Commonwealth Development Corporation Bill (Second sitting)

Philip Boswell Excerpts

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

[Patrick Grady]

As I said, the autumn statement demonstrated that GNI will go down and therefore the ODA forecasts are being revised down as well. The point I am trying to make is that if we are going to find a way of varying the cap on investment in the CDC, finding a way to make it proportionate to overall aid spending would seem to be the more sensible way of doing that.

[Philip Boswell (Coatbridge, Chryston and Bellshill) (SNP)]

In amendments 4 and 5, my hon. Friend and I have suggested a percentage adjustment mechanism. In this case, the figure of 5% is proffered. Does he agree that such a mechanism is altogether more equitable and appropriate? Will he elaborate on that for the Committee’s further consideration?

[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.

--- Later in debate ---

[Patrick Grady]

I beg to move, That the clause be read a Second time.

I mentioned during the evidence session that nowhere in the Commonwealth Development Corporation Act 1999 do we find the words “poverty” or “impact,” or even the phrase “international development”. We have heard much on Second Reading and in Committee—in evidence and during our debates—about the robust business cases, policies and decision-making procedures that are in place in DFID and CDC, but at the end of the day, that is all they are: policies and procedures. New clause 1—and perhaps some of the other new clauses—attempts to make it much clearer in the legislation that governs the CDC that it must meet the same high standards set for DFID and all the other Departments that spend money towards the ODA target. The new clause would require any proposal by the Government to raise the limit on Government assistance to CDC to be accompanied by a report to the House about how such an increase in investment was expected to lead to a reduction in poverty, as defined by the International Development Act 2002.

As we have just heard, the Government are asking for authority to increase their investment in CDC to up to £12 billion by statutory instrument. That is both a significant amount in itself and nearly 10 times the current investment cap. As I said a minute ago, I wonder how many other arm’s length bodies have received or have the potential to receive such an increase—800%—in their funding from the Government by statutory instrument without any additional information justifying that being required to be laid before Parliament.

If Parliament is to be asked to increase the funding cap, it should have information at its disposal to help it make that decision. Ministers keep telling us that robust business cases will be presented, but—

[Philip Boswell]

Will my hon. Friend give way?

[Patrick Grady]

Yes, I will.

[Philip Boswell]

My hon. Friend quite rightly focuses on the robust business case that is required. New clause 2 would better enable transparent goals and practice in terms of checks and balances to be implemented prior to a commitment on funds—

[The Chair]

Order. The hon. Gentleman mentioned new clause 2. We are debating new clause 1.

[Philip Boswell]

My apologies, Ms Ryan; I meant new clause 1. Given the previous concerns about potential bad practice, which were raised on Second Reading, does my hon. Friend recognise the potential for misuse of this substantial fund as an enticement in titanic and desperate international trade negotiations due to Brexit? Should not a serious, transparent and fully accountable stage-gate approval review be implemented before any funding is approved on a case-by-case basis?

[Patrick Grady]

My hon. Friend makes an important point. As I said, Ministers have told us that robust business cases will be presented, but that is an assurance from the current crop of Ministers and the current generation of CDC officials. Putting reporting requirements in the Bill would help to future-proof against any risk of CDC backsliding into the kinds of questionable behaviours that were raised on Second Reading. My hon. Friend also raises interesting points about precisely how this massive potential investment in CDC relates to the Government’s ongoing trade agenda and their interests in trading with different parts of the world, especially in the light of Brexit.

The mechanism proposed in the new clause may not be perfect, and some of the other new clauses are, in some ways, a bit more robust and may place a heavier burden on the Government, but are the Government prepared to use this opportunity to make it clear in the Bill—as they seem to be doing in debate and in the evidence we have heard—that the primary purpose of the CDC and the taxpayers’ money that it spends is to reduce poverty around the world, and that people come before profit?