HL Deb 29 April 1980 vol 408 cc1139-49

3.6 p.m.

Viscount LONG

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, that the House do now again resolve itself into Committee.—(Viscount Long.)

On Question, Motion agreed to.

House in Committee accordingly.

[The Lord ABERDARE in the Chair.]

Clause 9 [Overseas aid]:

On Question, Whether Clause 9 shall stand part of the Bill?

Lord HATCH of LUSBY

I beg to move that Clause 9 be omitted from this Bill. It is a cause of some surprise to me that the Bill has reached this stage without, apparently, any comment as to the content of this clause. Indeed, the only explanation that I can think of is that, as it appears to have changed its number several times between the two Houses, it has passed the notice of those who have been dealing with it. I should like to put it to the Government that the normal deduction from reading this clause is that they have overlooked its content and would like it now to be removed. I say this in no party spirit. I put this suggestion to them on the testimony of their own leading members of the Cabinet. I want to quote first from the noble Lord the Foreign Secretary, who, in this House, on 20th February (at column 748 of the Official Report) had this to say: We believe that it is right at the present time to give greater weight in the allocation of our aid to political, industrial and commercial considerations alongside our basic developmental objectives". Many of us would agree with that. Then he went on to say in a subsequent paragraph in his Statement on overseas aid: The greater part of our bilateral aid is tied to procurement in the United Kingdom and so provides valuable orders for British firms. I might add that our contributions to multilateral institutions also enable British firms to compete for very substantial business financed by them all over the world. We are examining means by which they might get a greater share of this business". I would suggest that this is one of the means.

When the Labour Government introduced the Industry Act they deliberately included Clause 9, to which I am referring and which allows the Scottish Development Agency, the Welsh Development Agency and the National Enterprise Board to provide technical assistance overseas. Why? The simple reason is that aid of this kind provides employment in this country. I want to make this quite clear, and I hope that the Government spokesman will support this point. There is a considerable misunderstanding in this country that aid is charity and only charity. Of course, it has a charitable aspect to it, and we hope it always will have, because we believe that the British people are charitable people. But it has something more than that. It also has a very important investment element, and it is the investment element that I am stressing this afternoon.

At a rough estimate it has been calculated that the aid which we now supply provides approximately 40,000 jobs in this country. I hope again that the Government will support me in emphasising this aspect of overseas aid. It is for that reason—as the noble Lord, Lord Trefgarne, will remember—that I so bitterly regretted the Government's action in destroying the development education work that was being done by the Overseas Development Ministry.

Why then should we suggest in an Industry Bill that these three bodies should have the power to offer technical assistance to overseas countries? Both the Scottish Development Agency and the Welsh Development Agency have developed and are developing expertise in the building of industrial estates. Surely this expertise can be of use to other countries which in their turn can provide orders for the industry of our own country. We have seen certain of the nationalised industries participate in this kind of work. Developing countries need railways, power stations, coal and oil. All these commodities, these installations, are nationalised in this country and most European countries. This is one way in which the European countries are able, through their public sector, to assist in the development of developing countries.

But again I stress it is not just as charity but also because these activities provide the orders for the industries of the donor countries, not just for the nationalised industries but also for many private firms. This is a joint enterprise and this was the purpose of Clause 9 when it was introduced into the Industry Act. Even the chairmen of the nationalised industries in this country have set up their own committee in order to further this work, and further it again because they know that this is profitable for them, for the nationalised industries, and also because in its turn in its spin-off it leads to commercial orders for the private sector of this country. If the Scottish Development Agency and the Welsh Development Agency can assist in this way, what of the National Enterprise Board?

Yesterday we had several mentions of the INMOS organisation. I would give this again as an example. INMOS gives us in this country our first toehold into the new technology of electronics. It could be of immense value in the development of the industrial content of the developing world. In doing so, the National Enterprise Board can widen its scope and provide something which is not simply parochial to the British Isles but which enables us to have an influence in the building of industry overseas and also an influence in the development of British commerce and British industry as a spin-off.

I hope that the Government will accept the points that I have made as a matter of national interest, not of party interest. I hope that in doing so they will note just what we are talking about. Clause 9 deals with Section 4 of the Industry Act 1975, with Section 18 of the Scottish Development Agency Act 1975 and with Section 3 of the Welsh Development Act 1975.

I want to refer the Committee to the relevant parts of those sections because they coincide. Section 4 of the Industry Act 1975 has this to say: … furnish technical assistance in a country or territory outside the United Kingdom against reimbursement to them of the cost of furnishing that assistance". Section 18 of the Scottish Development Agency Act 1975 has this to say: … furnish technical assistance in a country or territory outside the United Kingdom against reimbursement to them of the cost of furnishing that assistance". Section 3 of the Welsh Development Agency Act 1975 repeats this: … furnish technical assistance in a country or territory outside the United Kingdom against reimbursement to them of the cost of furnishing that assistance". I suggest that what we are talking about is the opportunity that these three Acts offer to provide technical assistance from the National Enterprise Board, from the two agencies, for payment. In other words, it cost us nothing, but it was an opportunity to invest in developing countries in a way which would enable the industry of this country to have wider and wider opportunities of offering its goods in the developing world. That is the reason that these sections were put into the three Acts that we are talking about. I cannot for the life of me understand why the Government should now wish to remove the power which these three agencies have to further the interest of British industry and to withdraw their assistance to the countries of the developing world.

