International Development (Official Development Assistance Target) Bill

Debate between Lord Forsyth of Drumlean and Lord McConnell of Glenscorrodale

Friday 6th February 2015 Lords Chamber

[Lord Forsyth of Drumlean]

And very good they are too. My issue is: how do you make an annual statement about how the Secretary of State has complied with the duty under Clause 5(1)? Clause 5(1) 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”.

My point, which is my noble friend’s point, and was the original intention of the noble Lord, Lord Hollick, had he been able to be here, is that to determine whether there is value for money in these programmes, it is necessary to have a powerful independent body that reports to Parliament. However, what the clause provides for in subsection (2) is for the Secretary of State to put in the annual report, which the Minister has mentioned, a statement about how the Secretary of State has complied with the duty to make arrangements for the independent evaluation.

The noble Lord, Lord Purvis—I am sure he is anxious to get back on his feet—in his explanation of this clause, said something completely different. He seemed to say that what was being proposed here was that the Secretary of State would indicate in the annual report how well he had complied with the duty to ensure the independent evaluation of the programme. I am saying that that is a nonsense, and that what my noble friend’s—

[Lord McConnell of Glenscorrodale]

My Lords—

[Lord Forsyth of Drumlean]

In a second. My noble friend’s amendment seeks to have an independent body that reports to Parliament and says, “Look, the Secretary of State’s programme has gone wrong here and has gone well there”, and then Parliament holds the Secretary of State to account. The problem with this arrangement is that the independent body is the creature of the Secretary of State, and the Secretary of State reports in his annual report on how it is doing. That is all I am saying.

[Lord McConnell of Glenscorrodale]

With all due respect to the noble Lord, Lord Forsyth, I suspect that most other Members in your Lordships’ Chamber both understand and accept the explanation that has been given by both the noble Lord, Lord Purvis, and the Minister. In fact, the noble Lord, Lord Purvis, made a very good point about comparing aspects of this legislation with previous legislation in this Parliament on the parliamentary scrutiny of ministerial financial expectations. I implore the noble Lord, Lord Forsyth, to accept—or at least allow the rest of us to accept—the explanations and understandings that have been given, and allow us to move on.

[Lord Forsyth of Drumlean]

If the noble Lord understands it so well, perhaps he could explain it to me.

International Development (Official Development Assistance Target) Bill

Debate between Lord Forsyth of Drumlean and Lord McConnell of Glenscorrodale

Friday 6th February 2015 Lords Chamber

[Lord Forsyth of Drumlean]

My Lords, the amendment seeks to leave out the provision for meeting the aid target annually and replace it with “five year period”. Its purpose is to try to get over some of the difficulties caused by having a fixed target that has to be met within a calendar year with, as I explained earlier, a Government who are budgeting on the basis of a financial year, and to allow some flexibility. I am sorry that my noble friend Lord Fowler, who I know feels passionately about these matters, is not in his place—he has arrived. In his excellent speech he made a number of points that relate directly to this issue and which I shall try to deal with.

The amendment seeks to change the timeframe within which the 0.7% target applies. The Bill currently places a duty on the Secretary of State to ensure that public spending reaches 0.7% of GNI every year. I should just like to point out that the UN resolution did not actually require 0.7% to be achieved each and every year, so my amendment is not in conflict with the original UN resolution. For some reason, “every year” has been added in the nature of this Bill, and I believe that that greatly adds to the impracticalities and difficulties that the Bill presents. The amendment would mean that public spending on international aid would be required to reach 0.7% of GNI across a five-year period, and that would avoid the need to rush or defer spending on aid programmes.

I shall resist the temptation to take the Committee through the whole NAO report, which was published on 15 January and which I referred to earlier, but it deals with the real concerns and difficulties that the department has had in managing what it is being asked to do by government.

[Lord McConnell of Glenscorrodale]

At the risk of provoking the noble Lord to read out the whole of the NAO report, I hope that he will accept that during the Second Reading debate, which he listened to very carefully, a number of alternative versions and impressions of that report were described by noble Lords, including the very positive comments made in the report about the way the department was preparing for this eventuality. It was not a one-sided report and the version that the noble Lord gave earlier was not the only version described during Second Reading.

[Lord Forsyth of Drumlean]

I am not seeking to take sides with anyone. If the National Audit Office and the Chairman of the Public Accounts Committee draw our attention to the very serious difficulties which the department has had to meet, and to the serious implications for getting the best value for money in the aid programme, we need to take account of that.

[Lord McConnell of Glenscorrodale]

The report, which I have read in great detail, praises the department for the way in which it sought to achieve those objectives.

[Lord Forsyth of Drumlean]

And rightly so. The department is absolutely heroic. It has been given an impossible task. If the noble Lord has read the report, he will see that it had to juggle its budgets and go to the Treasury for extra cash. My noble friend on the Front Bench is shaking her head. If she wants to intervene and contradict me, I would be happy to give way, because it is clear from the report that it has had to do so because of the Government’s policy.

