Overseas Aid: GNP Proportion (Hansard, 27 June 1994)

§ Baroness Chalker of Wallasey
My Lords, UK net official development assistance was 0.51 per cent. of GNP in 1979 and 0.31 per cent of GNP in 1993.

§ Lord Ashley of Stoke
My Lords, is the noble Baroness aware that she is deservedly praised for her work? However, those figures indicate that the Government have consistently moved away from the target of 0.7 per cent. At a time when the Government claim that our economic recovery is stronger than that of other countries, no fewer than 12 out of 21 OECD countries devote a higher proportion of their GNP to overseas aid. What can we do to persuade the Government to give a higher priority to overseas aid and to start moving towards the target of 0.7 per cent. rather than away from it?

§ Baroness Chalker of Wallasey
My Lords, I am well aware of the noble Lord's anxiety in the matter. However, according to the latest OECD statistics published last week, the UK oda/GNP ratio at 0.31 per cent. was above the average of all donors of 0.29 per cent. in 1993. We are concerned at the decline in aid flows from the OECD as a whole, but our aid has always focused on where it can do the most good. One of the important aspects of our aid is the continued high level of private finance flows to developing countries. We are the major provider of private finance, more than £1.7 billion in 1992, which is more than half the whole European Union total. Only Japan and the US do better. So aid is not the whole story; debt relief, a successful outcome of the Uruguay Round and private investment are part of the whole. Of course, those other issues are not included in the OECD figures.

§ Lord Cledwyn of Penrhos
My Lords, can the noble Baroness say what is the estimated value at this time of the peace dividend? Can she say how much of that is being used on overseas aid?

§ Baroness Chalker of Wallasey
My Lords, the noble Lord, Lord Cledwyn, will know that we have all wrestled for that figure. I do not believe that anyone has an adequate answer. I believe that we will only really benefit from the peace dividend if we see stability in those countries which previously spent so much money on armaments and which we are helping both through the well-respected know-how fund of Britain and in other ways, through the EBRD and EC funds of PHARE and TACIS. But it will be a long while before we know the real dividend.

§ Baroness Hooper
My Lords, will my noble friend confirm whether the figures which she quoted in her original Answer include the aid distributed via the European Community or the European Union?

§ Baroness Chalker of Wallasey
Yes, my Lords.

§ Lord Stoddart of Swindon
My Lords, will the noble Baroness confirm that in 1995–96 Britain's contribution to the EC will be £3,500 million? That is approximately 0.65 per cent. of gross domestic product. Is it fair, right or moral that we should contribute nearly twice as much to already rich countries as we contribute to very poor ones?

§ Baroness Chalker of Wallasey
My Lords, I understand the noble Lord's anxiety. My concern with the Question is for the aid programme. I am also anxious that the 25 per cent. of the UK aid budget which goes to the European Community should be well spent. I cannot forecast for 1995–96, but Britain can hold its head high in terms of the quality and targeting of its aid. I hope that in the years to come there will be more sense about the wider EC spending on which the noble Lord rather cleverly sought to persuade me to respond in his question.

§ Lord Dean of Beswick
My Lords, in view of the repeated horrific scenes—one of which was shown on television—of the massacres in some third world countries which part of the aid reaches, can the Minister tell us what steps are being taken to ensure that money from the aid programme does not reach people or forces indulging in genocide against minorities?

§ Baroness Chalker of Wallasey
My Lords, the United Kingdom has been extremely careful with the £11 million that it has given in assistance for the refugees from the fighting in Rwanda. It has also been careful with the £170 million that we have given to those suffering in Bosnia. We often work directly with local groups, helped by our own non-governmental organisations, ensuring that the assistance goes, so far as is humanly possible, to those in need. We all know of bad examples where troops have stolen food or medicines; but, on the whole, I can be fairly confident in saying that well over 90 per cent. of what Britain intended for the victims has reached them.

§ Lord Ashley of Stoke
My Lords, is the noble Baroness aware that I agree with her that the quality and targeting of the aid is good? That is in part due to her own efforts and she should be congratulated. However, the central point of the Question is that the proportion of 530 GNP is decreasing. That is what is important. It does not matter about the methods being used; the important point is the proportion of GNP. We must persuade the Government to change that, causing the proportion to go up rather than down.

§ Baroness Chalker of Wallasey
My Lords, I know of the noble Lord's anxiety about the proportion; but over the past five years the figures have varied from 0.27 per cent. to 0.32 per cent., averaging out at more than 0.30 per cent. Britain has made steady progress. The second point to remember is that as Britain's GNP has increased, the amount we spend on aid, which has been growing slowly but nevertheless growing, decreases as a proportion of GNP. It is important that we have good quality because that quality can produce more than it used to, as it certainly does in the case of Britain's aid programme.