New Clause 1 — The Independent Commission for Aid Impact

– in the House of Commons at 9:30 am on 5th December 2014.

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“(1) The Independent Commission for Aid Impact (ICAI) shall have responsibility to carry out independent evaluation of the relevance, impact, value-for-money, efficiency and effectiveness of the ODA in accordance with the provisions of this Act.

(2) The Schedule [The Independent Commission for Aid Impact] makes further provisions about the ICAI.”—(Mr Nuttall.)

Brought up, and read the First time.

Photo of John Bercow John Bercow Chair, Speaker's Committee for the Independent Parliamentary Standards Authority, Chair, Speaker's Committee on the Electoral Commission, Speaker of the House of Commons, Speaker of the House of Commons

With this it will be convenient to discuss the following:

New clause 2—Reduction of Cabinet members’ salaries if 0.7% target not met

“If an annual report laid before Parliament in 2016 or any subsequent calendar year shows that the 0.7% target has not been met in the report year, salaries provided for under Section 1 and Part 1 of Schedule 1 to the Ministerial and Other Salaries Act 1975 shall each be reduced by £1000 in the following financial year.”

New clause 3—Annual reporting: relevant period

“(1) The International Development (Reporting and Transparency) Act 2006 shall be amended by leaving out section 1(2) and inserting—

“(2) In this Act, “relevant period” means a period of 12 months ending with 31 March in the case of information which is normally produced by reference to financial years.”’

New clause 4—Independent International Development Office

“(1) There shall be established an independent body known as the Independent International Development Office (referred to in this Act as “the IIDO”).

(2) The Schedule [The Independent International Development Office] makes provision about the IIDO.”

New clause 5—Calculation of ODA for the purposes of section 1

“An amount equivalent to the following annual payments, or estimates thereof, shall be included in the calculation of annual UK ODA for the purposes of section 1—

(a) the amount payable by the United Kingdom to the European Union.

(b) Welfare benefits paid to foreign nationals.

(c) Welfare benefits paid to UK nationals living abroad.

(d) The administrative costs of the Department for International Development and its agencies and associated public bodies.”

New clause 6—Calculation of Gross National Income for the purposes of section 1

“Adjustments to the figure provided to Parliament as the UK’s gross national income as at the end of the financial year shall not change or invalidate the UK’s performance against the target under section 1.”

New clause 7—Applicability and expiry of the provisions of this Act

“(1) This Act shall come into force on such a day appointed by the Secretary of State by an order contained in a statutory instrument.

(2) An order under subsection (1) shall not be made unless a referendum has taken place in the United Kingdom and more than 50% of those casting a vote do so in favour of meeting the target.

(3) This Act shall only have effect in those years where the United Kingdom records a budget surplus.

(4) The Secretary of State may vary the target mentioned in section 1 by an order contained in a statutory instrument in response to the UK leaving or joining a multilateral organisation which itself disburses ODA.

(5) This Act shall expire on the anniversary of its coming into force in the fifth year of its being so in force.”

Amendment 16, in clause 1, page 1, line 4, leave out “gross national income” and insert

“final gross national income of the preceding year.”

Amendment 20, page 1, line , leave out “met” and insert “progressed toward”.

Amendment 18, page 1, line 5, leave out “calendar” and insert “financial”.

Amendment 5, page 1, line 5, at end insert

“when the central government net cash requirement is in surplus.”

Amendment 21, page 1, line 6, leave out “the 0.7% and insert “a 0.35%”.

Amendment 6, page 1, line 7, leave out from “by” to end of line 9 and insert

“the Office for Budget Responsibility.”

Amendment 19, page 1, line 13, at end insert

““financial year”, for the purposes of this Act, includes a period which begins with the day on which this Act comes into force and ends on the following 31 March.”

Amendment 22, in clause 2, page 1, line 16, leave out “the 0.7% and insert “a 0.35%”.

Amendment 7, page 1, line 17, leave out

“as soon as reasonably practicable” and insert

“, no more than 10 days during which both Houses of Parliament are sitting,”.

Amendment 8, page 1, line 18, leave out from “statement” to end of line 19.

Amendment 23, page 2, line 2, leave out “the 0.7% and insert “a 0.35%”.

Amendment 24, page 2, line 5, leave out “the 0.7% and insert “a 0.35%”.

Amendment 9, page 2, line 7, leave out from “State,” to end of line 8 and insert

“need take no action on the basis of such a revision.”

