§ 8.52 p.m.
§ Lord Thomson of Monifieth rose to ask Her Majesty's Government whether they will reconsider their decision to phase out the educational low priced book scheme.
§ The noble Lord said: My Lords, I have had an interest in the educational low priced book scheme since it was set up 35 years ago. Perhaps your Lordships will indulge me in just a little nostalgia. During the 1960s, at the time of the rush to independence in Africa, some of us felt that independence desperately needed a drive for more education if it was to have some chance of succeeding. In those days I joined forces with Richard Hornby on the other side of the House of Commons who was then PPS to Duncan Sandys, the Secretary of State for Commonwealth Relations, and later a Minister with Commonwealth responsibilities himself, in founding the Commonwealth Education Council to campaign for a greater educational element in our overall aid programme. I well remember the welcome we gave to the Government's launching of the educational low priced book scheme.
§ Since then the scheme has become a valued, albeit modest, part of our educational aid programme, about which I know the Minister feels deeply. I believe that the educational low priced book scheme makes the best kind of contribution to Britain's influence and reputation abroad and does so at a minimal cost. In 1994 nearly 900,000 academic textbooks were distributed through the third world under the scheme. They covered scientific, technical, medical and business studies. They went to 54 countries nominated by the ODA. Twenty-six of those countries come within the ODA's low income GNP group, of which India, Nigeria, Pakistan and Ghana provide the majority of the ELBS sales.
§ The economics of the scheme are interesting and praiseworthy. The UK retail value equivalent of these 900,000 books amounts to around £20 million but the students throughout the third world countries pay £4 million. The ODA gets this saving of £16 million for a subsidy of £1.32 million. The publishers, the distributors and the booksellers share in filling the gap by reduced unit costs of production and by reduced margins in terms of the price. Altogether it seems a pretty good piece of economics and a good bargain all round.
If it is discontinued, as the Government are apparently tempted to do, it will cause a major disruption to syllabuses and to reading lists. The ELBS publishers have produced large numbers of letters from those who
feel they would be affected. Perhaps I may give your Lordships a sample of them. One from Ibadan in Nigeria, signed by 110 medical students, says:
We the undersigned medical students depend almost solely on this scheme for a large percentage of books for our studies".
I shall not take up the time of the House by reading extracts from other letters, but that is typical of the large number of letters that have come in.
§ None of us would suggest that the scheme is written in tablets of stone. The scheme itself must adapt to changing circumstances. There have been huge and in many cases beneficial changes of circumstances in the developing Commonwealth since the 1960s. There have rightly been regular reviews of the scheme. But the need for a review does not seem to be any reason for abandoning a scheme which has worked well. The ODA is rightly concerned about ensuring that the scheme benefits those who most need help and that it should target poorer countries and the poorer students within them. Changes can be made to help to bring that about. The geographical changes are presumably within the power of both the ODA and the publishers who are involved in the scheme.
§ I am told that one of the arguments that is sometimes used by the Government to justify their thoughts about phasing it out is that some of the books go to Hong Kong, which has a per capita income rather higher than that of people in this country. But they go to Hong Kong because the Foreign Office, the parent department of the ODA, insisted, presumably for Foreign Office diplomatic and political reasons, that it should be included.
§ What is undoubtedly more difficult is to ensure that within the poorer countries it is the poorer students who get the maximum benefit of the scheme. I do not suggest that there are simple solutions but I do suggest that all the evidence shows that the vast majority of books go to relatively poor and worthy recipients. If the Government are tempted to make radical changes to the scheme by perhaps substituting the so-called book presentation scheme under which free books are given to libraries, it would certainly mean many fewer books for the same cost or else a very greatly increased cost for the same number of books.
§ The Minister is to meet the publishers shortly and I am very happy that she has arranged to do so. She said in a letter which she kindly wrote to me that she is ready to explore all possibilities with them. When the Minister responds to the debate, I hope that she will say that that phrase allows the possibility of refining, if not retaining, the essentials of the scheme.
§ The ODA has conducted its review. There has been some criticism that it took quite a long time to conduct its review and even longer to make the findings of the review available to those who have the task of administering the scheme. Although the ODA review refers to the difficulty of reaching poorer students, its conclusions are that the scheme's merits outweigh its minor limitations, and that it should be retained with some modification. I very much hope that that will be the Government's considered reaction to maintaining the scheme when all the factors have been taken into account.647
§ Finally, on the costing of the scheme, I should like to seek an assurance from the Minister that the proposed changes to the scheme—whatever finally emerges as to its shape—are not simply a disguised cut in educational book aid and that this tiny subsidy, which comes to 0.08 per cent. of the ODA's total aid budget, will be retained to make textbooks available to those who could not otherwise afford them.
