Developing Countries: Jobs and Livelihoods

David Simpson Excerpts

Wednesday 15th June 2016 Westminster Hall

[Jeremy Lefroy]

I entirely agree with the hon. Gentleman. I will give an example of that later in my speech, but he is absolutely right. I made a similar point in Monday’s debate in this Chamber on foreign aid expenditure.

What can be done? I shall give several possible solutions. First, let us work with what we have. I shall start with agriculture, because it is at the heart of the economies of most developing countries. It provides most of the work and a considerable share of GDP, Government income and exports. It also provides the basis for local manufacturing. Even in developed economies such as ours, food and drink production is the largest manufacturing sector. Why should that not be the case in developing countries?

Although all countries will of course wish to diversify into other sectors and reduce reliance on agriculture, that is not the same as neglecting agriculture. That mistake has been made far too often in the past, both by Governments and by their aid-funded advisers. I am glad to say that things have changed over the past three decades. Countries such as India and Vietnam, and more recently Ghana, Tanzania and Ethiopia—to name but a few of many—have given much more prominence to agriculture and increased their support of it. The same is true of development agencies, especially the Department for International Development. I welcome that.

Working with what we have in agriculture also means working with the smallholder farmers who are its backbone. When I started to work with smallholder farmers nearly 30 years ago, the view of many was that they were on the way out, and that the future of agriculture was large-scale farming. In fact, they are more important than ever, providing food security even in conflict zones. For example, in the 1970s Angola produced a similar amount of coffee to Uganda, but Angola’s coffee was almost all produced on large estates, while Uganda’s was produced by smallholders. Both countries went through long periods of turbulence. Today, Uganda’s coffee production is the same as it was back then, if not more, but Angola’s coffee production has almost disappeared. Smallholder farmers are incredibly resilient.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on securing this debate. He has vast experience of developing countries. Does he agree that there needs to be an emphasis on educating young people so that there are links with the business community? He will know that every year in the House there are campaigns to get children in developing countries into education. That would help them on the pathway to jobs, no matter how little.

[Jeremy Lefroy]

I agree entirely. I shall address that issue in a moment, because it is vital.

I have a couple of other examples of sectors in which we can work with what we have. Hospitality is important in every developing country. It is about not only international tourism, but looking after people in one’s own country and wider region. Hilton estimates that, if there is proper investment around the world, the hospitality sector alone could create an additional 70 million jobs over the next decade. Apart from agriculture and agricultural processing, construction is very likely to create and sustain jobs and livelihoods in most parts of developing countries. I shall say a little more about that later in my speech. We must also consider local services. Services are often neglected in favour of large manufacturing investments, yet in every town and city, along every main street, one will see service businesses. We need to support and encourage them, because if every service business employed one more person, millions more people would be employed throughout the developing world.

Secondly, not only should we work with what we have, but we must not stand still. Everyone wishes to see a better life for their family. Incomes from agriculture can be improved in many ways. That subject is worth an entire debate in itself, but, to be brief, they include enhanced productivity through better inputs, advice, irrigation, finance, diversification, storage to reduce crop losses, and access to markets and to information about those markets. In other words, that means moving on from subsistence agriculture.

DFID’s recently published conceptual framework on agriculture puts it well. It says that there is

“the assumption that sustained wealth creation and a self-financed exit from poverty depend, in the long-term, on economic transformation and the majority of the rural poor finding productive and better paid employment outside of primary agricultural production”—

note that the framework says primary—

“Despite the need for this transition, agricultural growth and downstream processing and productivity growth are likely to be important, if not essential, as a continued source, if not driver, of growth.”

