Commonwealth Development Corporation Bill

Earl of Sandwich Excerpts

2nd reading (Hansard): House of Lords & 3rd reading (Hansard): House of Lords & Committee: 1st sitting (Hansard): House of Lords & Report stage (Hansard): House of Lords
Thursday 9th February 2017 Lords Chamber

[The Earl of Sandwich (CB)]

My Lords, it is a pleasure to follow the noble Lords, Lord Bruce and Lord Boateng, with their historical experience of the CDC, and I am much looking forward to the speech of my old noble friend Lord Eccles, who has seen the CDC almost from the beginning.

I was surprised that this Bill was made a money Bill, considering the huge questions raised by the expansion of the DfID programme. I know we have limited powers in this House, but I tried to complain. I went to the Chief Whip, who agreed to talk to the Lord Speaker, but I decided I could not take it any further. A central issue in the Bill seems to me whether, in handing over such a large proportion of our aid to the private sector and to one particular body, we may be bypassing some of the core principles that have governed the aid programme over many years.

I know that the CDC has changed considerably under new management. I have discussed this directly with the CEO, Diana Noble, quite recently. My noble friend Lord St John made a very strong case for the CDC. I accept that it has responded to radical change. To take only one example, in 2015 more than 1 million jobs were indirectly created by the CDC in Africa and Asia alone. I also have great admiration for the Minister of State in another place, Rory Stewart, whose work with the voluntary sector is well known, as is the experience of our own Minister, but having read Mr Stewart’s replies to the debate in the Commons, I am not yet convinced that the CDC has embraced poverty reduction, which, incidentally, is not quite the same as job creation.

The Minister used the words “doing good while not losing money”. That does not seem to be an adequate description of our international development programme, because poverty reduction has been the focus of our aid programme for some time. We abolished tied aid a generation ago, and the failures of huge projects such as Pergau and Narmada marked the end of large-scale UK investments during the 1980s. Since then, successive Aid Ministers have listened to criticism and have won public support for more programmes which demonstrate people’s participation, meet the needs of the very poorest in society, create partnerships and bring non-governmental organisations directly into the planning and execution of projects. The noble Lord, Lord Judd, mentioned that. I was encouraged to hear the Minister say that there is still room for improvement, presumably in the direction of the very poorest. That is precisely the dilemma the CDC faces.

As someone familiar with some of the UK’s best NGOs which are working alongside the poorest and in partnership with DfID, I have seen this work at first hand and I know that it brings real benefits to society. I do not need persuading that the private sector, and the CDC in particular, can be an effective channel to the poor. In fact, business is a good route for the voluntary sector to follow. For instance, the business model in which women create their own credit and loan scheme, originated with the Grameen Bank and other microcredit organisations, is still widely respected. The noble Lord, Lord Boateng, mentioned SMEs in Africa, which are another important channel.

When it comes to investment decisions, which are not risk free, and due diligence at a higher level of management, there comes a point when must priorities change. Pay scales rise and the interests of the corporation itself may take over from those of the beneficiary. This is a built-in dilemma which was discussed in some detail yesterday in the Public Accounts Committee which I attended. Investment really belongs to a different tradition, and this is why the CDC is being kept separate from the mainstream aid programme. One might be forgiven for asking whether it needs to focus on the poor at all.

Additionally, there is the issue of accountability. Does the CDC really know how its funds are being used on the ground and where they are directed and, even more importantly, can it monitor progress and impact at a later date? Fortunately, we now have really good watchdogs in the form of ICAI, the NAO and DfID itself, not forgetting the IDC, other Select Committees and occasionally our own EU Select Committees which have occasionally covered the EU aid programme. The CDC is very closely scrutinised.

On the whole, the CDC comes out well from various reports and audits. It has responded to recommendations and its transformation is much admired. There are some criticisms worth mentioning, some of them highly technical, which were examined, inevitably in much more detail, in the Commons debates, and I am sorry that we cannot do that today. For example, the NAO found that the development impact target measures prospective impact rather than actual impact. The noble Lord, Lord Judd, raised this point. There are also recruitment and retention challenges. The CDC may be on the right track, but it still has to demonstrate that it can make a lasting difference to the lives of the poorest. ICAI reports have come out with similar comments, although they recognise the growing role of foreign direct investment in development. My noble friend Lord St John made that point.