§ 9.1 p.m.
§ Lord Stewartby
My Lords, I rise briefly to support the noble Lord, Lord Thomson, in his request to the Government to think carefully about whether they have taken the right course, at least so far, in relation to the scheme. I do not for a moment claim to have either the length or impressive experience of the noble Lord on this subject, but having read something about it, I found myself feeling some concern about the way in which the matter has been handled.
My concern was originally triggered by the wording of a Written Answer from my honourable friend Mr. Baldry in another place, when he said that the scheme was being phased out over two years because it was not fully meeting the ODA's developmental priorities. I think, all of us would accept that the scheme may not have been fully meeting those priorities, but, just because a scheme does not fully meet the priorities of the department, it seems a radical course to say that it shall be discontinued and some undefined alternative put in its place. I should have thought that a better procedure would be to examine the scheme, to consider those parts of it which were not working satisfactorily from the ODA's point of view and then to see whether one could not deal directly with those points of weakness.
As the noble Lord, Lord Thomson, said, the inclusion of Hong Kong appears to be for entirely different reasons. When I looked at the figures that have been recently placed in the Library, I found that Hong Kong's share of the total was not large. However, if Hong Kong has been grafted onto the scheme, surely it is possible to adjust the list of countries which would be eligible for the scheme rather than doing away with the scheme and venturing into uncharted territory, which may produce a very different result.
When one looks at the way in which the scheme has worked so far, it is clear that the form of subsidy has enabled a considerable volume of books to be distributed to a wide range of countries. What worries me most is that unless a variation or adaptation of the scheme can be kept in place, any alternative is likely to remove the incentives for the publishers to produce such material at economic prices. As the noble Lord suggested, the overall effect might be that fewer books were available for distribution to the poorer students in the poorer countries, or, if the number of books was maintained, that that would be at a greater cost to the department's budget. I hope that my noble friend can give us an assurance that she would not wish to endorse any alternative that has either of those effects. Therefore, I wonder whether it is not possible, even 648 now, for my noble friend to consider whether making adjustments to the scheme, as opposed to replacing it, would not be a better way forward.
§ 9.5 p.m.
§ Baroness David
My Lords, I am very glad that the noble Lord, Lord Thomson, has asked this question tonight. He has a wonderful record here, so I am only too pleased to support him. The subject is of immense importance to thousands of students in poor and developing countries, and it is impossible to think of any other scheme that would give such good value—so many books at so low a cost to so many people. The noble Lord mentioned the number of books and the readership which would be 1.5 million people, we reckon. He has also mentioned the value of them. I should like to say that the publishers are, in fact, contributing about £8 million in subsidy, whereas the ODA provides £1.5 million (going down) so we are getting very good value for money indeed.
Perhaps I may quote the price of one book. Longman produces Hughes' Electrical Technology. It costs £18.99 here. Produced in a special cover with a different coloured cover but otherwise absolutely identical, it is sold for £3.80 through the ELBS. That seems to show the sort of value that the students are getting.
I know that the Minister has received hundreds of letters from students. I have been shown a good many of them. The noble Lord, Lord Thomson, mentioned Nigeria. Part of a letter that I have seen states:As students we get well under one thousand naira as monthly allowance from our parents or subsidy from our government. This amount … to about £8 or less per head in a month".You cannot buy many books for that.
The University of Nairobi bookshop states:University of Nairobi students get a book allowance of £50.00 per year as part of their loan from the Kenya Government. This amount is expected to cover their textbook and stationery needs. Clearly this is not sufficient for the serious student … If the scheme is withdrawn, it means that the students will net be able to buy any books".I do not believe it is possible to think of a better scheme. I hope that the Minister can respond to that, because we understand that the department is thinking of alternatives. So I do hope she will tell us what they are thinking about. We know that there have been many criticisms of the scheme and that it is not well targeted. The poorest students in the poorest countries are not the recipients.
The figures in the noble Baroness's letter to Mr. Bennett are not accurate. She said the better off countries account for about a third of the ELBS books sold. The actual figure is a fifth; 78.5 per cent. of them go to students from low or very low income countries. So I hope that that has been made clear to her now.
The countries targeted can be changed. It seems to me that this is quite possible, but I do not see why the scheme should be blamed for bad targeting if the ODA itself can change matters. I understand that a year or two ago Singapore, for instance, was taken off the list. Hong Kong has been mentioned as a Foreign Office request. Malaysia and Turkey could he taken off perfectly well.
