International Development (Official Development Assistance Target) Bill

Debate between Lord Forsyth of Drumlean and Viscount Astor

Friday 6th February 2015 Lords Chamber

[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.

[Lord Forsyth of Drumlean]

It is true that there are a lot of amendments in the group but they are consequential on the concept of creating a five-year period. The noble Lord, Lord McConnell, and I are old sparring partners and old habits die hard for him. In response to his intervention, and at the risk of being accused of repetition—I note that the noble Countess, Lady Mar, is not present—I stress that the National Audit Office report said that DfID was 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”.

What does that mean if not that it was not getting the best bang for the buck? The noble Lord said that 2013 was the first year for meeting the relevant target. He is absolutely right about that. However, the report goes on to say:

“The Department’s plans for delivering the 2015 ODA target require it to rapidly increase its investments, which could be difficult for it to achieve”.

If that is not saying loud and clear that we are unnecessarily putting the department in a straitjacket, I do not know what is. My amendment would prevent that and I hope that the noble Lord, Lord Purvis, will accept it.

The noble Lord opposite is clearly not persuaded by the National Audit Office report. My noble friend Lord Fowler was very unkind to Margaret Hodge, the chairman of the Public Accounts Committee, who I think in many respects has done a great job in chairing that committee. Indeed, she has said that it appeared that the cash has been “rushed out” to “meet the 0.7% target”.

She added:

“This raises questions about value for money which Parliament will be keen to look into”.

I do not think we can ignore that. Just to show that I am being balanced and fair, Sir Peter Luff, a very distinguished colleague, who many of us in this House remember with great affection, said:

“The committee must grill Dfid very carefully to make sure this money was spent wisely and well. This proves the folly of binding targets which set out how much you have to spend irrespective of need”.

Neither of these parliamentarians is noted for holding extreme views.

However, as the noble Lord is not happy with National Audit Office’s view, I turn to the International Development Committee, which was also concerned about the impact of the 0.7% target on the effectiveness of aid. It stated in its annual report of May 2014:

“2013 was an exceptional year. DFID’s expenditure increased rapidly as UK ODA rose from 0.56% to 0.7% of GNI. Nevertheless, it does seem surprising that DFID should spend over a quarter of its budget in December and almost 40% of its budget in November and December. DFID should provide the reassurance that its expenditure is rational and costeffective and not rushed out at the end of the year, which is the impression that can be given by its spending profile in 2013. We recommend that DFID carefully monitor its ability to meet the 0.7% target given uncertainties about both its own spending and that of other Departments and the GNI figure, which is itself subject to regular revision”.

As regards that latter point on regular revision, to which my noble friend Lord Howell referred, suddenly, it is decided that we need to take account of illegal drugs activity and prostitution and, as a result of that, we have to find an extra several hundred million pounds to spend on the aid budget. Does that make sense? It may be a bonus for the department, but it will certainly not be part of a planned approach.

I feel strongly about this issue as I was a member of the Economic Affairs Committee, under the splendid chairmanship of my noble friend Lord MacGregor, which took evidence on this issue. The evidence is there for people to see. It highlighted the problems, including that of wrongly prioritising the amount that is spent rather than the results that are achieved. Throughout the morning we have talked about how much is spent rather than how to get the best value for money from what is spent, as I said when we discussed the earlier amendment of my noble friend Lord MacGregor. We thought that a single-year target,

“makes the achievement of the spending target more important than the overall effectiveness of the programme”.

That was one of the conclusions of this House’s distinguished committee. We also said that,

“the speed of the planned increase risks reducing the quality, value for money and accountability of the aid programme”.

That is what we concluded a few years ago and that view is supported by the NAO and the International Development Committee.

A further point that has not been touched on this morning is that reaching the target increases the risk that aid will have a corrosive effect on other political systems by creating aid dependency. That, again, points to what DfID is doing very successfully—that is, looking at more targeted and sophisticated ways of providing aid and support and involving the private sector. I sense that the House has probably heard enough of this argument. I beg to move.