My Lords, the noble Lord, Lord Hollick, is very sad that he cannot be here—his name is on the amendment as the prime mover—because with his business interests he has a very strong concern about value for money. Unfortunately he has had to go because we are now at a quite late stage of a Friday afternoon for considering Bills.
The amendment is all about value for money. The clause to which it refers states:
“The Secretary of State must make arrangements for the independent evaluation of the extent to which ODA provided by the United Kingdom represents value for money in relation to the purposes for which it is provided”.
The amendment queries why the Secretary of State has been given in the legislation the task of making arrangements for the independent evaluation and why it is not clear in the legislation where that independent evaluation has to take place. We believe that it should be the Independent Commission for Aid Impact.
Let me explain exactly why we believe it should be the Independent Commission for Aid Impact, and why that should be described in legislation and not left to the discretion of the Secretary of State. I will simply quote a number of passages from a report that came out very recently—indeed, I think it was on 19 January—from the House of Commons Committee of Public Accounts, chaired by the right honourable Margaret
Hodge. It is a report on the oversight of the Private Infrastructure Development Group and graphically illustrates why it is important to have an independent evaluation of value for money on aid and not leave it simply to the Secretary of State to make the arrangements.
The report is absolutely devastating. It states, first:
“The Department’s oversight of PIDG”—
the Private Infrastructure Development Group—
“has not been sufficiently ‘hands on’. We are concerned that the Department has insufficient assurance over the integrity of PIDG’s investments and the companies with which it works and the Department has not done enough to put a stop to PIDG’s wasteful travel policies and poor financial management … the Department should do more to make sure PIDG takes a robust approach to the assessment and management of these risks. The Department was not well briefed on the specifics of individual investments which had attracted public concern”.
The committee therefore recommended that:
“The Department must ensure that PIDG has a robust and appropriate approach to due diligence in general and that it receives detailed briefings when concerns are raised about specific investments”.
Next, the committee says:
“The Department’s weak oversight of PIDG means that some of PIDG’s operational decisions are at odds with the Department’s objectives”,
and therefore recommends that:
“The Department should review its oversight mechanisms for PIDG to make sure that it has an appropriate level of visibility of operational matters, and that sound financial controls are in place and that money is appropriately spent”.
Next, the committee says:
“The Department’s poor oversight of PIDG allowed money to sit idle in a bank account rather than funding projects … The Department is not using its position as the dominant funder to drive improvements in PIDG’s performance”.
It therefore recommends that:
“The Department should use its 2015 multilateral aid review to develop a proportionate and risk-based approach to how it funds and oversees multilaterals, with a clear focus on whether its level of influence in multilaterals is commensurate with its level of funding, both in absolute terms and relative to other donors”.
Next, the committee says:
“Public confidence on spending on overseas aid through PIDG requires robust and independent information on the impacts achieved, which is currently lacking … While the Department has commissioned some independent evaluation of PIDG’s performance, it is too reliant on information from PIDG itself in making judgements about performance.
It therefore recommends that:
“The Department should push PIDG to have a robust system to monitor and evaluate impacts using the Department’s own expertise to gain assurance over the adequacy of PIDG’s approach”.
Next, the committee says:
“The Department has failed to draw sufficiently on the insight of its country teams to influence the investment decisions PIDG is making. PIDG represents a major investment by the Department”.
I could go on.
That is not me; that is the Public Accounts Committee. That is why I believe that the department should not be responsible for deciding how value for money is evaluated but should give it to the independent committee that I suggest. I beg to move.