649 I understand the review said that it was not possible, but I understand that it is. So I hope perhaps the Minister will respond to that and tell us what is right. I wonder whether I could say just a little about the review. I understand that it was undertaken by two consultants to ODA: Mr. Crapper, an economics don who did the costings; and Monica Vincent, whose experience was chiefly in teaching English as a foreign language with, with all respect, no great knowledge of publicity, markets, or scientific, medical and technical books.
No one went to visit any of the countries involved. There was no sampling in the countries, no research, no questionnaire. Neither the users nor the publishers were consulted. I gather there was one meeting in Edinburgh with Malaysian students who are, after all, atypical. They were studying education, not science or medicine. But despite all that, the review did say carry on with the scheme. The review was not shown to the publishers. It should have been out in July. It was dated September, but it was March before the decisions were known, and April before it was seen. There really should be partnership and better dealings between all the people involved.
For academic courses and producing the right books at the right time, there must be adequate foreknowledge or some books will not be available. The mere fact that news has got around that the scheme is to be phased out probably means that certain titles will not be available.
Another criticism has been that the scheme concentrates too much on medical books, the theory presumably being that medical students are likely to be middle class. There may possibly be some students who could afford to pay more; but the point is surely that the vast majority are poor and worthy recipients of aid. They could not possibly afford UK book prices. And remember the average income in India is £150 a head, and India is the most important recipient. Surely, for developing countries, doctors and nurses too are very, very valuable members of the community and need to be encouraged.
It would be interesting to hear what the department has in mind for the future. There have been other schemes. The ODA has in the past supported three specific schemes run largely through the British Council—the Library Development Scheme, the Book Presentation Programme and the English Language Book Society (ELBS), now known as the Education Low Priced Books Scheme, which is what we are talking about. This programme has been strongly supported by the British publishing industry, as I have explained. The industry also helps with training through the Book House Training Centre, established in the early 1980s.
ELBS has been an especially effective scheme, because its administrative costs are exceptionally low and because distribution costs are covered through normal commercial mechanisms, and because the student market itself determines which and how many books are bought at the reduced price. This avoids most of the costs involved in selecting and ordering titles, choosing recipients, despatching consignments and so on. It is very hard to see how any alternative scheme 650 can be anything like as effective. Indeed, to make any sort of mark, to help mitigate the damage done by the termination of ELBS, what is required is indeed not £1.5 million, but a restoration of the funds previously made available—perhaps £10 million at current prices, plus the money spent by regional and country desks as part of major projects.
ELBS not only supports the quality of the education, but develops a long-term relationship with our country. It is easy to imagine the reaction if suddenly this long-established (35 years) and highly effective support is cut off. It would be a repetition of the disaster over overseas student fees. It sometimes seems as if ODA officials pursuing their own dogmas and internal organisational objectives overlook entirely the effect of termination of established schemes on the recipient country, leaving a hole in their educational provision which cannot easily be filled by alternatives and creating the idea that we in the UK no longer care.
I believe that the ODA should change its mind on this. It not only supports education and the provision of the skills required for social and economic development, but it helps to develop a continuing relationship between the new generations in the developing countries and the UK, thereby helping to create friendly relations and trade.
The students who follow the courses that the books help to sustain are likely to be the brighter and better students of the younger generation, the leaders of their country in the future. Surely it is madness on our part to deny them the wherewithal to make progress and risk losing the undoubted good will that is generated.
I do hope very strongly that today's debate will have encouraged the noble Baroness to change her mind and that of her department. It is not too late to recover the damage that could be done.
§ 9.15 p.m.
§ Viscount Waverley
My Lords, I shall be brief and attempt to be practical, having already detained your Lordships earlier today. I fear that I am about to put the cat among the pigeons. If the Minister has determined to terminate or radically alter the scheme, I should like to approach the problem in a way different from other noble Lords.
What could be asked is whether possible alternative damage control mechanisms could be found in order that our friends around the world who are less well off will not suffer unduly. Let us ask ourselves who in the trade will be affected by change. There will be the publisher, of course, directly and indirectly through possible loss of structure in each of the countries concerned. Perhaps as many as 50 times more books are sold as a result of the subsidy, enabling a local representative in situ selling books, by allowing for more profitable order-taking in other market segments. The distributor, the wholesaler and the bookseller will all be affected, as will the ancillary trades comprising airlines and freight agents.
I recognise that concerns are for the needy around the world. However, I do not necessarily subscribe to the view that the subsidy which the ODA is paying to the 651 publishers is the only way of retaining low prices. For example, the publisher could increase his discount to the distributor from 45 per cent. to 60 per cent., an amount which, although reducing the publisher's margins, is still affordable. I am not entirely sure why publishers believe that they need to sell new material to many of the markets. I can tell the House that schools, frankly, do not care whether a book or periodical is new, provided that it is readable and will last the test of time.
