Foreign and Commonwealth Office: Funding

Earl of Courtown Excerpts

Tuesday 9th February 2016 Lords Chamber

[The Earl of Courtown (Con)]

My Lords, I thank the noble Lord, Lord Luce, for his thoughtful and comprehensive contribution to this debate, and welcome this opportunity to address the issue of funding for the Foreign and Commonwealth Office and our foreign policy interests. We last debated the subject in November in response to a Question from my noble friend Lady Helic. That was prior to the publication of the strategic defence and security review, the spending review and the new development strategy. At that time I reassured the House of the Government’s commitment to eliminating the deficit. I confirmed that the FCO had played its part through cutting its operating costs while continuing to respond to new challenges and opportunities.

The noble Lord, Lord Luce, highlighted the importance of soft power and praised the chairmanship of a committee of your Lordships’ House by my noble friend Lord Howell, as did the noble Lord, Lord Chidgey. The noble Lord is quite right about the importance of soft power and sought assurance that the Government would continue to invest in our diplomatic resources, as well as in military and development activity, in order to protect and advance of the UK’s interests globally. It therefore gives me great pleasure to confirm the commitments made in another place by the Chancellor of the Exchequer in the Autumn Statement on the spending review. The Chancellor announced that the Government would protect the FCO in real terms. I am sure that noble Lords will all want to know what that protection means in practice. First and foremost, the overall resource departmental expenditure limits for the FCO will rise in line with inflation in each of the four years covered by the spending review. This will raise funding from £1.1 billion in 2015-16 to £1.24 billion by 2019-20. This settlement will enable the department to maintain our world-class diplomatic service, including our network of diplomatic posts, which host 26 different government departments and agencies around the world. This global presence, and continued foreign policy leadership in Whitehall by the Foreign and Commonwealth Office, will serve to protect our national security, promote our prosperity, and project the UK’s values.

In line with this Government’s commitment to spending 0.7% of gross national income on development assistance, the FCO will be allocated additional ODA-eligible resources, more than doubling our spending—from £273 million in 2015-16 to £560 million in 2019-20. This will enable us to pursue our key foreign policy priorities and deliver the ambition set out in the new development strategy.

Within this settlement the Foreign and Commonwealth Office will undertake new work. This includes hosting the presidency of the European Union in 2017, and increased spending to support the UK’s Overseas Territories, in order to meet our long-standing commitment to address their reasonable needs. To that end, the Foreign and Commonwealth Office will co-ordinate a new strategy for the Overseas Territories and chair a new director-level board, to direct cross-government activity. In addition, the Foreign and Commonwealth Office will spend up to £24 million over the next four years to increase the presence of its counter-terrorism and extremism experts overseas. The noble Lords, Lord Kerr, Lord Luce, Lord Wilson of Tillyorn, Lord Green and Lord Wallace of Saltaire, all commented on the language capabilities of our service. The Foreign and Commonwealth Office will allocate new funds to improve Mandarin, Russian and Arabic language skills. It will enhance country and regional expertise across the former Soviet Union and the Gulf, and invest in electronic data collection and analysis to maximise the benefits of open-source information.

[Lord Patten]

May I come back very briefly on that point about language skills, to ask if that list could be extended to take in more people trained in Farsi, given the growing importance of Iran, which is opening up to the world?

[The Earl of Courtown]

On that issue, I will have to write to my noble friend. On the same topic, the noble Lord, Lord Wilson of Tillyorn, asked about the teaching of hard languages and how many students come out of the excellent FCO language centre, which opened in 2013. It accommodates approximately 1,000 students per year, including those from other government departments.

The noble Lord, Lord Luce, suggested—as did other noble Lords—that the Foreign and Commonwealth Office is under-resourced to address the myriad challenges that we face. While protection of the Foreign and Commonwealth Office’s departmental resources is an important signal of the Government’s commitment to maintaining our global role, I acknowledge that it is not likely to be sufficient in an increasingly challenging international context. I am therefore pleased to confirm that spending on the Government’s international priorities will increase, with a larger Conflict, Stability and Security Fund, a new Prosperity Fund and more funding for the British Council and BBC World Service. I noted what the noble Lord, Lord Chidgey, had to say but I will have to write to him on the details. This is intended to increase the impact of the United Kingdom’s soft power assets, as mentioned by other noble Lords.

The Conflict, Stability and Security Fund, through which the Foreign and Commonwealth Office funds much of its conflict prevention work, will grow by 19% in real terms by 2019-20, to a total of £1.5 billion per year. This will strengthen the UK’s ability to support stabilisation in countries including Syria, Ukraine, Somalia and Pakistan. It will increase the United Kingdom’s response to serious transnational threats, including extremism, serious and organised crime and illegal migration.

As I have already mentioned, a new Prosperity Fund, worth £1.3 billion over the next five years, will be used to support global growth, trade and stability. This will reduce poverty in emerging and developing countries, and open up new markets and opportunities to the United Kingdom. Funding for the British Council will also be protected in real terms. In addition, the council will be able to bid for up to £700 million from a cross-government fund to improve links with emerging economies, help tackle extremism globally, and support good governance.

The noble Lord, Lord Hylton, gave me prior notice of a couple of questions that he wished me to answer. I will answer them, but if there is anything more I can add later, I will. Basically, he was asking me what Her Majesty’s Government are doing to prevent the largest share of food aid going to Assad-controlled areas. All UK-funded assistance is distributed on the basis of need to ensure that civilians are not discriminated against on the grounds of race, religion or ethnicity. The Department for International Development continues to work with the United Nations and the international community to ensure that all minorities’ rights are protected and our aid reaches those in greatest need.

We recognise that the Syrian Kurds are in the midst of the continuing civil war, and their fight against Daesh. However, we do not recognise calls by the PYD for an autonomous Kurdish area. We continue to use our contact with Kurdish groups to encourage commitment to pluralism, respect for the other political forces within the Kurdish areas and co-operation with the rest of the Syrian opposition to work towards a political solution to the conflict.

Lastly, the Foreign and Commonwealth Office will be provided with a flat cash settlement of £98 million capital funding per year to invest in its real estate. This will fund new embassy buildings in Abuja and Budapest and provide further investment across the Foreign and Commonwealth Office estate to keep people safe while they are working for the UK abroad.

[Lord Marland]

At the risk of being a Commonwealth bore, the Minister made the point that the UK will be president of Europe for six months. It will also be chairman of the Commonwealth for two years. The Minister has been at great pains to refer to the Foreign and Commonwealth Office, but he has not said at any point what the Government intend to do there; I would like him to write to me.

[The Earl of Courtown]

My Lords, of course I will. With the time allowed, I was unable to extend my remarks to all issues.

This Government’s investment in our foreign policy capability delivers results on many fronts: whether the key role we played in the Iran nuclear negotiations, or our leadership in tackling the Ebola crisis. Meanwhile, our commitment to protect the Foreign and Commonwealth Office budget and to provide additional funds for cross-government activity internationally will ensure the UK continues to play a pivotal role in tackling the most important global challenges in the years to come.