When I was involved in buying cocoa from smallholder farmers, we saw the price per kilo paid to farmers, and hence their income, rise at least fourfold over two or three years as result of a combination of improved quality, better logistics, a higher world market price and a greater percentage of that price being paid to the farmers. It also depended on having a reliable buyer prepared to take a long-term approach, rather than one driven by short-term trading considerations. The farmers’ improved incomes not only sustained and improved their own livelihoods but created jobs at a tremendous rate. The money stayed in the local economy to support input dealers, schools, clinics, general stores and bars. That, in turn, created jobs in local and national manufacturing and service businesses. I am a believer not in trickle-down economics, but in trickle-up economics, and smallholder agriculture is at the heart of that.

I have concentrated on agriculture, but the need not to stand still applies to all the other sectors I mentioned. In hospitality, training, good-quality service and investment meet the needs of nationals, not just tourists. There is no reason why someone cannot provide an excellent hotel or tourist spot for their own population. They do not need to rely on a few hundreds of thousands or tens of thousands of overseas visitors.

Construction jobs can be enhanced through a formal apprenticeship scheme of the kind I mentioned. They can also be supported by placing specific requirements on contractors in large infrastructure projects to employ and properly train local people in their work. That is increasingly happening, but it needs to be extended to the most senior levels of the contract, not just the grassroots workers. Skills are best transferred in the heat of building a major road, bridge, airport or railway line.

--- Later in debate ---

[Jim Shannon]

My hon. Friend is most wise, as always. He sets the scene. There are many difficulties at home and abroad. All we can do in the debate is to set the scene and the goals, and contribute, we hope, to a strategy for a way forward. That is what we are trying to do. In 2014, the UK provided £752 million in bilateral aid directly related to jobs, businesses and the economy. Some £358 million was for particular production sectors, such as agriculture and forestry, and £394 million was for economic infrastructure and services, such as transport and storage, or banking and financial services. Together, that accounted for 11% of bilateral aid from the UK.

[David Simpson]

My hon. Friend has mentioned substantial amounts of money. Does he agree that it is essential for that money to be targeted on the people who need it? So often, we have seen corruption in a lot of the countries, with the money being siphoned off and going to the black market or whatever, and not getting to the people who need it.

[Jim Shannon]

My hon. Friend is right. Monday’s debate in Westminster Hall, to which the Minister replied, clearly hinted at such things. We all outlined examples where aid had not been focused on the sector that it should have been. My hon. Friend is right to highlight that point, as we did on Monday.

The Independent Commission for Aid Impact published a report on DFID’s private sector development work in May 2014, giving it an overall amber-red rating. It found that

“The impact of individual programmes is positive…and DFID has demonstrated its ability to assist the poor through a range of interventions”.

However, it also found that

“It has not turned these ambitions into clear guidance for the development of coherent, realistic, well-balanced and joined-up country-level portfolios.”

The hon. Member for Stafford is therefore right that that is what we should try to focus on.

How much of the money actually achieved its aim? Not much, it would seem. Have we made progress and moved from the amber-red zone? My fear is that we have not. Before her children came along, my parliamentary aide used to go to Africa every year in the summer to carry out mission and humanitarian aid work, and she told me of the horrific corruption in many countries that prevented aid from getting to where it was needed; my hon. Friend the Member for Upper Bann (David Simpson) mentioned that, too. The same goes for containers of agricultural equipment that we in Northern Ireland sent overseas; the containers reach their destination with some things having been taken out of them. In fact, those who pack the containers have learned to pack the essential stuff in the back, in the hope of it reaching its destination. The Elim church missionaries in Newtownards in my constituency of Strangford do fantastic work in in Malawi, Zimbabwe and Swaziland in Africa, as do many other churches across the whole of Northern Ireland, and indeed the United Kingdom.

Stories of corruption make it clear to me that work on ending it needs to be carried out with the Governments to which we send aid. We need to ensure that, when we send aid bilaterally, we do so only when there are procedures in place that allow it to make a difference on the ground, rather than being swallowed up in paperwork and translation. One of the best ways of achieving that goal is to use those who are already on the ground, and to divert funding through bodies that we see making a difference, whether that is Oxfam, Christian Aid or mission bodies with permanent staff on the ground.

