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HOUSE OF COMMONS SESSION 1997-98 / INTERNATIONAL DEVELOPMENT COMMITTEE | Second Report THE DEVELOPMENT WHITE PAPER Report, together with the Proceedings of the Committee, Minutes of Evidence and Appendices Ordered by The House of Commons fo be printed 16 December 1997 LONDON: THE STATIONERY OFFICE £14.70 IO BENE UGRU AQ COM Mel. EVUUSEMUIC COUR ITH S s / SASyHe ] eae Ablste cAteweds oPn VAowR AAL : HOUSE OF COMMONS SESSION 1997-98 INTERNATIONAL DEVELOPMENT COMMITTEE Second Report THE DEVELOPMENT WHITE PAPER SEROLSL wDs LSP LI SLL IEE TODD RIES I TLE ETE PLR) /T ~IN~zY.a PKA : are : my. V. T¥ i7 A XE—Le B DA 28 JAN 1998 ” ene : é ; AAJ Arie mrmne ft : ror wie Vi MLURTRC AO 8 VV CLICE Aibe Newai w ALA LVRELALIO CIEE] LeeRIE L BOPR ABE E LL UE BOSS EIN EE LATRINES.) iwVeg? Report, together with the Proceedings of the Committee, Minutes of Evidence and Appendices Ordered by The House of Commons to be printed 16 December 1997 LONDON: THE STATIONERY OFFICE £14.70 330 il SECOND REPORT FROM The International Development Committee is appointed under Standing Order No. 152 to examine the expenditure, administration and policy of the Department for International Development. The Committee consists of a maximum of eleven Members, of whom the quorum is three. Unless the House otherwise orders, all members nominated to the Committee continue to be members of it for the remainder of the Parliament. The Committee has power: (a) tosend for persons, papers and records, to sit notwithstanding any adjournment of the House, to adjourn from place to place, and to report from time to time; (b) to appoint specialist advisers either to supply information which is not readily available or to elucidate matters of complexity within the Committee's order of reference; (c) to communicate to any other committee appointed under the same Standing Order and to the Committee of Public Accounts, the Deregulation Committee and the Environmental Audit Committee its evidence and any other documents relating to matters of common interest; (d) to meet concurrently with any other such Committee for the purposes of deliberating, taking evidence, or considering draft reports. The membership of the Committee since its nomination on 16 July 1997 is as follows: Mr Dennis Canavan Mrs Tess Kingham Ann Clwyd Mr Andrew Robathan Ms Barbara Follett Mr Andrew Rowe Mr Bernie Grant Dr Jenny Tonge Mr Piara S Khabra Mr Bowen Wells Ms Oona King Mr Bowen Wells was elected Chairman 16 July 1997. eT The cost of preparing for publication the Shorthand Minutes of Evidence published with this Report was £1,240.03. The cost of printing this Volume is estimated by The Stationery Office at £4,500. THE INTERNATIONAL DEVELOPMENT COMMITTEE — ill TABLE OF CONTENTS took, Rae: le ae oi eee IR 2S apne eel ag en Vv Paragraph PA EOS MPEL OG ALG TRE oy te eed doe cei ey a ii <p Rade i a 1 INTERNATIONAL DEVELOPMENT AND WHITEHALL ................. 6 Teeter eet PeeCOINCO POONERR Y oor och d pst oe Wa aes fora dese oS eles cote ibe DEMOS EINER a gs 0 Ton BTS a SETA A RS en hE NT, De ee ee ame EP 28 THE AID AND TRADE PROVISION AND MIXED CREDITS ............ 33 THE PRIVATE SECTOR AND THE COMMONWEALTH BENE ORME NEE, CORPORAILON be se ia drey® ace. eMy oR Raa dic, acs« pet shining airs 35 INCU DTS COUN IA GB DY aks Barc aler ha sta Gti y.“ ata ae PRAk A o « claws LAbigatarmias 38 Rk ak a a kal sce ee oka Ril Mat cide te) hohe ciel undid tease 44 CesT MIEN ELDON Se ee ie, Str Oa dt Nae, AN aS Nae titi SN tok Eye sene tans 48 SOO GUMERNANGIEANIMCORRUPTION ii) ie. teiphen Toss Tbaeeasie Sag we 51 eT SUG) Ne wa: Ral ae Ye deal Rl te ted ocae Aas «Slat des thes Cheptarriies. © 4 54 Page SUMMARY OF CONCLUSIONS AND RECOMMENDATIONS ............ Xix Pe OGHEMING Or eG Il Es ocnn nbn! nasd Al voveursethiteecihtgoen ts XXIi Se (OLE ANG g wed EASES SR 0a les ete OF an wee ra Oe A PE a Sa ea XXiil LIST OF MEMORANDA INCLUDED IN THE MINUTES OF EVIDENCE .... xxiii LIST: OF APPENDICES TO THE MINUTES OF EVIDENCE..............4. XXIV MUN TGR PE NLD ENGR ae acta Rita of wiohal inflate: te olwine eitenrce- 1 BEPENDICES OTHE MINUTES OF EVIDENCE vn csoeys eof wheter yee oi\s pir benes ie ah ‘ A mn ee! oe fat ' : > : > yy 7 » f a ow “Wh, ae r ; 4 : i's iii e italy-i ’ Patt 2 - ma a A wri I nn pe8aR l nNape <ORa oen e) WSeD SiTiAaAdIhOdTi gAhO aVOiInL:A PPM TN Distt,,( rhs . ‘leit a~ SRA fe ae BaWhs pty z L Sh , af Rix J Tisch Wa Gp Rahite 3) 40 SCANT GC Si HOOP Re Po a ‘f a awf isaae an o¥ y ”Ra y /re rea ea . ru2"t; aViA. ey i" ) ia » OPA 4 b5i ne}o nt byt MO! ys oe bhf ee Ei ef, vatr, ade r+e arM eY a iahb e e ; bay tdi e me Oe Bsi e Otiaes th. : e: e ; Reetd i;t iyc an , tH wif ' : aeoe . ' : yA "1 P§L Ls ab e, e.e had * bg cnv e A) . 