Under: Developed Countries (Aid)

Part of Bill Presented – in the House of Commons at 12:00 am on 2nd December 1968.

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Photo of Bernard Braine Bernard Braine , Essex South East 12:00 am, 2nd December 1968

I join those who have congratulated the hon. Member for Norwich, North (Mr. Wallace) on his good fortune in the Ballot, on his wisdom in selecting the important subject of aid and development, and on the manner in which he introduced it in an excellent speech which has led to an interesting and thought-provoking debate.

I agree with the hon. Gentleman that it may seem to be odd to some that we should be discussing how to give away substantial resources at a time when we are massive borrowers on our own account and are in the grip of serious economic crisis. Is it not a fact, one might ask, that the Americans, far wealthier than ourselves, are cutting their aid to poorer countries? Why should we not stop giving money away to other countries at least until we have repaid our debts?

Precisely because questions like that are being asked, I warmly welcome this debate. For it provides us with an opportunity to examine the whole question of aid, or as I prefer to call it, development assistance, to identify its purpose, to study its effectiveness, and to judge it in relation to the needs of both developed and developing countries alike.

Here, I pay tribute to the thorough and painstaking work of the Estimates Committee, whose admirable Report gives us so much valuable information and clears away so many misconceptions. In this connection, I pay tribute also to the late Sir Andrew Cohen, a great public servant who will be much missed.

True, the Committee was precluded by its terms of reference from pronouncing on aid policy as such. It could not say whether our aid should be increased, reduced or even abolished. It was limited to considering whether the present arrangements fulfilled the avowed purposes of the aid programme. The Committee's conclusion is clear: … the British aid programme is on the whole well conceived, well administered, and is fufilling its objects. There has been a marked improvement in its effectiveness since the formation of the Ministry of Overseas Development, and future trends are encouraging. All of us who follow these matters will endorse those words.

If, therefore, I have some criticisms to offer, it is not because I doubt the wisdom or necessity of a British contribution to development assistance but because there is so much to do at home and abroad with the limited resources at our disposal that we must scrutinise carefully how those resources are used.

The first requirement, surely, is to put the whole human predicament in some sort of perspective. I should be the last to minimise the grave difficulties facing the advanced, developed and relatively wealthy nations of the Western world. Plainly, as we have said on this side many times, it is a precondition of our being able to help the poorer nations, which constitute some two-thirds of the human race, that we put our various houses in order. But I sometimes doubt that there is even a glimmering of understanding of the appalling dangers which will confront mankind if the present gap between rich and poor in the world is allowed to grow wider—and, make no mistake, in relative terms it is growing wider all the time.

In a most interesting speech, the hon. Lady the Member for Halifax (Dr. Summerskill) spoke of the world's population growth. At present, the total world population is about 3,400 million, half of whom are poor indeed. By the end of the century, if present trends continue, the figure will be nearer £7,000 million. With every year that passes, the world population increases by an amount greater than the whole population of these islands. Within the next 30 years, most probably sooner, the human race must adapt itself to a numerical increase equal to that which has occurred since the beginning of time up to now, or it will face a catastrophe of unimaginable proportions. The world cannot be allowed to drift along without special effort being made to head off that threatened disaster.

I believe profoundly in the truth of Pope Paul's dictum that "development is peace". It is imperative that a sustained and massive effort is made by all the developed nations to accelerate economic growth in the poorer countries while there is still time in which to do it. In short, the poorer nations are faced with a time-scale the significance of which is not yet fully grasped by the mass of people in developed countries such as ours, where present affluence gives vastly more room for manoeuvre, induces appalling complacency, and tends to obscure the long-term dangers for all mankind.

Now, I am not particularly impressed by the argument as to whether it is our moral duty to provide aid or whether we should consider it only in the light of self-interest. That argument may even frustrate the cause of development. It tells us nothing about what sort of aid is needed, how much, and how it should be channelled and administered. As I have often said, the word "aid", with its overtones of charity, may itself be leading us down the wrong turning. For it does not readily convey the real intention, namely the provision of selective help in promoting economic growth of a kind which in the end benefits both donor and recipient alike, and, through them, the world at large.

I agree with the hon. Member for Eccles (Mr. Carter-Jones) that what is needed is a tar clearer idea of the purposes of aid and the criteria which should be rigorously aplied to both its giving and receiving, instead of the confused argument about whether the motivation should be one of conscience or one of plain self-interest. Why is there such confusion? One reason may be that the United Nations Development Decade was launched without a proper preliminary assessment of the real needs of the situation. As a consequence, methods of giving aid have all too often been haphazard and uncertain. Methods of utilising it have sometimes been wasteful. There has been too little coordination of programmes and projects. There has been an acute shortage of that skilled management which alone can ensure that resources are used to the best advantage. As one hon. Member said, loan terms have been imposed with too little regard to the capcity to repay, and until recently far too little attention has been paid to population control, though it is only fair to observe that the population explosion is caused not merely by a higher birth rate but by a higher survival rate, and there is nothing that we can do about that.