Supplying book returns from more affluent markets could have a tremendously beneficial effect. Additionally, the ODA or an appropriate body could act as a conduit for consolidating orders, organising break-bulking in the country of destination and distributing internally. It may be that considerable savings can be achieved by doing that as well as being a more satisfactory method of shipping.
Timely competitive deliveries are equally as important to the colleges and libraries around the developing world. Small orders sent by air or ship and individual orders sent by post are exorbitantly expensive in comparison with the method that I have outlined.
What is the amount of subsidy that we are talking about? A recommended retail price in the UK, for example, of an engineering textbook from a major publishing house might be £18.99. The amount of subsidy available to the publisher from the ODA is approximately £1.75. The old maxim stands in good stead: where there is a problem there is a solution. The scheme is undoubtedly of value to academics and students in developing countries. But it may well be that more prudent management can help or account for the total currently required.
I would however like to be told tonight by the Minister where the savings will be allocated as a result of not paying all or part of the subsidy to the book publishers. It may be that the amount is being deemed as moneys needing to be saved. If, on the other hand, the Minister sees wisdom in the proposals advanced tonight and decides to announce a scheme that essentially retains the ELBS, she may care to consider whether my proposals have merit.
§ 9.18 p.m.
§ Lord Soulsby of Swaffham Prior
My Lords, the House should be grateful to the noble Lord, Lord Thomson of Monifieth, for bring the issue once more to the attention of your Lordships. I was interested to hear his account of the origin of the scheme. I must declare an interest in that in those early days I had the honour of having one of my texts selected for the ELBS scheme. I shall say more about that later.
The decision to phase out the ELBS scheme has caused great anxiety, as we have heard from the noble Baroness, Lady David. Letters have been sent by students at various universities throughout the world. Furthermore, it has caused great anxiety in the publishing houses and, in particular, among those individuals concerned with education and training in the professions and the various vocational skills in the developing world.
652 Those who have seen this scheme operate at first hand will know just how valuable it is. I have had that privilege in several countries of the world. When one is working at the sharp end of this type of scheme one realises how tremendously important it is to the education of people in the developing world and in the very poor countries of the world.
It is a unique scheme. No other country that I know of has produced a scheme like it. It is indeed the envy of a number of countries who put aid into the "third world" as we call it. It is of enormous benefit to the developing world. Two major areas which have benefited from the scheme over the years have been India, which has been mentioned previously, and Anglophone Africa. I would go so far as to say that much of the higher education in those parts of the world has been based on the availability of ELBS editions of various textbooks. It is textbooks that we are concerned with, not research volumes or any other subjects like that.
One goes to various countries, to Ibadan in Nigeria, to Nairobi, Harare and universities in India, for example, and one sees the ELBS books on the library shelves. They are well used because their dog-eared nature means that everybody wants to get at them. I can assure noble Lords that if one happens to be an author of one of the books, the local people, with great joy, want one to annotate it and add one's name. They feel very happy that one of their books has the author's name on it.
There are some universities in India which further subsidise the ELBS editions so that the very poor students can in fact buy them outright for a minuscule amount of money. The scheme will allow that to be done. Furthermore, the scheme brings great prestige to the United Kingdom. I believe that it affects her own influence and her reputation in the world, not only by promoting the knowledge and learning of our academics in this country, but it also has a spin-off because many people will then think first of buying British goods rather than buying other goods in the world. I believe that that effect has been particularly important. As regards Malaysia some years ago, a decision to charge high fees for higher education had quite the reverse effect because it was decided to go east rather than west with purchasing.
The ELBS editions are sold at approximately one-fifth of the regular price. There is an important effect of that in that it counteracts a phenomenon which is unfortunately rather widely practised—that is to say, the piracy of books by means of photocopying the volumes or through cheap reproductions. But the photocopies cannot undercut the ELBS editions, so the scheme protects the publishers in this country from the pirating effect that takes place in certain other countries.
The efficiency of the scheme is quite remarkable. We have heard tonight that for £1.5 million, up-to-date textbooks across the whole range of subjects are provided to tens of thousands of students in poor countries. That must be a minuscule part of the ODA budget. Further, the scheme is administered by three individuals at International Book Development, which, as has been said, last year was responsible for the distribution of 900,000 books under the scheme. That 653 must be one of the most cost-effective endeavours that the ODA, of which I think most highly, has undertaken in recent years.
In view of that fact, I believe it is pertinent to consider why the scheme is under the threat of withdrawal. Why should a scheme so well regarded, which has been so effective, be withdrawn? I understand that the 1988 review decided to focus the scheme on countries where the gross capital input or wage was of the order of 1,000 dollars. That brought about 56 countries into the scheme.
