Tackling Infectious Diseases

Jeremy Lefroy Excerpts

Thursday 20th April 2017 Commons Chamber

[Jeremy Lefroy (Stafford) (Con)]

I congratulate my colleague from the International Development Committee, the hon. Member for Ealing, Southall (Mr Sharma), on his comprehensive speech, which covered a huge amount of ground. I also declare my interest as a member of the boards of the Liverpool School of Tropical Medicine and the Innovative Vector Control Consortium, which develops new insecticides to put on bed nets to counter mosquitos, and as chair of the all-party group on malaria and neglected tropical diseases.

I had the honour on Monday this week to chair a meeting in Washington, as chair of the Parliamentary Network on the World Bank and International Monetary Fund, with Madame Christine Lagarde of the IMF and Dr Jim Kim, president of the World Bank. Dr Kim spoke about infectious diseases and the threat posed by them. He pointed out that we had come together as a world with three countries in west Africa—Liberia, Guinea and Sierra Leone—to tackle Ebola. There was a huge cost of life there, particularly among medical workers, but the co-ordinated action enabled that epidemic to be curtailed; it could have been much worse. He talked also about Zika and the work done on it. He pointed out, too, that a major epidemic of an infectious disease, possibly a flu, which could affect as many as 30 million people resulting in a scale of deaths that we have not seen since Spanish flu in 1919, was perfectly possible and very much on the radar. That illustrates why this debate is so important.

The UK Government have been at the forefront in providing resources for research and development as to tackling infectious diseases and the deployment of those tools in the countries where they are needed, not only in the cases of Ebola and Zika, but, as the hon. Gentleman mentioned, in terms of the rise in the resistance to drugs, particularly for tuberculosis, but also for malaria. Resistance has been growing to the artemisinin-based combination therapy drugs, or ACTs, in south-east Asia, and, as we know, it is always from south-east Asia that resistance grows to malaria drugs; it did for chloroquine and it did for sulfadoxine-pyrimethamine, or SP, and now it is for the ACTs. That is where the real threat from malaria lies: if resistance grows there and then crosses to sub-Saharan Africa, we face the prospect of yet another drug becoming less effective. ACTs have played a huge role in cutting the number of deaths from over 1 million in 2000 to less than half a million last year.

The UK Government have played a major role through the funding of, for instance, the Medicines for Malaria Venture and the Innovative Vector Control Consortium, which I mentioned earlier, and I welcome the announcements this week by the Secretary of State on additional funding to combat neglected tropical diseases. I hope some of that funding will go into developing new drugs in the area, because we have shortfalls in the pipeline for tackling some of those diseases; some have very effective existing drugs, but others do not. We must also not forget the role that vaccines play, as the hon. Gentleman also mentioned, in respect of TB.

As the hon. Gentleman made clear, these are not commercial propositions in most cases. They are not drugs that companies can afford to develop on their own; they need the support of Governments and foundations. It is tremendous how Governments and foundations such as Wellcome and the Bill and Melinda Gates Foundation have stepped up, and indeed drugs companies in the case of neglected tropical diseases, where they have provided billions of doses free across the globe in the past 15 to 20 years.

I want to conclude by giving three reasons why we should be concerned about this matter and taking this action. First, that is absolutely the right thing to do: dealing with diseases that affect people across the globe, and not just the poorest people—the 1.5 billion who suffer from neglected tropical diseases and those who suffer from malaria, TB and HIV—but the people in our own countries who suffer from these diseases. Let us not forget that those people are right on our doorstep and in our midst.

Secondly, this is highly cost-effective. A ratio of about 40:1 has been mentioned, and I have seen that in many places. What we spend on international development has to be extremely effective. In many cases, what we spend on research and development and on treating these diseases is pretty much the best buy in international development, which is why I welcome the fact that the UK Government have concentrated more resources on these areas.

Thirdly, the UK is a world leader. That is even more important now that we are coming out of the European Union. We have institutions such as the London School of Hygiene & Tropical Medicine, Imperial College London, the University of York, the Liverpool School of Tropical Medicine, the University of Dundee and the University of Aberdeen. Many of our universities across the United Kingdom are world leaders in this area, and it is vital that, as we look to create a more global Britain, we do not neglect those areas in which we are already world leaders. That involves a number of things, such as investment in the form of Government support, primarily through DFID and in cash, but also ensuring that the best scientists such as the young researchers who want to come to this country because of our excellence can continue to do so and will not be blocked.

Let us not forget that researchers are often not well paid. If we set salary-based caps for immigration, we will automatically disqualify some of the brightest minds on the planet from coming here, so let us ensure that that does not happen. If we are to have immigration rules, they should be based on the task and not on the salary. Setting a cap of £30,000, for example, would probably exclude half the PhD and other doctoral posts in this country. This is absolutely critical. We also need to encourage our own researchers to go and work across the globe in collaboration with others. This kind of research is not national; it is international, and it requires the widest possible collaboration.

I want to conclude by thanking my hon. Friend the Minister, who is absolutely committed and who I know will have played a major role in the decision on neglected tropical diseases in the past week. This is something we have been waiting and calling for, and the Government’s announcement has exceeded our expectations. That is tremendous. It is great for the United Kingdom and, above all, for the people who are suffering from neglected tropical diseases.

That comes on top of a range of announcements on malaria, TB and HIV. As we come to the end of this Parliament, I hope that all the manifestos—particularly the Conservative manifesto—will contain a commitment to continue to spend 0.7% of our GDP on international development and a repeat of the commitment to make research and development on infectious diseases and the deployment of those resources a key priority for the new Government.

DFID’s Programme in Nigeria

Jeremy Lefroy Excerpts

Thursday 23rd March 2017 Westminster Hall

[Jeremy Lefroy (Stafford) (Con)]

I apologise for not being here at the beginning, Sir David. I was participating in the debate in the main Chamber. I am glad to follow the hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron). She has highlighted a lot of the very important issues. I would differ slightly with her on education, but I will come to that.

One thing that struck me more than anything in our visit to Nigeria, which was my first visit to that country, was when we were in Abuja and we visited a refugee camp where the refugees were cared for not by an outside agency or the United Nations, but by Nigerians themselves and by Christian organisations and mosques. The teachers gave up their time, often voluntarily, in a school that was almost in the open. I felt that Nigeria was a hugely self-reliant country, but, as the hon. Lady has said, perhaps the people are sometimes not supported sufficiently by their own Government. Nigerians are hugely entrepreneurial and dynamic people, but I believe they are sometimes a little held back. However, I felt that their caring for their own in the refugee camp in the middle of Abuja, where there were refugees from the north and particularly from Borno state, was a microcosm of what so many Nigerians do for each other across the country.

Education is clearly something for which the Chair of the Committee has a huge passion—as do we all—and he has made it a hallmark of its work. I welcome that. I agree that perhaps aspects of the schools that we visited in Kano surprised us, but other aspects encouraged me. For instance, in the Koranic schools we saw that, almost for the first time, many of the children were learning subjects to which they had not had access before. The curriculums that they were using—which have been largely supported through DFID—were encouraging; they were not, perhaps, the finished article, but they were probably a step forward from what there was before. Clearly, we want much more of an advance. We want girls’ education to be absolutely right; we want them to get the same education as boys. However, it was a step forward.

The other school had something like 13,000 children. It is one of the biggest primary schools in sub-Saharan Africa, if not the biggest, and, again, I felt that progress was being made. We visited a class with disabled children, where an effort was being made on their behalf. Clearly, in comparison with our education system or those of other middle-income countries—Nigeria is, of course, such a country—there are great shortfalls. Nevertheless, improvements are being made, particularly by one of the two education programmes that DFID is running in the north. Progress is being made, and much more could be done, but clearly that is fundamentally an issue for the Nigerian Government. In a country as large as Nigeria, DFID can only really supply technical advice and a little support here and there.

That brings me on to corruption, tax collection and so on. I share the views of the hon. Member for East Kilbride, Strathaven and Lesmahagow about the anti-corruption building. I was more interested in finding out about the anti-corruption work than I was in seeing a half-finished building in which that work might take place in future. There is little more to be said other than that I hope the building will be finished and that the work that is done in it will have a huge impact. I am not sure that the UK Government should finance the building. We should support the work that goes on there but not the infrastructure.

I was encouraged by the work on health that we heard about through some of our meetings in Abuja. I am the chair of the all-party group on malaria and neglected tropical diseases and I have a particular interest in the area, as does pretty much every Member attending the debate. We heard of the great progress that has been made in reducing the incidence of malaria across Nigeria, which, along with the Democratic Republic of the Congo, still has the largest burden of malaria in the world. We heard particularly of progress in the northern regions—the Sahel region of Nigeria, where there can be intermittent malaria, particularly in the rainy season.

We visited a midwife training school based at the hospital, and the pharmacy there. I was extremely impressed with the pharmacist, who was clearly dedicated to her work to prevent malaria. She contacted me and the all-party group after the visit and said, “I want to do something on World Malaria Day”—which was a month after our visit; “can you help us?” The all-party group agreed to send an amount of money—I think it was about $1,000; and with it the pharmacist co-ordinated a magnificent World Malaria Day event. She invited local people, local government leaders and health leaders, and also managed a mass distribution of bed nets. It was all done voluntarily and it showed the spirit of individual Nigerians—how they really want to work on behalf of their country and people. I very much hope that the same thing will happen again this year, and that our group will support it if it does. For $1,000 I think the impact was substantial, based on the report we received.

It is not only on malaria but on neglected tropical diseases that the work supported by DFID in the north has had a great impact. I believe that that programme is just coming to an end, and I urge DFID to look at supporting a continuation of the work. We know that, if work in areas such as neglected tropical diseases and, indeed, malaria is halted for a while, those diseases can come back. Clearly, we want the Nigerian Government to take up the work on NTDs. In the meantime I should like the Minister’s reassurance that DFID is considering supporting a continuation—perhaps in a different way—of the programme on NTDs in the north of Nigeria. I should declare an interest, in that I am a member of the board of the Liverpool School of Tropical Medicine. I want to make that clear as I know that the school has great engagement in Nigeria and with DFID programmes, although I am not sure in what respects.

