Integrated Review: Development Aid

Lord Sarfraz Excerpts

Wednesday 28th April 2021 Grand Committee

[Lord Sarfraz (Con)]

My Lords, I am a big fan of the noble Lord, Lord Alton, and agree with the broad consensus across your Lordships’ House that we must return to the 0.7% commitment as soon as we can. However, I am also happy to become the second speaker to sympathise with the Government’s difficult decision.

When thinking about our development footprint, one entity sometimes does not get the love it deserves. That is the CDC, our development finance institution, which is flying our flag across the world. Its portfolio supports 875,000 jobs across Africa and south Asia. Its investing companies pay over $3 billion of tax to national Governments and invest where nobody else wants to. While it is very sensible for the CDC to operate independently of government, it is 100% owned by the FCDO and will always be perceived as a component of the one HMG overseas strategy outlined in the integrated review.

We need to take more ownership of and credit for the CDC’s efforts globally. Whether pioneering the 3D printing of entire schools in Malawi or guaranteeing supply of syringes in Ghana, it is not just the CDC at work—it is the UK at work. We are very lucky that the CDC has extremely capable leadership, which has reshaped the investment strategy over the years and delivered an impressive annual portfolio return of 7.4% since 2013.

There is always more to do, however. If we are to become the global science and technology superpower that we aim to be, the CDC will need to be encouraged to work directly with the most innovative businesses in emerging markets—even if they are early-stage. To do this, we need to support the CDC and increase its appetite for risk-taking. This is in line with item 1.1 in the strategic framework, which states:

“We will accept more risk in our public investments, supporting the most creative, innovative and radical ideas for future development.”


The CDC could also be encouraged to partner more with innovative businesses here in the UK, to help them lend in global markets.

I would be most grateful if my noble friend the Minister could share what the future of the CDC might look like in light of the review. Does he agree with my enthusiasm for the role that the CDC can play in its implementation?