International Agreements Committee
Monday 12th October 2026
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14:34
Lord Johnson of Lainston
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Lord Johnson of Lainston
Well, good afternoon, everyone, and welcome back from recess. I'm extremely pleased we managed to accommodate the diary of Sir Andrew Mitchell and having our meeting on a Monday. I'm very grateful to colleagues who are able to join us today. We are, as you know, undertaking public evidence session and a general inquiry into our decision as a country to join the United Nations Industrial Development Organization. And so we thought, well, we were fortunate enough to be able to know the individual who decided we should leave Unido in the first place.
We've had one full evidence session already. I think we heard from the department, the Fcdo and other witnesses. But Sir Andrew, thank you very much for being with us. We couldn't be more fortunate to have you explain to us why we left in, I think, 2010, 2000 or 2000. The decision was taken in 2010. We eventually left in 2012. And also your views on us rejoining would be very helpful to.
And then we'll have questions from the rest of the rest of my colleagues. But that's a good, good place to to kick off and appreciate you coming to speak to us.
We've had one full evidence session already. I think we heard from the department, the Fcdo and other witnesses. But Sir Andrew, thank you very much for being with us. We couldn't be more fortunate to have you explain to us why we left in, I think, 2010, 2000 or 2000. The decision was taken in 2010. We eventually left in 2012. And also your views on us rejoining would be very helpful to.
And then we'll have questions from the rest of the rest of my colleagues. But that's a good, good place to to kick off and appreciate you coming to speak to us.
14:35
Lord German
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Lord German
Well, thank you. Thank you very much, my Lord. And I'm obviously both honoured and privileged to be invited to come and give you this evidence, which I do with great pleasure. I'd like to give you a slightly lengthy answer, if that's all right, on why we left. And when we came into government in 2010, International Development had the very strong support of not only the Prime Minister but also the opposition parties.
I've been always been very keen to make it clear that it was a British policy, not a Labour or Conservative one, and we knew then that Britain was an international development leader. That was a time when we really mattered and we set the agenda. And of course, during the course of that Parliament, the House of Commons agreed. I think with only four people voting against that, we should spend 0.7% of our gross national income on international development, not only because it was the right thing to do, but also because it was, if you like, the other side of the coin to defence, it was money that was always spent or should always be spent in our national interests.
And it was about enhancing our security and prosperity as much as those very poor countries in which we worked. But we knew that if we were going to spend 0.7% of GNI, we would have to satisfy the public that the money was being really well spent. And that was why we set up the multilateral aid review and the bilateral aid review, and the multilateral aid review put all 43, I think, UN agencies through their paces to see whether or not they were they merited UK taxpayer support, the criteria which we measured, what they were doing against was whether they were pursuing UK interests and whether they were delivering value for money for the UK, UK taxpayer and for many of these agencies.
My Lord, they had never been looked at. The UN were aghast that we were doing this and didn't really believe that we would do it anyway. The process was founded in our absolute belief, which was then copied in many other countries around the world in the importance of results. We put all our conclusions into the public domain. We had the peer review by experts about those, those, those decisions, and I announced the results of the multilateral aid review on the 1st of March 2011.
And we basically divided the 43 agencies into three groups. We first of all, we looked at the ones which were really successful against our criteria. For example, Unicef, which looks after children where we were so impressed by what they were doing. We doubled their core grant and gave them an extra £10 million. Then there were those which were absolutely critical to Britain's interests, like, for example, the Commonwealth Secretariat, which needed to improve.
And then there were those that we gave a sort of nine final warnings in the case of the agencies. And then we there were four that we decided we couldn't justify spending British taxpayers any longer. And that on that. And one of those was Unido. And we thought that they had no impact on global poverty, that they lacked a country level presence in the countries they were working, or significance that there are more effective development actors with greater impact on the ground.
Key elements of what Unido was doing in those days were done better by the Undp. And your lordship will remember Lord Malloch Brown, who was a was an important presence in your House, who ran Undp and was responsible for them doing so well. But on Unido, the key weaknesses we identified were a lack of transparency, weak financial management, and weak financial reporting. So we decided to withdraw over two years, saving £7 million a year.