Finally, there is also a problem of public information. Far too little is known about the CDC programme, while DfID projects are much more visible, and this creates discrepancies. ICAI last year pointed out the anomaly that the CDC is moving DfID back to BRICs and middle-income countries. While DfID has scaled down its aid programme in India, the CDC’s investment there amounts to one-quarter of its portfolio. Is the tail wagging the dog? Does this mean that India suddenly again becomes a developing country and not a middle-income country? Should not the public be aware of this, because many people have argued that the poorest in India should always be a priority? I also believe that the CDC should arrange visits, perhaps through the CPA as well as the IDC, so that more MPs and others can go out to see the work it is doing because it is so important.

I am sorry to strike a discordant note during the passage of this Bill, but while I recognise the value of the CDC’s work, I shall need more convincing that it is really about poverty. The noble Baroness, Lady Northover, mentioned the CDC’s effect on DfID, which is important. The SNP and others put down several amendments on these matters, but I think Her Majesty’s Government have still skilfully avoided the answer. The CDC apart, with the future loss of EU channels of funding and the fall in growth rates and commodity prices in Africa, DfID already faces a considerable challenge in rethinking its responsibilities to the developing world.

Ebola: Sierra Leone

Earl of Sandwich Excerpts

Tuesday 19th January 2016 Lords Chamber

[Baroness Verma]

My Lords, there are two main issues. One is being able to deal with the recovery and making sure that there is sufficient funding and support for us to be able to help strengthen the health systems in countries whose growth was very good before the outbreak but whose systems were not as strong as they should have been—those systems need strengthening. We will probably see the occasional case, but we must continue to encourage others to make sure that we rebuild west Africa in such a way that economic growth continues on a much more sustainable pathway. That can be done only if all global partners come together to be very supportive of what the UK has often done. The UK has led by example. Part of that is our commitment to 0.7% to ensure that our aid budget will always be protected.

[The Earl of Sandwich (CB)]

The Minister spoke about the value of community groups. Is she satisfied that there is proper co-ordination between civil society organisations and government health services? In view of the recent incident, is there perhaps a disconnect between the WHO’s analysis and that of the Government of Sierra Leone?

[Baroness Verma]

My Lords, there is not a disconnect. We have managed to deal with an unprecedented outbreak, but we need to make sure that co-ordination is much better. The UK was able to co-ordinate 10 government departments to work closely alongside other organisations in Sierra Leone. I do not think there is a disconnect, but there is always room to improve and to learn lessons when things have not gone so well. On the whole, we demonstrated that once you strengthen co-ordination on the ground and assist the Government of the day to support their systems, things get better.

International Development Policies

Earl of Sandwich Excerpts

Thursday 19th November 2015 Lords Chamber

Asked by

[The Earl of Sandwich]

To ask Her Majesty’s Government what steps they are taking to make their international development policies more effective.

[The Earl of Sandwich (CB)]

My Lords, I am delighted to introduce this new debate and to welcome friends old and new, especially the noble Lord, Lord Barker of Battle, from whom we will hear soon.

Today, I offer a survey of aid scrutiny, and will expect others to provide the academic analysis. My background is with aid NGOs, namely Christian Aid, Save the Children and CARE, all organisations with long experience in this field that have engendered in me a strong sense of aid effectiveness and public accountability.

As we all know, the UK has a good track record, and our Prime Minister took a lead in launching the sustainable development goals in New York over a year ago. But for us to be sure of meeting these goals, we also need to lead the world in aid effectiveness. I know that impact is the flavour of the month and that every organisation these days is concerned with outcomes, but with the Treasury coming down heavily on other departments, it is even more urgent that we in the UK sign up to an open and fully accountable aid programme. In the past year, this House has debated at length the amount of aid that we can afford, which is now ring-fenced under the Act. We now need to move on to proper methods of scrutiny and of streamlining our aid programme.

Our key watchdog, although not the only one, has the snappy title of ICAI, the Independent Commission for Aid Impact. It was a creation of the coalition Government and it has already been tested over the last Parliament. It reports to a sub-committee of the Commons International Development Committee. With 46 substantial reports behind it already and new commissioners in place, I know that ICAI intends to look at the longer-term impact of ODA. This is critical: how can one measure an aid programme year by year and report to the public on its impact only in annual reviews? There have to be appraisals over a much longer term. Three to five years is the average length of a DfID programme, and even this is hardly sufficient to measure its impact on health, education or other needs of society.

Nepal’s multi-stakeholder forestry programme provides an example. This impressive programme is a model of forestry, ticking two SDG boxes. It is already helping half a million poor people through community groups to adapt to climate change over the next 30 years, preventing landslides, flooding and erosion and improving livelihoods. DfID has a five-year investment of £20 million which ends next year, but this programme is not new; it has a long history. I well remember visiting it several years ago with an IPU delegation—the noble Baroness, Lady Northover, will remember it—and the same optimistic things were said about it then. I then heard that the programme was suspended, beset with political hold-ups, management problems and land disputes. The Swiss intervened, and then the Finns came in. Such setbacks occur all the time in developing countries. ICAI now says that the programme is back on track, but you cannot always believe either our own or Nepalese propaganda. We may not learn the truth for another 10 years.