The economy in Nigeria has been far too dependent, clearly, on oil in the past decades, but a real effort is being made to expand and diversify it. That has been made necessary by the fall in the price of oil. The hon. Member for East Kilbride, Strathaven and Lesmahagow rightly mentioned the lack of women in senior positions, and particularly the lack of women Members of Parliament. However, the Finance Minister of Nigeria is a woman, whom we had the pleasure of meeting in Abuja, and who was committed to reform of the Nigerian economy. I should hope that she—and, indeed, her reform-minded, progressive colleagues—would get the fullest possible support from the British Government, whether through DFID or the Foreign and Commonwealth Office, in their efforts to ensure that the economy of Nigeria works for everyone.

I want to touch on the issue of food, food security and famine. We have heard from the Government and from colleagues across the House of the issues in Nigeria and east and central Africa. I welcome the generosity of the British public in supporting the Disasters Emergency Committee appeal for east and central Africa. Perhaps the Minister will outline for us the current situation in Nigeria, as it is a year since we were there. Nigeria has a proud reputation of wanting to help itself to deal with such issues, but I want to find out what the current food security situation is. Our efforts are concentrated on east and central Africa, but we would not want countries in the Sahel—not just Nigeria but Chad, Mali, Niger and others—to miss out on the efforts that are being made. Whether we like it or not, the UK is a leader in the area; particularly given concern about the potential withdrawal of United States funding it would be a problem if areas where the UK is not so prominent fell behind because they are not on our radar. I should appreciate an update from the Minister about that.

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[The Parliamentary Under-Secretary of State for International Development (James Wharton)]

I thank hon. Members for their contributions and the very broad range of issues that they raised. In particular, I thank my hon. Friend the Member for Mid Derbyshire (Pauline Latham), whose tour de force opening comments covered a broad range of subjects—I hope I have been able to note them down sufficiently to answer her questions. In line with her gentle suggestion, if I fail to address any of her questions, I would of course be delighted to enter into further correspondence or discussion with her, as indeed I always am.

I am going to do my very best to go through the broad range of issues that hon. Members have raised, but I am going to base my comments, in the first instance, on my hon. Friend’s excellent contribution. She asked some specific questions at the end, but also talked in informative and in-depth terms about the Committee’s report and the Government’s response. The hon. Member for Glasgow North (Patrick Grady) spoke in his typically witty and engaging way, and said, in a politically carefully worded phrase, that the Government were partially in agreement. I think that is probably fair. To be partially in agreement is often that for which we should strive in this place. Were he and I to find ourselves completely in agreement, I suspect that either I would be wrong or he would be right—I am not sure which it would be.

My hon. Friend the Member for Mid Derbyshire talked about power. I will start there, as the shadow Minister chose to end there. Power sector reform is crucial for Nigeria. I do not need to remind hon. Members that power supply can be a key perquisite for sustainable growth. I am sure they are aware that in early 2016 Nigeria’s power sector supplied an all-time record amount of power, but that since then disruption, and even terrorist activity in some cases, has impacted on its capacity. However, I am pleased to inform the House that supply levels are approaching those of early 2016.

We are clear that reform is needed. It is clear that significant investment is needed in Nigeria’s power system. Over 60% of Nigerians do not have grid connection, which holds back economic growth. Intermittent supply presents real challenges for those who wish for certainty and investment. Reform was necessary. The shadow Minister alluded to the involvement of the occasionally controversial Adam Smith International, which has had its fair share of coverage. We are reviewing some of our relationships with it.

It is important to recognise that there are pluses and minuses to all change. Along with the price increases that have come from privatisation and the removal of some of the artificial subsidy within the power system, fixed charges for those who do not use power have been removed, and the lowest volume users have been protected through reforms that have taken place. Much more needs to be done for the power sector in Nigeria. We need to build on the reforms we have seen and continue to review and improve on changes that have been made. The interest that hon. Members take is welcome.

We have had a wide-ranging discussion about the importance of education. The Girls’ Education Project, which is in phase 3 in Nigeria, is one of the programmes that DFID in the UK supports. As my hon. Friend the Member for Mid Derbyshire recognised, it has seen reform and improvement and is now an A-graded programme, having had some issues in the past. We are helping more than 23,000 girls to stay in education through small cash transfers, which we discussed in the previous debate and which was raised in particular by the shadow Minister. There is no doubt that a significant amount needs to be done and that education is important in driving change and ensuring that a country such as Nigeria can develop its way out of some of the challenges it faces.

The sixth question asked by my hon. Friend was about sustainable development goal 4, which was also raised by the hon. Members for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) and for Liverpool, West Derby (Stephen Twigg) and my hon. Friend the Member for Stafford (Jeremy Lefroy). There is no doubt that there has been insufficient progress to date in Nigeria on education. Access increased by only 4% between 2003 and 2013, and the poorest are even less likely to complete schooling. That is why education is a real focus for DFID in Nigeria and why we have the programmes we have. However, it would be unrealistic not to recognise the scale of the challenge and the fact that more needs to be done and constant scrutiny is required. I welcome the work of the International Development Committee in that space.

[Jeremy Lefroy]

The Minister will know that African countries committed quite a long time ago—I think it was in the early 2000s—in the so-called Abuja declaration to spend 15% of their budgets on health. Indeed, some of them, including Rwanda, have reached that target or are not far short of it. That commitment was made in Nigeria. Does he agree that it would be very welcome if a similar commitment were made by sub-Saharan African countries and other developing countries around the world to spend a specific amount of their budgets on education, which we have seen far less commitment on than health?

[James Wharton]

My hon. Friend makes a relevant and important observation. The long-term sustainability of education in countries such as Nigeria must be founded on Government support and investment. We want to see and encourage more of that. We can offer direct support, as we do now, for those who need to benefit from it. We can offer technical assistance and support in training teachers and establishing curricula. However, for long-term sustainability, domestic Government support is required. My hon. Friend’s suggestion deserves a good airing and consideration, and I suspect we have not heard the last of it.

My hon. Friend the Member for Mid Derbyshire mentioned the Chibok girls. That issue caught the attention and imagination, in the most dire of circumstances, of much of the broader global community. It has drawn attention to the terrible conflict in north-east Nigeria and the effect of Boko Haram not only there but in neighbouring countries. I will go on to talk about some of the challenges with the humanitarian response that is required, but specific questions have been asked about the girls by hon. Members, including the hon. Member for East Kilbride, Strathaven and Lesmahagow. One hundred and ninety-five of them remain to be released, which is a significant number. There are significant challenges in addressing that. Much of north-east Nigeria remains a challenging area in which to operate. Boko Haram is not yet defeated, although there are some signs of progress. The UK provides significant support in that work, including a recent commitment of a further £5 million in funding. We offer and indeed give training to the Nigerian armed forces; more than 20,000 personnel of the armed forces have now received training supported by the UK Government. We must continue to fight radical terrorism in all its guises. Today of all days, I do not need to remind right hon. and hon. Members of that or of the scale of the threat faced by so many people throughout the world. The Chibok girls are a stark and poignant reminder of the scale of the challenge that many countries face.

Many others are of course affected by the conflict in the north-east, Boko Haram and the other challenges there, but I am pleased that we are playing the role we are playing, even though I am not pleased that it has not been possible to make more progress. However, we will continue to focus our efforts in that area and to provide appropriate support that can make a difference in the medium and longer terms.

The humanitarian crisis is a significant one. About 5.1 million people face a severely difficult environment; they face food insecurity. If we take no action, we estimate that somewhere in the region of 90,000 children could die. That is a stark and worrying figure, and one with which the world and the global community must engage. Indeed, I am pleased to recognise that the global community did engage at the recent conference in Oslo and has committed a significant contribution to the amount of funding that is needed: more than $400 million has been committed. More is needed, and we expect more to be committed in due course, but the $1 billion target has none the less not yet been reached.

The Government of Nigeria, however, have made their own commitment to spend $1 billion in the north-east. We recognise that that is a welcome announcement and that it gives the Government of Nigeria an opportunity to present themselves as a true world leader in this space, and Nigeria as a country that is serious about humanitarian issues and about tackling the problems it finds within its own borders. We must encourage them to do so, so their announcement is welcome. We look forward to working with them to ensure that the money materialises and is spent in the right way, so as to have the maximum beneficial impact that it can. I expect we will see further announcements on this over the weeks and months to come.

I thank those right hon. and hon. Members who have taken the time to meet me, whether one to one in recent weeks or at the drop-in session that I held with officials to brief interested Members of this House and the other place on the work of this Government, on the broader situation in north-east Nigeria and on the other famines throughout the globe, in particular in Africa, in what is set to be a very challenging year indeed.

The fifth question of my hon. Friend the Member for Mid Derbyshire was on strengthening joined-up working across UK Government Departments. In my eight or nine months at the Department for International Development, I have been pleasantly surprised by the extent to which that already takes place. I am keen to drive it further and I have regular discussions with my counterparts in the Department for International Trade and the Foreign and Commonwealth Office, and have had meetings with Ministers and officials at the Ministry of Defence, to discuss a broad range of issues across the portfolio that I oversee. That has included discussions about the situation in Nigeria. We need to continue to drive cross-Government collaboration, to break down silos and to make a reality of one HMG.

The truth is that, when people look at UK Government engagement, they do not see the Foreign and Commonwealth Office, the Department for International Development, the Ministry of Defence or whatever it might be; they see the UK Government, the role they play in the world and the contribution that they can make. Together we can make a greater contribution than in our individual departmental parts. I recognise that. It is a message that I reinforce continually to the teams for which I am responsible in DFID. It is an area in which we are making significant progress but, following this debate, I will take the opportunity to continue to push it, because it is one in which we can always do more. The more we can do, the greater the net achievement will be.

Many hon. Members have spoken about health and health systems. I particularly recognise the comments made by my hon. Friend the Member for Stafford on the importance of tackling malaria. I commend him for the work he does; he supports this area of debate and activity and the work of Government in this area in particular. He is aware of the Support to National Malaria Programme—SuNMaP—in which the UK Government are engaged in Nigeria. That £50 million contribution—the figures underline the importance of our work to tackle malaria on a global scale—aims to reduce the number of children who will die before their fifth birthday from 128 in every 1,000 to 80 in every 1,000 by 2022. Eighty is still far too high, but it underlines the significant threat that malaria in particular poses to so many of the world’s poorest children and to developing nations. It is a disease that we can beat and are committed to beating. I am pleased that this is an area in which, along with the UK’s part in the Global Fund, programmes such as SuNMaP are making such a significant contribution.

