brought to the debate.
When the aid budget is under attack in the press—as it is—it is important to ensure that hard-earned taxpayers’ money is shown to be spent effectively when delivering policy that helps the poorest in the world. Collecting data on inputs, outputs and outcomes which allow us to measure its impact is essential if we are to do that.
UK aid works, not only in helping some of the poorest people in the world to live in dignity and to begin to take charge of their own lives and livelihoods through economic development but benefiting us in the UK. The Overseas Development Institute recently published a report entitled Aid, Exports and Employment in the UK, showing how in 2014 UK direct bilateral aid generated an increase in UK exports and provided an estimated 12,000 extra UK jobs. It is a win-win relationship. I make this point because all too often DfID’s work is castigated in the press and those of us who support the fabulous work that it is doing need the ammunition to fire back.
UK aid strategy is changing. Over the past several years, more and more of the UK’s ODA is being spent by departments other than DfID through the FCO’s Prosperity Fund, the Conflict, Stability and Security Fund, the Ross Fund and few other pots in other government departments, in total amounting to a good third of the overall ODA budget. While it falls to DfID to ensure that all UK ODA complies with the OECD’s ODA rules, DfID, nevertheless, in its annual report and accounts makes it clear that aid administered by other departments is the responsibility of the Secretary of State of those individual departments. Those other departments have published precious little information about the increasingly large sums of ODA they spend. This situation must be rectified.
DfID, on the other hand, is in many ways an exemplar department when it comes to openness and transparency, which is vital if we are to collect the data we need to assess development impact. My noble friend Lord Purvis referred to the Independent Commission for Aid Impact which scrutinises DfID’s work and provides independent evaluation of all UK aid spending. The noble Earl, Lord Sandwich, gave useful information about the work in depth that ICAI carries out. As well as ICAI, DfID also commissions independent evaluations such as the DfID evaluation annual report, and bilateral and multilateral reviews give in-depth analysis of country and sector expenditure. In addition, DfID is subject to further external scrutiny by the International Development Committee, the Public Accounts Committee and the National Audit Office, as we have already heard.
The other departments do none of this and, although ICAI’s remit includes scrutiny of ODA spend by all UK government departments, this has not happened. When may we expect ICAI to undertake a review of ODA spend by other departments?
Since the last general election just a few weeks ago we have seen changes to ministerial posts such that we now have DfID Ministers with shared responsibility across other departments. Can the Minister confirm that this bodes well for future transparency? While DfID has displayed openness and transparency, there are a number of wider issues that I would like to raise where some joined-up thinking could maximise the impact of the UK aid budget.
The first is in respect of the policy on energy, an issue referred to quite extensively by the right reverend Prelate the Bishop of Truro. DfID is doing some good work on ensuring clean energy access for people in developing countries. However, at the same time the UK Government overall have spent more on fossil fuel projects in developing countries than on renewable energy projects. This needs to change as it is counterintuitive to help developing countries to mitigate against and adapt to climate change but to fund so many fossil fuel projects as well. In the same vein, DfID should use its position as a major shareholder in the World Bank to persuade it to switch to supporting more renewable energy projects. Between 2011 and 2015 the World Bank invested more in oil, gas and coal than it did in renewables.
Secondly, I want to talk about the Commonwealth Development Corporation. The CDC Act came into force earlier this year as a consequence of which, by 2020, a massive total of £6 billion will be made available to the CDC by DfID. In spite of the plethora of reports produced by DfID and its scrutineers, we still lack sufficient data on CDC’s activities. It must publish what it funds and it must do so in a timely way, given that all capital transfers to the CDC as of 2014 count immediately as ODA. Why is it that other development finance institutions such as the World Bank, the African Development Bank and the Asian Development Bank all appear and are rated in the multilateral aid review, but the CDC does not? Where in the department’s bilateral and multilateral reviews can the public see what impact the CDC is having?
I want to deviate from my speech a little and say in response to the point made by the noble Baroness, Lady D’Souza, that sound methodologies must be developed. The CDC does have at its disposal £5 million for just this purpose, but it lies unused. I think that we can put pressure on the CDC to use that money to develop some of the methodologies that are going to be necessary.
