HL Deb 19 July 1966 vol 276 cc365-6

2.49 p.m.

LORD BARNBY

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

[The Question was as follows:

To ask Her Majesty's Government whether they will reconsider the practice hitherto followed of making overseas financial grants without conditions and whether they will now as far as possible make them "tied" as to purchases in the United Kingdom.]

THE PARLIAMENTARY UNDER-SECRETARY OF STATE FOR COMMONWEALTH RELATIONS AND FOR THE COLONIES (LORD BESWICK)

My Lords, overseas aid grants are not made without conditions. They are mostly given for a specific object agreed between the recipient Government and Her Majesty's Government. As regards tying to United Kingdom goods and services, it is normally required that imports paid for by grant aid should come from the United Kingdom.

LORD BARNBY

My Lords, that Answer is rather disappointing—that a practice that is so desirable in the present condition of our balance of payments should not be more comprehensive. May I ask the noble Lord whether the Government would consider some differentiation in the case of those countries where the loan is of a character free of interest and with a delayed repayment, and also those countries which have not true democratic government; and, thirdly, would he take note of the practice of the United States, where the majority of the loans are actually tied?

LORD BESWICK

My Lords, I am sorry if the Answer was disappointing, in so far as it was different from what the noble Lord anticipated, but I do not think I can go beyond what I have said: that imports brought into the country by a recipient country normally come from the United Kingdom. I do not think the noble Lord wants us to vary that. As for disapproving of a form of government by withholding or refusing grants, I am not at all sure that that is something which the noble Lord would, on reflection, wish us to do.

LORD ROYLE

My Lords, I wonder whether my noble friend would refer the noble Lord, Lord Barnby, to the speech of his noble friend Lord Bessborough on Thursday last, in respect to the Indian famine? It might be an encouragement for what the Government are now doing.

LORD BARNBY

My Lords, to answer the noble Lord who replied, in his speech on the Second Reading of the Overseas Aid Bill he said, if my memory is correct, that between one-third and 50 per cent. of the loans resulted in purchases in the United Kingdom. In the United States, the practice is much more generous in regard to exports from the United States than is our practice in England.

LORD BALFOUR OF INCHRYE

My Lords, are we not getting to a rather absurd position, where the hard-pressed overburdened taxpayer of this country is having to provide funds to countries that have broken off diplomatic relations with us, who certainly do not like us much, in order that those countries should be able to buy arms from behind the Iron Curtain, China and other countries? It is becoming absurd.

LORD BESWICK

My Lords, the noble Lord is making some allegations which may, or may not, be justified. But I am sure that he is not seeking to say that we should get out of our own economic difficulties by imposing extra burdens on those so much less well off than we are.