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Overseas Development

Volume 984: debated on Monday 12 May 1980

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Aid Programme

38.

asked the Lord Privy Seal if, in the light of the Brandt report, he will review his decision to make substantial cuts in the aid programme.

Is it not somewhat hypocritical for Ministers to pay tribute to the Brandt report while at the same time sabotaging its chances of success by making a 14 per cent. cut in real terms in the aid programme for the next four years? Is it not hypocritical for the Lord Chancellor, at the Scottish Tory Party conference on Saturday, to question the morality of trade unionists when the Government are guilty of immorality in cutting the aid programme in order to give tax hand-outs to rich taxpayers? Finally—[HON. MEMBERS: "Too long."] Does the Minister accept that the Government can do something to restore their tattered image in the Third world by using a small percentage of the £4,000 million they will receive this year from North Sea oil to save the lives of some of the 8 million people who are living and dying in poverty?

Order. Those who were here at the beginning of Question Time will know that I asked hon. Members to ask one supplementary question and not to try to argue a case, because that prevents other questions from being called.

The Government have already paid tribute to the Brandt report. They are considering the proposals, but consideration is not yet complete. The Government hope to publish their views before the Venice summit on 22 June. If I might answer a second supplementary question—the cuts are due to the appalling economic state which the Government inherited.

Apart from the Opposition and my right hon. Friend the Member for Sidcup (Mr. Heath), how many people does my hon. Friend know who want to pay more in tax so that the money can be given to the underdeveloped countries to produce goods which threaten the jobs of British workers? Does it not make more sense to use overseas aid money to increase the effectiveness and efficiency of British industry?

In relation to the Lord Chancellor's pontification about morality, is the Minister aware of the growing concern, particularly in the British Council of Churches, at the fact that the Government have turned their backs on the obligation and responsibility that we have for the Third world? Does he agree, not only that money spent on overseas aid is a moral obligation, but that it is in our interests to spend in that way instead of pursuing the costly arms race?

With great respect, that is absolute nonsense. If the right hon. Gentleman could inform the Churches of that, I should be grateful.

Can my hon. Friend confirm that the Brandt report said that two of the greatest contributions that Britain can make to Third world development are the promotion of overseas investment and the expansion of manufactured imports—policies which are rigorously opposed by the Opposition?

That is correct. They would be of great help to developing countries. The specific recommendations of the Brandt report must be balanced against the economic realities facing the country. Proposals for increasing aid or accelerating the transfer of resources raise obvious difficulties.

Commonwealth Development Corporation

39.

asked the Lord Privy Seal when he will be able to report the results of his review of the Commonwealth Development Corporation; and if he will make a statement.

We are undertaking a review of the activities of the Commonwealth Development Corporation in the light of the statement on aid policy which I made to the House on 20 February. Officials of the corporation are participating fully in the work being done. I am not yet able to say when it is likely to be completed.

I thank my hon. Friend for that reply. When does he expect the review to be completed? Is he aware that urgent decisions must be taken in relation to the Commonwealth Development Corporation investment programme and manning, and the chairmanship of the corporation, within the next few months.

I recognise the need for urgency in completing the review. I cannot say precisely at this stage when that will be. Whenever it is, the House will be informed of the conclusions reached by Ministers. Any change of policy in relation to the CDC as a result of the review will be the subject of a statement to the House.

Can the Minister confirm that the CDC has a future under the Government's new aid policies?

Is the Minister aware that the CDC is doing a brilliant job in developing countries by carrying out projects which are fully commercially viable and which, at the same time, make important contributions to the economies of the countries in which they are operating?

That is true. There has been no review of the CDC since 1975 and it is time for another.

Overseas Aid Policy

asked the Lord Privy Seal whether, when considering payments of overseas aid, he will take into account losses caused to British companies owing to the failure of foreign governments to honour guarantees.

All relevant factors are taken into account when considering allocations of overseas aid.

Is my hon. Friend aware of the correspondence that I have had with him and other Ministers about the failure of the Government of Nepal to ensure that a debt owed to a British company is paid? Does my hon. Friend accept that in such circumstances British companies are entitled to look for support from the British Government and that our aid programme should take account of any failure to honour obligations?

My hon. Friend should recognise that the British Government have given the firm all support that they can through diplomatic channels. It is doubtful whether the proposal to cut off aid would help because aid improves the economy and makes it more possible for Governments to settle commercial claims. One of the problems is that the firm obtained a guarantee from the Nepal Government for the repayment of capital but failed to get it for the repayment of interest. It is that which is outstanding.

As it is a subject close to my hon. Friend's heart, can he say whether any progress is being made in developing European Community credit guarantees to cover mineral developments in the Third world? If they can be developed, would not that be of great assistance to the Third world and to mining companies in Britain?

Zimbabwe

41.

asked the Lord Privy Seal if he will make a statement concerning his plans for assistance to Zimbabwe.

42.

asked the Lord Privy Seal whether he will increase the amount of aid available to Zimbabwe.

I refer the hon. members to the statement which my right hon. Friend made on 15 April. The amount of British aid available to Zimbabwe remains as stated then.

Does the Minister agree that, although there were different views about the amount, there was general comment on the tardiness of response? Does he not agree that this country has a specific responsibility for the former tribal trust areas, where there was no infrastructure of administration for some time? Will we be able to help if requests are made in that area?

The requests for help will come from the Zimbabwe Government. They will discuss those requests with us, and we shall allocate the aid that we have promised already according to the joint wishes of the Zimbabwe Government and ourselves.

Although there was a general welcome for the decision to grant £75 million over three years, is the Minister aware that some assessments indicate that Zimbabwe may need up to 10 times that amount? Will the hon. Gentleman be a little more forthcoming and give some indication of the possibility of further aid from Britain, and also from some of the richer member States of the Common Market, which have benefited for so long from the excessive generosity of Britain towards the Common Market, budget?

I shall communicate the latter point to my right hon. Friend the Prime Minister, who will be dealing with the matter at the Council of Ministers. In our figure of £75 million we have allocated all that we can for the moment. It is for the other countries—and many are already pledging sums—to fill the balance of the amount that Zimbabwe will need. We are still pressing many countries to help Zimbabwe.

As the first step in that process, will the Government transfer aid that is at present allocated to Tanzania to Zimbabwe, as the former country does nothing but kick Britain in the teeth?

While taking the point made by my hon. Friend, I am afraid that the aid for Tanzania is committed already, and has been for some time. We cannot go back on Government commitments.

On a point of order, Mr. Speaker. I have been trying to catch your eye.

I am sorry. I did not realise that the right hon. Lady had tried to catch my eye.

I apologise to you, Mr. Speaker. I wish to ask a short, but double, supplementary. What did Mr. Mugabe have to say to the Prime Minister on Friday about his need for increased aid, especially increased technological assistance? Why is the aid mission still not going to Zimbabwe two months after independence? What proportion of the £7 million reconstruction aid is expected to be spent during the next few months?

On the latter part of the right hon. Lady's question, I expect that quite a lot of the £7 million will be spent this year. It is a question of its being ready, available, and they can spend it.

I have not yet heard about the contents of conversations which took place between the Prime Minister and Mr. Mugabe.