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Ficeen ey ‘i ; Cie ey AN 3 on aay te An ‘y, ss Wee ysta i ih) ' Rie ol' y0 aa chaes aDA aho st h Ae ‘ SECOND REPORT The International Development Committee has agreed to the following Report:— THE DEVELOPMENT WHITE PAPER INTRODUCTION 1. International Development is now a constant item on our television screens and in our newspapers. Subjects discussed range from the abolition of landmines, through the reduction in the emission of greenhouse gases, to Aids and infant mortality in developing countries. It has become apparent to the international community that the development of the poorer countries is not only a moral imperative but also in our own interest. The Development White Paper states, “As a country which depends more than most on international trade and investment, jobs and prosperity here in the UK depend on growth in the global economy to which developing countries could contribute so much in the future”.' There is also, as the Secretary of State for International Development made clear to the Committee, “the environmental imperative, the growing understanding in the world that if we do not make progress ... the world will be in very serious difficulty...just in terms of population growth, environmental degradation, war, refugee movements, disease, the terrible catastrophes that could come upon everyone and that unite the interests of the north and south in the world”. ” International development must therefore be at the centre of all government policy, not just a well-meaning afterthought. It is an essential part of responsible planning for the future of our own country. 2. Not only must development be considered in all aspects of domestic policy formulation. It also is of the utmost importance in our international relationships. The White Paper points out that Britain has a unique place in the world, “No other country combines membership of the Group of Seven industrialised countries, membership of the European Union, a permanent seat on the Security Council of the United Nations and membership of the Commonwealth. Our particular history places us on the fulcrum of global influence”.’ In giving evidence to the Committee the Secretary of State for International Development, the Rt. Hon. Clare Short MP, said that using this influence to promote the development of the poorer countries “would be an enormously fine role for us on the international stage”.* We support this ambition. To be an advocate for the world’s poor would be morally right, would be in the interests of the United Kingdom, and would take full advantage both of this country’s international position and of the expertise of its citizens. For such a role, however, it is necessary first to have a clear and focused development policy. 3. The White Paper on International Development, “Eliminating World Poverty: A Challenge for the 21st Century”, published on 5 November 1997, provides such a policy. This was the first White Paper dedicated to international development for 22 years. Its preparation had been one of the first initiatives of the newly established Department for International Development (DFID). The creation of DFID, with a Secretary of State at the Cabinet table, is a recognition that development policy has its own logic and importance. It must never be the victim of ulterior motives or distorted by other interests. We welcome the creation of DFID. We believe that it will give new focus to the United Kingdom’s development activity and also inject greater sensitivity to developmental issues throughout Whitehall. ' The White Paper on International Development, “Eliminating World Poverty: A Challenge for the 21st Century”, Cm. 3789, para.1.21 [henceforth referred to as "the White Paper"}. * Ore > White Paper para.1.23. a 8 48. vi SECOND REPORT FROM 4. The Committee agreed to conduct a short inquiry on the White Paper. The aim has not been to discuss all the matters raised in detail. That would take the whole of a parliamentary term, if not longer. The purpose of the Report has been to give an opportunity both to the Secretary of State to explain in more detail the thinking behind the White Paper and to the NGOs to comment on its contents. The Report also allows the Committee to consider the general philosophy of the White Paper and make recommendations on matters of emphasis and implementation. We trust that the Report will thus inform debate in Parliament and encourage further thought in Government on specific issues. 5. We were grateful to the Rt. Hon. Clare Short MP, Secretary of State for International Development, Mr Richard Manning, Director-General (Resources) and Mr Graham Stegmann, Head of Aid Policy and Resources, Department for International Development, for giving evidence to the Committee. We also received a number of memoranda from organisations and individuals containing their responses to the White Paper’s contents. These have proved most useful as the Committee deliberated. We commend all the evidence to the House to inform any future debate on the White Paper. INTERNATIONAL DEVELOPMENT AND WHITEHALL 6. The Secretary of State has made clear that the White Paper is a Government document, not merely the view of her own department.’ Mr Manning said that its production was “very much a coordinated process across Government”.® Clare Short explained, “We have for the first time a commitment in Whitehall to a department that brings to the table on questions of agriculture or trade or debt or whatever it is the interests of developing countries and not just the immediate short term interest of our own country...That is an advance and we have all departments signed up to the White Paper”.’ 7. We are pleased to note this emphasis on all departments owning the White Paper. We have no doubt that the White Paper was the result of many hours of debate and some compromise across Whitehall. There is always, however, a gap between the ideal and the reality. Clare Short herself admitted that “some of the tension and pull between short term interests, between immediate departmental interests and bigger world picture interests, will remain”.® DFID therefore will need both appropriate structures and adequate support in its advocacy of the development agenda in Government. 8. We were told of some of the structures that had been put in place since the election. A cross-departmental committee on development had been established.? DFID now had a representative on the committee of Whitehall officials charged with examining requests for arms export licences... We welcome these initiatives and look forward to further information on how these cross-departmental committees are operating. We also welcome the fact that DFID now represents the United Kingdom at the World Bank. We trust that DFID is closely involved with the Treasury in the formulation of policy at the IMF and on the question of debt relief. ; 9. There remains, however, a significant omission. DFID does not have a place on the Cabinet Committee for Defence and Overseas Policy. The Secretary of State explained that she did “attend regularly, but I am not formally a member, so that I think I am not handicapped in terms of the decisions that have taken place at it. I think it may be a little bit of a snub to the Department ... there is a case for arguing that it should, as of right, as a Department be at that table”''. We agree with the Secretary of State. Attendance at a Cabinet Committee is not the same as formal membership, nor is that membership merely OMe Ol, AO yey 1O4y §Q.41. ? O25. ot O6ak '' Q.66. THE INTERNATIONAL DEVELOPMENT COMMITTEE vii symbolic. The opinions of DFID must carry equal weight with those of other departments of State. The Government must demonstrate the seriousness of its concern to integrate developmental issues into all aspects of policy consideration. We recommend that the Secretary of State for International Development be a full member of the Cabinet Committee on Defence and Overseas Policy. 10. The Committee will certainly support DFID in ensuring that all government departments consider development matters in their policy and its implementation. The Committee will call for evidence from other government departments when relevant to an inquiry. Only thus can all government departments acquire the habit of thinking developmentally. We were pleased to note in the recently produced mission statement of the FCO a reference to combatting poverty in the world through the UK’s status at the United Nations. There are other government departments whose mission statements and objectives should also make reference to the Government’s commitment to international development and the elimination of poverty. They include MAFF," the DTI’ and the Treasury, to name but three. Similarly, we recommend that the departmental reports of other government departments, including the FCO, the Treasury, DTI, MAFF, DfEE,’* DH" and DETRS,** all include a section on how their policy and activities have promoted international development and the elimination of poverty. We intend from time to time to take evidence from them on this matter. THE ELIMINATION OF POVERTY 11. At the heart of the Government’s policy on international development is the elimination of poverty, as the title of the White Paper makes clear. 1.3 billion people live in extreme poverty, on less than the equivalent of one dollar a day.'’ Almost 70 per cent of them are women. The concern to eliminate poverty provides an admirable focusing of our development efforts on the truly important. The Secretary of State said that “there was a whole period in the history of development when the general view was that big projects in poor countries helped the countries and therefore would help the poor, and the whole era of massive dams and big infrastructure projects came out of that analysis. Part of this [focusing of development effort on poor people] is lessons about what reaches the poor and what does not reach the poor”.'