My hon. Friend also mentioned neglected tropical diseases—another very important point and one that is not lost on the Secretary of State, who is very keen to pursue further work in the area.

Our programme in Nigeria being our second largest bilateral programme in Africa, it is one in which I take a very keen interest as the responsible Minister. In recent weeks, I have had significant and in-depth discussions with our teams, including in Nigeria, going line by line and component by component through the programmes that DFID supports there and talking about our strategy for the future and where we need to go to have the maximum impact with the money that we spend.

The hon. Member for East Kilbride, Strathaven and Lesmahagow, in particular, talked about the need for a strategy—the need to see where we can make a long-term difference. I can assure her that that message is not lost on me as the responsible Minister or on our team in country, with whom I have been having those discussions. We expect to see changes as a result of those discussions, but it would perhaps be premature for me to pre-empt now what they might be. However, she is absolutely right to say that we need a ruthless focus on value for money, on where we can make a difference and on the impact that we can have. We need to ensure that we identify those programmes that are working and those that could work better, either change or close programmes and then reinvest to ensure that we get the maximum impact we can.

We need to recognise that there are big challenges in countries such as Nigeria. Corruption, which was mentioned by several hon. Members, is a key cause of poverty and a key factor that can hold back development. It is not like me to disagree with the former Prime Minister about much—actually, in effect, I do not disagree with him about this—but corruption cannot, in any context, be fantastic. To be fantastically corrupt is to be terribly so. That, of course, is what he really meant, and the attention that he drew to the issue was welcome. We have significant programmes, including Anti-corruption in Nigeria—ACORN—and PERL, the Partnership to Engage, Reform and Learn, both of which engage with government structures and civil society groups, through which we are working both to empower people to tackle corruption when they see it, and to ensure that institutions have the tools to address it.

Several references were made to particular individuals and individual cases. With hon. Members’ permission, I will not talk about those cases, because many are live, but they make clear the point that we need to pursue corruption wherever it might hide, from the lowest to the highest levels, without fear or favour. We must always be alert to the risk that anti-corruption work will be focused on the political enemies of the people who control the direction of that work, and we are. We should be proud of what we do in this area. The work that we do to tackle corruption is an absolutely necessary and vital prerequisite for securing the long-term sustainable growth that we all want to see delivered and we all recognise Nigeria has the potential to secure.

Nigeria is a relatively affluent country in its region. It is blessed—or perhaps cursed—with significant natural resources. It accounts for about a quarter of the population of sub-Saharan Africa. It presents one of the greatest opportunities for growth and one of the greatest dangers of instability on that continent. We are right to be engaged there, we are right to play a key role given our historical ties and the country’s importance for the future, but we are also right to scrutinise what we do and to hold to account those who are responsible for it.

I therefore welcome the Committee’s work and thank hon. Members for their contributions and questions. I hope that I have addressed most of the points that my hon. Friend the Member for Mid Derbyshire raised, but I know that she will take me up on any that I omitted to comment on. I look forward to continuing our work and the positive and constructive dialogue that we have had today as we all strive to improve life and realise the opportunities that exist for the people of Nigeria. Nigeria is a friendly and important nation that I hope we will continue to trade with, and I am confident that its economy will become further entwined with that of the UK as both nations develop and march forward into the world in a way that will deliver benefits for both our peoples.

Commonwealth Development Corporation Bill

Jeremy Lefroy Excerpts

Programme motion: House of Commons & 3rd reading: House of Commons & Report stage: House of Commons
Tuesday 10th January 2017 Commons Chamber

[Kate Osamor]

The hon. Gentleman makes a valuable point, but the Bill still needs scrutiny. That is what I am laying out.

We all know that transparency is something that DFID does very well indeed. Its performance in the aid transparency index demonstrates an international gold standard in that regard. Historically, however, the same cannot be said for CDC. It is of the utmost importance that the proportion of the ODA budget that is channelled through CDC be subject to the same checks on outcomes and value for money to which DFID holds itself. New clause 4 lays down conditions that would guarantee transparent governance through an agreed framework reached with the Independent Commission for Aid Impact and CDC. Proper annual measurements of outcome would be a welcome addition to the Bill.

In relation to new clauses 1 and 8 and the issue of CDC use of separate financial centres where countries do not have sufficiently robust regulatory environments, now is the time to put on record the Government’s commitment to strengthening financial service centres in developing countries. The Opposition know that the importance of addressing and tackling CDC’s use of tax havens cannot be overstated. Although we heard assurances in Committee from Diana Noble, the chief executive of CDC, that using offshore financial centres ensures legal certainty and lessens risk for investors, far more than reassurance is needed to ensure transparency on that point. We need clear legislative safeguards, which is why the Front-Bench team will press new clause 1 to a vote. New clause 1 requires any proposal to increase the limit by secondary legislation to be accompanied by a thorough analysis of CDCs use of such centres. Where the countries in question do not have sufficiently robust regulatory environments, it is the UK’s job to ensure that those centres are made more robust.

[Jeremy Lefroy (Stafford) (Con)]

The hon. Lady makes some important points. Does she agree that the changes made to CDC five years ago, under which CDC was encouraged to make direct investments in developing countries—contrary to the preceding situation, in which it made investments in funds situated offshore—were a major step forward?

[Kate Osamor]

The hon. Gentleman makes a valid point, and I will touch on that in my speech. Regardless of any development, we must always be robust and we must be able to show taxpayers that we have a transparent and accountable system. That is at the forefront of our objections to the Bill.

I seek assurances from the Minister of State, the hon. Member for Penrith and The Border (Rory Stewart), that he will consider supporting the implementation of such safeguards. It is of course to be applauded that the whole ethos of CDC has been transformed since it was the subject of widespread controversy some years ago. It is testimony to the organisation’s willingness to change that it reacted to that criticism by becoming a more positive institution and implementing an overhaul of the systems that were in place. These efforts were praised in the most recent report by the National Audit Office, which assessed CDC’s progress in implementing the recommendations that the NAO made in a report in 2008. It was heartening to read in the follow-up report that CDC has proved successful in adapting its strategy in accordance with NAO’s earlier recommendations, including instituting frameworks to limit excessive pay and to refocus CDC’s priorities on the world’s very poorest nations, rather than investing in markets that already attract foreign investors.

[Jeremy Lefroy]

Will the hon. Lady give way?

[Kate Osamor]

No, I need to make some headway.

It was also encouraging to learn that CDC has not only met but exceeded the targets agreed with DFID relating to its financial performance and development impact, and has improved its procedures for documenting fraud and corruption. Although we on the Front Bench praise CDC for making those changes, we must not forget that the recent NAO report was by no means unequivocally positive, and that it highlighted significant areas for improvement. Allow me to quote directly from a passage in the report examining the efficiency of CDC’s methods of capturing its development impact:

“It remains a significant challenge for CDC to demonstrate its ultimate objective of creating jobs and making a lasting difference to people’s lives in some of the world’s poorest places. Given the Department’s plans to invest further in CDC, a clearer picture of actual development impact would help to demonstrate the value for money of the Department’s investment.”

That is quite some statement. According to the NAO, it is “a significant challenge” for CDC to demonstrate how effectively it does the very thing it was set up to do.

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[Mrs Drummond]

No, because we are investing in very difficult areas where robust systems may not already be in place, plus the CDC has very clear guidelines about where the money is going, so we can track it much more easily than we can with other aid agencies.

[Jeremy Lefroy]

Does my hon. Friend agree that the issue is not so much about offshore centres being invested in by funds from a variety of jurisdictions, but about the tax paid in-country for activities undertaken in that country? In that respect, the investments made by the CDC are excellent and provide major tax revenues of billions of dollars a year for those country’s Treasuries.

[Mrs Drummond]

I thank my hon. Friend for his very clear explanation, which beefs up what I have said.

On the case for raising investment limits, amendments l, 3 and 6 and new clauses 2, 5 and 10 would hamper the CDC in the same way. We have already extensively debated the need to increase the limit, and we have had assurances from the Minister and the CDC that business cases for further capital will be clearly made. We will have the full strategy document this year, backed by an analysis from the CDC of the development impact. We will have both before any additional money goes through the CDC.

On the focus of spending, I agree with my hon. Friend the Minister that the question of which specific investments are made must be delegated to DFID and the CDC. That would give the Government oversight and ensure that sustainable development goals are at the heart of the investment. Putting countries or, indeed, limiting sectors in legislation would make delivering the development process cumbersome, and I believe that it would hobble the CDC.

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[Jeremy Lefroy]

Whether people live in the United Kingdom, Tanzania or Colombia, the most important route out of poverty is a good job or a good livelihood, and that is why I fundamentally support the work of the CDC. It has done excellent work throughout the world for nearly 70 years, and in recent years it has concentrated on the most needy countries, where there is the highest level of unemployment or the highest level of poverty. I welcome the fact that the Government are to invest more through the CDC in the coming years.

However, I think that today’s debate, and our debates in Committee and on other occasions, have made it clear that the CDC must be careful. It must invest in areas in which commercial investors would not normally invest; otherwise, it should be the commercial sector that invests in them. The CDC must invest in the areas that create the greatest number of jobs in return for the investment made. That will often involve agriculture, and it will often involve difficult investments, because it is not easy to invest in agriculture in remote areas. However, that is what the CDC is there for: it is not there for an easy life. I know that—given the management that it has had recently, and given the calibre of its staff—it is up to those challenges, and I welcome the Bill.

Commonwealth Development Corporation Bill (First sitting)

Jeremy Lefroy Excerpts

Committee Debate: 1st sitting: House of Commons
Tuesday 6th December 2016 Public Bill Committees

[Fiona Bruce (Congleton) (Con)]

Q I would like to ask Diana about job creation. You say that one of CDC’s key strategic aims is to achieve development impact focused on job creation. How do you measure jobs that are created directly and indirectly? Last week, the National Audit Office said in its report that progress on measuring job quality has been slow. How are you working on that? How are you measuring productivity, quality of jobs and income levels?