By the way, the Government do not need this Bill to decide to spend 0.7%, 0.8%, 0.9% or 2% of GDP on development aid. This is not a sine qua non as far as the Government’s policy is concerned. Indeed, without the Bill the UK’s international aid budget has grown exponentially over the past few years. In absolute terms, the UK ODA spending increased from £3.8 billion in 2003 to £11.4 billion in 2013. That is an increase of £8 billion over a 10-year period. The most recent rise in spending is particularly striking; it increased by £2.67 billion between 2012 and 2013. That is a 33% increase in spending, which is a lot to take account of in one year.

The National Audit Office report, which I shall paraphrase and summarise—I hope the noble Lord will accept that it is a fair assessment—said that DfID spent an extra £1 billion in international aid in just eight weeks towards the end of 2013 to satisfy the 0.7% target. Spending an extra £1 billion in eight weeks before the year end reminds me of the bad old days of local government when all the roads started getting dug up in March because the local authorities were trying to spend their budgets. All kinds of projects that would not have made the cut if considered on a priority basis and a sensible basis suddenly got done. This is the very situation that we are creating by having this inflexible target over a limited period of time, and it is what the amendment seeks to address.

My noble friend Lord Fowler chided me for using words such as “rush”. He is absolutely right; one of the beneficiaries of the rush to spend was indeed the AIDS programme—and a very worthwhile programme that is. I do not know which programmes lost out the following year when they had to be throttled back in order for the target to be met, but of DfID’s spending in 2013, around 40% occurred in November and December. If that does not say that this is a department trying to spend the money and struggling to meet a target, I do not know what it says. Why did it take until the last two months of the calendar year, the year in which the target is assessed, to spend 40% of the budget? The National Audit Office outlined a number of concerns relating to the 0.7% target and its impact on efficiency of aid spending. These include DfID having to,

“quickly add some activities to its 2013 plans but delay others set for 2014, making it more difficult to achieve value for money”.

One of the arguments that we have heard this morning was used by the noble Lord, Lord McConnell, as I recall, in his Second Reading speech. He said, “If we have this target, we can stop talking about the quantity of aid and start thinking about the quality of aid”. I paraphrase him and am relying on memory; I hope I have not misrepresented him.

[Lord McConnell of Glenscorrodale]

I am delighted that the noble Lord has repeated my argument.

[Lord Forsyth of Drumlean]

The noble Lord’s argument is no good if we stick with the provisions in the Bill, because, as he said himself, the National Audit Office report says that the target resulted in some activities having to be rushed in. They had to be ready to be implemented and other activities had to be delayed. That is not providing certainty or long-term planning; it is substituting for long-term planning the shifting of particular programmes, such as the AIDS programme that my noble friend Lord Fowler referred to. “What can we do? What can we spend this money on? Right, let’s do the AIDS thing because that is ready to fly, and we will defer this other one because we will not then be able to afford it”. Everything is geared towards meeting the 0.7% target.

--- Later in debate ---

[Lord Forsyth of Drumlean]

I agree that I could not make the noble Lord’s arguments because they are confused. He is confusing two things: the desire to ensure that we have effective programmes to deal with poverty and the desire to meet a particular target and implement it in a legislative form that will have the effect of programmes being delayed and of money being spent unwisely because of the constraints that are being put on the very excellent people in DfID. We are very lucky; in DfID, we have one of the best organisations in the world. Why on earth are we shackling it in a way that prevents it from setting priorities, doing its job effectively and getting the long-term certainty and commitment which the noble Lord, Lord McConnell, who I see is about to intervene again, has talked of so eloquently in his speech.

[Lord McConnell of Glenscorrodale]

I thank the noble Lord for allowing me to respond to his reference to my Second Reading speech. I wish to make two points. First—I hope that the noble Lord accepts this—the National Audit Office report makes clear that it does not believe, and has no evidence to suggest, that any of the money that was spent on projects in that financial year was wrongly spent or that the projects were not worth while. That is very clear in the National Audit Office report. Secondly, that report was specifically commissioned because this was the first year of meeting the new target and clearly there were going to be timescale issues in meeting the target in the first year. The point that noble Lords are making—including the noble Lord, Lord Purvis, in bringing forward this Bill—is that bringing consistency and predictability to meeting this target year after year will help deal with those timescale issues, not exacerbate them.

[Viscount Astor (Con)]

My Lords, before my noble friend replies to the noble Lord, will he confirm that he is speaking to all the amendments in the group as it is a large group? I say to the noble Lord, Lord McConnell, that it is normal in Committee to allow the mover of the amendment to make his speech. There is plenty of opportunity to respond afterwards. Indeed, the mover of the amendment can then respond at the end of the debate.

Scotland Bill

Debate between Lord Forsyth of Drumlean and Lord McConnell of Glenscorrodale

Tuesday 6th September 2011 Lords Chamber

[Lord McConnell of Glenscorrodale]

My Lords, I suppose that the starting phrase should be, “Follow that!”. In any debate on the constitutional position of Scotland, my starting point is what is best for the people of Scotland and what is best for Scotland—not what is best for the coalition Government, the Labour Party or even the union, but what is best for Scotland and the people of Scotland—whether it is best to be inside or outside the United Kingdom or, indeed, the European Union.

