HC Deb 20 July 1965 vol 716 cc1331-2
29. Sir J. Fletcher-Cooke

asked the Minister of Overseas Development what proportion of British aid disbursements during the latest 12-month period for which figures are available was tied to the purchase of goods and services from this country; and whether she proposes to effect any change in this proportion in the current year.

Mrs. Castle

Of British aid disbursed in 1964, exclusive of technical assistance, aid for pensions and compensation and debt servicing loans, 42 per cent. was wholly tied, and a further 16 per cent. partly tied. Much of the remainder returns to this country in payment for goods. I do not expect these proportions to change significantly in the current year.

Sir J. Fletcher-Cooke

The right hon. Lady says "wholly tied" and "partly tied". Can she give a little more information as to what she means? Can she, in particular, say whether any of the aid is tied to specific goods, or types of goods, or to any goods produced in this country?

Mrs. Castle

It depends partly on the form of aid and the projects concerned. As I have no doubt the hon. Member knows, when making loans we agree the projects on which the money should be spent, and we would bear in mind the impact on our own economy of adding to that particular form of demand. In some cases, notably in the case of our dependent territories, where the aid is not formally tied, none the less there is, by agreement, a considerable flow of British goods.

Sir G. Nicholson

What view does the right hon. Lady take of the proposal to make some of this aid specifically in the form of goods, which may to some extent ease our balance of payments problem?

Mrs. Castle

This is a matter that we have under consideration. It is not particularly easy to carry out, but we are studying it.