Diana Noble: As you rightly point out, we focus on jobs because we believe a job is the first and the best step out of poverty. I think everyone on the Committee understands the difference that a job makes to someone in a poor country: to them and to their family. When we talk to workers it is clear that they also use the income particularly to educate their children, so it has a benefit for future generations. How do we measure job creation? This is something that we take very seriously. Two years ago, in partnership with some academics, we put in place a way to measure job creation across the whole of the Africa and south Asia portfolio.

We are the first DFI to collect data from all our portfolio companies. We do not just collect headcount data; we also collect revenues, supply chain, purchases, work and wages as well. The academic uses that to calculate not just the direct job creation but the indirect job creation. As you can imagine, some of our priority sectors, such as financial inclusion and particularly infrastructure and power, have a far greater job impact beyond the direct jobs. So we have now published the methodology on our website. We are going to go through a peer review process because we want it to become one of the industry standards. We have shown the data from that for two years now. We can start to compare and contrast it. It shows that the portfolio has created over 1 million jobs in the past two years. That is a number we take immense pride in.

You also rightly talked about job quality, because it is not just about volume. Quality has lots of different elements to it. What all of us sitting in this room might consider a good job is not necessarily so with the lens that you should use in the countries where we invest.

On job quality, before we make an investment, our fantastic environmental and social team go and sit down with the company and do due diligence on them. They say, “Are you up to standard, particularly in the areas of health and safety?” If they are not at the right standard, an action plan is agreed with management and put in place.

The second thing we do is collect data across the portfolio on fatalities and serious accidents. We have been doing that since 2008. We have very rich data now and have been able to combine that and give training back to portfolio companies and fund managers about the areas that lead to fatalities and serious accidents. We think that gives huge added value to our portfolio.

We are going further than that. We are collecting information on lost time injury frequency, particularly for manufacturing and construction—places where workers are potentially put at harm. We are looking at staff retention for some of our larger investments, because we are advised that it has a big correlation with job quality. We are doing an evaluation in Bangladesh at the moment—everyone on the Committee will be aware of the issues in garment factories there—to try to understand what workers really want out of their jobs, so that we can build that in. There is a big element of learning. We are on a journey, and there is still a long way to go.

[Jeremy Lefroy (Stafford) (Con)]

The question I wanted to ask has been asked, Mr Streeter.

[The Chair]

So we move on to Patrick Grady.

Commonwealth Development Corporation Bill (Second sitting)

Jeremy Lefroy Excerpts

Committee Debate: 2nd sitting: House of Commons
Tuesday 6th December 2016 Public Bill Committees

[Stephen Doughty]

The Minister suggests we should not be sceptical of the Government and their intents. It is the role of this House to be sceptical of the Government and their intents. To suggest that Ministers are going to take powers but might not use them is a slightly curious argument: I have not seen many cases of that in the past. The timing of this is very odd, given some of the other circumstances, which I will come on to.

[Jeremy Lefroy (Stafford) (Con)]

Will the hon. Gentleman give way?

[Stephen Doughty]

I will give way in a moment, but I just want to make one point. We have seen a very important change in the definition of the ODA, which occurred only last year. Previously, as I said on Second Reading, it was the issue of the CDC net disbursements that contributed to our ODA figures. Normally we looked at the money that the CDC was investing, returns from that investment, the function of the two and ended up, usually, with a positive number. Over the past five years it had been a £100 million or £200 million positive contribution to our aid effort. In fact, last year it would actually have been a negative contribution of minus £9 million. However, the Government changed the rules. They decided to count the capital inflow into the CDC—all of it, in its entirety—as ODA, as aid, rather than the function of what is actually, potentially, being achieved.

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What is to prevent the Government in the future from putting pressure on the CDC, regardless of whether it wants the money, to spend, use or request, through the process that the Minister has described, large sums to bump up the figures to show that the Government are, for example, meeting the 0.7% aid target? Before the Minister jumps to his feet to say, “Oh no, that would never happen,” let me say that he knows full well that it has been the habit of all Governments, of all colours, to look at how figures are presented, move things around and reclassify things in an attempt to meet wider targets and wider agendas. Obviously, a certain amount of that goes on all the time, but it does look very odd that we are seeing this huge rise, this huge potential new power being given, at the same time as the definition of how that is counted is changed. That is where my scepticism and that of many others comes from.

[Jeremy Lefroy]

It is a pleasure to serve under your chairmanship, Ms Ryan. The hon. Gentleman raises a very important point about the capacity of DFID and, indeed, the capacity of the two continents—Africa and part of the continent of Asia, south Asia—to absorb this kind of money, but does he not agree that one major challenge facing the world at the moment is the need to create in the next 15 years 1 billion jobs, most of which will be in those countries, and that the amount of money that we are talking about is tiny in comparison with the amount that would be required to create those jobs and thereby to alleviate poverty?

[Stephen Doughty]

I agree that the challenge of creating jobs is huge and one in which we and others should be playing a role, but it is not solely our role. Again, I hope that one question that we will get on to discussing is whether we should be providing what is in effect private capital in some of these locations or whether the capital should be coming from other sources: other Governments, institutions or DFIs. Indeed, should that be the responsibility of the Governments themselves? We will undoubtedly come on to that in discussion of some of the new clauses, but one of my fundamental questions is about the focus of this money: where is it going currently, and is it doing all that it could do? Professor Collier himself said this morning, in relation to the current bias of funding towards south Asia and India in particular, that he thought that there should be more focus on Africa. I agree.

[Jeremy Lefroy]

I agree, too, on that point. Will the hon. Gentleman also accept this point about the other DFIs? The Dutch DFI has invested far more money than we have, and the Netherlands has a population one quarter the size of the UK’s. The French Proparco is in a similar position to the UK, but the Germans have invested three times as much. We are laggards in this respect.

[Stephen Doughty]

We are not here to discuss the Dutch DFI, but I do know a reasonable amount about it. It provides only marginally more than us. It does do interesting work; it does not do exactly the same work as us. I do not know its history of recapitalisations and how much additional ODA money it has received recently. It would be interesting to look at that. However, the question here is this. What is the best use of our money? Are we not investing or have we reduced investment in other sectors where we could be using our aid in order to do this, and is that the right choice? That is the question before us, and when we look at, for example, DFID’s closures of bilateral programmes in places such as Burundi, we do not have clarity from the bilateral aid review on whether there will be further closures or changes.

We have heard worrying things about cuts in bilateral funding for HIV/AIDS programmes, despite the good money that is going into the global fund. We have seen a shift away from certain sectors and from budget support. We have seen a shift away from investing in free healthcare and education, and in teacher salaries, and with removing user fees for healthcare, for example. When the CDC invests in private healthcare and private school systems, we might have a debate about the role that voluntary and private play in healthcare and schools, but again it is an opportunity cost—it is a choice about where we invest these things.

I accept the hon. Gentleman’s wider point about the importance of jobs, investing and crowding in capital into some of these sectors, but we have to question what we should be doing with our money and whether that is right versus other potential sources. I contend that the Government simply have not come forward with a case that justifies this level of cap. Some increase in the CDC’s budget might be justified, but certainly not at this level.

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[Patrick Grady]

I thank my hon. Friend for that point. The point of equity and proportionality is what I am trying to test. As I have said, under my formula, the figures would come out not that much lower than the caps proposed in the Bill. Let us accept, in good faith, that we will hear some rationale for those caps. My formula would take us not a million miles away from those numbers. The point is that under my formula, the caps would vary over time, depending on what the total ODA spend was likely to be.

Even if the Minister objects to the particular formula, I will be keen to hear why some kind of proportionate formula is not preferable to the hard numbers in the Bill. We have heard about other amendments that probe those numbers. A formula that linked the caps to the total ODA spend over a period of time surely would help to clarify the link with the overall amount of ODA and the balance of the Government’s development priorities, which we will discuss when we debate the new clauses.

[Jeremy Lefroy]

I will make four brief points. First, there are several reasons for bringing forward the Bill, but one of the major reasons is that reducing the expected rate of return of the CDC’s investments, which I absolutely agree with, creates a need for more capital.

Under the last Labour Government, the CDC grew substantially, was well managed, invested in funds and made a lot of money out of significant investments, such as that in Celtel. All of that was good and I welcomed it, but it perhaps was not in accordance with the CDC’s original mission, although I would argue that it helped to reduce poverty. Capital was generated internally to quite a considerable extent. The required rate of return was relatively high, those returns came in and that money was reinvested.

Now that CDC is quite rightly supposed to focus on harder investments with lower rates of return and higher risk, there inevitably will not be as much free cash flow or free capital available for investment, so the shareholder —the UK Government, DFID and the taxpayer—needs to be prepared to put in more capital if we are to meet those objectives.

The second point is about middle-income countries. I fully accept the Minister’s point about the importance of targeting lower-income countries wherever possible, but let us not forget that the range for middle-income countries is, frankly, ridiculous. It goes from just over £1,000 to £13,000 per year. At the lower end are countries that are basically low-income countries and at the higher end are relatively wealthy countries. If we categorise all middle-income countries as somehow moderately wealthy, that is simply not the case. There was a point—not now, sadly, because of what is happening there—when South Sudan was briefly a middle-income country; look at where it is now. We have to be very careful when we talk about middle-income countries as though they are a homogenous group; they are not.

[Stephen Doughty]

The hon. Gentleman is making an important point and I have no doubt we will discuss this further. Is he not concerned, though, when he looks at the amount that is going into India, for example, and at individual states within India, where the majority of even the CDC’s new disbursements are still going to the richest states rather than the poorest? The top disbursement was to Maharashtra, where Mumbai is.

[Jeremy Lefroy]

Absolutely, we should look at that. However, there are more of the poorest people in India than in the whole of sub-Saharan Africa. If you take the view that a company in India in which you invest is likely to have national ambitions and wants to work across India, you would hope that it would therefore target the poorest as well as those who are perhaps better off. I agree, though, that the CDC needs to look at this and ensure that it does not stray back into the realms of investing only in fairly soft, nice, high rate of return investments.

My third point is about employment. I have already mentioned the figure of 1 billion jobs. The World Bank says that 600 million jobs are required across the world in the next decade; others have put it as high as 1 billion. There will be more of those 1 billion jobs in the middle-income countries than in the low-income countries, so we need to invest across the two if we are to tackle this enormous threat.

