UK aid is subject to external scrutiny through independent monitoring by the Select Committee on International Development, audit by the National Audit Office and peer review by the Organisation for Economic Co-operation and Development. DFID's policies and country programmes are evaluated by external experts and findings are published. However, we can and should go further, so I intend to establish a mechanism to ensure more independent evaluation of DFID's impact and I will inform the House of my proposals in due course.
I am grateful to the Secretary of State for that answer. Assuming that he wishes to see recipient countries spend aid in an effective and accountable manner, when the Department is extending its aid reach into fragile states with often limited democratic credentials, why are the Government not doing more to show that they are responding and producing external scrutiny? Given that the Secretary of State says that the quality of governance has a huge impact on development, surely it is time for the Government to get its own house in order.
I hope that the hon. Gentleman listened to the answer that I just gave before asking a supplementary question that he may have written before he heard what I had to say. I accept entirely that we can do more to ensure that there is independent evaluation of the work that we are doing, but there is a considerable amount of scrutiny currently and in the more difficult places in which we work we take seriously our responsibility to ensure that we can demonstrate an impact. That is why, in those cases, we often do not give direct budget support, but provide assistance through programmes and projects in other ways.
I welcome the Secretary of State's statement that he is going to follow Conservative party proposals to have an independent aid watchdog in this country. Does he agree that as the Department for International Development is set to double its budget, we owe the British taxpayer a zero tolerance policy on corruption in aid budgets?
I agree with the hon. Lady. I take with the utmost seriousness my responsibility to ensure that every penny of our aid goes to where it is intended. Every Member of the House, regardless of what party they belong to, should be interested in ensuring that a rising aid budget has the best possible impact.
Does my right hon. Friend agree that part of the business of scrutiny of aid in developing countries must be carried out by the Parliaments of those countries and their public accounts committees? Will the Secretary of State tell the House how his new governance fund will be used to strengthen the capacity of Parliaments to do that work and scrutiny, and will our National Audit Office look at their reports and use them in its independent audit of his Department's work?
I agree with my hon. Friend completely on that point. The governance and transparency fund that we are establishing will in part be used to support parliamentarians in building their capacity to hold their Governments to account. The Public Accounts Committee and the work of the National Audit Office are really good examples of how to do that. We enjoy the benefit of their wisdom and experience, and occasional probing from time to time. I do not see why our colleague parliamentarians and Ministers in developing countries should not enjoy the same experience.
I welcome my right hon. Friend's statement. I hope that his Department will look in particular at evaluating the spend on orphans and vulnerable children. I wonder whether he would agree that the untying of aid from trade, and the introduction of the poverty focus by the Labour Government was probably the single most effective step in improving the effectiveness of UK aid.
I agree with my hon. Friend. They were important decisions, taken for exactly the right reasons. On spending on orphans and vulnerable children, one of the reviews that we have been carrying out has been into the impact of our approach to HIV and AIDS and that is one of the issues at which it has been looking.
Some £50 million of unearmarked aid will be given to the Afghan reconstruction trust fund this year. Having been a part of the process of paying that aid, I know that it involves handling large bundles of cash and taking them down to the provinces in Afghanistan. Given the current levels of corruption to be found in some provinces in Afghanistan, what specific measures are in place today to ensure that that money is being well spent?
The most important measure that is in place is the Afghan reconstruction trust fund, which is managed by the World Bank on behalf of all the donors that put in funding, including the United Kingdom Government, and it pays out only in response to certified expenditure. What is that money being spent on? As the hon. Gentleman knows, it is being spent on helping to pay the salaries of teachers and other public servants who are trying to build the capacity of the Government of Afghanistan to respond to the needs of their people.
The Secretary of State is aware that, over the last year, we have been pressing the Government to set up a truly independent aid evaluation process, so we welcome the answer that he gave just now—although I hesitate to point out to him that he gave exactly the same answer two months ago. Will the Secretary of State accept that the issue is about not only aid effectiveness, but development effectiveness and demonstrating results and outcomes so that taxpayers can have confidence that their money is being well spent?
I do accept those latter points, which is precisely why I have informed the House today that I intend to set up a mechanism. I said two months ago that I was looking at proposals. One of the things that we are doing is assessing the experience of other countries, such as the Netherlands, Denmark and Sweden, which have been addressing the same issue. It is important that we are all able to offer reassurance to the British public that Britain's aid is making a difference, as it is.
We congratulate the Secretary of State on adopting this Conservative proposal.
Following cross-party support last year for the Bill introduced by Mr. Clarke, the Secretary of State is required to report to Parliament on the impact of Government policies on development and developing countries across the range of relevant Government Departments. Will he tell the House how he is getting on with that process and when he expects to be able to report?
We are getting on fine and we will publish the outcome of that work in the Department's annual report, which will appear at the beginning of May.