HC Deb 20 July 1965 vol 716 c1331
28. Mr. R. Carr

asked the Minister of Overseas Development what proportion of British aid disbursements was given in support of local costs in 1964–65 or failing that in the calendar year 1964; how this compares with the previous year; and whether she is planning to make any increase in this proportion in the current year.

Mrs. Castle

I estimate that some 30 per cent. of our bilateral financial aid, excluding the categories of aid for debt servicing and certain transfer payments, was in support of local costs in each of the years 1963–64 and 1964–65. In the current year we shall examine each case for local cost aid on its merits, but I must have regard to the particular impact of this kind of aid on the British balance of payments.

Mr. Carr

Will the right hon. Lady bear in mind the great importance of local cost aid in order to make other forms of aid fructify, and that even that, perhaps, does not have quite such a bad effect on our balance of payments as some people think?

Mrs. Castle

I am aware of the necessity for a reasonable allocation in respect of local costs for each of the loan agreements. In return, I hope that the developing countries will realise that we have our balance of payments difficulties and will do their best to increase their imports from this country.