The hon. Member for Glasgow North (Patrick Grady) spoke about charitable work. I know of one church in my constituency that, instead of giving Christmas presents, promoted the gift of a cow or a goat to Africa, so that individuals could breed the cows and in the meantime sell milk, or use it to live on. That is a practical way of doing things that changes lives in a small way. It may be a small change for the Government, but the change made in villages throughout Malawi and Zimbabwe was in no way small. Can we learn a lesson from missionaries who have been on the field for 20 years, and who know the systems and how to work in them to achieve results? I believe so.

There is a desperate need for jobs and livelihoods in these countries, and there is an onus on us, as a country that allocates a great deal of funding, to ensure that that is achieved, and that funding is not caught up, or whittled away in the process of getting to the man on the street. I look forward to hearing from DFID. I apologise to the Minister and the shadow Minister for the fact that I will not be here for their speeches, as I have a Select Committee to go to at 10.10 am.

I believe that we can effect change with the much-needed funding that this generous nation of the United Kingdom of Great Britain and Northern Ireland gives each and every year, and I encourage other countries to do the same.

Job Creation: Developing Countries

David Simpson Excerpts

Tuesday 24th June 2014 Westminster Hall

[Jeremy Lefroy]

I am most grateful to my hon. Friend for that intervention. She is absolutely right. Of course, in Rwanda people would say that they have much further to go. They want to concentrate on developing the skills of their population, and in particular young people. They are looking at, for instance, the IT sector, because Rwanda is a landlocked country without large natural resources, apart from its own people and the beauty of its landscape. As I said, my hon. Friend is absolutely right.

High levels of unemployment or underemployment, especially among young people, are a problem in most countries in the world. When we ourselves have a youth unemployment rate approaching 20%, we recognise that this is a shared problem and there may well be—in fact, there should be—shared solutions. It is estimated that 1 billion additional jobs will be needed in the next decade for those who are currently out of work and those who will be coming into work over that time. Throughout my remarks, I shall use the word “job” to include self-employment and work in the informal sector, particularly in agriculture.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on obtaining the debate. Does he agree that although it is vital that jobs are created—that is what this debate is all about—in order to achieve that for small and large businesses, it is important that the infrastructure of those countries needs to be improved dramatically? Would it be an idea for moneys donated from the United Kingdom to these countries to be focused on certain areas to help to create jobs for young people?

[Jeremy Lefroy]

I am most grateful to the hon. Gentleman for his wise intervention. Later I shall come to the issue of infrastructure—he is absolutely right about that—and give one or two examples of where it has made a huge difference.

To return to the point about the word “jobs” including the informal sector and self-employment, we have to remember that if we define “jobs” too narrowly as those where people enter into paid employment, we will be missing the point. That is a fairly small percentage of the total amount of work available in the world at the moment.

--- Later in debate ---

[Lynne Featherstone]

I will respond to the hon. Lady in a moment on the issue of deadweight loss.

Moving on from CDC, in the long term, the key to mass job creation is improving the environment for domestic and other businesses to invest and grow. DFID is focused on these long-term determinants of job growth.

[David Simpson]

As we believe that these projects and job creation are very important, does the Minister agree that we cannot overestimate the number of jobs that need to be created? I believe the figure is 95 million over the remainder of this decade, so time is of the essence. We need to move on this issue.

[Lynne Featherstone]

The hon. Gentleman is obviously right. We work in that direction and we are working as fast as we can to enable job creation to happen. I have covered a number of things, but part of what DFID does is on the enabling environment for investment and therefore job creation, whether that means cutting the time it takes to get goods across a border from four weeks to one day, or help with filling in forms or how long it takes to start a business—all the things that are very off-putting to investors. We are working on all fronts.

