HC Deb 24 July 2002 vol 389 cc968-70
4. Mr. Andy Reed (Loughborough)

What steps she is taking to monitor and improve poverty reduction strategies in countries receiving debt relief. [69876]

The Secretary of State for International Development (Clare Short)

The UK worked hard to reshape IMF and World Bank relations with developing countries through the creation of the poverty reduction strategy process. This puts developing country Governments—[Interruption.]

Mr. Speaker

Order. There is far too much noise in the Chamber.

Clare Short

Thank you, Mr. Deputy Speaker.

The process puts developing country Governments in the lead in bringing together economic policy and the distribution of debt relief, aid and local revenues in order to reduce poverty. The strategies are publicly debated and scrutinised before they are agreed. We are monitoring progress and believe that this approach is leading to improved economic management and social reform.

Mr. Reed

Does my right hon. Friend agree that poverty reduction works only if it is not an accounting method, but improves the lives of the poorest in the countries involved? Does she agree that civil society must be involved in the production of those poverty reduction plans, such as in Uganda? Will she try her hardest to ensure that the World Bank and the IMF includes civil society in the outcomes of all poverty reduction plans, so that they make a difference to the poorest in the country and not just to the bankers and the leaders?

Clare Short

I agree with my hon. Friend that poverty reduction means improvements in people's lives. The shift of the measurement of progress by the IMF-World Bank programmes to poverty reduction means that they must focus on people's lives and not on some theoretical economic reform. That is one of the improvements that has been made. It is a requirement of poverty reduction strategies that they are openly debated with civil society. We must make sure that it is not just a few groups who are capable of applying to agencies such as mine for grants, but that representatives of the people, such as churches, women's organisations and village groups, can apply so that the real poor get a say in the priorities of their country. That is improving, but there is a way to go. [Interruption.]

Mr. Speaker

Order. I must ask the House to be quiet. There are hon. Members who are interested in this matter.

Dr. Vincent Cable (Twickenham):

Does the Secretary of State agree that poverty reduction strategies can be severely compromised by arms export deals that entail debt obligations? As the Export Control Bill comes to the House for the last time this afternoon without a sustainable development clause, can she say what action she can take as a Minister to minimise the damage?

Clare Short

I agree with the hon. Gentleman. My aspiration is that we should learn the lessons of the Tanzania air traffic control case, whatever side of the argument one might be on. Such a contract will not be made again. We helped Tanzania to have procurement, financial management and scrutiny systems, and I am confident that those systems are now in place in Tanzania. The way in which we apply criterion 8—not giving a licence to something that would threaten the sustainable development of a poor country—must be tightened up and improved, and there has been an internal review.

Personally, I do not think that we need the amendment—although I respect those who fought for it—to achieve a tighter and better application of the sustainable development rule. But I agree that that is what we should achieve, and then good will have come out of bad.

Mr. Tom Clarke (Coatbridge and Chryston)

Does my right hon. Friend agree that the House will welcome the apparent easing of tension between India and Pakistan, but will be gravely concerned about the humanitarian problems in Bangladesh, in view of the flooding that has million becoming homeless, affected 30 per cent. of the country and left 50 dead? Will my right hon. Friend continue her excellent efforts and encourage the European Union to emulate her actions?

Clare Short

I agree with my right hon. Friend that it is welcome that the tension has reduced between India and Pakistan. My right hon. Friend the Foreign Secretary has put a lot of effort into that. However, I do not think that the crisis is by any means over. We still have 1 million men on the line of control and elections are due on the Indian side of the line, in Jammu and Kashmir. If we have any crises, we could have an escalation, and then it could easily go nuclear. We should not take our eye off the danger there.

I also agree with my right hon. Friend that Bangladesh copes enormously well with its floods, but it deserves more support and help because so many poor people there deserve a better chance in life.