Lastly, I should like to talk about double standards. Britain was a driving force in ensuring that women and girls were front and centre in the drawing up of the UN sustainable development goals. Our commitment to this group, representing half of the world’s population, is enshrined in legislation and our then Secretary of State was a founding member of the UN High-Level Panel on Women’s Economic Empowerment. The UK has been a driving force in putting issues such as gender-based violence in conflict zones, forced marriage, teenage pregnancy and FGM at the forefront of international decision-making, so when a high-scoring project, properly assessed for impact and aimed at tackling the serious issues facing girls in developing countries, is sacrificed on the altar of the Daily Mail’s vitriol, something is seriously wrong with decision-making at the highest level. I am talking of course about Yegna, the Ethiopian Spice Girls. To make an impact, we must be consistent. There is little point in carrying out assessments and then ignoring the results, and I hope that cash transfers will not go the same way.
The Conservative Party’s manifesto stated that the party will,
“work with like-minded countries to change the rules”,
related to overseas development assistance. Will the Minister share with us what definition of aid the Secretary of State will be content with and at what point she will depart unilaterally from the OECD’s ODA definition, as she has stated she is prepared to do? Where is her red line? For my part I am concerned that this Government’s preoccupation is solely with Brexit and it is no secret that the Secretary of State herself is wedded to a hard Brexit. Will the Minister reassure the House that there will be no return to tied aid as the Government pull out all the stops to get trade deals in the limited time at their disposal? Will he further reassure your Lordships’ House that trade with developing countries will continue to support development, including through improving market access, strengthening capacity to trade and building better livelihoods?
I end on a point made by the noble Lord, Lord McConnell of Glenscorrodale. The International Development Committee produced a damning report on the Government’s implementation of the UN’s sustainable development goals. There is also precious little mention of them in the bilateral or multilateral aid reviews. This is in spite of this commitment made at the G20 summit in the middle of last year:
“The UK is intending to publish a report in due course on its contribution to the Global Goals which will cover both international and domestic implementation”.
When can we expect this report?
Lord Collins of Highbury (Lab)
My Lords, I, too, thank the noble Baroness, Lady D’Souza, for initiating the debate. It has been vital and given us an opportunity to have several bites at the cherry with questions to the Minister. Last week he and I attended the NGO reception at which the Secretary of State was also present. At the event she evidenced the huge impact that UK aid has in the world, particularly in Africa. A number of people at that meeting gave first-hand, personal accounts of the impact. She has also said that,
“Britain is saving lives and bringing stability and security, and that’s good for our economy”.
While I welcome her new-found enthusiasm for development, I have concerns about the direction in which she is taking the department. Apart from seeking changes in the rules governing ODA, which we addressed earlier in Oral Questions—I hope that the Minister will be able to answer the specific questions on that additional sentence in the manifesto that the Government will not go it alone—I particularly want to address the issues the noble Lord, Lord Ahmad, raised in the debate on Her Majesty’s gracious Speech. He pointed out that more aid will be administered by other government departments, pointing out that in 2015 they accounted for 19.5% of ODA spending, compared with 13.8% in 2014.
One of the biggest beneficiaries of this aid has been the FCO. As noble Lords have pointed out, a big problem with this is the lack of monitoring and evaluation systems. The Government must ensure that non-DfID aid programmes and funds meet DfID’s high levels of transparency and report publicly on their activities. Parliament needs to be satisfied that they are being properly assessed against their achievements in delivering the sustainable development goals. What are the Government doing to ensure that all government departments and funds managing ODA achieve rapid and ambitious improvements to the transparency of their aid programmes?