3.20 p.m.

Lord RITCHIE-CALDER

I should like to support my noble friend in moving this amendment and in protest against this whole attitude of "stop the world and let us get off". This is what it is all about. We are contracting out of the real world. The clauses involved are enabling clauses; they enable the Scottish Development Agency, for example, to do the kind of things that some of us in Scotland want to promote. Again, I would repeat what was said. This is not charity: it is constructive development intended to promote Scottish interests—we are talking about the Scottish Development Agency—and also, as he pointed out very clearly, whatever the development agency or the National Enterprise Board or anybody else proposed to do, this meant that we were in fact consciously creating work for private enterprise in Scotland. Some of us have been very deeply concerned in this, because we have tried and have quite substantially succeeded in promoting the development which I want to see in the developing countries, done not as charity but as positive investment and encouragement to the industries involved.

How on earth can we be so shortsighted as to exclude the right to do these things when we have got surplus insights and we know what we are doing in terms of development? We would like to see that kind of insight transferred to developing countries so that they will not have to go through all the development problems that we have been through. Above all, it is the means by which private industry in all kinds of small companies and so on can be encouraged to go out into the developing world and produce not only the results I want to see produced, but worthwhile recompense in Scotland, or in Wales, or in national encouragement.

Lord HANKEY

Having at one time been a member of the Development Aid Committee of the OECD, I should like to say that it was apparent even about 15 years ago that the transfer of capital aid to overseas countries in the Third World was very seldom effective unless technical assistance went with it to make sure that it was intelligently and properly used. Anyhow, the transfer of know-how from the developed to the developing world is terribly important for their well being and their progress, on which I think our own prosperity is going to depend. When the Government reply, I hope they will explain to us how the transfer of technical assistance is going to continue. Obviously, it does not have to be done by the National Enterprise Board, but one would like to know that the process of giving technical aid will in fact not suffer.

Lord ROCHESTER

I am afraid that I cannot really get very excited about this clause. As I understand it, the Government now wish to remove from the National Enterprise Board the power to provide technical assistance to countries overseas and leave it to the Overseas Development Office to deal with the matter. When the power was given to the National Enterprise Board under the 1975 Industry Act, I think it was acknowledged by the spokesman for the Labour Government at the time that this power was in the nature of an experiment. I think also I am right in saying that it has not yet been used. I can therefore understand the Government's view that the power should be concentrated in the hands of a single agency and not of the NEB. On the other hand, just because it has proved to be of such little significance in practice and in order to minimise the area of disagreement between the political parties as to the powers of the board, I personally would not mind very much if the National Enterprise Board was left with this particular power.

What I should like to do is to take this opportunity to say that, not just for humanitarian reasons but for sound com- mercial ones, it seems to me greatly to be regretted that even in our present economic plight we are not providing more aid of this kind. The financing of fees for students from overseas in regard to technical subjects is perhaps an example of what could be done under this heading in our own long-term interest.

In comparison, anyway, with that major point, the question of what agency is actually to deal with this matter of providing technical assistance seems to me to be a relatively trivial one, and for my part I would counsel that this particular point is not pressed further now.

3.27 p.m.

Viscount LONG

I am grateful to the noble Lord, Lord Hatch, for raising this amendment but, as all of us know, he is dedicated to overseas trade and is a great expert on it, and at this moment I think we really must isolate overseas trade and the position of the NEB. When the subject first arose during the passing of the Industry Act 1975, we took an open-minded view of the possibility of its being incorporated in the activities of the NEB and the agencies. During the passage of the Bill we on this side of the Committee did not from the Conservative Benches oppose the Government clause for the very purpose that we are now discussing, but we are now taking into account the experience of the past four years and more of the NEB and the agencies. Since coming into office, we have been assessing the function of the NEB and the agencies as we think it should be carried out. In our view the power is no longer compatible with the role we envisaged for them.

I would also remind your Lordships that the Labour Government's spokesman, the noble Lord, Lord Melchett, indicated that the power was something of an experimental one. He also said that the provision of technical assistance overseas would be a very minor part of their activities. He was not exaggerating: it was not merely a minor part of their activities, but has not been part of those activities at all. We have considered the possibility of the NEB and the agencies undertaking such work overseas. They have not done that, and it seems to us that it would be quite wrong for them to do so. Had the demand arisen, we might have been considering a quite different proposition today.

