Development Aid Budget

Lord Collins of Highbury Excerpts

Monday 3rd July 2017 Lords Chamber

[Lord Collins of Highbury (Lab)]

My Lords, I, too, thank the noble Baroness, Lady D’Souza, for initiating the debate. It has been vital and given us an opportunity to have several bites at the cherry with questions to the Minister. Last week he and I attended the NGO reception at which the Secretary of State was also present. At the event she evidenced the huge impact that UK aid has in the world, particularly in Africa. A number of people at that meeting gave first-hand, personal accounts of the impact. She has also said that,

“Britain is saving lives and bringing stability and security, and that’s good for our economy”.

While I welcome her new-found enthusiasm for development, I have concerns about the direction in which she is taking the department. Apart from seeking changes in the rules governing ODA, which we addressed earlier in Oral Questions—I hope that the Minister will be able to answer the specific questions on that additional sentence in the manifesto that the Government will not go it alone—I particularly want to address the issues the noble Lord, Lord Ahmad, raised in the debate on Her Majesty’s gracious Speech. He pointed out that more aid will be administered by other government departments, pointing out that in 2015 they accounted for 19.5% of ODA spending, compared with 13.8% in 2014.

One of the biggest beneficiaries of this aid has been the FCO. As noble Lords have pointed out, a big problem with this is the lack of monitoring and evaluation systems. The Government must ensure that non-DfID aid programmes and funds meet DfID’s high levels of transparency and report publicly on their activities. Parliament needs to be satisfied that they are being properly assessed against their achievements in delivering the sustainable development goals. What are the Government doing to ensure that all government departments and funds managing ODA achieve rapid and ambitious improvements to the transparency of their aid programmes?

Another area of concern is what is happening to Ministers in DfID. We have Alistair Burt and Rory Stewart reporting to Boris Johnson at the FCO, and of course the Minister now also covers the Treasury. While I am all in favour of cross-Whitehall co-operation, as highlighted by the noble Lord, Lord Bruce, is there something more going on here, especially in the light of the Budget’s shift away from DfID? I certainly hope there is not. Most noble Lords here would agree that DfID has huge expertise and a world-renowned reputation in defeating poverty. It should remain independent and the leading provider of UK aid. Will the Government confirm that they will apply the International Development Act 2002, with its legal requirement for aid to focus on poverty reduction, to all aid, regardless of which department or fund manages it?

Poverty and bad governance are still holding too many countries and their people back. Many women, disabled and older people and too many minorities are discriminated against and denied access to their fair share of goods, services and opportunities. Economic growth has the potential to be the engine to drive change. But, as the noble Baroness, Lady Hayman, said in Oral Questions, growth without jobs, inclusion, healthcare, education and human rights—growth without power—will not deliver for the many.

The universal nature of the sustainable development goals and the principle of leaving no one behind are vital tools. As my noble friend Lord McConnell asked, what are the Government doing to ensure that aid programmes delivered outside DfID focus on supporting the SDGs? Just when will we have clearer reports from cross-Whitehall co-operation on how the SDGs are being implemented? How will Parliament be involved in that?

To deliver the greatest impact, we must have a fairer tax system for the world’s poorest countries. Unfortunately, different government departments seem to be working against each other. According to the IMF, developing countries lose around $200 billion a year to tax avoidance. The UNCTAD estimates that tax havens cost developing countries at least $100 billion a year. While DfID is doing good work in helping developing countries broaden their tax base, other departments are not helping to improve tax transparency. The Treasury should work quickly to introduce public country-by-country reporting for UK companies. As the Minister is in the Treasury now, can he tell us how Ministers are progressing this matter multilaterally and when they expect an agreement to be reached? What discussions are taking place about the overseas territories following the UK’s lead and introducing a public register of beneficial ownership? The private registers being introduced at the moment are almost useless for developing countries, as they cannot see the information and many are excluded from information-sharing agreements. While this policy inconsistency continues, the impact of our aid will never be quite as much as we would like.

Value for money means measuring success by the change that we make and not simply by the cash that we put in. That is why Labour strongly supports the Independent Commission for Aid Impact. When a budget as important as this is ring-fenced, there is a fiscal responsibility and a moral duty to deliver as much change as possible for the money that we invest. DfID’s Annual Report and Accounts sets out the mechanisms which the department uses to ensure that it spends its money in a strategic, long-term way. As noble Lords have said, this includes a single departmental plan setting out strategic objectives for the period of the spending review. We also have the annual target and the framework of accountability, involving ICAI and Parliament.

As Priti Patel argued last week, the private sector needs to play an even greater role by integrating the aims of the SDGs into business practice. Developing countries currently face an annual investment gap of $2.5 trillion if they are to achieve the SDGs by 2030. That can be done only by working with the private sector. Noble Lords have mentioned the CDC, which should do more to measure the development impact of its investments. That would not only provide a better basis for investment decisions but increase the transparency of the CDC.

The 2012 to 2016 investment plan has expired; I am told that the 2017 to 2021 investment plan and strategic framework will be published this Thursday. I am sure that the noble Lord will tell us that it is a matter for the usual channels but I sincerely hope that time will be given in this House for a proper debate in government time on that strategic plan. It is vital that we hold the CDC to account, particularly in terms of transparency.

To conclude, I will pick up a theme that my noble friend Lord Judd referred to. We talk about aid dependency, but this generation has the opportunity to eliminate that for good by empowering the powerless. That is our vision on this side of the House, and it is what we will be pressing the Government to do.