The 1994 review maintained that the scheme was not targeted enough to the poorest students in the poorest countries and that it lacked accountability for the distribution of books. However, as we heard from the noble Baroness, Lady David, that review was conducted by two people who never went out of the country and who presumably relied on information that they gleaned from other sources. I can almost guarantee that, had they done so and gone to the poor countries and the universities which use the ELBS editions, they would have come to different conclusions.
One does not doubt for one moment that there is abuse of the scheme, shall we say, on the periphery; indeed, all aid schemes are open to abuse. But the greater good is so much greater than the abuse that occurs that I believe one can almost discard the abuse side. To my mind, that is no reason to withdraw the scheme. However, if, despite the pleas that we have heard tonight, my noble friend the Minister is still of a mind that ELBS as it is at present should be withdrawn, perhaps I may make a plea that the present scheme stays in place until another scheme—whatever it may be—is ready and capable of being instituted immediately. That would avoid an interregnum which, if it did occur, could be very harmful to the countries about which we are thinking and to the universities concerned.
If we lose the targets to which the books go, it may be very difficult to recoup them. It may well be that others will have moved in and the targets will have disappeared. Indeed, they may have moved in with less than satisfactory means of dealing with the issue. In fact, I understand that it may to some extent already be too late. I am informed by at least two publishers that funding is already being restricted so that they cannot maintain the stocks of books that would normally go for the ELBS edition.
I very much hope that my noble friend the Minister will give the matter close consideration. I also hope that she will reconsider the issue.
§ 9.28 p.m.
§ Lord Rea
My Lords, I should like to add my congratulations and thanks to the noble Lord, Lord Thomson of Monifieth, for tabling the Unstarred Question at such a critical time for the ELBS. In her reply, I very much hope that the noble Baroness will show that she is not only a listening Minister—which, indeed, we all know—but also one who can respond to what she hears by modifying the Government's intentions when the overwhelming evidence shows, as it has tonight, that those intentions are mistaken.
654 I particularly ask the Minister to pay attention to the speech just made by the noble Lord, Lord Soulsby, who has such wide, practical knowledge of the operation of the scheme. The Government's main reason for phasing out the scheme is that it is not reaching the very poor and that too high a proportion of ELBS books are sold in better-off developing countries. But I very much hope that the remarks made by the noble Lord, Lord Thomson of Monifieth, and by my noble friend Lady David will have dealt with that aspect.
However, there is also the suggestion that the books are going to those in the poorest countries who can afford them. It has been suggested that those who are training for the professions, especially medicine, are likely to come from the better-off section of the population, even in poor countries, and that they should be able to afford full price textbooks. I hope that the noble Baroness will not use that argument.
In the first place the elite in the developing countries, whose sons and daughters are the only ones who have the necessary money to buy full price textbooks, are a small proportion of the population and are quite insufficient in terms of sustaining the universities of the third world. Many students of these universities, as my noble friend pointed out, are desperately poor. The cheap but excellent textbooks provided by ELBS are a godsend to them, for which we in this country receive much praise. I hope that the noble Baroness will have read some of the 450 letters—I gather she has been sent 320—which the ELBS publishing committee has received from users of the scheme. Those letters show how much it is appreciated.
We on these Benches of course support the ODA's policy of concentrating resources on the poorest, especially if it helps them to climb out of poverty, rather than providing temporary relief. ELBS comes within this first and best category of aid; namely, helping countries to climb out of poverty. By helping to train a well educated superstructure—I was going to say infrastructure but that would not be appropriate in this case—we enable countries to develop self-sufficiency more quickly. Too many developing countries still depend too much on ex-patriates to man their professions and on ex-patriates to provide the technical base on which any modern country depends.
If the means by which we aid these countries to become self-sufficient more quickly are British books provided through the ELBS, there is a better chance that the knowledge that the students concerned will gain will be sound, because the books will have been carefully selected by academic referees. Here I address the remarks of the noble Viscount, Lord Waverley. One of the things that ELBS can do is to provide up-to-date books and the latest editions of textbooks. If one is attending a higher education institute, one needs those latest editions. One cannot depend on a book which is several editions old if one is to train one's students properly. British textbooks in any case are usually better written and explain complex concepts more clearly than those from many other countries, except perhaps the United States. The textbooks published by United States publishers might well creep in and fill the gap if ELBS books become less readily available.