I was in Tunisia last week at the launch of the Parliamentary Network’s middle east and north Africa chapter—I chair the global network. The problems that a country such as Tunisia faces, with a population of 10 million and unemployment among graduates of 60%, are enormous. We know the social consequences of that. Tunisia has a very high rate of young people who have gone to Syria and Iraq to fight for Daesh. That is one consequence of the very high rates of unemployment and the lack of hope in those countries.

Finally, this is about investment. We talk about money being spent, but it is actually investment. Once it goes in, provided it is well-managed, it is recycled. As I have said, the money that made about £500 million of profit from Celtel under the last Labour Government was recycled into investment and is still there. Some of it may have been invested twice since then. This is not a one-off hit where we make a grant to an organisation and it does excellent work, but is then gone. It is money that goes round and round, that is recycled and that creates jobs.

[Stephen Doughty]

The hon. Gentleman makes an interesting point and I agree that it is investment and it is recycled—the CDC has shown that. However, does he not agree that that applies to our whole aid budget? If we invest in the education of a girl through a bilateral programme, with the opportunities that provides in her life and the opportunity it gives her to contribute to the economy, that is, similarly, an investment.

[Jeremy Lefroy]

Yes; I do not disagree with that.

[James Duddridge]

The hon. Member for Cardiff South and Penarth is wrong. It is not an investment in the same way, in that it is not so easily controlled. An investment in a girl’s education is, indeed, an investment, but we are discussing an investment that has an actual return, which we can reinvest and have some degree of control over, as the aid budget is targeted in different ways. It is a different type of investment. As I said on Second Reading, it is a gift that keeps giving.

[Jeremy Lefroy]

I will conclude by saying that I feel a little like I am in the middle of a great argument, but I probably agree in some way with both Members.

[Kate Osamor (Edmonton) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Ms Ryan. This is the first time for me, but I am sure there will be many more.

I want to speak about investment. That word has been used many times and in the absence of an investment strategy from the CDC, we feel very sceptical about why we should use taxpayers’ money in this way. It is only fair to ask the Minister to present that to us, so that we can have a debate in which we feel we have all the information. That is my brief contribution on this group of amendments.

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Those are my main points. Is the capacity there and does the Minister see indirect investment as having a significant role in the future? Does he share the view that identifying first-time funds in developing countries is an important part of our agenda and will he recommit himself to the issue of equivalence of respect through this amendment?

[Jeremy Lefroy]

I accept that the potential increase from £6 billion to £12 billion is very substantial. I note that subsection (3) talks about regulations. Does the Minister envisage gradual increases, perhaps of a billion at a time, through regulations under secondary legislation? I believe that secondary legislation is a very adequate way in which to do this and that hon. Members need to take it very seriously, as the hon. Member for Cardiff South and Penarth has mentioned. However, it might reassure Members if somewhere in the Bill or in an amendment it was stated that the increases would be no more than, say, £2 billion at a time. After all, we are now considering raising the amount by £4.5 billion in the Bill, yet, as I understand it, we are looking to put it up by £6 billion through secondary legislation. It might therefore be proportionate to indicate that we would expect the Government to come back to the House on more than one occasion if the sum were to go from £6 billion to £12 billion.

[Imran Hussain]

For the sake of avoiding repetition, I will cite the case I previously outlined, because I think the arguments are exactly the same. The only additional point is that I agree with my hon. Friend the Member for Cardiff South and Penarth, who makes the point that using a statutory instrument to double the increase, if not more, is something that MPs will be uncomfortable with, for obvious reasons.

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[Jeremy Lefroy]

I have to say that I agree with a considerable number of the hon. Gentleman’s points, although I see some problems with the way in which the new clauses address them. For instance, if we restricted new capital to a certain list of countries, where would that leave the self-generated capital, both from existing investments and from these investments once they are sold? That does not seem to be clear, so in effect we would have to segregate capital raised through the profits or the free cash flow of the sale of existing investments, and capital raised through the sale of new investments that had been restricted to certain countries.

[Stephen Doughty]

The hon. Gentleman will correct me if I am wrong, but has that not already happened with regard to legacy investments in Latin America, for example, as a result of the changes in the strategy for CDC in 2012?

[Jeremy Lefroy]

Yes, it has, absolutely, but what I am saying is that the new clauses are not specific enough to achieve what the hon. Gentleman wants.

I must also repeat my earlier point that middle-income countries are a very broad church. I think I mentioned that they cover gross national incomes between £1,000 and £13,000; forgive me, but I meant between just over $1,000 and just over $13,000—dollars, not pounds, although that is less of a difference than it was a year ago. I believe firmly that a country with a gross national income of $2,000 or $3,000 per head per year is absolutely the kind of country that we should be investing in to create the jobs I referred to earlier, but it would be counted as a middle income country.

My final point is that when we invest in multilateral institutions such as the World Bank through IDA, we are investing in low income countries; but when we invest through the International Bank for Reconstruction and Development, which is the major part of the World Bank, we are investing indirectly in middle income countries, including India, China, Brazil and all the other countries that the hon. Gentleman mentioned. I would not like us to treat the CDC differently from our investments in the World Bank or in other multilateral institutions such as the Global Fund.

[Imran Hussain]

Again, I associate myself with the comments made by my hon. Friend the Member for Cardiff South and Penarth. I have two additional general points. We have to look at the 2011 review. There were clear purposes behind it, one of which was that the CDC had lost its focus. As a result of the review, we saw the new universe of countries and, as I said earlier, have ended up in a better place today than we were in four or five years ago.

My hon. Friend is absolutely right that we must not lose our focus on development impact and where it can be greatest, and nor must CDC. We must continue to focus on the poorest countries, where the impact will be felt the most and where it is most needed. The CDC’s ultimate goal must be to alleviate poverty, and that goal is not best achieved in some of the countries that have been used as examples.

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[Kate Osamor]

I have not spoken a lot today. That is not because I have not been in support of my hon. Friend the Member for Cardiff South and Penarth, which I believe is the right way of saying it—I have heard many versions today. I want to speak on this clause, because my issue relates to tax havens and the way the CDC is using them. In the evidence session earlier today, Diana Noble of the CDC admitted that at times it has to use tax havens, but I feel that DFID should be looking at transparency. We should be working more closely with CDC because we are setting up a system that could be exploited, and I am concerned that we could be sitting back and not using the power that I believe DFID could be using.

This is the time to look at how the relationship was initially set up and at how we might reform that relationship, not because we should be micromanaging but because we should be taking some responsibility for taxpayers’ money. I say that because, while there is cross-party support for DFID in this House, there is a lot of tension outside among people who do not agree with the way we are spending money. If this was highlighted and got into the wrong hands—the Daily Mail—it could turn into a situation in which the Government would have to fight back. I ask that we look at that relationship, make it a lot more transparent and also look at what will happen when Diana Noble moves on, because a new CEO may not able to turn things around the way she has. She has made great changes, but she is moving on, so we need to look at how that new relationship with DFID will be, and this is the time to change that situation.

I support the clause and I hope that the Minister can reassure us that we will not be in a situation going forward whereby the CDC, or similar organisations, have to use tax havens because the country they are functioning in does not have systems to take the tax.

[Jeremy Lefroy]

I have a lot of sympathy with the points made. I cannot support this new clause because I do not think that the international situation lends itself to being practical for the CDC at the moment. Regrettably, there is not the range of options for CDC to make its investments at the moment alongside other partners. When it is direct investments, which I am very glad to see the CDC has started to do again since the new arrangements in 2011-12, there is absolutely no reason why the investment cannot be made directly into the share capital of the company in which the investment is being made. However, when you are trying to leverage other investments, as the CDC often does, alongside other DFIs or other private sector entities, you have to arrive at a mutual agreement as to what jurisdiction is most suitable, both from the point of view of the ability of the legal system to uphold agreements and in terms of when dividends are paid, and whether double tax arrangements and so on are in place.

These are all practical matters, but I very much agree with the hon. Member for Edmonton and the hon. Member for Cardiff South and Penarth that there is an opportunity here for the CDC to set the pace—for instance, here in the United Kingdom, where we have such a fine legal system, as is being displayed right at this very moment across the road.

[Hon. Members]

Hear, hear.

[Jeremy Lefroy]

That is true from whatever point of view we approach the matter. Why can we not set up the kind of structure, based in the UK, that would be perfectly reasonable for funds to see as an acceptable basis for making their investment alongside the CDC?

[Rory Stewart]

I shall try, for the sake of right hon. and hon. Members who are under time pressure, to be quite short in answering. Of course, I agree strongly with points made about the absolute importance of this. The CDC never invests in any of these locations in order to save tax or to avoid scrutiny. There are only two reasons why we would do it, and those are the reasons that were raised by the hon. Member for Cardiff South and Penarth; which is to say either because the regulatory environment in the country in which we are investing is not sufficiently robust for us to be able to trust UK taxpayers’ money to that location, or because we are attempting to accumulate a larger fund where we are trying to get co-investors. We are very proud of that. We have brought in, at times, £1 billion of investment and have managed to bring in £30 billion behind it, so that is a multiplier effect of 30 which might not have been possible had we not been able to ensure that we were able to go through certain offshore centres.

However, we are very focused on this issue. The Labour Government made great progress in focusing on the white list. The hon. Gentleman mentioned Anguilla and the British Virgin Islands. To be absolutely clear, as I think he is aware, we do not, nor would ever, invest in those locations, nor would we invest in Panama. We only invest in the places that have been put through the OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes as compliant locations.

Nevertheless, I agree that in the long run we need to develop financial sectors within Africa to ensure we can make secure investments through African locations, rather than having to go through offshore centres. DFID is now running a big programme on that, which is something the CDC can learn from. To respond to my hon. Friend the Member for Stafford, we absolutely should be taking the lead on this. On that basis, I ask that the motion be withdrawn.

Sustainable Development Goals

Jeremy Lefroy Excerpts

Thursday 24th November 2016 Westminster Hall

[Jeremy Lefroy (Stafford) (Con)]

It is a pleasure to serve under your chairmanship, Mr Stringer, and to follow the hon. Member for Poplar and Limehouse (Jim Fitzpatrick). I was interested that he mentioned Staffordshire fire and rescue service. I shall contact it and ask it about the work it has been doing. It is also a great pleasure to follow the Chairman of the Select Committee, the hon. Member for Liverpool, West Derby (Stephen Twigg) and my hon. Friend the Member for Congleton (Fiona Bruce), who made very important speeches.