Another area of concern is what is happening to Ministers in DfID. We have Alistair Burt and Rory Stewart reporting to Boris Johnson at the FCO, and of course the Minister now also covers the Treasury. While I am all in favour of cross-Whitehall co-operation, as highlighted by the noble Lord, Lord Bruce, is there something more going on here, especially in the light of the Budget’s shift away from DfID? I certainly hope there is not. Most noble Lords here would agree that DfID has huge expertise and a world-renowned reputation in defeating poverty. It should remain independent and the leading provider of UK aid. Will the Government confirm that they will apply the International Development Act 2002, with its legal requirement for aid to focus on poverty reduction, to all aid, regardless of which department or fund manages it?
Poverty and bad governance are still holding too many countries and their people back. Many women, disabled and older people and too many minorities are discriminated against and denied access to their fair share of goods, services and opportunities. Economic growth has the potential to be the engine to drive change. But, as the noble Baroness, Lady Hayman, said in Oral Questions, growth without jobs, inclusion, healthcare, education and human rights—growth without power—will not deliver for the many.
The universal nature of the sustainable development goals and the principle of leaving no one behind are vital tools. As my noble friend Lord McConnell asked, what are the Government doing to ensure that aid programmes delivered outside DfID focus on supporting the SDGs? Just when will we have clearer reports from cross-Whitehall co-operation on how the SDGs are being implemented? How will Parliament be involved in that?
To deliver the greatest impact, we must have a fairer tax system for the world’s poorest countries. Unfortunately, different government departments seem to be working against each other. According to the IMF, developing countries lose around $200 billion a year to tax avoidance. The UNCTAD estimates that tax havens cost developing countries at least $100 billion a year. While DfID is doing good work in helping developing countries broaden their tax base, other departments are not helping to improve tax transparency. The Treasury should work quickly to introduce public country-by-country reporting for UK companies. As the Minister is in the Treasury now, can he tell us how Ministers are progressing this matter multilaterally and when they expect an agreement to be reached? What discussions are taking place about the overseas territories following the UK’s lead and introducing a public register of beneficial ownership? The private registers being introduced at the moment are almost useless for developing countries, as they cannot see the information and many are excluded from information-sharing agreements. While this policy inconsistency continues, the impact of our aid will never be quite as much as we would like.
Value for money means measuring success by the change that we make and not simply by the cash that we put in. That is why Labour strongly supports the Independent Commission for Aid Impact. When a budget as important as this is ring-fenced, there is a fiscal responsibility and a moral duty to deliver as much change as possible for the money that we invest. DfID’s Annual Report and Accounts sets out the mechanisms which the department uses to ensure that it spends its money in a strategic, long-term way. As noble Lords have said, this includes a single departmental plan setting out strategic objectives for the period of the spending review. We also have the annual target and the framework of accountability, involving ICAI and Parliament.
As Priti Patel argued last week, the private sector needs to play an even greater role by integrating the aims of the SDGs into business practice. Developing countries currently face an annual investment gap of $2.5 trillion if they are to achieve the SDGs by 2030. That can be done only by working with the private sector. Noble Lords have mentioned the CDC, which should do more to measure the development impact of its investments. That would not only provide a better basis for investment decisions but increase the transparency of the CDC.
The 2012 to 2016 investment plan has expired; I am told that the 2017 to 2021 investment plan and strategic framework will be published this Thursday. I am sure that the noble Lord will tell us that it is a matter for the usual channels but I sincerely hope that time will be given in this House for a proper debate in government time on that strategic plan. It is vital that we hold the CDC to account, particularly in terms of transparency.
To conclude, I will pick up a theme that my noble friend Lord Judd referred to. We talk about aid dependency, but this generation has the opportunity to eliminate that for good by empowering the powerless. That is our vision on this side of the House, and it is what we will be pressing the Government to do.
The Minister of State, Department for International Development (Lord Bates) (Con)
My Lords, I join other noble Lords in paying tribute to the noble Baroness, Lady D’Souza, for securing this debate. It has been extremely useful and one of those occasions when you look at the wealth of expertise both in and outside this House and are not quite sure whether at the end of it you are supposed to give a speech or should have been taking notes. Of course, it has been a combination of both as I have gone through this debate.