But we did continue, of course, with funding specific projects. Well, we didn't leave the IOM, for example, the AU, which dealt with migration. We did cut back what we were doing, but subsequently there were specific project issues which the IOM was engaged with, which were very important to Britain's interests. I remember a particularly tricky and worrying occasion when we had thousands of refugees during the Libyan crisis. On sitting on the coast at Misrata, and we provided funding for the IOM to go in and lift them off the off the off the side, off the side of the wharf.
Very brave people who did that. So, so we could always still fund if the necessity specifically arose, but we decided we wouldn't give them any more annual funding. And there was there was a it was fully in the public domain, but there was an occasion, I know, when I was rung up by Downing Street to say that they thought that the Prime Minister was concerned that whether we got Unido right and someone had had lunch with someone batting for Unido, and I explained to her number ten why we were doing it, and number ten were entirely satisfied.
So it was a well thought through and careful decision.
I've been always been very keen to make it clear that it was a British policy, not a Labour or Conservative one, and we knew then that Britain was an international development leader. That was a time when we really mattered and we set the agenda. And of course, during the course of that Parliament, the House of Commons agreed. I think with only four people voting against that, we should spend 0.7% of our gross national income on international development, not only because it was the right thing to do, but also because it was, if you like, the other side of the coin to defence, it was money that was always spent or should always be spent in our national interests.
And it was about enhancing our security and prosperity as much as those very poor countries in which we worked. But we knew that if we were going to spend 0.7% of GNI, we would have to satisfy the public that the money was being really well spent. And that was why we set up the multilateral aid review and the bilateral aid review, and the multilateral aid review put all 43, I think, UN agencies through their paces to see whether or not they were they merited UK taxpayer support, the criteria which we measured, what they were doing against was whether they were pursuing UK interests and whether they were delivering value for money for the UK, UK taxpayer and for many of these agencies.
My Lord, they had never been looked at. The UN were aghast that we were doing this and didn't really believe that we would do it anyway. The process was founded in our absolute belief, which was then copied in many other countries around the world in the importance of results. We put all our conclusions into the public domain. We had the peer review by experts about those, those, those decisions, and I announced the results of the multilateral aid review on the 1st of March 2011.
And we basically divided the 43 agencies into three groups. We first of all, we looked at the ones which were really successful against our criteria. For example, Unicef, which looks after children where we were so impressed by what they were doing. We doubled their core grant and gave them an extra £10 million. Then there were those which were absolutely critical to Britain's interests, like, for example, the Commonwealth Secretariat, which needed to improve.
And then there were those that we gave a sort of nine final warnings in the case of the agencies. And then we there were four that we decided we couldn't justify spending British taxpayers any longer. And that on that. And one of those was Unido. And we thought that they had no impact on global poverty, that they lacked a country level presence in the countries they were working, or significance that there are more effective development actors with greater impact on the ground.
Key elements of what Unido was doing in those days were done better by the Undp. And your lordship will remember Lord Malloch Brown, who was a was an important presence in your House, who ran Undp and was responsible for them doing so well. But on Unido, the key weaknesses we identified were a lack of transparency, weak financial management, and weak financial reporting. So we decided to withdraw over two years, saving £7 million a year.
But we did continue, of course, with funding specific projects. Well, we didn't leave the IOM, for example, the AU, which dealt with migration. We did cut back what we were doing, but subsequently there were specific project issues which the IOM was engaged with, which were very important to Britain's interests. I remember a particularly tricky and worrying occasion when we had thousands of refugees during the Libyan crisis. On sitting on the coast at Misrata, and we provided funding for the IOM to go in and lift them off the off the off the side, off the side of the wharf.
Very brave people who did that. So, so we could always still fund if the necessity specifically arose, but we decided we wouldn't give them any more annual funding. And there was there was a it was fully in the public domain, but there was an occasion, I know, when I was rung up by Downing Street to say that they thought that the Prime Minister was concerned that whether we got Unido right and someone had had lunch with someone batting for Unido, and I explained to her number ten why we were doing it, and number ten were entirely satisfied.
So it was a well thought through and careful decision.
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14:45
Lord German
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Lord German
Yes. Well, thank you very much. Lady, the so. So basically, I think you're asking me whether there are tangible benefits over and above, you know, the informal engagement and voluntary amounts that we we make. And I think what I would say is there are arguments for going back in, but they have to be tested against the current and very different from my time in government constraints on the development spend.