® The focus on poverty thus partly involves a reassessment in the development community of how the poor can really be helped. The White Paper in section 2 outlines the new agenda. There is now a particular emphasis, for example, on greater equality for women, good governance and the rule of law, and such sectors as health, education and family planning.'” 12. The focus on poverty is in part a result of a new analysis of developmental effectiveness. It is also the result of changes in the international political order. The end of the Cold War has removed one of the great pressures for the misuse of aid for political ends. It has coincided with a series of international conferences under the auspices of the United Nations which have set an internationally agreed agenda on such issues as the environment and development, population and development, women, food, human rights, social development, and human settlements. Development must ultimately be viewed as an international effort. This is because the challenge of poverty is so large that only an international response can be effective. It is also because the increasing globalisation of trade and finance means that solutions to poverty are often global ones. 2 Ministry of Agriculture, Fisheries and Food. '5 Department of Trade and Industry. '4 Department for Education and Employment. 'S Department of Health. '© Department of the Environment, Transport and the Regions. '7 White Paper para.1.9. # 0.12. '? White Paper para.2.3. Vili SECOND REPORT FROM 13. The commitment to eliminate poverty does not remain purely theoretical in the White Paper. The Government commits itself to a number of international development targets as found in the document ‘Shaping the 21st Century: The Contribution of Development Co- operation’, produced by the Development Assistance Committee (DAC) of the OECD” and published in May 1996. They are: — a reduction by one-half in the proportion of people living in extreme poverty by 2015. — universal primary education in all countries by 2015. — demonstrated progress towards gender equality and the empowerment of women by eliminating gender disparity in primary and secondary education by 2005. — a reduction in the mortality rates for infants and children under 5 and a reduction by three-fourths in maternal mortality, all by 2015. — access through the primary health-care system to reproductive health services for all individuals of appropriate ages as soon as possible and no later than 2015. — the implementation of national strategies for sustainable development in all countries by 2005, so as to ensure that current trends in the loss of environmental resources are effectively reversed at both global and national levels by 2015. There are also important qualitative targets such as democratic accountability, the protection of human rights and the rule of law.”! 14. The White Paper’s focus on poverty was universally welcomed in the memoranda received. This is in itself important, suggesting a shared vision in government and civil society which is vitally important for future success. The adoption of the DAC targets was also praised.” There was, however, concern that others would have to adopt these targets for them to be at all reachable, in particular the multilateral institutions. An obvious donor which must commit itself to the targets is the European Union. 15. Over 30 per cent of the United Kingdom’s development programme is spent through the European Union. If the European Union does not also commit itself to the DAC targets the United Kingdom’s efforts will be seriously frustrated. The Committee was pleased to note a greater emphasis on the alleviation of poverty and mention of the DAC targets in the Commission’s recent Communication on the renegotiation of the Lomé Convention.” The White Paper commits the Government to use its influence to strengthen the poverty focus of the European Union’s development programme and set quantifiable targets for poverty reduction. That influence will be particularly marked in the first half of 1998 when the United Kingdom has the Presidency of the Development Council. We recommend that in the office of the United Kingdom Representative to the European Commission in Brussels there be personnel and input from DFID at the highest level to ensure progress in the reform of the European Union development programme. This should be at the same level as DFID’s representation at the World Bank. 16. We recommend that the United Kingdom press for the adoption of the DAC targets by the European Union. A debate on the subject should also encourage the European Union to adopt a more coherent and poverty-focused developmental policy. The number of agreements, instruments and Directorates-General currently involved in development suggests a divided and confused approach. In short, we believe that the © Organisation for Economic Co-operation and Development. *! White Paper Panel 4 p.21. * Evidence pp.30, 52, 72, 81. >C> OCMomOm)un ic5a3t7 ioAnna l frpom athe dComm ission to the Coeuncile a nd the E Parli