The noble Baroness, Lady D’Souza, has a distinguished track record in this whole area. She outlined, rightly, the need for evidence-based analysis of what is working here. We also heard during the course of the debate from my predecessor, my noble friend Lady Verma, who left a tremendous legacy from her time as Minister. I publicly thank her for that. Many of the areas in which I now deal simply continue excellent initiatives that she began. I also join others in welcoming my noble friend Lady Sugg to the Front Bench as Whip. She will be a tremendous support because, again, she has such experience and expertise in this area.
If I were to try and answer all the questions presented to me, we would exceed the two-and-a-half hour cut-off line—perhaps even the two-and-a-half hour cut-off line for my speech. I have a limited amount of time, but I am very keen that we are able to draw on the wealth of expertise in this House. I will look for an opportunity, I hope before the recess, to continue some of these discussions we have had today.
UK aid plays a vital role in helping the world’s poorest and most vulnerable. That is both morally right and in our enlightened self-interest, as we were reminded. One of the other themes of the debate has been that the world has changed. The noble Lord, Lord McConnell, referred to that in particular. We talked about the changing nature of some of the pressures. I want to dive straight in to the ODA issue mentioned by so many. It is an area of focus.
The rules of the OECD’s Development Assistance Committee were set up some 40 years ago, when the world was a very different place. They have been changed only once in the past 40 years. That process of changing them, once, in March 2016—as the noble Baroness, Lady Sheehan, and the noble Lord, Lord Collins, referred to—took a period of four years to agree. This is a slow-moving area because the Development Assistance Committee works by consensus. We have been very keen to say that we want to share our concerns with our friends. That has literally just begun through our communication process. At this stage, I cannot give a run-down of who our friends are in these particular areas or what each of them are coming to us to say are the areas they would like to see changed and improved.
However, they have looked at particular areas such as climate change. That is something on which 40 years ago there was perhaps not the same focus so we need to look at it. Some elements of research that you can do into climate change are not ODA eligible, yet they benefit, as many have mentioned, the poorest on the planet. There is also violent extremism and countering terrorism—the new threats we face. Do the rules allow and capture all that has been done in this particular area? There is migration on a huge scale around the world, almost unprecedented in our history—certainly post-war—and that raises new challenges. So when, for example, we deploy Border Force cutters in the Mediterranean to intercept the people-traffickers who make fortunes out of other people’s misery and put their lives at risk, and when we work with the Libyan coastguard to try and improve their security and safety, are these not areas that we ought to be able to consider as part of our overall effort?
There is also trade. We talk about trade and development. The only way we are able to achieve that aspiration set out by the former archbishop of not creating dependency—referred to by the noble Lord, Lord Judd—is by trade. Look at the number of people in extreme poverty, which reduced by 50% between 1990 and 2010. What was the reason for that—was it the levels of aid? No, it was the levels of trade, so those are very important to us. That is also the reason why the Secretary of State for International Trade and the Secretary of State for International Development jointly announced that one of our ambitions is to maintain and build upon the preferential trade arrangements for the 48 countries in Africa to be able to trade into the United Kingdom tariff-free. We recognise that that is incredibly important to us.
The noble Earl, Lord Sandwich, referred to the issues of monitoring. Many noble Lords referred to the level of monitoring that goes on. He referred to the possibility that there might even be an excess of monitoring in some respects. Of course, at the moment overseas aid is, in the UK, probably one of the most scrutinised of any spends that happen anywhere in the world. That is one reason the noble Lord, Lord Purvis, was right to point to the International Aid Transparency Initiative’s rating of DfID as world-class and world-leading in the way that it does aid. We have nothing to fear from transparency because that is part of the way we learn and gather information about this. I direct noble Lords to the website “devtracker”. It is a bit of a catchy name, but the Development Tracker is an incredible resource, enabling you to see exactly, in real time, what is actually happening on which programmes and who is delivering them. You can read the independent evaluation reports carried out and see how much money has been paid—as I say, in real time. These are ground-breaking methods of transparency that are recognised internationally. Of course, then we have our own quality assurance, and that has been added to a whole new—
Lord Purvis of Tweed
I do not wish to interrupt the Minister’s flow, but he has quite substantially moved on from the area of the DAC and OECD. With the greatest respect, I was waiting for him to answer the point that a number of noble Lords across the Chamber asked about the line in his party’s manifesto that, if there were no agreement within the OECD and DAC, the Government would propose unilateral action and bring forward legislation to change the criteria for ODA in the UK. All of us asked him to reflect on that and perhaps move away from it, especially in the context that he no longer has a majority in either House. This would be a good example of listening to a great deal of concern that moving unilaterally would not be in the best interests of the UK in this area.