Amendment 10, page 2, line 8, leave out from “statement” to end of line 9.

Amendment 11, page 2, line 10, leave out subsections (3) and (4).

Amendment 25, page 2, line 10, leave out “the 0.7% and insert “a 0.35%”.

Amendment 26, page 2, line 19, leave out “the 0.7% and insert “a 0.35%”.

Amendment 1,  page 2, line 25, leave out clause 3.

Amendment 15, page 2, line 36, leave out clause 5.

Amendment 2, in clause 5, page 2, line 39, at end insert

“and is relevant, sustainable and capable of having a measurable impact.”

Amendment 37, in clause 6, page 3, line 4, leave out subsection (2).

Amendment 3, page 3, line 4, leave out “1 June 2015” and insert “1 January 2016

New schedule 1—The Independent Commission For Aid Impact

Accountability and Reporting

1 (1) It will be the responsibility of the Secretary of State for International Developent to lay responses to reports of the ICAI before Parliament.

(2) The ICAI shall carry out all other duties as established.

Finance

2 (1) The budget of the ICAI for the purpose of section ( ) will be agreed by the Secretary of State for International Development.

(2) The Department for International Development may make to the ICAI such payments out of money provided by Parliament as the Department for International Development considers appropriate for the purposes of enabling the ICAI to meet its expenses arising under this Act.

(3) Payment are to be made at such times, and subject to any such conditions, as the Department for International Development considers appropriate.”

New schedule 2—The independent International Development Office

Membership

1 The IIDO is to consist of a member to chair it and six other members, appointed by the Secretary of State for International Development following apre-appointment hearing by, and with the consent of, the International Development Committee of the House of Commons.

Employees

2 (1) The IIDO may employ staff.

(2) Staff are to be employed on such terms as to remuneration and other matters as the IIDO may, with the approval of the Minister for the Civil Service, determine.

(3) Service as a member of staff of the IIDO is employment in the civil service of the State.

(4) The IIDO must pay to the Minister for the Civil Service, at such times as the Minister may direct, such sums as the Minister may determine in respect of the increase in the sums payable out of money provided by Parliament that is attributable to the provision of pensions, allowances or gratuities under section 1 of the Superannuation Act 1972 payable to or in respect of persons who are or have been members of staff of the IIDO.

Duties

3 (1) The IIDO will have the responsibility to carry out independent evaluation of the relevance, impact, value-for-money and sustainability of ODA.

(2) The IIDO will develop systems to verify the extent to which ODA is spent efficiently and effectively.

Annual report

4 (1) The IIDO must prepare a report of the performance of its functions in each financial year.

(2) The report relating to a financial year must be prepared as soon as possible after the end of the financial year.

(3) The report must be sent to the Department for International Development.

(4) The Department for International Development must lay the report before Parliament.

(5) “Financial year” means—

(a) the period which begins with the day on which this Schedule comes into force and ends with the following 31 March;

(b) each successive period of 12 months.

Accountability and Reporting

5 (1) It will be the responsibility of the Secretary of State for International Development to lay responses to reports of the IIDO before Parliament.

(2) The International Development Committee of the House of Commons may provide parliamentary oversight of the work of the IIDO and report annually on its current and future work programme.

Finance

6 (1) The budget of the IIDO will be agreed by the Secretary of State for International Development.

(2) The Department for International Development may make to the IIDO such payments out of money provided by Parliament as the Department for International Development considers appropriate for the purpose of enabling the IIDO to meet its expenses.

(3) Payments are to be made at such times, and subject to any such conditions, as the Department for International Development considers appropriate.

Accounts and audit

7 (1) The IIDO must—

(a) keep proper accounts and proper records in relation to its accounts, and

(b) pre pare in respect of each financial year a statement of accounts.

(2) Each statement of accounts must comply with any directions given by the International Development Committee as to—

(a) the information to be contained in it and the manner in which it is to be presented,

(b) t he methods and principles according to which the statement is to be prepared, and

(c) the additional information (if any) which is to be provided to Parliament.

(3) The IIDO must send a copy of each statement of accounts to—

(a) the Secretary of State for International Development, and

(b) the Comptroller and Auditor General, before the end of the month of June next following the financial year to which the statement relates.

(4) The Comptroller and Auditor General must—

(a) examine, certify and report on each statement of accounts, and

(b) send a copy of each report and certified statement to the Secretary of State for International Development.

