UK Development Bank

Debate between Patrick Grady and Jeremy Lefroy

Wednesday 20th June 2018 Commons Chamber

[Jeremy Lefroy]

The hon. Gentleman is right, although I am sure that many places will bid for it when it is established, as I hope it will be.

[Patrick Grady (Glasgow North) (SNP)]

I congratulate the hon. Gentleman on securing the debate. I work with him on the all-party parliamentary group on the World Bank and International Monetary Fund. Is he aware that in Scotland, Scottish Enterprise has established the Scottish Investment Bank to provide the kind of domestic support that he describes? Perhaps that could be expanded in a co-operative manner. Will he say a little more about his concept for a global international development bank to tackle global poverty? In particular, will he make it clear that the loans would be for projects and infrastructure, and that there would not be a return to the days of significant loans to Governments, which led to the debt crisis in the 1970s and 1980s? Does he agree that this would involve a different kind of financing?

[Jeremy Lefroy]

The hon. Gentleman is right to suggest that we do not want a return to the days when countries were burdened with unpayable debts that eventually had to be relieved, at great cost to the countries themselves and to taxpayers around the world. He rightly points out that there are such financial institutions around the United Kingdom. I was not aware of the Scottish Investment Bank, but it is great to hear about it. No doubt that model could be built on.

Commonwealth Development Corporation Bill (Second sitting)

Debate between Patrick Grady and Jeremy Lefroy

Committee Debate: 2nd sitting: House of Commons
Tuesday 6th December 2016 Public Bill Committees

[Patrick Grady]

I thank my hon. Friend for that point. The point of equity and proportionality is what I am trying to test. As I have said, under my formula, the figures would come out not that much lower than the caps proposed in the Bill. Let us accept, in good faith, that we will hear some rationale for those caps. My formula would take us not a million miles away from those numbers. The point is that under my formula, the caps would vary over time, depending on what the total ODA spend was likely to be.

Even if the Minister objects to the particular formula, I will be keen to hear why some kind of proportionate formula is not preferable to the hard numbers in the Bill. We have heard about other amendments that probe those numbers. A formula that linked the caps to the total ODA spend over a period of time surely would help to clarify the link with the overall amount of ODA and the balance of the Government’s development priorities, which we will discuss when we debate the new clauses.

[Jeremy Lefroy]

I will make four brief points. First, there are several reasons for bringing forward the Bill, but one of the major reasons is that reducing the expected rate of return of the CDC’s investments, which I absolutely agree with, creates a need for more capital.

Under the last Labour Government, the CDC grew substantially, was well managed, invested in funds and made a lot of money out of significant investments, such as that in Celtel. All of that was good and I welcomed it, but it perhaps was not in accordance with the CDC’s original mission, although I would argue that it helped to reduce poverty. Capital was generated internally to quite a considerable extent. The required rate of return was relatively high, those returns came in and that money was reinvested.

Now that CDC is quite rightly supposed to focus on harder investments with lower rates of return and higher risk, there inevitably will not be as much free cash flow or free capital available for investment, so the shareholder —the UK Government, DFID and the taxpayer—needs to be prepared to put in more capital if we are to meet those objectives.

The second point is about middle-income countries. I fully accept the Minister’s point about the importance of targeting lower-income countries wherever possible, but let us not forget that the range for middle-income countries is, frankly, ridiculous. It goes from just over £1,000 to £13,000 per year. At the lower end are countries that are basically low-income countries and at the higher end are relatively wealthy countries. If we categorise all middle-income countries as somehow moderately wealthy, that is simply not the case. There was a point—not now, sadly, because of what is happening there—when South Sudan was briefly a middle-income country; look at where it is now. We have to be very careful when we talk about middle-income countries as though they are a homogenous group; they are not.

Developing Countries: Jobs and Livelihoods

Debate between Patrick Grady and Jeremy Lefroy

Wednesday 15th June 2016 Westminster Hall

[Jeremy Lefroy]

The hon. Gentleman makes a valuable point. One reason why I called for this debate is because not nearly enough work is going on around the world. The UK is taking a lead, but he is absolutely right that much more needs to be done here and around the world.

In many countries, much of the work is subsistence agriculture and low-income self-employment—that is true for something like 50% of the 3 billion people working worldwide. Making ends meet is extremely difficult. I have to admit that all the figures I have cited are imprecise and sometimes speculative, which is a problem. We do not have accurate data, but I hope we will see more in future. It is about not only data but action, but action depends on good data.