Lord Bates
I do not want to parallel or parody debates taking place on other aspects of government policy and exiting the European Union, but I can assure the noble Lord that we have no red lines. We are still developing what the issues are that we would like to address. We began that process talking to the NGOs. I would like to continue by talking to Members of your Lordships’ House about what the issues are, citing some of the problems and talking it through with officials. Of course, then we need to present that to colleagues. So it is not a firm, baked plan, which we are demanding or otherwise we will go out on our own. We have said we are quite determined that there are some issues that need to be addressed and we want to share that with people and work together in a consensual way.
Returning to the point about examination and monitoring, of course we have our own internal quality assurance. We also have the National Audit Office. We have the Independent Commission for Aid Impact, which has been cited. The noble Baroness, Lady Sheehan, asked about the CSSF. That was one of the ICAI reports that the noble Earl, Lord Sandwich, referred to, where that scrutiny is beginning to happen. There is also the International Development Committee in the other place, of which the noble Lord, Lord Bruce, was a distinguished chair for 10 years. Again, we have a very good working relationship with that committee. It is rigorous, but there is a partnership because we all want the same thing—namely, to eradicate extreme poverty.
Then we have the sustainable development goals, which a number of noble Lords, including the noble Lord, Lord Collins, and my noble friends Lady Verma and Lady Jenkin, referred to. They are going to introduce a whole new level of scrutiny. Again, it comes back to the point about the Development Assistance Committee. Forty years ago, we did not have the millennium development goals, never mind the sustainable development goals. Now we have these new goals that introduce whole new categories—such as beneath the ocean or peace and conflict, which the noble Lord, Lord Alderdice, referred to—that we need to work on.
I was asked what the Government are doing in respect of the SDGs. We published our Agenda 2030 in March. That was the cross-government response to that. The Office for National Statistics has announced a consultation looking at the best way of producing data and statistics in these matters so that we can track our progress towards the SDG aims. It has some very important elements in it. The noble Baroness, Lady Warwick, was concerned about how those data might be connected. There is a huge new initiative taking place across the UN institutions about collecting data, particularly on the sustainable development goals—what actually works and how it should operate. That is being done by the UN Statistical Commission. We have representation on that and we will follow that, and publish routinely and regularly, in accordance with the requirements of the SDGs, how we are progressing. We will also be able to see online how other countries are progressing towards them. I think this is going to be a major step forward—to reassure the noble Baroness, Lady D’Souza, among others—because once we see countries’ own self-assessment of where they are lagging behind and where they are progressing, we will have an additional level of data to help us ensure that our resources are directed to those who are in greatest need.
The noble Lord, Lord Bruce, also asked why BEIS is the second-highest ODA spender. Of course, that is because the primary objective of BEIS ODA is research and innovation—to reduce poverty by generating and putting into use knowledge and technology to address development challenges and advance development for the poorest in the world. The noble Baroness, Lady Warwick, gave the example of King’s College working in partnership with the Government of Sierra Leone on Ebola. What has been achieved through this, and more widely through development, is incredible, but we still have a long way to go. We have rigorous ways of monitoring the impact and communicating the achievements.
I know that at this point the noble Lord, Lord Judd, will be flinching in his seat, but I ask him to bear with me on impact because it is leading to the subject of effectiveness. We can see that development aid is changing the lives of the world’s poorest. Just today we read about the outbreak of cholera in Yemen, and there is the World Health Organization with 1 million cholera vaccines, desperately trying to get safe access. It is true that you cannot separate the security elements from the humanitarian need in this respect. The noble Lord, Lord McConnell, referred to this as well. Without the security elements, we will not be able to get those vaccines to those who need them.
