asked the Minister of Overseas Development, in view of the necessity for resolving the balance of payments problems, and in the context of the National Plan, if he will table in the OFFICIAL REPORT the total aid to under-developed countries; what percentage of the budgeted gross national product this will be; how much will be public aid; of the public aid, what proportion will be interest-free grants; how much will be private investment overseas planned for each of the next five years; and whether he will make a statement.
The National Plan states that the size of the aid programme will be reviewed periodically in the light of the progress made in overcoming our economic problems. We have been able to set out a target of £225 million for official aid in the current financial year which is expected to be about 0·7 per cent. of the gross National Product. The UNCTAD target of 1 per cent. of "national income" includes private investment, and this we are meeting.
I cannot forecast what proportion will be grants or interest-free loans nor what the amount of private investment will be during the next five years.
In view of the statement made last week on aid to Indonesia, would my right hon. Friend be willing to launch a campaign in the company of many interested voluntary organisations on the importance of aid and development as a means of helping world stability?
I think that the importance of economic aid as a help to world stability is appreciated on both sides. I shall be glad to discuss the matter with my hon. Friend if he so wishes.
This is something, which we keep in mind, but on a previous occasion I have explained the difficulties of doing it. We should like to do it but it is not always possible.
asked the Minister of Overseas Development how much of the total overseas aid to underdeveloped countries given by Great Britain in 1965 was in the form of private investment overseas; what was the value of this aid; how this compared with each of the previous three years; and what proposals he has for encouraging commercial investment overseas, designed to give a good return on the capital invested, with a view to bringing about a long-term improvement in the balance of payments.
Official aid was £194 million in 1965. Private investment in developing countries was very approximately £110 million—net of dis-investment—compared with £70 million in 1963 and £85 million in 1964. My primary concern with private investment is in its contribution to development and questions on general issues of trade and financial policy should properly be addressed to my right hon. Friends with major responsibilities in these fields.
Will my hon. Friend bear in mind that while we have this very difficult balance-of-payments problem, development aid is a very serious drain on us? Will he give further consideration to using the surplus capacities of agriculture and industry in this country for this purpose until the drain on our balance of payments has been improved?
These are matters which we have constantly in our mind, but we have to try to strike the right balance between giving the necessary aid to developing countries and protecting our own economic interests.
Figures for the financial year 1965–66 are not yet available. 43 per cent. of our official bilateral aid disbursed in the calendar year 1965 was wholly tied and another 16 per cent. partly tied. A significant part of the disbursement under technical assistance, pensions and compensation, will also have been spent in the United Kingdom.
Do the figures which the right hon. Gentleman has quoted represent Government forward planning for the future? Does he consider that a good deal of aid to the under-developed countries in respect of services such as fishing boats could be produced from development areas in this country?
The figures which I gave were for the last calendar year, but considerations such as that which the hon. Member raised are very much in our minds and we try to get a synthesis between the interests of the countries we are helping and the economic requirements of the United Kingdom.
Does the Minister think that the figures which he has given to my hon. Friend are satisfactory, par- ticularly in view of the fact that a Brooking's Institute Report showed that in the case of American aid about 90 per cent. was tied? Does he think that we can get away with a lower proportion than the United States in view of our balance-of-payments position?
I think that the balance is about right. We do tie less aid than a number of countries but more than many others. In view of our special responsibilities to many of the independent countries of the world as well as to our dependent territories, I think that the balance is right.