(5) The Secretary of State for International Development must lay before Parliament a copy of each such report and certified statement.

(6) “Financial year” has the same meaning as in paragraph 4(5).

(7) The IIDO must keep under review whether its internal financial controls secure the proper conduct of its financial affairs.

References to International Development Committee

8 (1) Any reference in this Schedule to the International Development Committee of the House of Commons—

(a) (a) if the name of that Committee is changed, is to be treated as a reference to that Committee by its new name, and

(b) if the functions of that Committee (or substantially corresponding functions) become functions of a different Committee of the House of Commons, is to be treated as a reference to the Committee by which those functions are exercisable.

(2) Any question arising under sub-paragraph (1) is to be determined by the Speaker of the House of Commons.”

Amendment (a), to new schedule 2, line 3, leave out “six” and insert “four”.

Amendment (b), line 4, leave out “for International Development”.

Amendment (c), line 5, leave out from “of,” to end of line 6 and insert

“a committee in the House of Commons and an equivalent committee in the House of Lords”.

Amendment (d), line 6 after “Commons” insert

“and equivalent committee in the House of Lords”.

Amendment (e), line 12 leave out sub-paragraph (3).

Amendment (f), line 19 at end insert—

“2A All costs associated with the IIDO shall count towards the target set out in section 1 of this Act.”

Amendment (g), line 38 leave out “for International Development”.

Amendment (h), line 72 leave out “for International Development”.

Amendment (i), line 78 leave out paragraph 8.

Photo of David Nuttall David Nuttall Conservative, Bury North

As the House will have seen on the amendment paper this morning, there are seven new clauses, two new schedules and several amendments. I propose to divide up the amendments into several sub-groups, although others may choose to deal with them in a different way. For the sake of clarity, it seemed to me that it might be helpful if I draw together a number of different threads. I will start with new clause 1 and new schedule 1.

Photo of Peter Bottomley Peter Bottomley Conservative, Worthing West

For context, and for those who read our debates, perhaps we should remind ourselves that we are talking about whether, from every £100 of our wealth, we should give 70p each year to those who will use it well. It is important for people to know that some Conservatives—probably most—want the Bill to go through and some oppose it, and some of these discussions help to delay the passage of the Bill.

Photo of David Nuttall David Nuttall Conservative, Bury North

I do not want to be drawn immediately off target. We are considering some rather detailed provisions this morning. I accept that there are different views. There are many on the Government Benches who think it would be a good thing to use some of our public money—moneys that we have taken from the taxpayer—to pay for international aid. To a large extent, I go along with that, but what the Bill does is entirely different. It tries to enshrine in statute one particular area of Government spending, which no other areas of Government spending enjoy. It could be argued that it is better for a Government to spend whatever they want, be it 0.7% or 0.8%, of their own free will, rather than being obliged by statute to do so. There is another point. There may be those who, once they see that the 0.7% target has been enshrined in statute, think the job is done.

The people of this country have a long and proud history of giving generously to charity, and long may that continue, but is not there a danger that some—although not all—might think that, because 0.7% is enshrined in statute, the Government are doing that job for them? I for one do not wish to go down that road. I would like people to feel that it is also their responsibility, as an act of charity, to contribute to international aid.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

Is not the problem with the Bill highlighted by the autumn statement? GDP is forecast to increase by more than 3%, which means more than £400 million extra will have to be spent on overseas aid next year in order to meet the target. At the same time, the Chancellor is saying that we are still in the age of austerity.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend makes a good point. Several newspapers have today reported that that would indeed be the effect of an after-the-event revision in gross national income. Some of the amendments that we will consider today attempt to deal with that problem.

Photo of Philip Davies Philip Davies Conservative, Shipley

Is it not worse than that, though? Given what the Chancellor said in the autumn statement, and given the OBR’s projections, Government spending as a proportion of GDP will have to come down. As the OBR has highlighted, even health spending will have to come down as a proportion of GDP. If the Bill goes through unamended, the percentage of Government spending that goes on overseas aid would have to keep rising, rather than remaining constant. Our amendments are designed to deal with that anomaly.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is absolutely right. That is one of the reasons why we are attempting to change the definitions in the Bill.