Just last week, I returned from South Sudan. I was delighted to hear the analysis and the experiences of the right reverend Prelate the Bishop of Truro. I saw the terrible situation there. Were it not for the World Food Programme and DfID’s contribution to that, 1.6 million people who are relying on airdrops of food, through a completely man-made conflict—this is not to do with climate change but entirely to do with the civil war which is raging on the ground—would have their lives put at risk. Therefore, to say that you can somehow separate the security dimension from the humanitarian dimension is not correct.
I will speak about other government departments. The noble Lord, Lord McConnell, referred to the Building Stability Overseas Strategy. Of course, we now have the UK aid strategy—Command Paper 9163—produced in 2015. I do not want to quote extensively from it but that is our new marching point for this and includes significant elements on how we are going to work with global peace, security and governance. I commend it to noble Lords. It says:
“All departments spending ODA will be required to put in place a clear plan to ensure that their programme design, quality assurance, approval, contracting and procurement, monitoring, reporting and evaluation processes represent international best practice”.
It is also right and absolutely fair to say that other government departments are not quite at the level of DfID at the moment. We do not want to crow too much about that because they have not been doing it for as long. My noble friend Lady Chalker is in her place. There is a long tradition and expertise in that area in government, which we want to retain. But that cannot be any reason not to aspire to the highest standards. We have said that we want all government departments that are delivering ODA to be rated either good or very good within five years. An ODA senior officials’ group now meets regularly across government to ensure that lessons are learned and we can assist other government departments in doing that.
The noble Lord, Lord Bruce, mentioned disability. Again, this is part of the SDGs and leaving no one behind, which is a key part of what we are doing. Looking again at our disability strategy is also something that the Secretary of State, Priti Patel, has made a personal passion of. We will be putting additional resources towards that.
The noble Baroness, Lady D’Souza, and the noble Lord, Lord Alderdice, mentioned small grants. I covered this subject in the exchanges in Questions about the small charities challenge fund.
The right reverend Prelate also spoke about what churches could be doing in this area. I will be meeting him tomorrow. Again, I turn to the example of South Sudan. When I was in South Sudan, I met Archbishop Deng—a very gracious man—the Archbishop of South Sudan and Sudan. There are 100,000 churches in South Sudan. What an incredible network that we could be using for peace and reconciliation. I also met Bishop Anthony Poggo, who I am sure is well known to the right reverend Prelate.
The noble Lord, Lord McConnell, mentioned the catalytic impact of private sector investment and the £2.5 trillion gap in private financing. We need to get much more private capital in there. Governments cannot do this alone through ODA. It needs to be through trade, private investment and, increasingly, government assistance providing a catalytic role in that.
Without doubt, UK aid is making a significant contribution to tackling the global challenges of our time. The Government agree wholeheartedly on the importance of measuring its impact so we can fully understand and continue to improve on the very significant contribution the UK is making to the world’s poorest, to stability and prosperity here and to eliminating extreme poverty by 2030. I look forward to continuing these discussions as weeks go on.
Baroness D'Souza
My Lords, I thank the Minister for his response, which was, as always, sympathetic, informative and detailed, and I warmly thank all noble Lords who contributed to the debate.
It is extremely encouraging that DfID is regarded so highly within this House and well beyond it, but there are areas which would benefit from greater scrutiny, particularly, clarification of the objectives and perhaps the strategy of aid itself and aid delivery. A particularly interesting idea is whether we can look further at the potential synergistic effect of bringing together the work of various government departments, the private sector and NGOs.
There are two very small points I want to make. First, many small research-based NGOs are doing some remarkable work on modelling and charting the development process rather than its impact and notably the evidence for development. As the noble Baroness, Lady Sheehan, said, it would be wonderful if they could receive some money to further the work they are doing.
Secondly, it is nearly 60 years since there has been a general debate on the basis for international aid. I wonder whether the UK is in a very good position to be able to lead an initiative to discuss what should be the basis for aid in the coming years.