My Lords, I was not able to attend Second Reading because of long-term commitments in Norfolk. The noble Lord, Lord Lipsey, who has his name on some of the amendments today, is unable to attend because of other commitments, and asked me to give his apologies.
I would like say at the outset that there are two themes in the amendments that we have put forward. One is the issue that the noble Lord, Lord Butler, raised, which I entirely agree with, and this amendment is relevant to that. The other is to do with making sure that aid is effective and that it deals with corruption and things of that sort. Those are the two themes. If we are to have this argument about this amendment, we shall go on all day. I want to make my point on this amendment in relation to the first theme and I do not want to repeat it afterwards, so that we can go swiftly through the remainder of the amendments. But if we
are not even able to do that on this amendment, I have to say that I do not think that this House is performing its function of scrutinising legislation in detail. I say to those who fear a filibuster—and there is not; we have a number of objections for a number of purposes—that I intend to make most of my arguments on this amendment so that I do not have to repeat them. But if I am not allowed to do so, I have to ask: who is preventing this Bill going forward?
We all know that there is a tight timetable. It should have been a government Bill but it is a Private Member’s Bill, which adds to the difficulties, and we all know we are coming right up to the end of the Parliament. I want to try to make the Bill more effective, as I believe this House should do, and I hope I will be allowed to develop my argument on this amendment; otherwise, I shall have to repeat it on all the other amendments. Let me make my position on that clear.
I congratulate the noble Lord, Lord Purvis of Tweed, on his very impressive speech at Second Reading—of course, I have read the whole debate—and his recognition of some of the concerns we have. I am in total agreement with him about the importance of development aid and I am proud of the contribution this Government make and the lead they give internationally. But I have some concerns about the Bill. The first set is all about the points that the noble Lord, Lord Butler, made. I hope I do not have to repeat them on the later amendments.
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The point of principle here is that I am opposed to the principle of enshrining any area of public expenditure in legislation as a proportion of GDP or GNI for each and every year. It leads to the inevitable point, which the noble Lord, Lord Butler, was making: if aid, why not health, education—so politically important—or defence? Arguably, at a time when our national security is under such serious threat, that is one of the most deserving of all for that particular purpose, and it gets only 2% of GDP—not that much above the 0.7% for aid. If we do not protect our national security, we shall be in no position to continue our very substantial aid programme. If one tries to preserve, as the Bill does, the hypothecation principle, it sets the example for all those other areas. The political commitments being made now in advance of the election mean that we are close to ring-fencing the health and education budgets as well. The problem is that the more we make it a legal commitment, added to a political one, the more the pressure to cut back on all other areas of public expenditure, including welfare, transport, capital expenditure generally and so on. The pressures on all those other areas are even higher when public expenditure has to be contained at times of economic crisis or because of the need to reduce the fiscal deficit.
The noble Lord, Lord Butler, referred to the fact that I was Chief Secretary when he was the Permanent Secretary—and an admirable one he was. That is why I believe, having been involved in many public expenditure rounds, that public expenditure decisions should be taken in the light of all considerations in each public expenditure round and not be bound by particular legislative commitments.
There is another problem. As our Economic Affairs Committee report put it, having a fixed target has certain consequences, such as,
“it wrongly prioritises the amount spent rather than the result achieved … it makes the achievement of the spending target more important than the overall effectiveness of the programme”.
We have some amendments that deal with that very point, where there is some evidence that the department has rushed out a lot of expenditure simply to meet the target in the past year. The report goes on to say that,
“the speed of the planned increase risks reducing the quality, value for money and accountability of the aid programme … reaching the target increases the risk … that aid will have a corrosive effect on local political systems”.
There are many arguments against having a fixed percentage in legislation. That is why we have put forward a number of amendments to deal with that point.
I have a number of views on value for money and so on that I was going to express now to avoid having to repeat them later. I shall confine myself simply to this point on this occasion but I repeat: there are strong arguments against hypothecation. That is what the Bill is doing and it will lead to the issue of whether other areas of expenditure, which for the general public are more important, should be hypothecated as well, and we run into a very serious situation if we continue on this tack. This is only one of several amendments that we have put forward on this theme, and I hope we do not have to repeat the arguments every time we come to it.