The UK has a great opportunity to show leadership in implementing the sustainable development goals. In our report, we have given four or five out of 10 for what has happened so far, but I want to let bygones be bygones and look ahead to the future. We have got a new Minister and a new team, and this is a great opportunity for them and the United Kingdom to show leadership, as the former Prime Minister, David Cameron, showed in developing the SDGs with the two other leaders and the United Nations more generally.

As the hon. Member for Liverpool, West Derby said, the millennium development goals were, on the whole, a success. They were fairly narrowly focused, but they were all the better for that because we could see that great progress was being made. As the chairman of the all-party group on malaria and neglected tropical diseases, I saw how much the emphasis on malaria in the MDGs meant for countries in which the disease is endemic. Malaria deaths have been reduced by more than half over the past 15 years, with a huge reduction in the number of cases. The SDGs are much broader, but that does not mean that they should not equally be a success. All of us have to work to achieve that.

We must start at home. These are global goals, and they are meant to apply to the United Kingdom. I welcome the Secretary of State’s letter, because it gives a lot more clarity. I have a suggestion for the Minister on something that other countries have not yet done, so perhaps we can take the initiative. Why do we not ask to be marked by other countries—particularly those to which we give bilateral aid—so they can look at what we are doing? We should open the books in the great spirit of partnership and equality so they can see whether we are matching up to the goals. International development should be something we do together with each other, not to other people.

I have five levers—I tried to think of a better word, but I could not—that the Department for International Development can use to achieve the 17 SDGs and the 169 targets to be achieved, and five means by which those levers can be supported. The levers are ways into not just one goal but lots of goals.

The first is jobs and livelihoods, which help to reduce poverty. If someone has a job or a livelihood, they are likely to have access to better health, better education and many other things. It is not just about economic development. Many areas in which jobs and livelihoods are created are beyond economic development. For instance, they will be created in the health and education sectors as countries employ more health workers and teachers.

The second is education, about which the Chairman of the Select Committee spoke at length. Without education, we will not get anywhere. As he said, DFID is already spending more than 7% of its budget on education, but I think we need to up the amount going into all forms of education, because it is one of the great levers for tackling almost all of the 17 goals.

The third is gender equality. If we do not aim for gender equality, we will not reduce poverty as we should, and we will not achieve the health outcomes, education outcomes and all the other outcomes that we want from the SDGs.

The fourth lever is water and sanitation. Earlier this year colleagues on the International Development Committee and I had the honour of going to the Democratic Republic of the Congo to see an excellent project that DFID had funded, providing water to villages for the very first time. We were humbled by people’s reaction. The project was low-cost, only a few dollars per head to provide clean water, but it meant that children and women in particular had to spend far less of their day getting the water that they and their families needed. That brought home to me how cheap it really is to make such life-changing interventions for so many people.

Over the past five years DFID has reached more than 60 million people with better water and sanitation. What has happened is absolutely wonderful, but a lot more can be done—so many more hundreds of millions of people are still without. Over the past two or three years that was brought home to me while most of Stafford was dug up in order to replace the water and sewerage systems. Of course I had plenty of moans about the effect on traffic congestion but, ultimately, my constituents said, “Yes, we know that this has to be done. We know that we have a system that is decades old and needs to be replaced. And we know how vital water and sanitation are to our everyday lives.” If that is the case for us, it is the case for every person on the planet.

The final lever I suggest is that of global public goods in health, climate change and, following on from what my hon. Friend the Member for Congleton said, peace building. Global public goods are, by definition, goods for the benefit of everyone, such as the development of drugs against tuberculosis—we know how far we are falling behind on drugs against TB—or research into antimicrobial resistance, which I raised in the main Chamber earlier today. The Government have taken the lead after an excellent report from Lord O’Neill earlier this year but they need to pursue it relentlessly because, as he said, by 2050, if we take no action, 10 million lives will be lost every year—that is more than die from cancer —to diseases that cannot be cured because of resistance, and that will cost the global economy trillions of dollars.

Global public goods are not only in the area of health, but in climate change. Many communities around the world face the prospect of being submerged, or flooded regularly, and others face regular droughts, even though there are practical, if not simple, actions that we could take on behalf of those communities and of the world as a whole.

Peace building is another area. As my hon. Friend the Member for Congleton said, we need to invest in peace building at an early stage—in inter-faith relationships and dialogue, for example—and, as the Committee has said on many occasions, in training peace negotiators, women in particular. There are almost no women peace negotiators whom I am aware of in the United Nations. Let us invest in that: prevention is so much better than cure or, as Churchill said:

“To jaw-jaw is always better than to war-war.”

Those are the five levers that I humbly suggest the Department looks at. It is doing many of those things already, but I wanted to put them in one place. If we concentrate on those levers, we will succeed in addressing the SDGs in the best possible way.

Finally, I will talk about the five means. The first, as our report suggested, is the collection of data, and the UK has a comparative advantage in data accumulation. Earlier this week at our all-party group on malaria and neglected tropical diseases, we heard how an Oxford centre for collecting data has been hugely helpful in identifying which areas have problems with malaria or particular neglected tropical diseases and how to address them. With good data we will make much more progress, and I know that DFID has that as a priority.

The second means we refer to as scale. We hear a lot about pilot projects, some of which go to scale, but many stay as pilot projects and get nowhere. Right from the beginning of a pilot, we have to think how it will be scaled up. The project might of course not work, in which case it can be cut after the two or three years of the pilot, but so often we hear about a successful pilot project only for a hiatus to occur as people think how to get it to hundreds of thousands, or millions of people, as opposed to the hundreds or thousands whom the pilot helped.

Third is the issue of partnership, which has also been mentioned. It is absolutely vital that we work in partnership with NGOs and other Governments. We need to see the SDGs as an enterprise on which we are all engaged together. I come back to the point made by the hon. Member for Poplar and Limehouse about small grants. The idea that DFID will not get out of bed for less than £1 million—I am sure that is not the case—is how things seem to many of us who have met several such excellent charities in our constituencies or are aware of them through previous or current work. They simply cannot get access to funding, even when they have raised a lot themselves. The Department is looking at that carefully, and the Minister has expressed a desire to do more, so it will be good to hear his suggestions when he replies to the debate.

The fourth means is parliamentary scrutiny, and I mean not the scrutiny of this Parliament alone, but that of parliaments in the places where we work. Frankly, if Members of Parliament in a country where we operate are not interested in the work being done for the development of their own constituents, why should we be? I agree that we have a moral imperative to do such work—I am sure all Members present feel that—but if a Parliament does not look at the kind of things that our own DFID officials look at, we should begin to question whether we are in the right place, because there might not be the right commitment. I urge DFID to help and work with parliaments in the countries in which we are active—through multilateral organisations in those with whom we do not have bilateral relations—to scrutinise the work of their own Governments and of the development agencies there.

Finally, long-term engagement is another point made by the Committee on a number of occasions. DFID has been involved in some excellent long-term programmes. The one I always come back to is the reforestation programme in Nepal, on which we have worked together with the Nepali Government over more than two decades. It has resulted in a tremendous increase in reforestation in that country, which is vital in tackling climate change in Asia and globally. We need to do more, however. Too often, I fear, people involved in a country and doing great work are not aware of what DFID did 20 or even 10 years ago in the same country. It was good to hear the permanent secretary take up that challenge at a recent evidence session the Committee had and suggest the possibility of looking at one or two countries to map what DFID has done, together with the NGOs and the Government of the country, over the past 20 years, so that we have much better understanding of how long-term partnership can or perhaps, in some cases, cannot help us.

It is an honour to take part in the debate. I welcome the Minister’s presence, because I know how seriously he takes his portfolio, and I look forward to hearing his reply.

Oral Answers to Questions

Jeremy Lefroy Excerpts

Wednesday 16th November 2016 Commons Chamber

The Secretary of State was asked—

[Jeremy Lefroy (Stafford) (Con)]

1. What recent assessment her Department has made of the humanitarian situation in the Sahel and northern Nigeria.

[The Secretary of State for International Development (Priti Patel)]

This year we have significantly increased our support, providing a further £80 million of humanitarian aid to support more than 9 million people affected across the region. I can assure my hon. Friend that we are working to tackle poverty and the crisis in the region at source, rather than waiting for the consequences to reach us domestically.

[Jeremy Lefroy]

There are more than 2.6 million displaced people in the area, 6.4 million people are facing food insecurity, and a public health emergency has been declared in four countries, together with the Central African Republic, in response to a polio outbreak, yet United Nations appeals are only one third funded or less. What more can the UK Government do to bring this crisis to the world’s attention?

[Priti Patel]

My hon. Friend is right to draw attention to an appalling situation facing the region, and more must be done to meet the humanitarian needs. The UN needs that help to increase its capacity and develop. As to what more can be done, we encourage Governments across the world in the donor community to step up their contributions, just as we have, because the humanitarian response required must be funded now. With my hon. Friend and with the UK Government, we are challenging everyone to step up and do more.

Oral Answers to Questions

Jeremy Lefroy Excerpts

Wednesday 29th June 2016 Commons Chamber

[Mr Hurd]

If that is the wish of the House, I am sure that both Departments will listen to it carefully. We are extremely concerned about the situation and have been for very many months. I am in regular contact with the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Rochford and Southend East (James Duddridge), who has responsibility for Africa, about what he is doing on the diplomatic front and what we are doing in terms of planning contingencies in the event of an escalation of the humanitarian crisis.

[Jeremy Lefroy (Stafford) (Con)]

Young people from specific communities are being taken from their homes, tortured and then killed. We have a deep crisis in Burundi: a President in denial who refuses to accept the validity of the Arusha peace process. What can the UK Government do to encourage other neighbouring African countries to take this matter even more seriously than they appear to be doing at the moment?

[Mr Hurd]

I share my hon. Friend’s concern and passion about this situation. I assure him that my hon. Friend the Under-Secretary and I work together extremely closely to put whatever pressure we can on countries that may have influence, and to ensure that we are in a position to do the right thing in providing support for the Burundian people.

Developing Countries: Jobs and Livelihoods

Jeremy Lefroy Excerpts

Wednesday 15th June 2016 Westminster Hall

[Jeremy Lefroy (Stafford) (Con)]

I beg to move,

That this House has considered jobs and livelihoods in developing countries.