655 As other speakers have said, those who are helped to gain their qualifications through ELBS will have a lasting respect for British institutions. Those many letters which I mentioned that have been received by the ELBS publishers committee since the Government's announcement of their plans to phase out the scheme show how greatly it is appreciated throughout the Commonwealth. Those who gain qualifications, often with the help of the ELBS, are, as other speakers have said, likely to become leaders in government, commerce or the professions in their own countries. They will, as many already do, remember the help they received from Britain and are likely to encourage trade, international co-operation and friendly relations with the UK in the future.
It has been said many times, not only from these Benches—and my noble friend Lady David mentioned it this evening—that the value of the good will and friendly links which the UK lost by cutting subsidies for Commonwealth students in British universities 20 years ago was much greater than the savings gained. I know that there was a Labour Government in power then, but I believed then that it was mistaken, as it has proved to be.
While the savings envisaged now are much smaller, the ending of the ELBS would be another decision based on short-term thinking. I hope very much that the noble Baroness will be able to say that this highly cost-effective and popular scheme, modified if need be, will be allowed to continue.
§ Viscount Waverley
My Lords, before the noble Lord sits down, perhaps I may point out that the delivery plan that I propose would allow for publications to be delivered in as timely a fashion as under the current ELBS.
§ 9.35 p.m.
§ The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey)
My Lords, I am grateful to the noble Lord, Lord Thomson of Monifieth, for initiating this debate and to your Lordships for making some useful points. I listened carefully to the contributions, but it is clear that many concerns over the issue are based on a misconception of our intentions and of the operation of the scheme. Therefore, I am glad to have this opportunity to respond.
First, the educational low-priced books scheme has not yet been phased out. We have said that it will be phased out in two years because we want to replace it with something better. We believe it essential that we do the very best for the students, particularly those poor students who cannot afford books. I can assure my noble friend Lord Soulsby of Swaffham Prior that the existing scheme will continue for a further two years.
I was extremely surprised by the contribution of the noble Baroness, Lady David. She made a quite unfair and disproportionate criticism of my officials and the reviewers of the scheme. I shall return to the review in a moment. The noble Baroness will know, as I know the noble Lord, Lord Rea, knows, that it is my job and the task of my officials to get the very best value for money for student recipients in line with ODA policy laid down in the 1980 Overseas Development and Cooperation Act. I have no other remit than to do that. My concern is the students and that those students will turn to the UK when 656 they are qualified and will bring trade for the UK in the longer term. Therefore, neither I nor my officials have any of the negative aspirations which were accorded to us.
First, perhaps I may explain how the scheme operates. The ELBS provides a subsidy from the aid programme to British publishers. That subsidy helps them to produce cheaper versions of standard texts which they have already published. As the noble Lord, Lard Thomson of Monifieth, said, we want the best kind of contribution, but at the least cost. The misconception in many of the letters sent to me, many of them stimulated by people outside your Lordships' House, has been that the ELBS supplies free textbooks to students or libraries. That is not so. These books are sold on the commercial market.
It is a fact that a number of publishers have chosen not to submit books to the ELBS, preferring to work through the commercial system. I mentioned the Overseas Development and Cooperation Act. The British aid programme is defined in that Act as:promoting the development or maintaining the economy of a country or territory outside the United Kingdom, or the welfare of its people".Those are important words. The primary purpose of British aid is development. As I told many of your Lordships before, we seek, as we are required to do, the most cost-effective and best targeted way of delivering aid. That is exactly what the noble Lord. Lord Thomson of Monifieth, asked.
The aid programme funds the supply of books and other teaching materials but in a number of different ways, because we wish to be flexible and efficient in helping students in developing countries. The ELBS is just one of those ways.
It is perfectly true that we spent £1.5 million on this scheme last year, over £200,000 of which was the administrative cost of the scheme. But in the last financial year we also spent some £7.3 million to provide books through other schemes; so it is not the ELBS alone. There is the regional engineering centres project in India which focuses not only on books but on other information inputs in design, energy, information technology and materials engineering. There is the secondary schools textbook project in Jamaica. There is the supplementary readers for primary schools project in Zambia. There is the construction of a library and a Faculty of Information in Moi University in Kenya. There is the English language teaching project in Ethiopia. There is the English language teaching support system in Tanzania. There is the independent development trust school book project in South Africa. There are many other schemes. There is help through Book Aid International (formerly known as the Ranfurly Library Service) which provides free books to developing countries and does a first-class job.
There is an annual books allowance for all ODA supported scholars and trainees. Under the British Council there are project related books and information aid worth over £2 million. There are the heads of mission gifts and small project schemes. There is the Commonwealth of Learning information database and books. There are the low priced book schemes in Eastern Europe.