As I mentioned, there are several new clauses, two new schedules and 22 amendments. I propose to speak first to new clause 1 and new schedule 1 and then to contrast them with new clause 4 and new schedule 2, together with several amendments thereto that have been tabled by my hon. Friend Jacob Rees-Mogg. I will then deal with the proposed changes to the definitions in the Bill and one or two stand-alone amendments that do not fit into the other categories. I will deal with the accounting period at the same time. I will then speak to a series of amendments that would reduce the figure from 0.7% to 0.35% and explain how that proposal arose.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend mentioned our hon. Friend Jacob Rees-Mogg. Perhaps I should point out that he has been detained as one of his children is performing in a Christmas event at school, but he will be dashing here as soon as he can to speak to his amendments. I thought that I ought to put that on the record.

Photo of David Nuttall David Nuttall Conservative, Bury North

I am extremely grateful for that intervention, because I was looking towards where our hon. Friend normally sits in the Chamber and was somewhat concerned by his lack of presence. I am relieved that he will be able to deal with amendments 8, 9, 10, 11 and 37, which stand in his name. I will touch on those briefly at the end of my remarks. Before that, I will deal with the definitions of the accounting period, the 0.35% proposal, the issue of enforcement, which is dealt with in new clause 2, and amendments 1, 2 and 3, tabled by my hon. Friend Mr Chope.

Concerns were raised on Second Reading about the original Bill’s provision for a new body that was to be known as the Independent International Development Office. That had been provided for in clause 5. Although the clause was relatively short, the related detail in the schedule to the Bill was extensive. Subsection (1) simply stated that there should be established an independent body, known as the Independent International Development Office—I shall refer to it from now on as the IIDO—and subsection (2) provided that the schedule should make provision for it. The schedule provided a lot of details about the membership of the IIDO, including who its employees were going to be, its duties, its annual report, its accountability and reporting requirements, its financial arrangements, and its internal financial accounting and audit requirements. It was a comprehensive statement of what was to be required of the new body.

Given that the Bill will enshrine in law a legal requirement to spend billions of pounds of taxpayers’ money every year, I can understand why its promoter felt it necessary to include in it specific provision for oversight. To be fair to the Minister, he made it clear on Second Reading that he was unhappy about the clause and the schedule and that he would seek to change them in Committee. It was no surprise, therefore, that in Committee amendments were tabled that took out clause 5 and the schedule and inserted a new clause 5, which is very much pared down, and simply says:

“The Secretary of State must make arrangements for the independent evaluation of the extent to which ODA”— overseas development assistance—

“provided by the United Kingdom represents value for money in relation to the purposes for which it is provided…The Secretary of State must include in each annual report a statement as to how he or she has complied with the duty under subsection (1).”

Leaving aside the fact that, by virtue of section 6 of the Interpretation Act 1978, there is no need to refer to both genders because it provides that where one gender is included in legislation the other is included automatically, this pared-down requirement is not sufficient. While I entirely agree with the Minister that there was no need to establish an entirely new body, with all the extra costs and layers of bureaucracy that that would involve, at least some element should be written into the Bill for separate and independent scrutiny.

That was the reasoning behind my tabling new clause 1, which provides that an existing body, the Independent Commission for Aid Impact,

“shall have responsibility to carry out independent evaluation of the relevance, impact, value-for-money, efficiency and effectiveness” of the UK’s overseas development assistance as provided for in the Bill. The ICAI, which is not a statutory body, was set up in the early months of this Parliament. The framework agreement between the Department for International Development and the ICAI sets out a broad framework within which the ICAI operates as an advisory non-departmental public body sponsored by DFID. The framework agreement requires it to report directly to Parliament through the International Development Committee. As an independent body for the scrutiny of UK aid, it is the perfect body to take on the role that I foresee for it. I may have some support for that; I am not sure. My right hon. Friend Mr Mitchell said on Second Reading:

“ICAI is not a comfortable organisation for Ministers…It reports not to Ministers, who are able to sweep inconvenient truths under the carpet, but to the International Development Committee.”

He said that the Committee had shown itself to be

“fearless in pursuing the Government when alerted to difficulties by the independent commission”.

The ICAI can deliver precisely what we want to see in the Bill and what the House wishes to endorse. My right hon. Friend Mr Lansley, whom I see in his place, said on Second Reading:

“I confess that I cannot see why the Independent Commission for Aid Impact should not be given statutory backing. I therefore hope that when the Bill is further considered, it might be possible, in clause 5, simply to give statutory backing to what has been created as ICAI.”—[Hansard, 12 September 2014; Vol. 585, c. 1202.]