I draw attention to my entries in the Register of Members’ Financial Interests.

“A good job can change a person’s life, and the right jobs can transform entire societies. Governments need to move jobs to center stage to promote prosperity and fight poverty”.

Those are the words of Dr Jim Yong Kim, president of the World Bank, in his introduction to the 2013 World Development Report. In 2014, my right hon. Friend the Secretary of State for International Development said:

“Growth reduces poverty through jobs…raising incomes for individuals through the dignity of work and providing tax receipts for governments to fund basic public services like health and education.”

On the other hand, the lack of jobs and the opportunity to earn a living fuels discontent and unrest and drives economic migration. We are seeing the consequences right now, which is yet another reason why working in partnership around the world is both the right thing to do and very much in our national interest.

In sustainable development goal 8, UN member Governments commit that by 2030 they will achieve

“full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value”.

Just last year the International Development Committee published a report on jobs and livelihoods. One of its recommendations was that jobs and livelihoods were “such an important issue” that its successor Committee in this Parliament should take it up

“to assess what progress has been made.”

I am sure that that will happen in the coming years, but I wanted to ensure that the matter was raised in the House. I am delighted to see so many colleagues present. Other members of the International Development Committee would have been here, but the timing of the debate clashes with a meeting of its Sub-Committee on the Independent Commission for Aid Impact.

[John Howell (Henley) (Con)]

Does my hon. Friend feel that the Prime Minister’s initiative to make a number of MPs, such as myself, trade envoys will contribute to the work he is describing, given the wide role we have been given? How much does he think the prosperity fund will play a role in helping to develop local industries and situations to enable the creation of new jobs?

[Jeremy Lefroy]

I am most grateful to my hon. Friend for that intervention. He is doing fine work as a trade envoy for Nigeria, which is vital, because British investment around the world will help to create jobs. The prosperity fund will provide opportunities for people to develop that work. I entirely agree with my hon. Friend.

The 2013 World Development Report estimated that, globally, 200 million disproportionately young people are unemployed, with a further 620 million young people neither working, nor looking for work. Due to age profile and population growth, the report estimates that a further 600 million jobs will need to be found in the next 15 years just to keep employment rates constant. Personally, I would put that figure even higher, at closer to 1 billion.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I congratulate the hon. Gentleman on securing this debate. He is discussing the figures and alluded to the fact that we would like to go further. Does he agree that it is almost a pipe-dream that the sustainable development goal that appears to indicate the elimination of poverty and unemployment, particularly in developing countries, will be achieved by 2030? We really need radically to reassess what we are doing to achieve that goal.

[Jeremy Lefroy]

The hon. Gentleman makes a valuable point. One reason why I called for this debate is because not nearly enough work is going on around the world. The UK is taking a lead, but he is absolutely right that much more needs to be done here and around the world.

In many countries, much of the work is subsistence agriculture and low-income self-employment—that is true for something like 50% of the 3 billion people working worldwide. Making ends meet is extremely difficult. I have to admit that all the figures I have cited are imprecise and sometimes speculative, which is a problem. We do not have accurate data, but I hope we will see more in future. It is about not only data but action, but action depends on good data.

The World Development Report found that: first, there are too few productive waged jobs in modern, formal sectors; secondly, most people are engaged in very low-productivity, seasonal or subsistence work in both rural and urban areas; thirdly, there are large gaps in job opportunities for women, youth and marginalised groups; fourthly, much work is in poor conditions, or is unsafe or risky, including in formal employment; and fifthly, many labour market-related institutions are ineffective, including skills institutions.

[Patrick Grady (Glasgow North) (SNP)]

I congratulate the hon. Gentleman on securing this debate. I apologise that I cannot stay for the whole debate, but I am going to an event in the House of Lords to mark Small Charity Week and speak about the importance of small charities in international development. Does he agree that many small and grassroots organisations have an important role to play in equipping people in developing countries with precisely the kinds of skills he is talking about, which they need in order to move into productive employment?

[Jeremy Lefroy]

I entirely agree with the hon. Gentleman. I will give an example of that later in my speech, but he is absolutely right. I made a similar point in Monday’s debate in this Chamber on foreign aid expenditure.

What can be done? I shall give several possible solutions. First, let us work with what we have. I shall start with agriculture, because it is at the heart of the economies of most developing countries. It provides most of the work and a considerable share of GDP, Government income and exports. It also provides the basis for local manufacturing. Even in developed economies such as ours, food and drink production is the largest manufacturing sector. Why should that not be the case in developing countries?

Although all countries will of course wish to diversify into other sectors and reduce reliance on agriculture, that is not the same as neglecting agriculture. That mistake has been made far too often in the past, both by Governments and by their aid-funded advisers. I am glad to say that things have changed over the past three decades. Countries such as India and Vietnam, and more recently Ghana, Tanzania and Ethiopia—to name but a few of many—have given much more prominence to agriculture and increased their support of it. The same is true of development agencies, especially the Department for International Development. I welcome that.

Working with what we have in agriculture also means working with the smallholder farmers who are its backbone. When I started to work with smallholder farmers nearly 30 years ago, the view of many was that they were on the way out, and that the future of agriculture was large-scale farming. In fact, they are more important than ever, providing food security even in conflict zones. For example, in the 1970s Angola produced a similar amount of coffee to Uganda, but Angola’s coffee was almost all produced on large estates, while Uganda’s was produced by smallholders. Both countries went through long periods of turbulence. Today, Uganda’s coffee production is the same as it was back then, if not more, but Angola’s coffee production has almost disappeared. Smallholder farmers are incredibly resilient.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on securing this debate. He has vast experience of developing countries. Does he agree that there needs to be an emphasis on educating young people so that there are links with the business community? He will know that every year in the House there are campaigns to get children in developing countries into education. That would help them on the pathway to jobs, no matter how little.

[Jeremy Lefroy]

I agree entirely. I shall address that issue in a moment, because it is vital.

I have a couple of other examples of sectors in which we can work with what we have. Hospitality is important in every developing country. It is about not only international tourism, but looking after people in one’s own country and wider region. Hilton estimates that, if there is proper investment around the world, the hospitality sector alone could create an additional 70 million jobs over the next decade. Apart from agriculture and agricultural processing, construction is very likely to create and sustain jobs and livelihoods in most parts of developing countries. I shall say a little more about that later in my speech. We must also consider local services. Services are often neglected in favour of large manufacturing investments, yet in every town and city, along every main street, one will see service businesses. We need to support and encourage them, because if every service business employed one more person, millions more people would be employed throughout the developing world.

Secondly, not only should we work with what we have, but we must not stand still. Everyone wishes to see a better life for their family. Incomes from agriculture can be improved in many ways. That subject is worth an entire debate in itself, but, to be brief, they include enhanced productivity through better inputs, advice, irrigation, finance, diversification, storage to reduce crop losses, and access to markets and to information about those markets. In other words, that means moving on from subsistence agriculture.

DFID’s recently published conceptual framework on agriculture puts it well. It says that there is

“the assumption that sustained wealth creation and a self-financed exit from poverty depend, in the long-term, on economic transformation and the majority of the rural poor finding productive and better paid employment outside of primary agricultural production”—

note that the framework says primary—

“Despite the need for this transition, agricultural growth and downstream processing and productivity growth are likely to be important, if not essential, as a continued source, if not driver, of growth.”

When I was involved in buying cocoa from smallholder farmers, we saw the price per kilo paid to farmers, and hence their income, rise at least fourfold over two or three years as result of a combination of improved quality, better logistics, a higher world market price and a greater percentage of that price being paid to the farmers. It also depended on having a reliable buyer prepared to take a long-term approach, rather than one driven by short-term trading considerations. The farmers’ improved incomes not only sustained and improved their own livelihoods but created jobs at a tremendous rate. The money stayed in the local economy to support input dealers, schools, clinics, general stores and bars. That, in turn, created jobs in local and national manufacturing and service businesses. I am a believer not in trickle-down economics, but in trickle-up economics, and smallholder agriculture is at the heart of that.

I have concentrated on agriculture, but the need not to stand still applies to all the other sectors I mentioned. In hospitality, training, good-quality service and investment meet the needs of nationals, not just tourists. There is no reason why someone cannot provide an excellent hotel or tourist spot for their own population. They do not need to rely on a few hundreds of thousands or tens of thousands of overseas visitors.

Construction jobs can be enhanced through a formal apprenticeship scheme of the kind I mentioned. They can also be supported by placing specific requirements on contractors in large infrastructure projects to employ and properly train local people in their work. That is increasingly happening, but it needs to be extended to the most senior levels of the contract, not just the grassroots workers. Skills are best transferred in the heat of building a major road, bridge, airport or railway line.

[Imran Hussain (Bradford East) (Lab)]

Does the hon. Gentleman also recognise the importance of urban planning, in particular for the foundations it lays for economic development? We need to do more on that.

--- Later in debate ---

[Jeremy Lefroy]

That is a very interesting point. I agree. We see the consequences of poor urban planning in many parts of the world. In that context and the general context of construction, I would like to ask the Minister whether all the infrastructure and construction projects that DFID supports now have clauses that require the training and development of local skills, rather than just bringing in professionals and others from outside.

Thirdly, we must act locally and regionally, not just from the capital city. People working at the grassroots are the best at creating large numbers of jobs, so Governments and aid organisations need to concentrate their work there, not just in capitals or large cities. The Bangladesh-based international development agency BRAC is effective at doing that, as I saw in Babati in Tanzania—a small town south of Arusha, which the International Development Committee visited in 2014. Charities such as Hand in Hand, set up by the Swedish entrepreneur Percy Barnevik, also work outside the main cities and capitals.

In Nigeria, which the International Development Committee visited in March, DFID has an office in Kano. I think it is the only major aid organisation based in Kano, which gives it the advantage of having a greater appreciation of the situation on the ground. I would encourage the same elsewhere. I would like to see DFID staff based in regional towns and cities, not just capitals. Given modern communication technology, we do not need expensive infrastructure to do that, and I think many would welcome the chance to do their work outside the bubble of a congested, expensive capital city.

