UK Aid and Debt Receipts (Hansard, 11 February 1992)

The Earl of Caithness
My Lords, this financial year the Government are providing £1,787 million in overseas aid to developing countries. The total of debt interest payments from developing countries to the United Kingdom Government during 1990–91 was £232 million.

§ Lord Hatch of Lusby
My Lords, will the noble Earl take this opportunity either to confirm or deny figures published by Christian Aid showing that debt repayments in 1990, taking into account new loans, government and voluntary aid, export credits and investment, exceeded the official and private flows by £2,493 million?

The Earl of Caithness
My Lords, the noble Lord omits one important figure that contributed to that sum, which is bank lending. If he knew the rules on bank lending he would recognise that, although there is a figure of £6,100 million concerning that provision, the sum includes—although it looks like a repayment —a write-off. It may help the noble Lord to know that the OECD in its figures for 1991 assesses that developing countries received £26.1 billion more than they paid out.

§ Lord Renton
My Lords, is it not also relevant to bear in mind that British banks and, I believe, the United Kingdom Government have in a number of cases waived the interest payments which they were otherwise expecting to receive?

The Earl of Caithness
My Lords, my noble friend is right. When my right honourable friend the Prime Minister was Chancellor of the Exchequer he put forward the Trinidad terms specifically in order to relieve debt in developing countries. As Prime Minister he is pushing forward that scheme and gaining support from other countries.

§ Lord Ennals
My Lords, do the Government accept the United Nations target figure of 0.7 per cent. of GNP? If so, will the Minister say what is the present percentage contributed by the British Government and when they expect to achieve the United Nations target?

The Earl of Caithness
My Lords, that is an important question, but not relevant to the one on the Order Paper.

§ Lord Judd
My Lords, the Minister referred to the Trinidad terms. Many people welcome the Prime Minister's initiative. However, does the Minister agree that it is scarred by the evidence that since then the Paris Club, in dealings with Nicaragua and Benin, for example, has scaled down those terms; that America has secured an opt-out option; and that there is considerable dismay that the terms are not being pursued as vigorously as we had hoped? Will the Minister take back to the Prime Minister the view that he should pursue vigorously what he set out in those terms as one of the most effective ways of assisting third world countries?

The Earl of Caithness
My Lords, my right honourable friend the Prime Minister is pursuing that matter. It was as a direct result of the Prime Minister's proposal that in December 1991 the Paris Club of government creditors agreed to implement enhanced debt relief measures for the poorest countries implementing economic reforms.

§ Lord Mellish
My Lords, recognising that the amount of overseas aid that the Government give is very high, especially when compared with yesteryear, can the Minister give some assurance that the aid goes to the right people at the right time, which is much more important?

The Earl of Caithness
My Lords, the noble Lord is right. The quality of aid is just as important as the quantity. On more than one occasion we have been commended on the way we use our aid.

§ Baroness Ewart-Biggs
My Lords, does the Minister agree that the present low level of government aid to developing countries is not in line with the level of public contributions to agencies working in the third world? For example, is he aware that while the value of official development assistance in 1990 was only two-thirds of its 1979 value, money donated to voluntary organisations by the public increased from £150 million to £184 million in that period, which was an increase of 13 per cent.?

The Earl of Caithness
My Lords, that shows that the prosperity which we have brought to the country has resulted in very generous donations.

§ Lord Stoddart of Swindon
My Lords, the Minister said that the question asked by my noble friend Lord Ennals was not relevant. Is the Minister aware of the huge difference in money terms between what is spent by the Government and the United Nations target? Does he agree that if we attained the United Nations target the amount that we would be contributing to overseas aid would not be £1,787 million, but £3,560-odd million?

The Earl of Caithness
My Lords, that again is an important question but not relevant to what appears on the Order Paper.

§ Lord Cledwyn of Penrhos
My Lords, following on from my noble friends Lord Ennals and Lord Stoddart, is it not the case that, according to the OECD report which I have read, the Government's contribution today is 0.27 per cent. of GNP, which is 588 the lowest on record? Does the Minister agree that that is disgraceful? Is he aware that 144,000 children die of disease or starvation every three days? Does he agree that the Government should do better, given that they have performed a miracle over the past 13 years?

The Earl of Caithness
My Lords, again, the noble Lord the Leader of the Opposition raises an important point, but it is not related to the Question on the Order Paper.

§ Lord Ennals
My Lords, perhaps the Minister will look at the first part of the Question on the Order Paper, which asks, what are the latest figures for United Kingdom overseas aid"? In those circumstances how can he say that the questions put by three noble Lords on this side of the House are not relevant?

The Earl of Caithness
My Lords, because the Question refers also to, receipts from interest on developing countries' debts". It was the net flow which the noble Lord, Lord Hatch of Lusby, was asking about.

§ Lord Jenkins of Putney
My Lords, is the noble Earl aware that he is taking advantage of the traditional courtesy of this House and that he would not be allowed to get away with that kind of answer in another place?

§ Lord Hatch of Lusby
My Lords, far from omitting bank loans, in the figures I gave I specifically mentioned new loans. Will the noble Earl answer my original supplementary question as to whether he accepts the figures given by Christian Aid, whose report I am sure he has read, or whether he rejects them? All the figures are taken from government figures. If he rejects them can the Minister point out where they are at fault?

The Earl of Caithness
My Lords, I did not dispute the figures because they are as the noble Lord says and appear in British Overseas Aid: Annual Review 1990–91. I was explaining that the figure for bank lending looks like a huge repayment. However, because of banking conventions, it takes account of bank write-offs.

The Lord Bishop of Saint Albans
My Lords, perhaps I may ask an easy question of the Minister. If he agrees that the figures given by the noble Baroness, Lady Ewart-Biggs, represent generosity on the part of the public, does he also accept that they also represent the public will, which may be the right pointer to Her Majesty's Government for steadily increasing overseas aid knowing that they have the support of the people?

The Earl of Caithness
My Lords, I would very much like to take part in a debate on the subject. If the right reverend Prelate will table a similar Question, then perhaps we can debate that specific issue.