Essentially, that is what new clause 1 is designed to do, although I appreciate that it may not receive widespread support in the House. The suggestion was made on Second Reading that that was one potential way forward, and it was discussed at some length in Committee, although not at great length.

It is perhaps worth contrasting the work of the ICAI, and the fact that it already exists as a functioning oversight and monitoring body, with the proposal made by my hon. Friend Philip Davies. On this occasion, I do not agree with him. New clause 4 and new schedule 2, which he has tabled, are designed to reinstate provisions contained in the Bill on Second Reading that were taken out in Committee. I will leave it to my hon. Friend to explain why he thinks that that would be a better way forward.

Photo of Philip Davies Philip Davies Conservative, Shipley 9:45 am, 5th December 2014

My hon. Friend is making a powerful case for new clause 1. Given that the proponents of the Bill say that the proposals in new clause 4 received overwhelming support when they formed part of the

Bill on Second Reading, does he not think that those people should have the opportunity to vote for the Bill that they voted for on Second Reading rather than for a Bill that a few individuals decided to change in Committee? Is new clause 4 not, therefore, helpful because it would allow people to vote for the Bill that they thought they were voting for the first time around?

Photo of David Nuttall David Nuttall Conservative, Bury North

I certainly hope that the House will have the opportunity to choose between the options that are available. The will of the House may well be for a new body to be established, but I have concerns about that. A new quango will need staffing; it will need to find new premises, probably at great expense—perhaps in London, or perhaps in another part of the country; it will need to set up a new website; and it will need to set up its own accounting functions. It will need to start from scratch, whereas the ICAI is already up and running. In Committee, my right hon. Friend Mr O’Brien said of the ICAI that

“we have been extremely pleased with the members who have served on it under an expert chairmanship.”

Of course, my right hon. Friend was a DFID Minister back in 2010 when this particularly body was being established. He went on to say:

“They were able to make their own selection of the projects they wanted to examine, after looking at a menu of options. None of that was steered by or in any way discussed with Ministers or the Department. It was entirely an opportunity for ICAI to make its own judgment; indeed, that is precisely what it has done over the years. I think everyone would agree that that has had a good and beneficial effect, in terms of scrutiny and ensuring real accountability for the massive aspirations that are tied to this public money reaching the intended destinations and public goods. ICAI now has a track record.”––[Official Report, International Development (Official Development Assistance Target) Public Bill Committee, 11 November 2014; c. 36.]

My right hon. Friend clearly thinks that there may be a role for the ICAI and I hope it will find favour with the House.

Photo of Philip Davies Philip Davies Conservative, Shipley

Clause 5 states:

“The Secretary of State must make arrangements for the independent evaluation of the extent to which” the aid

“provided by the United Kingdom represent value for money”.

The Bill does not say how that will be achieved, so without either new clause 4 or new clause 1 Members will potentially be voting for a pig in a poke.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is absolutely right. I hope that when the Minister addresses this particular sub-group of amendments he will explain exactly how the provision in the version of clause 5 that was inserted in Committee—it is not the same version that the House agreed on Second Reading—will be achieved in practice. It is all very well to say that the Secretary of State

“must make arrangements for the independent evaluation of the extent to which ODA” represents value for money, but it would be helpful to know exactly how that particular provision will be delivered.

Photo of Philip Davies Philip Davies Conservative, Shipley

Is not the danger with the Bill as crafted that, in effect, the Government will be responsible for deciding what constitutes an independent evaluation and for marking their own homework? Surely it is the duty of this House to set up the basis on which we think the Government should be scrutinised, rather than leave it to them to decide for themselves what constitutes independent evaluation.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is right. Indeed, more suspicious minds than mine may wonder why the Government are reluctant to include a provision to enable either the ICAI or my hon. Friend’s proposed body to carry out independent evaluation and oversee the Department’s work. There may be a good answer to that and I look forward to hearing the Minister’s explanation.

Photo of David Nuttall David Nuttall Conservative, Bury North

Yes; I am pleased to see that my hon. Friend has arrived in the Chamber.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

It is always one of life’s great pleasures to be in the Chamber, and it is always a sadness to be away from it.

My hon. Friend is making an interesting point, and I wonder whether it brings us to the underlying tokenism of the Bill: without any proper mechanism for checking whether the money is well spent, it is merely a grandiloquent expression of intent, rather than proper legislation.