Your Lordships will understand that the educational low-priced book scheme is but one of a number of projects. That is why in each case I must ensure that the scheme is value for money and reaches the very students 657 about whom the noble Lord, Lord Rea, spoke. We all know that the original objective of the ELBS was to sell information books overseas and to provide a limited pump-priming subsidy to publishers. The policy aims for ELBS were to spread British influence—a matter with which we cannot disagree and never will—and to further the growth of the English language—again a matter on which there is total agreement. It was to provide a form of aid—it is a form of aid, but it mainly goes to the publishers—to assist exports and to forestall similar action by the Communist world. Perhaps that aim is now a little out of date.
The scheme has had a fine reputation. No one disputes that. Over the years it has had some notable successes. A number of noble Lords have had their own works published as ELBS books. There is nothing against that and I am not critical of it because I am in favour of extending information.
Let me say a few words about the review of ELBS. As a number of noble Lords have said, there was a review in 1988. It concluded that the scheme lacked developmental focus. In some subjects the books did not correspond with the ODA's priorities. However, the scheme was permitted to continue subject to revised guidelines. One of those was that to qualify the country should have an average per capita GNP of less than 1,000 dollars per annum. It should be in receipt of British aid or multilateral aid towards which the UK contributes and where the publishers consider there is a market for UK books.
Since that time we have looked carefully at whether the scheme is meeting all those objectives. I have to tell your Lordships that the review undertaken last year showed little improvement since ELBS was last reviewed in 1988. There was marginal improvement, but overall not enough to give value for money.
Perhaps I may respond to the noble Baroness, Lady David, and what she said about the consultation on the review. It is not true that no questionnaires or letters were sent out. Our advisers in each and every development division were required to find out what was going on. It is not true that no visits were made. Ethiopia, Zambia, Kenya and Zimbabwe were visited. We had reports in from Asia after we had specifically requested countries to give us information about how the scheme was running. No decision was made on the matter until all the information had been received and the review was complete. Once the review was complete, I was not prepared to stop the scheme immediately because it takes time to adjust to such matters. That is why I gave notice that we would phase it out after a period of two years.
In addition, not only was the second review based on overseas visits, but so was the 1988 review. We also had discussions with the Publishers Association, the ELBS steering committee and the ELBS administrators. So the matter was thoroughly investigated. It was of great concern because I wished to extend the help we give but to ensure that it is properly targeted, as the rest of our aid is targeted.
I mentioned that one of the criteria laid down after the 1988 review was that the scheme should apply to countries with a per capita GNP below 1,000 dollars. In the latest review we found that 22 of the 54 countries 658 within the scheme no longer came within that category. Between them those more prosperous countries accounted not for one-fifth, as the noble Baroness said, but for one-third of the number of books actually sold under the ELBS scheme.
Since the mid-1980s there has been an increase in the share of titles sold in South Asia as against a decrease in the predominantly poorer African countries. We all realise that there is a positive aspect to ELBS but—as has been said in correspondence and by a number of noble Lords in this debate—the scheme is not reaching the poorest students in the poorest countries. They were the people for whom it was intended. Therefore, it does not meet our developmental objectives. That is something which I must always keep in mind. I cannot allow a continuation of aid funds to subsidise students in more prosperous countries while students in the poorest countries cannot benefit. I must find ways of enabling the poorer students to benefit.
In the scheme, there is no way to guarantee who actually buys the books or that the benefit of the subsidy reaches the ultimate purchasers. So there is no way of ensuring that the subsidy benefits the poorer students. We know that the publishers make a profit. I have nothing against publishers making a profit, but I do not believe they should be subsidised when it is the students' needs that we seek to address. It is at a marginal extra cost to the publishers, but I gather that on a book costing £7.68, the gross return to the publisher is £1.96. I am sure that that is a variable figure because it will vary from some types of text books to others. But it is one example which we know for certain.
There are even instances which should worry us all where professional people from developed countries visiting developing countries purchase ELBS hooks for their own use. They then use them back in their own country. That cannot be a proper use of aid funds, but I cannot stop it happening with the scheme as it now is. That is one of the problems.
There are some subjects where the demand is greatest which gain precedence over other subject areas which are equally important in development terms. It is perfectly true, as the noble Lord, Lord Rea, said, that about 60 per cent. of the books distributed under ELBS are medical books. We have nothing against that. But books on engineering, education, agriculture and environment form only a small part of the ELBS sales. They are still important, even if good health is fundamentally important to all.
The situation is this. The nature of the scheme is such that it is not possible to target individual students, institutions or even disciplines. It does not distribute free books. And I am sad to say that it has developed into a scheme that is overly influenced by commercial considerations, when I am required under the 1980 Act to put developmental considerations before everything else.
