International Development (Reporting and Transparency) Bill

I, too, congratulate the right hon. Member for Coatbridge, Chryston and Bellshill (Mr. Clarke), both on his success in the ballot and on his excellent choice of subject. I congratulate him on his detailed, articulate and generous introduction to the Bill, as well as on the marvellous way in which he has corralled a diverse and disparate group of people both inside and outside the House to support its general principles. The Opposition, particularly the shadow Secretary of State, my hon. Friend the Member for Sutton Coldfield (Mr. Mitchell), and I, support those general principles. Sadly, my hon. Friend cannot be in the Chamber today, as he is leaving for Rwanda to study conflict prevention, which is a fundamental foundation and building block in the alleviation of poverty through economic regeneration in much of the developing word. As I said, the Opposition support the Bill’s general principles, and I hope that in his reply to the debate the Minister will support those principles as well as many of the details and proposed amendments and improvements suggested by hon. Members on both sides of the House. Indeed, I shall make some suggestions myself. Before I do that, may I put the mind of the hon. Member for City of York (Hugh Bayley) at rest? The Conservative party, like the Labour party, is a broad church. I assure the hon. Gentleman that, like the Government, we are committed to working towards the UN target of spending 0.7 per cent. of our national income on aid by 2013. We recognise and support the provision in the Bill for monitoring progress towards this commitment. We also support the ambitious targets of the millennium development goals and are deeply concerned that sub-Saharan Africa will not meet any of these targets, as was highlighted by the hon. Member for Glasgow, North (Ann McKechin), whose contribution was excellent if, sadly, a little lengthy. We agree with the Government on the HIPC initiative, which has the potential to relieve the burden of debt on many countries. We support the international finance facility on immunisation, to which I shall return. We support the Global Fund to Fight AIDS, Tuberculosis and Malaria. The Conservative party shares the aspirations of the Government, as set out at the G8 summit, and we want the Gleaneagles commitments to be implemented expeditiously. Finally, we recognise that reform of the world trade rules is essential if the poorest nations are to be able to trade themselves out of poverty. We, like all hon. Members, are disappointed at the outcome of the WTO meeting in Hong Kong, particularly as one of the original key commitments of the millennium development goals was to create an open and non-discriminatory multilateral trading system. Sadly, we are still a long way from that target. We welcome and support the principles of the Bill. Above all, we welcome the provision that would require the Department for International Development to report annually on the effectiveness of its aid programmes in reducing poverty. DFID is a well regarded organisation, which is internationally recognised as a leading aid agency. We can and should all be proud of it, but it could be doing more. The public support aid because of outputs—lives saved, children educated and HIV deaths and infections prevented. But DFID is still too focused on money spent, rather than its effectiveness. DFID’s systems for evaluating and assessing its projects are weak and urgently need to be improved. As was highlighted by my hon. Friend the Member for Tiverton and Honiton (Angela Browning), an internal DFID report found:"““While there are many examples of positive contribution to development progress, there is generally insufficient information on the links between DfID’s inputs and interventions on the one hand, and the positive outcomes observed on the other””." The report also found that"““there is no single, overall strategic plan which guides the allocation and deployment of DfID resources””." It is therefore clear that DFID should strengthen and develop its systems to measure the effectiveness of aid in reducing poverty. Robust systems for evaluating the effectiveness of DFID’s budget must be implemented, and we support the Bill as making a significant contribution to resolving those issues. We acknowledge that there is some question whether the Bill duplicates the statistical reports produced annually by DFID. However, the Bill is necessary, as has been pointed out, to formalise that procedure and extend it. I agree with the right hon. Member for Coatbridge, Chryston and Bellshill that formalising it as the Bill sets out will upgrade the effectiveness and significance of the reporting structure and allow for re-allocating funds away from the least effective projects. I also agree with the right hon. Gentleman that a single annual report could stimulate comprehensive debate and facilitate year-on-year comparisons, hopefully on the Floor of the House. We agree with specific provisions in the Bill, and I shall put those on the record. We agree with the overarching architecture and objectives of the Bill—to bring transparency and accountability to international development spending. DFID’s systems for evaluating the effectiveness of its budget allocation are weak and need to be strengthened. True accountability can be achieved only through robust assessment of aid effectiveness, and we support the Bill’s aims in this direction. Furthermore, we support the Bill’s aim to focus