I mean, the the development challenge debate and the era have changed. And developing countries do need industrial capacity. And there's a change now where there's very little grant aid money, but there is money for investment. And so investment and not grant aid is the word of the day, although it's important to remember in a very poor country that investment will not be successful unless you
I mean, the the development challenge debate and the era have changed. And developing countries do need industrial capacity. And there's a change now where there's very little grant aid money, but there is money for investment. And so investment and not grant aid is the word of the day, although it's important to remember in a very poor country that investment will not be successful unless you
15:01
Speaker 1
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Speaker 1
To all of those decisions are much, much more difficult now because the funding is so constrained. And also never forget that the cutting of the funds is one thing, but the vaporizing of the expertise which was respected around the world. Indeed, I would go so far as to say, my Lord, that I think the only area of British international leadership which has been accepted in the past without qualification has been on international development.
You saw this respect on all sides of the United Nations, and today, I'm afraid, we are in a very, very difficult and different circumstance when it comes to British interests and British effectiveness in the way I've described.
You saw this respect on all sides of the United Nations, and today, I'm afraid, we are in a very, very difficult and different circumstance when it comes to British interests and British effectiveness in the way I've described.
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15:02
Speaker 1
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Speaker 1
Well, I felt we could use taxpayers money better ourselves. And with the very limited taxpayers money that is available today, much of which, of course, is going to fund the first year of an asylum seeker's time in Britain. And that is in accordance with the rules governing the overseas aid budget leaves very little indeed. And therefore we have to be we have to approach being careful with the way we spend this money in a in a very different way from when, with all party agreement the money was far greater and our reach and effectiveness were far greater.
Always remembering, of course, that the first call that the British public expect us to make on this budget is on humanitarian expenditure, and the committee will be well aware of the disaster that's going on in Darfur at the moment. And obviously, that , quite apart from being an area of previous British historical interest, is also an area that cries to the heart of a generous British public in supporting these people there who have been and are in desperate peril.
Always remembering, of course, that the first call that the British public expect us to make on this budget is on humanitarian expenditure, and the committee will be well aware of the disaster that's going on in Darfur at the moment. And obviously, that , quite apart from being an area of previous British historical interest, is also an area that cries to the heart of a generous British public in supporting these people there who have been and are in desperate peril.
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15:04
Speaker 1
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Speaker 1
That is that money is not being spent by the Foreign Office. It is from doubtless from the Oda budget, the development budget. But I think it is being spent mainly by Disney's, because, of course, within the government they have the lead on many of these climate issues. And I gave an example where £15 million of British taxpayers money was being spent in Brazil, but that if if it brings in not only the development finance money from from multilateral organisations, but also the additional private sector money would look to be very good value indeed.
But, you know, the you have to wait and see what the evaluation says.
But, you know, the you have to wait and see what the evaluation says.
15:05
Lord Hannay of Chiswick
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Lord Hannay of Chiswick
Yes. Well, we'll have to wait and see what happens in the Brazilian election to. But thank you very much for coming along. And I think it's hugely valuable to the committee to have a former Secretary of State of your effectiveness, which I would certainly bear testimony to coming here to tell us why it was you withdrew and to answer our questions. So that's very good. And I would like to pick up one point that you made at the beginning where you instanced Unicef, where you had greatly increased our contribution, because it was a very good organisation which was spending the money in an effective way.
I think that is a very important point, because when I was responsible in New York for these matters, one of the weaknesses then was the position we're in now, which is that whenever we went to a subject, a UN organisation, to a rigorous inquiry, they would say to us, and if we can satisfy you, will we get more money? And the answer . In the early 1990s, when Baroness Chalker was the minister, was sorry, it won't make any difference to the amount of money you can get, and that is a hopeless position to be in, because there is no And if so, the nature of subjecting the decision, which the government has now reached to rejoin Unido to a review of some sort or another in a probably a specified period of time to make sure that the UN is not, as I think you yourself suggested, sometimes UN organizations do, slipping back again into funding largely its own running costs and not the objects that the organization is set up to do.
So the double question is this. First of all, do you think that the decision that's being taken, and I'm sorry, we're going to jump. I'm just jumping to the assumption that it will be taken, that it has been taken and that it will be sustained, that that decision should be subjected to some form of review to ensure that there has not been backsliding on the elements that the government considers have demonstrated that Unido is doing better in recent years.