Regional trade is vital. DFID has some excellent programmes—in particular, TradeMark East Africa, which, like many things I am going to talk about, is worth an entire debate itself. I will not say more about it at this stage, other than that I believe it has done some excellent work in breaking down trade barriers across the region.

Fourthly, we need to embrace job creation in public services, which are sometimes forgotten. Building public services, such as health and education, provides huge job opportunities. The NHS is the UK’s largest employer by far. At the moment, in Tanzania there is one doctor for every 25,000 people, whereas in the UK it is something like one for every 350. If Tanzania increased its number of doctors to one for every 2,000 people, that would create more than 20,000 highly skilled roles in that country alone, and probably more than 100,000 in total in the health sector. I am very glad to hear that this month Tanzania is considering increasing its health spending substantially in its budget. If that happens, there will be greater employment in the health sector. The same applies to education.

Of course, there is an argument that that depends on increasing Government revenue. That is absolutely true, but it also depends on choices about how Government revenue is spent. It is a virtuous circle: greater access to healthcare and education helps people’s productivity, and hence increases the income that generates taxes. I do not have an estimate of how many additional jobs will be created in developing countries if staffing and education reached just one quarter of developed countries’ levels, but it would be in the millions globally, and almost all would be filled by the young people who need them most.

Fifthly, we need to be inclusive. We need to ensure that the work covers everybody, and women and girls must be at the heart of it. Policies that exclude people are not only wrong, but bad for jobs and livelihoods, and hence economic growth.

Sixthly, there must be access to the right kind of finance, without which we cannot create jobs and livelihoods. Again, a separate debate is required on that issue, so I will limit myself to two examples. Small and growing businesses, which will create the most jobs and need finance, tend to be seen as risky. Commercial banks are increasingly risk averse in developing countries, as they are in developed countries, as they implement capital adequacy rules designed, understandably, to protect depositors. Loans come with high security requirements, so finance will increasingly need to come in forms that are not so restrictive. The providers will need to be willing to take on risk—that applies as much to the UK as to developing countries. The last thing we should do is discourage entrepreneurs by promising them destitution if things go wrong, which is pretty much what commercial banks in developing countries do: they take everything away if the loan goes bad.

The Economist recently published an article with examples of that kind of finance, including GroFin and Equity for Tanzania. I have to declare an interest: I helped to found Equity for Tanzania, and I am director of its charitable parent organisation in the UK. It leases equipment to the growing businesses in Tanzania, and takes as security only the equipment itself. It has the specific aim of job creation. Returning to the point that the hon. Member for Glasgow North (Patrick Grady) made, it was supported by a small grant from DFID about 12 years ago and developed into a much larger organisation.

The second example is CDC—formerly the Commonwealth Development Corporation—which invests in larger business. It has the specific aim, set up by the previous Secretary of State, my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell), to create jobs and livelihoods, and to work in the most needy countries. I welcome that.

Finally—this also relates to the point made by the hon. Member for Glasgow North—we need education and training. A strong and diverse economy built from the grassroots also needs a vibrant education and training system that teaches not simply the essential building blocks—mathematics, sciences and languages—but the skills that people need to work for themselves or run a small enterprise. When the International Development Committee visited Sierra Leone in 2014, President Koroma stressed to us his desire to see more vocational training. In Nepal in 2015 we saw a vocational training scheme run by the Swiss and supported by DFID. There is a tendency to see traditional vocational training models as ineffective, having high capital and running costs and being inaccessible to young people. I believe we need models that are more akin to our apprenticeship schemes, and that are based on working alongside skilled businessmen and women. People should receive financial support for doing so, together with some central training. That is cheaper and more effective.

I also suggest there is a need to embed business and self-employment training within school curricula. Most students will end up working for themselves, or in small enterprises, and they will be better prepared if the training starts in school—again, the same applies in the UK. We do not have enough of that in our school curricula. It would also raise the status of business and self-employment as something a student wishes to do, rather than as a last resort if they cannot go to university or obtain a government or salaried job of some kind. Excellent work on that is done by Youth Business International, part of the Prince’s Trust network, and Peace Child International.

I will now look briefly at DFID’s work, first at its economic strategic development framework, which has five pillars: improving international rules for shared prosperity; supporting the enabling environment for private sector growth; catalysing capital flows and trade in frontier markets; engaging with businesses to help their investments contribute to development; and ensuring that growth is inclusive and benefits girls and women. I have already touched on many of those subjects, so DFID is already covering a lot of the ground. The DFID framework, however, excludes the role of public services in economic development, especially job creation. When the framework is next revised, I ask the Minister to include that in it; it is important.

The second area in which DFID is doing a lot of work is its youth agenda, “Putting young people at the heart of development”, published only in April this year. It focuses on two transitions, between childhood and puberty, or adolescence, and between education and productive work, going from dependence to independence. The April publication has been followed up with a couple of internal papers on youth and jobs, and youth and entrepreneurship. DFID is apparently preparing for a consultation on the issues later this year. That is good, and I welcome it, but we need not only consultations and papers, but action. DFID has the opportunity to lead such work internationally.

Finally, there is the World Bank, which I began with. I declare an interest, as I chair the international Parliamentary Network on the World Bank & International Monetary Fund. In 2014 the bank launched its Solutions for Youth Employment initiative and an umbrella trust fund for jobs, which is supported by DFID. Will the Minister tell us about any progress on that? Are we simply discussing a lot of nice platitudes, welcome though they are, and even policies, or are we talking about real action to create, or support the creation of, those jobs and livelihoods, which are so urgently needed?

In conclusion, I welcome what is being done at the moment. As the hon. Member for East Londonderry (Mr Campbell) said, we must go a lot further and a lot faster. I want to see every DFID bilateral programme fully engaged with the host Government on jobs and livelihoods, particularly for young people. They will find an open door, because that will always be one of the top priorities of any responsible Government. That does not necessarily mean large programmes in every country—we need to avoid duplication—but it does mean constant dialogue to see how we can support the Government.

DFID needs to use its influence in all multilaterals to put jobs and livelihoods at the centre of activity, particularly in health and education, which we cannot see as somehow completely divorced from jobs and livelihoods, because they depend on people working in them and having their jobs and livelihoods in those sectors.

Make no mistake, this is possibly the biggest challenge of our generation, along with tackling climate change. Hundreds of millions of young people could be ignored, without hope, seeking to move elsewhere, and at the mercy of people traffickers or extremists, or we could have those same young people engaged, valued and able to contribute where they are.

--- Later in debate ---

[Jeremy Lefroy]

I am most grateful to everybody here for their valuable contributions. We have touched on a huge range of subjects that are vital to consider in relation to jobs and development. The hon. Member for Strangford (Jim Shannon) spoke about the need to tackle unemployment everywhere, and the importance of small projects. The hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) mentioned the important work that the Scottish Government do through their development fund, and how critical it is to work with young people. The hon. Member for Islwyn (Chris Evans), in a powerful and passionate speech, spoke about the business environment, the importance of tackling corruption, stability and direct investment.

My hon. Friend the Member for Portsmouth South (Mrs Drummond) spoke about many issues, and particularly the importance of the digital economy in the developing world. My hon. Friend the Member for Aldridge-Brownhills (Wendy Morton) mentioned the importance of education. The hon. Member for West Aberdeenshire and Kincardine (Stuart Blair Donaldson) spoke about the vital nature of partnership working and the work that the Scottish Government have done in partnership with Malawi on Kilombero rice and, indeed, Mzuzu coffee, which I have had the pleasure of tasting. The hon. Member for Bradford East (Imran Hussain) spoke powerfully about the need to be ambitious and aspirational, and touched on city planning.

The Minister spoke about DFID’s work, which I commend. He indicated that DFID is moving powerfully in the directions in which I would like to see it go. He spoke about infrastructure and Energy Africa, which my right hon. Friend the Member for Welwyn Hatfield (Grant Shapps) instituted last year, and about how that is already making progress.

Above all, there is a passionate desire here to work for inclusive, job-rich growth in developing countries, because that is important for the people in those countries, and because it allows them to stay where they are and not put pressure on our country. It is in their interests and ours.

Motion lapsed (Standing Order No. 10(6)).

Foreign Aid Expenditure

Jeremy Lefroy Excerpts

Monday 13th June 2016 Westminster Hall

[Jeremy Lefroy (Stafford) (Con)]

I refer to my entries in the Register of Members’ Financial Interests. Almost all the work that I have seen carried out with the support of DFID tackles individual poverty. It also supports global public goods, which is in the interests of us all. As the hon. Member for Central Ayrshire (Dr Whitford) mentioned earlier, if we take our foot off the gas with diseases such as polio, malaria or neglected tropical diseases, the tremendous work done over the last 15 or 20 years will be undone. We must continue it.

The same is true of the work on water and sanitation referred to by my hon. Friend the Member for Congleton (Fiona Bruce). DFID’s work has reached 60 million people over the past four years—vulnerable people in remote rural areas and the most difficult of circumstances. We have heard about the work with Syrian refugees who can have an education as a result of the work funded by DFID. Just two or three months ago, the International Development Committee saw the tremendous work being done with children in the north of Nigeria to ensure that they have an education fit for the 21st century, and last year we saw forestry work done over more than 20 years in Nepal, increasing forestation there by around 15%. That is important in tackling climate change.

I want to mention five ways in which DFID could look for improvement. The first is always, where possible, to consider the use of returnable capital instead of grants. In many cases, grants are most appropriate, but in many other cases, particularly involving work with the private sector, it would be better to use concessional lending or returnable capital, which can then be recycled.

The second is maximum leverage. We find, for instance on health, that many of the countries where we work committed in Abuja in 2001 to spend 15% of their budgets on health, but are nowhere near that at the moment. If we can connect the work that we do with them with reaching the target that they themselves set, we will get tremendous leverage from our spending.

The third, mentioned by the right hon. Member for East Ham (Stephen Timms), is effective partners such as BRAC. If we can use effective, low-cost partners that are prepared to work in difficult circumstances, we will find that our aid goes much further.

The fourth is to encourage the backing of small grants. Often, as hon. Members have mentioned, grants aimed at organisations working from our own constituencies can do a tremendous amount of good, perhaps matching the money that we raise locally. DFID says that that is sometimes too difficult for it to do.

Finally, DFID needs to be more rigorous in planning and more efficient in spending. There is much more work to be done on that.