Third World

HC Deb 14 June 1976 vol 913 cc23-6

35. Mr. Tim Renton

asked the Minister for Overseas Development whether he will make a statement on his Department's long-term objectives in regard to the needs of the Third World.

Mr. Prentice

Our long-term aim is to help promote the economic and social development of developing countries, particularly the poorest amongst them, with appropriate measures in the fields of aid, trade, commodities and industrial co-operation.

My Ministry's principal rôle is the provision of official aid and the Government's objective is to seek to move towards the target of providing 0.7 per cent. of our gross national product in the form of official development assistance. I cannot, however, set a date by which we shall reach the target, since our progress towards it must be determined by the pace of our own economic recovery and by the other calls on our resources. Meanwhile, we shall continue to play our full part in the international aid effort by providing the maximum volume of aid we can reasonably afford with as high a quality as possible.

Mr. Renton

Does the Minister accept that there is a crying need for more inward investment to the Third World but that it is often held back by fears of confiscation and increased tax rates once the investment is made? Is the right hon. Gentleman co-operating with other developed countries to help to create institutions to undertake these investments on a multinational basis?

Mr. Prentice

I agree that direct private investment has an important rôle to play in development. The conditions under which it operates within individual self-governing countries is a matter for them. The developed countries are in touch with each other about matters of common concern, and we often discuss in OECD and other international gatherings the kind of guidelines and help that we can give to promote private investment, which is complementary to official aid and in no sense a substitute for it.

Dr. Bray

Does my right hon. Friend agree that the Kissinger proposals in this respect are not necessarily the most advantageous to developing countries or to ourselves? Does he agree that this whole area is so complex that it would be a proper subject for parliamentary debate? Will he agree to arrange an early debate on this topic?

Mr. Prentice

I should welcome debates on these matters as frequently as possible. As for the approach of Dr. Kissinger or anybody else to these matters, I cannot deal with that topic in a supplementary answer, except to repeat that in our official programme we are concerned to help the poorest countries and the poorest groups within them. Private investment tends to go not to those nations but to others further up the economic league table, which is understandable. That is all the more reason why official aid should be concentrated on the poorest groups.

Sir Bernard Braine

In view of the fact that a good deal of development assistance does not help the poor in the developing countries, may lead to greater disparities of incomes, and in some cases may prop up oppressive and corrupt régimes, and also bearing in mind the advice given by the President of the World Bank and the Government's welcome shift of priorities to rural development, may we have an assurance that the Minister will take a much tougher line in terms of the criteria to be applied from now on in meeting requests for overseas aid from developing countries?

Mr. Prentice

In the criteria we use, we are trying to do more for the poorest countries and for the poorest groups within them. This, in general, means doing more for the rural sector than for the urban sector. As our projects committee studies various schemes, it tends to take a more favourable view of projects within the rural sector and of those which will benefit the poorest groups.

Mr. Pavitt

In pursuing his long-term objectives, will the Minister in the short-term examine the relationship between his Department and the Department of Trade? In view of the way in which the UNCTAD conference was handled, is it not time that there was a much better relationship and correlation of ideas between my right hon. Friend and those on the other side of the fence?

Mr. Prentice

I think that the two Departments co-operated well at UNCTAD. Indeed, my hon. Friend the Under-Secretary of State has already answered a Question on this matter. The criteria that we have been discussing today were in the minds of the whole delegation, whose representatives at the UNCTAD conference came from several Departments.

Mr. Forman

Is the Minister aware that Conservative Members favour the speediest possible movement to the Pearson target of 0.7 per cent. of gross national product in terms of official aid, and that we would find it easier to argue the case in the country if the Labour Government were more prepared to control their own indebtedness and, indeed, the general public debt in this country?

Mr. Prentice

I am glad that the hon. Member mentioned support by Conservatives for the target. I am also aware that the hon. Member for City of London and Westminster, South (Mr. Tugendhat) has just published an official booklet on behalf of the Conservative Party emphasising the need for a higher volume of overseas aid. This matter needs to be pursued on both sides of the House.

As for the general question of public indebtedness, the Chancellor of the Exchequer, and, indeed, all members of the Government, have made clear that we intend to keep strictly to the limits of public expenditure recently announced.