Do you think that that should be a review? And the second part of the question is if there is going to be a review after, let us say, 3 or 5 years, a review of the decision to rejoin that, do you think that that should be subject to any kind of parliamentary process in either House of Parliament, of the sort that we are having at the moment here on this decision?
I think that is a very important point, because when I was responsible in New York for these matters, one of the weaknesses then was the position we're in now, which is that whenever we went to a subject, a UN organisation, to a rigorous inquiry, they would say to us, and if we can satisfy you, will we get more money? And the answer . In the early 1990s, when Baroness Chalker was the minister, was sorry, it won't make any difference to the amount of money you can get, and that is a hopeless position to be in, because there is no And if so, the nature of subjecting the decision, which the government has now reached to rejoin Unido to a review of some sort or another in a probably a specified period of time to make sure that the UN is not, as I think you yourself suggested, sometimes UN organizations do, slipping back again into funding largely its own running costs and not the objects that the organization is set up to do.
So the double question is this. First of all, do you think that the decision that's being taken, and I'm sorry, we're going to jump. I'm just jumping to the assumption that it will be taken, that it has been taken and that it will be sustained, that that decision should be subjected to some form of review to ensure that there has not been backsliding on the elements that the government considers have demonstrated that Unido is doing better in recent years.
Do you think that that should be a review? And the second part of the question is if there is going to be a review after, let us say, 3 or 5 years, a review of the decision to rejoin that, do you think that that should be subject to any kind of parliamentary process in either House of Parliament, of the sort that we are having at the moment here on this decision?
15:08
Lord German
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Lord German
There is a very interesting question on Unicef. I completely agree with your lordship, because it was important to show, as I said, the UN were aghast that we were doing this. They didn't believe we would do it. And that speaks to a complacency of an organization which you know far better than any of us do. And with Unicef, we were showing that it was not an exercise in cutting. You know, often people immediately would cynically think they're only doing this to cut away.
But we only cut away four of the organizations. And Unicef is an example of one where we looked at the results they were achieving. We saw what they were doing for children, an impossibly awful situations around the world and how they were ameliorating that. And so we were able, following a very stringent analysis, able with some pleasure to double the core grant, which, as I say, I think was £10 million a year at that point.
And we're very pleased to to do it. On the subject of a, of, of a proper assessment of this decision and the nature of whether it should be a parliamentary inquiry or not. I think your committee, my Lord, has shown the right way to do this. I note that the government has, I think, promised that there will be an evaluation in 2029, and I hope very much that this committee will hold the I mean, I start by saying that the Oda budget is under unprecedented stress.
And therefore, you know, you have to be clear that this is not just a nice to have. It's because of the stress on the budget. It needs to be, you know, one that will really do good. And I've mentioned a number of ways in which it could really do good, and in particular, helping with the very important climate change agenda. But the there are issues that remain. I think there are two that I would mention to the committee.
One is Unido's own review and independent evaluation of its results. Based management looked at the performance of Unido between 2018 and 2025. So that was sometime after we had given the shock of of leaving. And as you said, my Lord, other countries copied our lead. So the formal systems and frameworks, according to the 2018 2025 review, are much improved. But it also makes clear that results management was not well implemented across the whole of Unido.
That is incredibly important because if you can't show the results, you can't justify it to taxpayers the money you are spending. Secondly, the report identified weak accountability and controls below senior management levels. This included fragmented data systems, incomplete baselines, and shortcomings in measuring outcomes across their activities. The results agenda, which I have repeatedly mentioned, and this really matters because better systems and a more attractive strategy are not the same thing as demonstrating those results.
So my conclusion is that you need a has changed in ways that are important since we reviewed them in the multilateral aid review after 2010, but they have not fully overcome the original Mar concerns. But my department, when I was in the Foreign Office, was not spending money on Unido, hasn't done for at least five years. So in a way, the answer to that question to justify rejoining. Well, I think the jury could be argued to be out, needs to be put to designees .
And a lot of attention paid to 2029 when that next review takes place.
But we only cut away four of the organizations. And Unicef is an example of one where we looked at the results they were achieving. We saw what they were doing for children, an impossibly awful situations around the world and how they were ameliorating that. And so we were able, following a very stringent analysis, able with some pleasure to double the core grant, which, as I say, I think was £10 million a year at that point.
