§ Q7. Mr. Alexander W. Lyonasked the Prime Minister whether the Government will increase the level of overseas aid to 1 per cent. of the gross national product during the period of the United Nations Development Decade.
§ The Prime MinisterWe are already attaining this target, Sir.
§ Mr. LyonWould my right hon. Friend agree that, in achieving this purpose, it makes no economic sense to reduce our commitments to overseas aid by £20 million in the coming year as part of our freeze measures, if overseas aid is designed to build up the economies of underdeveloped countries, thereby increasing our markets?
§ The Prime MinisterIn the first place, I do not think that the motive for aid 827 or developmental capital should be solely or mainly for the purpose of increasing our markets. It is a fact that over the past few years, under successive Governments in this country, the amount devoted to aid has risen quite considerably and pretty steadily. It has increased considerably in the last two years and is still at a record level for this country. In this situation, when we have had to count every penny of overseas expenditure, it was inevitable that some restriction on the increase—not a cut—had to be laid down for aid, although the cut there is very much smaller than is envisaged in the case of defence.
§ Mr. HeathIs the Prime Minister aware that over the four years 1961 to 1965, this country maintained the 1 per cent. of gross national production investment overseas, and that at Geneva in the spring of 1964, at U.N.C.T.A.D., we committed the country to a continuation of this policy? Can he give an assurance that, despite the Chancellor of the Exchequer's policies affecting private investment overseas and the Corporation Tax and other measures, the 1 per cent. will be continued for the next four years?
§ The Prime MinisterYes. This is our policy and the commitment entered into by the right hon. Gentleman has been fully met. We are now spending more on aid and developmental capital than we were, even in March, 1964. One thing that we have tried to do, I hope that the right hon. Gentleman will agree fairly successfully, is to see that aid is used to prime the pump of activity within the countries concerned rather than to be a form of charitable aid.