Know-how Funds (Hansard, 11 December 1995)

§ 30. Mr. John Marshall
To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about the use of the know-how funds. [3315]

§ Mr. Hanley
The main objective of the know-how fund, Britain's programme of bilateral technical assistance to central and eastern Europe and the former Soviet Union, is to help countries in transition to democracy and a free-market economy by providing advice and expertise. Total expenditure in 1994-95 was £77.2 million. The annual report for 1994-95 and a list of implemented projects are in the Libraries of both Houses.

§ Mr. Marshall
I thank my right hon. Friend for that answer and for his report on the work of the know-how fund, which has been widely welcomed by the recipients. Does he agree, however, that it is even more important that we should be willing to trade with those countries, and that the European Union should adopt a less protectionist and more liberal trading philosophy when dealing with them?

§ Mr. Hanley
The European Union assesses its aid priorities regularly. The know-how fund is a British institution and a British initiative.

§ Mr. Battle
Although under this Government overseas aid has been redirected not only to the know-how fund, which is welcome, but to the multilateral programmes, does not the bilateral aid cut mean that the poorest sub-Saharan African countries are paying the price for that shift and for those cuts? Government cuts in the programme are not being made up for by shifts to the know-how fund or to multilateral funding.

§ Mr. Hanley
In answer to an earlier question from the hon. Member for Eccles (Miss Lestor), I implied that she had been dishonest in her figures. I should like to withdraw that and say that "disingenuous" may be a more accurate word. The hon. Gentleman mentions exactly the same thing. The aid budget remains large; it is still the fifth largest in the world. The bilateral programme, because of our international agreements, is shrinking, but that does not mean that the proportion of bilateral aid or our proportion of multilateral aid is such that there is a reduction in aid to the poorest countries. We are maintaining three quarters of our aid to such countries.

§ Dr. Spink
Will my right hon. Friend acknowledge the great contribution of the British Council in working alongside the know-how fund? It works cost-effectively and delivers an excellent service in those eastern bloc countries and brings trade and jobs to this country.

§ Mr. Hanley
My hon. Friend is right to pay tribute to the British Council and all its works.