I do not know whether those hon. Members present have ever eaten in Nando’s, for example, but I was in Mozambique, where Nando’s exclusively grows its peri-peri peppers. It is a labour-intensive process, with massive work for smallholdings, done to a very high standard—because the standards, both of the product and how people work, are very important to DFID and the British Government—which means huge job creation. It is a win-win for the country, the company and the individuals who are being taught and looked after while they grow peri-peri peppers—and I can highly recommend peri-peri chicken.

DFID currently supports more than 60 programmes with specific targets to provide economic assets to girls and women in developing countries. We have set ourselves a target of helping 18 million women to access financial services and 4.5 million women to strengthen their property rights by 2015. Both will have a fundamental impact on the job prospects of the women involved by improving their control over assets and finance.

For some women in work, the conditions remain unacceptable. The UK is supporting the International Trade Centre to work with Governments and customs authorities in east Africa to improve conditions for female informal traders, who face harassment and extortion at borders—the example often given is someone who starts with 12 eggs and, by the time they pay off all the people who have to be paid off, has about three eggs left to sell. That is a common, everyday kind of factor.

The Department is also scaling up its work on education and skills—an important point that my hon. Friend the Member for Stafford raised—to make sure that skills are relevant to people’s changing opportunities and that the private sector is involved in designing, delivering and financing them. We are also increasing our work on infrastructure—my hon. Friend talked about power and transport—and thinking afresh about urbanisation, in order to create more and more productive jobs.

Food Crisis (The Sahel)

David Simpson Excerpts

Tuesday 12th June 2012 Westminster Hall

[Tony Cunningham (Workington) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Robertson, and I am delighted to have secured this debate. I also thank my colleagues for joining me here this afternoon.

To put the debate in context, 18 million people across seven countries, from Senegal to Eritrea, are now feeling the effects of food shortages. The horn of Africa crisis is beginning to fade in our memories, and as it is not the force it was in the media, our attentions start to turn to another crisis. Although we have an opportunity to do better this time, I am concerned that the world community is not acting swiftly enough. These crises illustrate how food security is a growing problem, which will show no sign of lessening unless there is a global commitment to tackle the issues. That global commitment must deliver its promises to the world’s poor.

I want to focus on a few issues, including children’s welfare during food crises, long-term investment and short-term recovery, and funding and the international community. Living in the region when times are not too bad is difficult. Four of the Sahel countries, Niger, Chad, Burkina Faso and Mali, are in the bottom 15 human development index countries. Even in a very good year, Oxfam says, 300,000 children die from malnutrition. These communities are some of the most vulnerable in the world and they lack almost all of life’s most basic requirements. To meet the millennium development goals, the Government must work to protect these people by investing in their future and protecting their present.

The current crisis has recognisable traits plus the added complication of conflict. We have seen it before, but this time we must deal with it differently and better. Cereal production across the Sahel in autumn 2011 was 25% lower than in 2010. A change in the climate can be an inconvenience here in the UK. We saw that with the Queen’s jubilee when it rained throughout the pageant. When we have water shortages, we might not be able to bowl on our favourite bowling green because it has not been watered. In the Sahel, however, such shortages can be a matter of life and death.

One of the most dangerous consequences of a food crisis is malnutrition, which often hits children first, and the most vulnerable children at that. Malnutrition is destroying the potential of thousands of children across Africa. In early May, UNICEF warned that 1 million children could die from malnutrition in the Sahel. We have been warned and we continue to be warned about the ramifications of not acting. The Government must act now to prevent not only deaths but the spread of malnutrition.

The Save the Children report, “A Dangerous Delay” highlights how damaging malnutrition can be, as it directly affects education and future earning power. The impact of not acting now will affect generations to come. Oxfam estimated that it cost $1 a day to protect a child from malnutrition before the 2005 food crisis in Niger, but $80 a day to save a child’s life from severe malnutrition once the crisis had peaked. It makes sense both morally and economically to act now.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on securing this very important debate. We are all aware of the number of debates that have taken place on this matter in this Chamber and elsewhere in the House. There is a problem of food security right across the globe, but in these countries some 300,000 children will die from malnutrition. Of course there is an issue of aid, but does the hon. Gentleman agree that it is good not only that we send aid to those regions but that the aid reaches the people who need it? There is also an issue of education and, where possible, irrigation should be introduced. However, I am sure that the hon. Gentleman will agree with me on the need for security of food.