There have been failures. Two years ago, ICAI uncovered a waste of aid money on a substantial scale in Africa. TradeMark Southern Africa failed to meet its targets and was closed down by DfID. Perhaps the Minister could say whether there are similar concerns in relation to its sister programmes, MRGP, which links north-south trade to ports in Mozambique, and the TMEA programme in east Africa.

The largest aid programme in the EU, EULEX in Kosovo, has done excellent work, but it has been criticised and drastically scaled down. I am not biased against large programmes if they work. The overhaul of customs and excise by DfID in Mozambique, for example, was very successful. One reason that we have invested heavily in Mozambique, against a difficult political background—as the noble Lord, Lord Judd, will testify from his visit—is that an active civil society there has acted as aid watchdogs. Good practice can often be scaled up from smaller enterprise and local initiatives.

I believe that there is a genuine desire in DfID to shift its emphasis towards human rights and poverty reduction. It is just a case of how you do it. We are reassured that even the CDC private sector is now being adapted to that end, and I genuinely hope that it will succeed.

I commend DfID on its parliamentary work abroad, because ICAI is right that other organisations should deal with elections. Strengthening national parliaments and equipping them to serve their nations should be a priority for us here in this country. I remember visiting the Kenya Parliament with the CPA some years ago and finding that, even in such an advanced environment with hundreds of MPs, there were only a handful of staff. The situation has now changed there, but not in many other developing countries.

There are other Select Committees that have to follow DfID: the environment committee, the Public Accounts Committee, the Health Committee, the Education Committee, the arts committee and any department that has an interest in international development. The NAO, the National Audit Office, also keeps an eye on DfID and occasionally criticises its financial performance.

I also include our own committees, remembering in particular our expert Economic Affairs Committee report on aid three years ago. Two years ago our EU External Affairs sub-committee, to which I belong, was critical of the EU’s water, sanitation and hygiene—or WASH—programmes in sub-Saharan Africa. The European Court of Auditors reported that half of 21 WASH projects in Africa were defective and had wasted EU money. The Development Commissioner subsequently denied this and said that the projects selected were random and that DfID had done another survey of 24 successful projects, but none of us was convinced. The scale of EU aid, whether through the EDF or ECHO, is such that our own committees and watchdogs will never be able to catch up with fraud, corruption, waste and all the other afflictions of aid.

However, it is not only the EU. DfID often has to operate in dangerous or remote environments, and humanitarian or conflict prevention programmes in countries such as South Sudan are dangerous. Aid and, indeed, aid workers may be hijacked or have to stop at short notice, with little chance of recovery. This is why ICAI gave the justice and security sector an amber rating last March.

At this point I commend our Liaison Committee for deciding to appoint an International Relations Committee next year after many years of lobbying. No fewer than 25 all-party groups look at DfID’s performance from time to time, including several country and regional all-party groups that occasionally report in some detail. DfID has a multiplicity of internal checks and balances. The acronyms and organograms are bewildering. Much of it is designed by the ARIES management system and database. There is the log frame, the business case, the risk rating, the calculation sheet to give the overall output score, and so on. I sympathise with the staff of DfID who have to cope with all this scrutiny, but what is the result and what are the prospects of a more effective aid programme? In general, I say that they are good and that ICAI is going to be a valuable ally for all concerned, including the general public.

One critical issue is always the capacity of local partners, whether government or civil society. DfID would like to work through more CSOs, organisations which are seen as effective when government is inefficient, corrupt or clearly not working to plan. However, CSOs are also expected to complete forms and are subject to regular scrutiny. I know DfID is currently conducting a civil society partnership review that includes so-called southern CSOs, but I expect there will be more emphasis on the international NGOs and that southern NGOs will get left out. I hope the noble Baroness will put us right on that.

There is always a tension between aid effectiveness and the confrontation of real poverty. Where infrastructure and services are most lacking, aid agencies inevitably fear to tread—yet that is where they are needed most.

Another topical question concerns the poaching of ODA by other departments, notably the FCO and the MoD. We in the aid business should defend our department, but soldiers build refugee camps and DfID is even resettling refugees. There will always be foreign policy issues common to two or three departments and hence some overlap in funding.

Finally, what of quality? Having looked at the private sector and value for money, the latest theme music from the Government is results and the importance of DfID’s results framework. I here only repeat ICAI’s word of warning in June, which brings me back to the beginning:

“Some of DFID’s tools … have had the unintended effect of focussing … on quantity … over quality … on short-term … achievements rather than long-term, sustainable impact”.

