International Development Funding (Hansard, 10 November 2003)

§ Baroness Amos
My Lords, the Government are committed to spending 90 per cent of DfID country programmes in low-income countries by 2005–06. That, together with contributing to the cost of 1089 recovery in Iraq, will lead to some reductions in aid to other middle-income countries in future years. Further details are provided in a Written Answer I have today given in reply to my noble friend Lord Radice. I have placed a copy of that Answer in the Library of the House.

§ Baroness Greengross
My Lords, I thank the noble Baroness the Leader of the House for that reply and declare an interest as a board member of HelpAge International, an international development charity working for and on behalf of older people in many middle-income countries.
I welcome the Government's continued commitment to increase overall international development funding and support for multinational organisations such as HelpAge International. I hope that Iraq will soon rejoin the group of middle-income countries. However, I am disappointed that the extra spending on its reconstruction has meant that a further £50 million has been cut from funding for middle-income countries in the next two years. That may be especially harmful to programmes in Latin America and Eastern Europe.

Noble Lords
Question!

§ Baroness Greengross
My Lords, I seek the Minister's reassurance that central to her department's international development agenda on poverty reduction is another change in circumstances that we face, which is the global revolution in ageing, which is impacting on all parts of the world, especially developing countries.

§ Baroness Amos
My Lords, I assure the noble Baroness that the commitment of the Government and of the Department for International Development to the poorest countries in the world will continue. What is happening at present is an acceleration of the trend to which we are already committed. We have a target to move our spending from a current base of 78 per cent spent on the lowest income countries in the world to 90 per cent by 2005–06. Iraq counts as a middle-income country. We have considered how we spend the money that we allocate to middle-income countries and have had to reallocate within it. But our commitment to the poorest countries in the world continues.

§ Baroness Northover
My Lords, does the Minister recall that on 12th March 2003, it was stated: It would clearly be wrong to consider withdrawing DfID funding from other humanitarian emergencies or development efforts elsewhere in the world"? Clare Short, the noble Baroness and the Prime Minister all said that reconstruction costs in Iraq would come from DfID reserves. However, on 6th November, Hilary Benn stated—and the noble Baroness echoes him—that the, withdrawal from programmes, earlier than we had previously decided".—[Official Report, Commons, 6/11/03; col. 42WS.], 1090 was because of expenditure in Iraq. What other battles is DfID likely to lose over Iraq?

§ Baroness Amos
My Lords, the noble Baroness, Lady Northover, misunderstands the nature of DfID funding. The money we spend on humanitarian aid and emergencies around the world is separate from the money we spend on our bilateral and multilateral programmes. There has been no cut in our humanitarian or emergency assistance to any country as a result of our programmes in Iraq. What we have considered reallocating—not during this year but from next year—is the money spent in middle-income countries, which we were already doing in any event so that we could meet our commitment to 90 per cent of our spending going to low-income countries.

§ Baroness Rawlings
My Lords, the middle-income countries whose budgets have constantly been under threat under this Labour Government are still home to at least 140 million people living in poverty. The Secretary of State, Mr Benn, released a shocking Written Statement last week describing reduction of spending in middle-income countries of about £100 million. Only in October did he pledge £544 million for Iraq, with no mention of cutbacks.
Of course we support aid for reconstruction of Iraq, but not at the expense of countries such as Albania, Romania and Bulgaria, to mention but a few, or poor countries such as those in Latin America. Why do the Government continue to calculate by pure numbers of people per country, not by percentage? There will always be more people below the poverty line in China than Albania, for example. How do the Government expect aid programmes to continue if they are cut so suddenly?

§ Baroness Amos
My Lords, the noble Baroness represents a party which presided over a dramatic fall in the amount going to overseas development. Since 1998, UK aid spending has increased by 74 per cent in real terms. So I do not understand her point about our overseeing cuts in expenditure on development. We have made a commitment to the poorest in the world that 90 per cent of our bilateral funding will go to them through our commitment to low-income countries.

§ Lord Joffe
My Lords, some middle-income countries, such as South Africa, are being ravaged by HIV/AIDS. Their needs are perhaps even greater than those of Iraq, especially bearing in mind that they are not in receipt of the massive reconstruction budget presently offered by the USA to Iraq. Will the Leader of the House outline the key criteria applied by DfID in reallocating funds from middle-income countries to Iraq and confirm that those criteria are consistent with those usually followed by DfID in allocating funds?

§ Baroness Amos
My Lords, I reassure the noble Lord, Lord Joffe, that dealing with HIV/AIDS is central to our work in sub-Saharan Africa and will continue to be, regardless of whether it occurs in a middle-income country such as South Africa or 1091 elsewhere. On the criteria, post-conflict countries have always been important to our development agenda. We are developing a strategy for our work in middle-income countries.