[Tony Cunningham]

I thank the hon. Gentleman for his comments and pay tribute to him for the work that he has done on this problem over many years. I wholeheartedly agree that we need to do more, but the problem is broader than just malnutrition; lots of other factors are involved as well.

Although some money has been pledged to Save the Children, UNICEF and elsewhere, not nearly enough is being spent to protect children from the harmful effects of long-term malnutrition. World Vision estimates that in Niger nearly 50,000 children have dropped out of school since the crisis began, and that 44% of school-aged children are migrating for work. The food crisis is not just about food; it affects a child’s health, mental well-being, education and future. We sometimes forget that education is a once in a lifetime thing. Malnutrition does not just affect the child while they are hungry; it is a life sentence. If a child misses out on education at a vital period in their life because of malnutrition, they never recover. Malnutrition is a life sentence for many people in this region.

Although UK funding has increased, it has not taken into consideration that the need has grown since 2010, when funding was £20 million. I urge the Government to act swiftly, not only to provide crisis funding but to invest in the future of the Sahel communities.

Zimbabwe

David Simpson Excerpts

Wednesday 8th December 2010 Commons Chamber

[Jeremy Lefroy]

I entirely agree. DFID and aid agencies that give bilateral and multilateral support can play an important role in supporting infrastructure. I have discussed infrastructure in relation to agriculture, and I would add irrigation to that, but infrastructure for sanitation, health and education is also important.

[David Simpson (Upper Bann) (DUP)]

Does the hon. Gentleman agree that although it is good to get land into small farms and perhaps to start up the co-operatives again, it is vital to have an incentive on pricing? The prices of products must be right so that those people can make a living and so that things do not fall apart again. DFID needs to consider that aspect and to ensure that there are returns on products, many of which, as he will know from his experience, are excellent.

[Jeremy Lefroy]

That is why I welcome the opening up of agricultural markets in Zimbabwe, which has been one of the most important Government reforms.

The need for rural infrastructure is shown by the figures on maize yields. The area planted to maize in Zimbabwe this year is 1.8 million hectares, which compares with 1.37 million hectares in 2000, but 300,000 fewer tonnes of maize will be produced as yields decline from 1.18 tonnes to 0.74 tonnes per hectare. How can yields be improved? The Select Committee report discusses conservation agriculture, which is supported by the protracted relief programme that the hon. Member for Birmingham, Northfield (Richard Burden) mentioned. As the report states, Christian Aid recognises that

“DFID’s consistent support to this area despite initial reluctance by other key stakeholders”

has been vital, highlighting that it

“had been particularly beneficial to vulnerable communities”

and that it was

“proven to lift households out of subsistence poverty”.

I congratulate DFID on its support for that programme under both the previous and current Governments and on taking the lead on it.

Conservation agriculture teaches people how better to manage their land and how to get a profitable harvest. According to Christian Aid, it enables households to get at least two, three, five or, in many cases—I could hardly believe this—10 tonnes of maize per hectare. That is quite incredible and I welcome the Select Committee’s recommendation that DFID should explore how conservation agriculture could be extended to other parts of sub-Saharan Africa where it could be used. I also welcome the Government’s positive response to that suggestion and I ask the Minister to ensure that that support continues.

The ordinary people of Zimbabwe have suffered grievously over the years, but they have shown, as many speakers have said, extraordinary resilience and courage. There is no doubt that the country can once again become the agricultural powerhouse that it should be. Proper land reform, not arbitrary seizure and settlement, is an essential part of that, as is effective support to the growing number of smallholder farmers. I welcome the Committee’s report, DFID’s response and the Government’s continuing commitment to the people of Zimbabwe.