Against that background it is not altogether surprising that a cynical attitude has developed towards aid in the richer countries and a bitterness in the poorer countries which threatens what to many of us has been the most promising development in the post-war world, namely the recognition that the gap between the richer and the poorer nations was unhealthy and dangerous, and should and could be bridged to the advantage of all.

But none of this is an argument against development assistance. Rather is it a complaint about the joint failure in many instances to deploy resources as efficiently as we and other donor nations might have done. Indeed, as the Estimates Committee's Report makes plain, where aid has been properly applied notable results have been achieved. Hitherto, we have heard about the failures; we have taken little note of the successes. Of course, it is true that gross national product per head is rising much faster in the richer countries than in the poorer. The richer countries, on average, added about seven times as much to their income per head last year as the poorer countries did to theirs. But such global comparisons are misleading, because the good performance of some developing countries is offset by the far less successful efforts of a few very large countries where massive population growth tends to offset the benefits of any additional wealth that is created. I shall never forget Mr. Nehru's sad lament to me in 1963, when I led the British Parliamentary Mission to India, that because of the population explosion his country had to run very fast not merely to stand in the same place but to prevent herself from slipping back.

On the other hand, when we look at individual cases we see instances where development assistance has been producing most encouraging results. Within the Commonwealth, Kenya and Pakistan are striking examples. Outside it, Taiwan and, I believe, South Korea have now reached the point of take-off, where they can dispense with foreign aid altogether. As the President of the World Bank said recently, no doubt with such instances in mind, Let us make no mistake: aid does work; it is not money wasted; it is sound investment. Obviously there are lessons to be learned from this varying pattern of experience. But what are they? Why is it that some developing countries do better than others? Is it because they are more sensibly governed? Is it because they give more encouragement to the private sector? Is it because they steer clear of prestige projects and concentrate on the less spectacular, but much more vital, task of improving their agriculture'? Is it because they have attracted more multilateral aid, which most authorities seem to think gives more flexibility in planning development programmes? Or is it because—and nobody has mentioned this so far—that some countries have received a greater volume of aid per head than others, which has enabled them to plan more boldly over a longer period?

Is there special significance in the fact that countries like Taiwan, which have received vastly more aid per head than India, have grown faster and have reached the point where they can dispense with aid altogether So far, no authority has tried to find convincing answers to those questions. The Estimates Committee's Report helps to spark our thought in this direction, but so far there are no convincing answers. That is why we should warmly welcome the World Bank's decision to set up its own Commission of Inquiry under the distinguished chairmanship of Mr. Lester Pearson, with a view to examining past aid efforts and devising more effective techniques and policies for the future. But this does not absolve us in the House from the responsibility of evaluating our own aid efforts.

I agree entirely with the suggestion of my hon. Friends the Members for liar-borough (Mr. Farr) and Dorking (Sir G. Sinclair) that we should have an annual report. The Estimates Committee was rightly very critical of the lack of clarity in our statistics. For example, in paragraph 12 it says that the gross amount of official aid spent in the current year will be some £227 million. But if' we assume that the amount of money returning in amortisation and interest on past loans will be similar to that for 1966–67, the net cost comes out at £170, million. Of course, that is on the debit side of our national accounts. Of course, it is money found by the harassed taxpayer; it cannot be conjured up from any other source. But although it is difficult to quantify the benefits, these are considerable, and I shall refer to them later.

Even so, in the sense that aid is a straight transfer of resources from donor to recipient, it is clear that our programme is smaller than it is made out to be. On the other hand, if we are to include the return on loans we should also regard private investment overseas, which performs an indispensable rôle in promoting economic growth, as part of our total effort to speed the economic development of the poorer countries. One cannot have it both ways. Yet as far as I can discover the figure of £227 million is nowhere stated by the Ministry of Overseas Development, and despite the many detailed and helpful statistics that it publishes it is not immediately apparent, for example, how much was spent on the 75 per cent. subsidy to overseas volunteers or on the payment to retired officers of former British colonial territories. We should like to know what those figures are. I put these amounts at £1 million per annum on volunteers and over £12 million on pensions and compensation. I hope that the Minister will confirm or correct these figures when he replies.

Thus the Report is right to recommend that the Ministry should consider ways and means of giving Parliament and the nation more accurate information about the full cost of the annual aid programme, together with an assessment of our commitments for future years. Nevertheless, if I take the sense of the debate, it would be wrong to view the matter purely in budgetary terms. To those who question the wisdom of a country like ours, saddled as it is with a serious burden of short-term indebtedness, having an aid programme of any kind, my answer is that Britain is a net creditor on overall overseas account. Our future prospects are bound up inextricably with the extent to which world trade expands, and it is with the future that aid is predominantly concerned. Essentially, it is concerned with long-term objectives.