In order for a country to be included, we have to have in that country a potential market in the eyes of the publishers. That is how the scheme runs at the moment. It would be possible to change that and change the countries. But that would still not answer the earlier points that I made.
659 One of the other problems that we have is the lack of available foreign exchange. That makes it difficult for poorer countries to import British books. ELBS does not meet those very real needs either. More generally, it is impossible to control the local selling price. Local booksellers apply a local mark-up which makes ELBS titles in certain countries more expensive than expected, despite the subsidy to publishers. Although the subsidy in many cases reaches its objective of providing key textbooks to poorer students, a disproportionate benefit is gained by others—by wealthier students in better-off countries and particularly by those who engineer to use the scheme for their benefit.
I am well aware that the publishers appreciate the ELBS. It gives them a foothold in countries where there is either unrealised potential for an expansion in the book trade or economic forecasts predict a rapid increase in demand for books of all kinds. So what ELBS does is allow publishers to underwrite the risks of establishing or maintaining a presence in countries where the potential is in the future. That is what worries me about the scheme. It is not following the objectives of which I spoke.
The noble Lord, Lord Rea, asked whether other countries might step in to fill the void left by ELBS. Other countries already have markets in the developing world. For instance, US publishers have developed a large licensing and reprinting business in India. They provide US texts at local prices equivalent to 10 per cent. of the standard edition price. They do that without any United States Government subsidy. So these sorts of reprinting— of, I accept, not such good quality books—go on all the time. It is not our job to try to work out a scheme which necessarily competes with another scheme like that. It is our job to get the low-priced books to the students who need them.
That is why I find there to be flaws in the ELBS. In view of that, I should be totally negligent not to seek to set those flaws right. I repeat that I am firmly committed to providing books in support of our aid objectives. I hope that publishers will be dynamic enough to seek to retain their position in developing countries without a subsidy from the ODA. I certainly know that there are some very forward-looking publishers around. I received a letter from the chairman of the export booksellers' group, the Booksellers Association. He welcomes the opportunity to look more widely at the role of books and information as part of our general aid effort,rather than concentrating narrowly on ELBS and on possible replacements".He understands that,global schemes of this type are not nowadays felt to be the most effective way of targeting aid".He also says that he is not entering a plea in favour of ELBS, although he says that the scheme has been well managed. We, too, believe that to be the case. We know that it has been relatively inexpensive but we also know the other factors which I explained earlier to your Lordships.
660 We are not phasing out ELBS without looking at all the alternatives. Indeed, my aim, as I hinted and as the noble Viscount, Lord Waverley, suggested, is to replace ELBS with something better. We are currently examining more effective ways of ensuring that poor students in poor countries who cannot afford to purchase books at full cost have access to the books that they need. We have a working group which will include the ODA's education advisers and publishers. Together they will examine all aspects of books provision under the aid programme. The aim is to develop well before the old scheme ceases in two years' time new arrangements that will fulfil the objectives to which we are committed.
One means of targeting may be to increase our direct support to libraries and educational institutions in the poorer countries, particularly those in need. But we shall look at all possibilities. They might include licensing arrangements with local publishers or cheap student editions, funded by UK publishers with an eye to business. For example, one notable publisher in this country has already approached me to discuss cheap student editions.
We shall continue our support too for Book Aid International that I mentioned earlier. It is really expert at getting the right books to the right places, where they are most needed.
I also want to encourage countries which can now do so to develop their own publishing resources rather than rely on imports. But I believe that the whole question of getting this right means that we should give notice that we are considering, indeed have decided upon, a change in order to fulfil our developmental objectives.
We live in a very changing world. ELBS has dealt in books, but only in books, for 35 years. We face an explosion in information technology and access. It is our job to look forward and consider all aspects of information needs in developing countries, not only for the rest of this century but into the next. I am particularly looking at that as the costs of new technology continue to fall. Universities and colleges are now acquiring access to Internet on their computer systems. Whole textbooks and encyclopaedias are now being made available, particularly in scientific subjects, on CD-ROM. Journals, multimedia distance education and a whole range of new applications are becoming available. That is why I have asked my professional advisers to discuss all those issues over the next few months with all the interested parties, including the publishers.
I can assure your Lordships, including my noble friend Lord Stewartby, that we do wish and intend to get the educational low-priced books to those who need them. But this is not the scheme by which to do it. There has been a great deal of special pleading in recent weeks. I understand why; but I also understand that I have a responsibility to make sure not only that I fulfil the law but also that our aid to education, as our aid in all other sectors, is the most effectively targeted that we can achieve to ensure that it benefits those who need our help most.
§ House adjourned at two minutes before ten o'clock.