For me, devolution for Scotland, and for Wales and Northern Ireland within the modern partnership of nations that is the United Kingdom, is indeed the best arrangement for Scotland and for the people of Scotland. That is why in my very first vote I cast a yes vote in the 1979 referendum that the noble and learned Lord, Lord McCluskey, mentioned earlier. That is why I campaigned through the 1980s and 1990s and was involved in the convention that the Minister mentioned in his introductory remarks, and why I stood for the Parliament and had the pleasure of serving with my noble and learned friend—I call him my friend even though he sits on that side of the House—as First Minister and Deputy First Minister in that Parliament.

Do I believe that the Scottish Parliament has done everything right in the 12 years since 1999? No, of course not; no Parliament does everything right. Do I believe that the Scottish Government or all First Ministers have done everything right? No, of course not. All Governments and First and Deputy First Ministers will make mistakes from time to time. But is Scotland a stronger and a better place? I would argue that, yes, it is. Did we survive and indeed build on the electronics manufacturing meltdown in the late 1990s to ensure that our economy's growth rate matched that of the UK by 2007? Yes we did. Did we reverse the brain drain that the Minister mentioned in his introductory remarks and increase Scotland's population after years of decline? Yes we did, through policies pursued in the Scottish Government and the Scottish Parliament. Did we lead the rest of the UK in the smoking ban? Yes we did. Did we reform Scotland's land laws and criminal justice service? Yes we did.

Devolution has made Scotland a stronger and better place, but after 12 years it is right to review the settlement agreed by referendum and by this Parliament back in the late 1990s. Was Calman the right way to do that? I think, on balance, yes. I am not a great fan of committees of the great and the good or of trying to seek consensus for the sake of consensus, but on the issue of the constitutional position of Scotland within the United Kingdom I think that the attempt to find consensus and the way in which that was done was broadly the right approach. Do I believe that the proposals have merit? Yes. Initially, I was not convinced by the report of the Calman commission, but over time I have become persuaded that most of the proposals have merit. Are they perfect? Of course not, but I do not believe that perfection should ever be the enemy of progress, as has been said by others more eminent than me.

Do I believe that the Bill deserves scrutiny? Yes, I do, but I also believe that it will ultimately deserve support. It contains proposals that are both radical and reasonable. I will come to the radical ones in a second. Although some of the initial proposals may irk the noble Lord, Lord Forsyth, I believe that, subject to the scrutiny that we need to give them, they will ultimately be supported by this House and Parliament. I am sure that they will lead to sensible decision-making in Scotland and therefore deserve a fair wind.

On finance and taxation powers, the original tax power was conceived at a different time and in a different economic climate. Like the electoral system, it was part of a settlement designed to secure the progress of devolution. The power to increase income tax by plus or minus 3p in the pound has never been used. That is partly because the parties who would have used it lacked the courage to do so. The nationalists lost an election in 1999 because they proposed to use it by increasing income tax and never made that proposal again. I would argue that one reason why the Scottish Conservatives have been in the doldrums since then has been that they have never been brave enough to propose to reduce income tax in the Scottish Parliament. That power has now become redundant because the political parties in Scotland have never felt that it was an appropriate use of the powers of the Parliament.

[Lord Forsyth of Drumlean]

One of the reasons it has not been used is because, when I was Secretary of State, the budget was about £14 billion. It is now about £30 billion. That was a period when there were vast amounts of money coming in. We are now in a period when the opposite is happening.

[Lord McConnell of Glenscorrodale]

I was just coming to the issue of the increase in the budget. In the mean time, the budget has increased from about £10 billion when I was the first Finance Minister to about £30 billion. A broad consensus has developed in Scotland over that time that there is not enough responsibility for spending in the Scottish Parliament and the Scottish Government and that there is a need to change taxation powers—the way that the Scottish Parliament receives finance and that the Scottish Government raises finance—to ensure greater accountability of decision-making.

I was not initially convinced by the proposal in the Calman commission but I have become convinced that it could indeed be workable and improve the governance of Scotland. As the noble Lord, Lord Forsyth, has just said, it is wrong to argue that the Scottish Parliament, perhaps alone among legislative parliaments in the world, is not fit to set taxes. As long as a parliament is held accountable for its decisions, it should be free to set some taxes. That opportunity in the Scottish Parliament would lead to more responsible decision-making than has perhaps been exhibited at some times over the last 12 years.

This power is also fundamentally different from the imposition of the poll tax back in the late 1980s. The difference is that income tax is income related whereas the biggest problem with the poll tax was not its gearing—although that was an issue—but the fact that it was correctly perceived to be unrelated to income and provoked a reaction and civil unrest across the country.

We should test the proposal here. The noble Lord, Lord Forsyth, made some important points about the need to test the detail. In my view, the principle is right. The Scottish Finance Minister having to set a budget every year and make a decision to raise taxes would enhance accountability and responsibility in the devolved settlement. However, since the Calman proposals have come forward—