The World Development Report found that: first, there are too few productive waged jobs in modern, formal sectors; secondly, most people are engaged in very low-productivity, seasonal or subsistence work in both rural and urban areas; thirdly, there are large gaps in job opportunities for women, youth and marginalised groups; fourthly, much work is in poor conditions, or is unsafe or risky, including in formal employment; and fifthly, many labour market-related institutions are ineffective, including skills institutions.

[Patrick Grady (Glasgow North) (SNP)]

I congratulate the hon. Gentleman on securing this debate. I apologise that I cannot stay for the whole debate, but I am going to an event in the House of Lords to mark Small Charity Week and speak about the importance of small charities in international development. Does he agree that many small and grassroots organisations have an important role to play in equipping people in developing countries with precisely the kinds of skills he is talking about, which they need in order to move into productive employment?

[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.

Visitor Visas: Sub-Saharan Africa

Debate between Patrick Grady and Jeremy Lefroy

Wednesday 8th June 2016 Westminster Hall

[Patrick Grady]

Yes, exactly. I will touch on some of those issues, and I agree wholeheartedly with my hon. Friend, who represents Blantyre in Scotland, which was the hometown of David Livingstone and is commemorated in Blantyre, the commercial capital of Malawi. The situation she describes is a problem not just in Malawi. The all-party group on Africa’s experience is that the situation in Malawi is symptomatic of challenges experienced across the region. It is a region where, as my hon. Friend alluded to, very small proportions of the population have access to electricity, let alone the internet, yet prospective visitors to the UK are expected to apply online for a visa. It is a region where public transport as we know it in the UK is practically non-existent, yet people are sometimes required to travel hundreds of miles to a visa application centre—sometimes on numerous occasions to progress the same application. It is a region where trade is mostly conducted in cash, yet payment for a visa can only be made online by credit card.

Those points on their own should be enough to give the Government pause for thought and cause them to ask whether their visa application system is genuinely fit for purpose in the region. Those are often only the first hurdles that applicants face, and they are sometimes high enough to prevent an application from being made in the first place. The Scotland Malawi Partnership reports that many of its member organisations—those are often churches, schools or small community groups—that consider the possibility of bringing partners to Scotland and the UK for a visit simply give up at their first browse of the visa application requirements. I understand from the SMP that NHS Lothian, NHS Tayside, Kingussie High School and Aberdeen presbytery have all recently had to cancel visits because of visa complications. They all have their own powerful stories to tell, which I am sure we could make known to the Minister.

[Jeremy Lefroy (Stafford) (Con)]

This weekend, my wife is holding a fundraiser in Stafford, the aim of which is to provide funds for medical students at the Kilimanjaro Christian medical centre. Two medical students from Tanzania were invited on our behalf some time ago, but they are not able to come, precisely because of the bureaucratic hurdles. All that they wanted to do was attend, visit, give their stories and go back.

[Patrick Grady]

I pay tribute to the hon. Gentleman for his long-standing work on international development. I suspect that many local charities that want to bring visitors over encounter exactly those hurdles.

Before coming back to the challenges of the process and the concerns about it, I want to deal briefly with why it is important that people from countries such as Malawi should be allowed to visit the UK. I stress that the debate is about visitor visas. The debate on immigration, asylum and settlement is aired often enough in this Chamber and elsewhere. However, the issues are perhaps connected, because there is a strong sense among those who go through the visa application process that the system is based above all on a concern that people who arrive on a visitor visa may abscond or refuse to return to their country of origin.

I plan to table written questions after the debate to establish what figures the Government hold on the rate of absconding or non-returning, especially among holders of short-term sponsored visitor visas, to see whether that concern is real or imagined. There will undoubtedly be individual chancers who make it to the UK on visitor visas and never quite make it home, although frankly, in my time in Malawi I met plenty of UK and European travellers who ended up on the beach at Lake Malawi and never quite made it home, because they were quite happy to spend their days in the travel lodges or set up their own. There is reciprocity there, but on the whole, people who come here for a short time—especially those who are sponsored or invited by charities and community organisations—come for a specific purpose and are supported and accompanied throughout their visit, often from the moment they arrive at the airport to the moment they are dropped off there at the end.

Visits for school or cultural exchanges, or for speaking or campaigning tours, are designed to have a lasting impact beyond the visitor’s short presence. A school exchange might promote better global citizenship among young people or provide an invaluable training opportunity for teachers from both countries. Visiting artists or musicians might help to inspire new kinds of creativity and collaboration or provide some social focus for the legitimately established diaspora community here in the UK.