While the provision was made in order to see what might happen, we have now been able to prove that the demand for those services from the NEB and the agencies during the past four years and more is not there. There is no point in trying to keep things in the Bill on the off-chance that they may come in handy some day. That is no way to deal with legislation. We believe that it is much more important that the efforts of the NEB and the agencies should be directed and concentrated towards the proper targets, namely, to encourage private investment in selected parts of industry in England, Scotland and Wales.

Noble Lords will know that overseas aid is a matter for the Overseas Development Administration. It has the prime responsibility for work of that kind. It is therefore a job for that office to carry out and not for the NEB and the agencies. With all the good will in the world, it is right that we should try to organise ourselves in Government in such a way as to have specialist departments looking after specialist interests rather than spreading everything around and hoping that someone may pick up a bit of something here or there. It is with a view to encouraging that kind of specialisation and expertise within government that we believe this should remain a matter for the Overseas Development Administration and not for the agencies.

If I may come back to one or two points that arose when the noble Lord, Lord Hankey, asked questions in regard to the National Enterprise Board providing technology abroad, it has never been that way; it has always been that the ODA supplies that, so it does not arise in this case.

The noble Lord, Lord Hatch of Lusby, I thought was overlapping the NEB and overseas development into one. What we are trying to establish here is that, with other agencies, the NEB concentrates all its efforts in the United Kingdom, thereby providing the work, the employment and the expertise so that those people abroad who want to buy from us will get the best product and we shall get our unemployment down in that way.

I think it was also the noble Lord, Lord Hatch, who said that the overseas students or the overseas "manpower" visited this country. However, we must concentrate all of our efforts in the United Kingdom on the work here, and not spread them. I hope that the noble Lord will not divide the Committee on this amendment, because it is surely more important now to concentrate all of our efforts on industry in the United Kingdom.

3.32 p.m.

Lord LEE of NEWTON

I thought that the noble Viscount, Lord Long, gave us a very strange interpretation of what this Bill is about in saying how much he wanted the NEB to concentrate on work in this country, at the same time as emasculating the NEB, robbing it of the main part of its functions. To me the two things do not add up.

I thought my noble friend Lord Hatch covered the question in great detail and with great clarity. I happen to have had the job of closing down the Colonial Office in 1967. One went round the remains of the Dependencies having a look at the position in which they were going to find themselves. Many of them went independent; many took associated status, and so on. But it would be a great error to believe that, because it happened in the political sphere, they had become suddenly economically independent, or that they were in a position in the world, where we are seeing a great movement in industrial progress—the scientific revolution coming to bear—where they would hold their own in the rather elementary industry that they are trying to develop, without assistance in some of the Western techniques.

The noble Viscount is telling us that this is a power that has never been used. If the noble Viscount has a spare two or three years and would care to look at the statutes and find all those that have never been used, he would know that there are many thousands there yet. That is not a reason for refusing to allow this part of the Bill to be maintained. We are not asking for anything new to be put in; we are asking that it be maintained.

My noble friend mentioned the fact that this is not a charity. I do not know whether one can assess how much return one gets from these things. But I am quite certain of this, that in a world that is becoming extremely unsafe, one of the factors that will bear against safety will be if half of the world is living in poverty. I believe that there is no other nation in this world with the same knowledge of the developing nations as that possessed in this country. I doubt whether there is any other nation in the world that is so trusted by the developing nations. Therefore, in that unique position that we hold, I believe it would be very wrong to give the impression that in the Bill in which "Mr. Gradgrind" is at work in which we are trying to save the coppers, in which we are denuding agencies in Wales and in Scotland, areas of high unemployment, of the power to do much in those areas, we are saying we want the NEB and the agencies to concentrate on British industry. The fact is that we do not want anything of the sort, or we would not be denuding them of those powers now.

At a critical moment in world history, at a time when the technological gap between the West and the developing world is widening every day, it is not common sense to withdraw from people with whom we have lived, who are part of the British Commonwealth. It is not logical to say that we are very sorry about all this, but we are in a bit of a jam ourselves, and that they want to develop their industries and understand the new technologies; we cannot allow INMOS, for instance, to do it for them.

I do not want to delay the Committee for much longer. I thought that my noble friend covered the question admirably. However, I hope that the Government will think again on this matter. If they intend to try to keep this in at Committee stage, I hope that they will look at it again before we reach the Report stage. It has been deemed to be a minor issue. I do not believe that for a second. The attitude of the developing world may well be hardened by this kind of thing, as they will see it as robbing them of the opportunity to gain new techniques, to develop their new industries, and keeping them producing sugar and so on. I hope that the Government will think again. I think that this is a very important amendment, and I ask my noble friends to join me in the Lobby.

Lord TREFGARNE

I understand it would be convenient if we were to take the Statement now. Therefore, I beg to move that the House do now resume.

Moved accordingly and, on Question, Motion agreed to: House resumed.