Overseas Voluntary Sector

David Simpson Excerpts

Wednesday 24th November 2010 Westminster Hall

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

I thank you, Mr Bone, for taking the time to chair this debate. I welcome this Government’s policy to increase overseas aid from 0.56 to 0.7% of gross national income—a step that was agreed in 1970, the year of my birth. By the time I am 45, we might have met our promise. Other Governments have failed. I wish this Government well in meeting their stated aim within the projected time scale.

Although I welcome the increase in the Department for International Development budget, I want to know what it will mean in respect of my experience in the sector. One windy, rainy day in the Outer Hebrides—we do have such days—I clicked on the DFID website, being at a loose end, and looked at pages on working with DFID, funding opportunities, not-for-profit organisations, and programme partnership agreements. Hon. and right hon. Members will have guessed that it was one of those wet and windy rainy days in the Outer Hebrides when the wind howled and the rain lashed; they are few and far between, but they do happen. I also looked at the part of the DFID site that invites applications for a new round of PPA funding. Finally, in frequently asked questions, under “Proposal and Logical Framework information”, my eyes alighted on point 2, particularly the following sentence:

“Successful applicants cannot receive a PPA which is more than 40% of their annual income, averaged over the previous three years.”

Having been asked by VSO to go on an overseas placement to Cambodia, I had to ask what that meant. At this point, I should mention the sad news from the festival in Cambodia over the past couple of days, where up to 350 to 400 people lost their lives in a crush. In Cambodia, I was aware of DFID funding coming through VSO and of the high esteem in which DFID is held overseas.

Therefore, my interest in this topic was driven not by the rain, but by the fact that I had been on a placement to Cambodia, as a Member of Parliament, for two or three weeks, and I felt a debt to VSO. Voluntary service overseas expanded my horizons most definitely and I felt duty bound to ask what DFID had on the horizon for VSO—that will probably also affect One World Action and Progressio.

At a time of budgetary concerns, I felt that my interest was a mere courtesy, the sort of courtesy that we Scots are famous for—he said, looking at his friends from Northern Ireland—especially as the DFID budget is to grow, according to page 60 of the comprehensive spending review, by 37% over the next three years. Although my comments will be mainly about VSO, as I have said, this matter affects other organisations.

Two years ago, when I spent time as an advocate in Cambodia, using my status as an MP to bring about change in education, I saw the work of VSO and was privileged to bring about, to a slight extent, a change in teachers’ salaries, making them less prone to corruption and making exam results more believable, which is an important factor in an emerging economy if skills and professionalism are to be trusted. I saw the good work that VSO was doing. In its turn, VSO ensured that other MPs, not just me, saw what was happening outside the Westminster and western European bubbles.

Ever since its creation in 1958, with a grant of £9,000, VSO has blossomed into one of the foremost aid organisations in the world, aiding countries in training health workers and teachers, from Sri Lanka to Malawi and in 44 other countries, reaching 26 million people in those countries—not the total population, but the number of people that VSO reaches and touches through its programmes and partners.

[David Simpson (Upper Bann) (DUP)]

I welcome you to the Chair, Mr Bone, and congratulate the hon. Gentleman on securing the debate. I will not even try to pronounce his constituency. We have difficulties enough in Northern Ireland with the English language, so it would be difficult to try to get that.

Does the hon. Gentleman agree that, for many years, one difficulty in respect of overseas aid has been that not all the moneys have gone to those most in need? Although we appreciate and welcome the increase in funding for the overseas voluntary sector, does he agree that it is essential that, during these economic times, money is targeted, because it can so easily be sidetracked to unscrupulous characters?

[Mr MacNeil]

The hon. Gentleman anticipates me. He raises the concerns of many. I hope to demonstrate that such fears can be allayed, so perhaps the Gentleman will bear with me. If I do not answer his concern, I would welcome another intervention.