HL Deb 13 June 1980 vol 410 cc745-6

11.8 a.m.

Lord HATCH of LUSBY

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 what is their policy towards the future budgets of the Commonwealth Development Corporation.

Lord TREFGARNE

My Lords, this will be determined in the light of ministerial consideration of the conclusions of the interdepartmental review of the Corporation now under way and of other priority claims on the aid programme.

Lord HATCH of LUSBY

My Lords, will the noble Lord agree that the Commonwealth Development Corporation is a strictly commercial enterprise carried out with very strict commercial administration: that it provides revenue to the Treasury; that this year it was hoping for a £25 million loan which would be set against the development budget; that it was also planning to pay £27 million straight to the Treasury which would not be offset against the development budget and that therefore the Government Treasury will be making a profit out of its operations?

Lord TREFGARNE

No, my Lords, I think that that is an over-simplified view of the financial arrangements of the Corporation. Certainly they will be repaying money to the Treasury this year, but this is money they have borrowed in previous years. The noble Lord is right when he says that the figure for this year will be £25 million.

Lord GORONWY-ROBERTS

My Lords, in support of my noble friend, may I ask to what extent the Government discuss these matters with the Commonwealth Secretariat?

Lord TREFGARNE

My Lords, the Commonwealth Secretariat are not directly involved in these matters but I have no doubt that they are fully aware of our plans and proposals.

Lord ORAM

My Lords, is it not clear from the recently issued report of the CDC that the Government have already adopted a restrictive attitude to the CDC finances? Will the noble Lord care to explain how Her Majesty's Government reconcile that restrictive attitude with their declared objective that they wish to administer the aid programme in a way which serves the industrial and commercial interests of this country? Is it not the case that the CDC operations are a very obvious part of the programme which serves those industries? Moreover, is it not the case that the cuts in the finances allowed to the CDC are disproportionately high compared with the cuts in the aid programme as a whole?

Lord TREFGARNE

My Lords, I certainly agree with the laudable aims and objects of the CDC to which the noble Lord referred. The fact is that the money we make available to the CDC has to come from within our limited resources, and the proposals of the previous Administration in this regard could not be sustained.

Lord HATCH of LUSBY

My Lords, I do not think the noble Lord has appreciated my point. Is it not the case that the Treasury are actually making a profit out of the operation of the CDC? Would it therefore not be economic folly, in the terms of the Government's policy, to cut down on the loans they make to the CDC which are more than repaid by the profitable enterprise that accrues from those loans?

Lord TREFGARNE

My Lords, I do not agree with the noble Lord's words that the Government make a profit out of the CDC. That is not a fair description of what takes place. As I have said earlier, the money we make available to the CDC, wherever it comes from, has to come from the limited resources that we have.