And we're very pleased to to do it. On the subject of a, of, of a proper assessment of this decision and the nature of whether it should be a parliamentary inquiry or not. I think your committee, my Lord, has shown the right way to do this. I note that the government has, I think, promised that there will be an evaluation in 2029, and I hope very much that this committee will hold the I mean, I start by saying that the Oda budget is under unprecedented stress.
And therefore, you know, you have to be clear that this is not just a nice to have. It's because of the stress on the budget. It needs to be, you know, one that will really do good. And I've mentioned a number of ways in which it could really do good, and in particular, helping with the very important climate change agenda. But the there are issues that remain. I think there are two that I would mention to the committee.
One is Unido's own review and independent evaluation of its results. Based management looked at the performance of Unido between 2018 and 2025. So that was sometime after we had given the shock of of leaving. And as you said, my Lord, other countries copied our lead. So the formal systems and frameworks, according to the 2018 2025 review, are much improved. But it also makes clear that results management was not well implemented across the whole of Unido.
That is incredibly important because if you can't show the results, you can't justify it to taxpayers the money you are spending. Secondly, the report identified weak accountability and controls below senior management levels. This included fragmented data systems, incomplete baselines, and shortcomings in measuring outcomes across their activities. The results agenda, which I have repeatedly mentioned, and this really matters because better systems and a more attractive strategy are not the same thing as demonstrating those results.
So my conclusion is that you need a has changed in ways that are important since we reviewed them in the multilateral aid review after 2010, but they have not fully overcome the original Mar concerns. But my department, when I was in the Foreign Office, was not spending money on Unido, hasn't done for at least five years. So in a way, the answer to that question to justify rejoining. Well, I think the jury could be argued to be out, needs to be put to designees .
And a lot of attention paid to 2029 when that next review takes place.
15:13
Lord Hannay of Chiswick
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Lord Hannay of Chiswick
Well, thank you very much. And I I'm delighted that when you read the transcript of the evidence we took from officials, you got the impression they'd committed themselves to a parliamentary procedure with this committee when they reviewed. I have to say that having sat in the room and watched them doing so, I'm not sure if I was left feeling a little way short of certainty that that is what was actually going to happen. And of course, they will have another opportunity to do so if we decide to raise this matter in our report, because it will come up in the debate that the House has, and I would hope we would get a more a full throated commitment to that, because one of the reasons, and I'd like you to comment on this last part of my question is that a parliamentary dimension to this is actually of benefit to our negotiators when they're talking to Unido, because they're able to say to them, look, you understand that we're going to have to go before a parliamentary committee and tell them that the money you you are spending is good value for our taxpayers.
And to do that, we're going to need some very convincing arguments. And here are three, four, five of them. This is a weapon in our hands rather than something we should be flinching from. Is that your view?
And to do that, we're going to need some very convincing arguments. And here are three, four, five of them. This is a weapon in our hands rather than something we should be flinching from. Is that your view?
15:14
Lord German
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Lord German
Yes. Your lordship is entirely correct. And my observation would be that the International Development Select Committee in the other place is highly respected, and certainly officials in both my second time in government between 2010 and 2013 and my final and third part between 2022 and 2024, officials were very wary of select committees because, you know, their job representing the taxpayer representing our constituents is to get to the bottom of all these matters.
And in a way, it's a it's a very, very good system for holding government to a count. And the International Development Select Committee is extremely good at doing it. I hope I said my notes here say that the government is proposing a 2029 review. And perhaps in your future discussions, my Lord, you might wish to turn that proposition into a commitment. I
And in a way, it's a it's a very, very good system for holding government to a count. And the International Development Select Committee is extremely good at doing it. I hope I said my notes here say that the government is proposing a 2029 review. And perhaps in your future discussions, my Lord, you might wish to turn that proposition into a commitment. I
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Lord Stevenson of Balmacara
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Lord Stevenson of Balmacara
Yes. Could I could I make one one question we're very grateful to you for for the comments you've made and you've you've broadened the debate and enlightened us on a number of issues that we were concerned about. I was just thinking and reflecting on what you said about the Ma review, which was obviously groundbreaking, I think, and you your credit, you should take credit for that in attacking something which probably most