Aid and Trade Provision (Hansard, 21 May 1997)

§ 4. Mr. Wareing
To ask the Secretary of State for International Development what plans she has to carry out a review of the aid and trade provision. [313]

§ Clare Short
As I have said, we are reviewing all our expenditure programmes. I am determined to concentrate our efforts on poverty eradication. This means that we are necessarily reviewing the aid and trade provision.

§ Mr. Wareing
I congratulate my right hon. Friend on her appointment and I am reassured by her answer. During any review, will she consider the recommendations made by the Select Committee on Foreign Affairs during the last Parliament when it looked into the Pergau scandal? Most of the ATP aid was being focused by the Tory Government on Indonesia and China—two countries which do not have the best human rights records. Among the developing countries, Indonesia is the sixth largest recipient of direct foreign investment. How could the Tory Government have justified concentrating 17 per cent. of ATP aid on that country? I am sure that my right hon. Friend will agree that we should be directing that aid towards the poorest peoples in the world.

§ Clare Short
During the review we shall, of course, take account of the Foreign Affairs Select Committee report. I share my hon. Friend's concerns and I am reviewing our aid programme to Indonesia. Many people argue that the aid and trade provision does not meet either development or commercial objectives very well. We want absolutely to concentrate all our efforts and all our resources on the eradication of poverty. That means that we must look seriously at the way in which the aid and trade provision has pulled our aid spend in a different direction.

§ Mr. Wilkinson
In greeting the Secretary of State at the Dispatch Box, I welcome her review of Britain's overseas aid programme, particularly the review of the aid and trade provision that she has announced. Will she focus much more on the aid and trade provision to the mutual benefit of British industry and commerce and the recipient countries, thereby enhancing political and commercial connections between them while at the same time diminishing Britain's contribution to the European 697 Union's aid programme, which is not nearly so well targeted as the British one and is often wasteful and misapplied?

§ Clare Short
As I have said, we are reviewing the aid and trade provision, but perhaps our thinking goes in a slightly different direction from that of the hon. Gentleman. The aid programme is not about the promotion of commercial opportunities. That is an important objective of Government policy, but the aid programme should be part of a bigger strategy for eliminating abject poverty in the world. That is in the long-term interests of everyone and, indeed, of commercial activity. If there is less poverty, there will be more commerce.
On European Union aid, the hon. Gentleman will know that it was his Government who, in Edinburgh, made an agreement which meant that up to 40 per cent. of our aid spend should go through the EU and unfortunately I have inherited that. The hon. Gentleman is right to say that the performance of EU aid is patchy and I shall be doing everything in my power to use our influence in the EU to try to get the concentration on poverty eradication in EU spending in the same way as we want to achieve that from our own aid spending.