I am grateful to all noble Lords who are taking part in this debate.

Middle East and North Africa

Earl of Sandwich Excerpts

Wednesday 16th September 2015 Lords Chamber

[The Earl of Sandwich (CB)]

My Lords, I think we have to be grateful to the brave TV camera men and women and reporters who bring this crisis before us every day. Yet the images are so bleak, and the crisis is almost beyond our island imagination. Such a degree of hardship thankfully does not exist in our society. We cannot conceive of a world without anything at all to live on, yet we have to make judgments which we think can somehow change it.

Last week, the Prime Minister announced he would at last increase the numbers of vulnerable Syrians to be resettled. Some of us, along with the Refugee Council and Amnesty, have been pressing the Government for months on this. We were told that, up to March, only a handful, 183, and by June, only 216, had been resettled under this scheme. Media reports undoubtedly changed the Government’s mind, and we now, as a country, have responded modestly to the plight of refugees in the region and to UNHCR’s call for resettlement. I fully endorse what the Minister says about bringing stability to lands in conflict, but the Government’s otherwise welcome Statement failed to address the key question of Europe. As others have said, it is astonishing that we appear to be doing nothing to help thousands of Syrians and others stumbling along railway lines towards us.

One might ask why the UK has decided to stand apart from other member states and always hide behind the Schengen and Dublin agreements. I believe, with the noble Lord, Lord Ashdown, that this was in part a soothing message from the Government to some of their Eurosceptic Back-Benchers that, for the moment, they do not want to spell out EU membership too clearly. I fully accept that Europe has not got its act together, largely because of the resistance of eastern European members. Hungary’s use of tear gas and barbed wire is incomprehensible to those who remember 1956, when its own refugees were pouring across the Austrian border. Unfortunately, Mr Orbán does not represent the view of Hungarian people any more than, say, Mr Rosindell reflects his own Front Bench in another place. Monday’s EU meeting at least showed that there is unity among the richer member states—we are meant to be one of those—which will inevitably have to share the responsibility. Much more, however, as has been said, must be done at the United Nations level. I wonder whether fear of numbers lies behind the reaction of some critics and Eurosceptics. The numbers are daunting, but surely there are not so many that they cannot be contained within and around Europe. We have to rely on crude estimates from UNHCR and FRONTEX, but we know they are six-figure numbers. The EU would like us to contribute now. Is that unreasonable?

I recommend doubters to examine the UNHCR list for refugee applications compared with populations in Europe. Sweden tops the list with 7.8 per 1,000 in 2014. Hungary is next, surprisingly, with 4.2, then Germany with 2.1. The UK is way down the list, at 0.5, which means only one refugee applied for asylum for every 2,000 of our citizens. If you compare our total population to recognised refugees, the number is of course lower, and the absorption of an annual 5,000 is barely noticeable. As Hilary Benn said in another place last week:

“The fact that we are not in Schengen does not mean that we should opt out of our responsibility to stand shoulder to shoulder with our European friends and allies in playing our part”.—[Official Report, Commons, 9/9/15; col. 427.]

I assume that that still forms part of Labour’s foreign policy, but we will hear from the noble Baroness, Lady Morgan, on that.

It is a pity that Lord Moser is no longer with us to join in this debate. As a teenage refugee himself from Nazi Germany who was cruelly interned here during the war, he said that he discovered his love of numbers by counting his fellow internees. He went on to run the Central Statistical Office and an Oxford college, besides making many contributions to education and music. He is already much missed on these Benches. I also add my own thanks to my friend the noble Lord, Lord Brooke, for bringing good humour to our debates over so many years.

Perhaps the Minister can help us with numbers. She cannot answer for the Home Office but she will know, and the noble Lord, Lord Clinton-Davis, will remember, that this country has already been generous to an earlier generation of boat people, having received more than 24,000 refugees from Vietnam, who were resettled over time by local authorities. My main questions relate to her department. Was DfID fully consulted on the decision to take money out of the aid budget? What will be the consequences for other DfID programmes? As my noble friend Lord Hannay said, why should Syrians be singled out when there are so many other nationalities involved? What about Kurds and Iraqis—indeed, those who come across the Middle East through Libya, Turkey and other countries? What about eastern Europeans? Are Kosovan or Afghan refugees to be treated differently? These are difficult questions but they will have to be answered at some point. The Balkan states are now receiving EU funding but are still dealing with the aftermath of their own civil wars. The Syrians are special now, but other priorities must come up in future.