spending on low-income countries. We also support the measures outlined in clause 2 which would improve policy coherence across Departments, assessing the actions of all Departments towards the aim of alleviating poverty. Clause 3(1)(e) and (f) provides for debt relief figures to be published, and we are strongly in favour of such a commitment as debt relief accounts for about 7 per cent. of expenditure on development in 2004–05. As has rightly been highlighted today, there has been some obfuscation and confusion in this area, and significant questions over delivery of commitments are being asked and need to be clarified. This is an opportunity to talk in general about the Bill, but some aspects can be improved and I want to put those before the House. Our greatest concern is the lack of detail in clause 7 on how the effectiveness of aid will be monitored. We recognise that measuring aid is difficult and challenging, but it is essential that every effort is made so as to ensure best value for taxpayers’ money and the greatest possible reduction in poverty. The Secretary of State should be required to attempt to obtain the greatest possible reduction in poverty with the resources available, to him in this instance, or to her maybe in the future, each year. To that end we would like to see clear, rigorous and independent evaluation and measurement of the effectiveness of aid spending in reducing poverty, and an explicit comparison of aid effectiveness across different projects and different forms of aid spending. That should be accompanied by systematic measures to reassess spending allocations and priorities so as to ensure the greatest possible reduction in poverty with the limited funds that are available. Specifically, in clause 7(2), assistance effectiveness monitoring is restricted to the 10 largest recipients of British bilateral aid, a point rightly highlighted by my hon. Friends the Members for Kettering (Mr. Hollobone) and for Bournemouth, East (Mr. Ellwood). The right hon. Member for Coatbridge, Chryston and Bellshill said that that was limited because of bureaucratic considerations. I hope very much that in Committee and on Report we can overcome those bureaucratic considerations that I am sure have been put before the right hon. Gentleman by the respective Ministers and officials in the Department. Aid effectiveness should be as rigorous as possible, and if the 10 largest recipient countries were to change regularly, as would be quite possible, it would hinder the year-on-year comparisons that are an essential part of the reporting structure. Additionally, in the financial year 2004–05, £948 million of the total £2,145 million spent on bilateral aid, or just 44.2 per cent., went to the 10 largest recipient countries. So if the Bill remains unamended, with just 10 countries accounting for their bilateral aid, well over half of British bilateral aid would not be subject to the Bill. Accounting for the top 10 countries also does not take into consideration significant contributions from the British taxpayer, such as £48 million to Mozambique and £47 million to Kenya in the financial year 2004–05. Nor would it take into account money that could not be allocated to a specific country. Furthermore, there is a lack of clarity in clause 7(2) regarding the areas of focus. There appear to be a number of oversights that should be discussed, such as the addition of education and diseases other than HIV/AIDS. I would argue that if the millennium development goals are to form the basis for this list, it should be done explicitly on the face of the Bill. In addition, I would like to see the wording of the clause tightened to provide for a detailed report on how and to what extent the aid spent directly contributes to the goals set out. We also think that clause 4 on millennium goal 8 should be clarified. Goal 8 does not lend itself to quantitive measurement. However, we recognise that there must be assessment of progress towards its completion. Further consideration must be given as to how goal 8 can be accurately monitored. There is clarity in the Bill regarding untied aid. Clause 4(3)(b) requires the reporting of the proportion of multilateral assistance that is untied. The Government have stated unequivocally that all British bilateral aid is untied, a policy with which we are in agreement. However, some confusion appears to remain, and it would help if the Minister, when he replies, would make a clear distinction between aid conditionality, which has been dropped, and aid criteria, which continue. We would also like to see clause 8(2) strengthened, a point made by my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth). The Bill asks the Secretary of State only to"““take account of whether it is possible””—" that is, to consider independent monitoring. As my right hon. Friend the Member for Bromley and Chislehurst has said, we also want to strengthen clause 8(2). The Bill currently asks the Secretary of State only to"““take account of whether it is possible””—" in other words, to consider—"““to . . . make provision for . . . independent monitoring””." We want to strengthen and improve the wording to ensure that the assessment of transparency is independent. We want to see more detail on who will conduct the monitoring, whether that person will be independent and what the relationship will be between the independent monitoring body and democratically accountable Ministers who come to this House to explain the expenditure of British taxpayers’ money.