Photo of David Nuttall David Nuttall Conservative, Bury North 10:00 am, 5th December 2014

That is the core problem, which some of us have pointed out since the Bill’s inception: it is a Bill without teeth. One of the new clauses tabled by my hon. Friend the Member for Shipley shows how the Bill might be given more teeth, or enforcement powers.

The ICAI would be the perfect body to carry out the role of scrutiny and evaluation because it operates on the basis of the following core values. It is independent: it undertakes its work without fear or favour, and reports the facts as it finds them. It has professional rigour and uses the highest professional standards to gather and evaluate evidence. It is transparent in that it places on its website all its reports and, crucially, the supporting analysis, as well as its records of costs and activities. It is responsive in that it takes into account public and parliamentary opinion in selecting its work programme and undertaking its work. It is innovative in that it makes the most of its new status to experiment with new ways of working, reporting and interacting with its stakeholders. Its last core value is to operate with the greatest integrity by ensuring that its operations are characterised by value for money, high ethical standards, transparency, and accountability to Parliament and the public.

The ICAI is a fairly small body. It consists of just four commissioners, who are led by the chief commissioner and supported by a small secretariat. We are not talking about some large, burgeoning bureaucracy. I accept that it has not been going for many years, but it has been around for most of this Parliament. As I said, it has been well received. Its work has been praised by former Ministers of the Department and the International Development Committee.

The ICAI is the ideal body to take on this role. It will have to be undertaken by somebody, because clause 5 states that the Secretary of State “must”—it does not say “may”—

“make arrangements for the independent evaluation of the extent to which ODA provided by the United Kingdom represents value for money”.

If the ICAI is not going to carry out that work, who is? It is vital work on behalf of this House and, indeed, the country.

I will go through the other proposals in passing. New clause 5, tabled by my hon. Friend the Member for Shipley, gives us a flavour of what I have loosely termed the definition amendments. It sets out that

“An amount equivalent to the following annual payments, or estimates thereof, shall be included in the calculation of annual UK ODA for the purposes of section 1—

(a) the amount payable by the United Kingdom to the European Union

(b) Welfare benefits paid to foreign nationals

(c) Welfare benefits paid to UK nationals living abroad

(d) The administrative costs of the Department for International Development and its agencies and associated public bodies.”

There was some discussion on the last point in Committee on whether the cost of running the Department should be included in, or excluded from, the target. It seems entirely sensible to include the cost in the target for the simple reason that it gives those involved in the work of international development programmes the desire to help themselves. The more they cut down on administration, the more they can put towards the cost of helping the people around the world we all want to see helped. I am sure my hon. Friend will have more to say about the quite astonishing figures relating to the amount of welfare benefits that go around the world. Without new clause 5, they will not be included in the definition of what constitutes overseas development assistance.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

Before my hon. Friend moves on, he mentioned payments to the European Union being included. As most of those payments go to poorer countries in the EU, is it not perverse that they do not count as overseas aid?

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend, as ever, is absolutely right. That is one reason why new clause 5 should be included in the Bill. As we all know, a substantial part, if not the largest part, of EU funds are disbursed in regional grants to the poorer parts of the EU.

Photo of Philip Davies Philip Davies Conservative, Shipley

Just to give an illustration, the overseas aid Department gives aid to Moldova, which is the poorest country in Europe. If Moldova were to become a member of the EU, we would be expected to make higher contributions to the EU to pay for all the work that would need to be done to bring Moldova up to scratch. The money we currently give to Moldova in overseas aid would then have to go somewhere else. In effect, the money would be spent twice.

Photo of David Nuttall David Nuttall Conservative, Bury North

I am grateful to my hon. Friend for that example, which is a perfect reason why it would make sense to accept new clause 5.

New clause 6, also tabled by my hon. Friend the Member for Shipley, concerns the calculation of gross national income for the purposes of section 1. As has already been touched on briefly in an intervention by my hon. Friend the Member for Christchurch, some difficulty has arisen this week concerning national statistics. As often happens, to be fair, they are subject to revision as more information comes in and more firms send their statistics to the Office for National Statistics.

New clause 6 therefore proposes:

“Adjustments to the figure provided to Parliament as the UK’s gross national income as at the end of the financial year shall not change or invalidate the UK’s performance against the target under section 1.”

Together with the other amendments that are being proposed, that would go some way towards dealing with the problem we have seen this week.

Amendment 16 proposes:

“Clause 1, page 1, line 4, leave out ‘gross national income’ and insert ‘final gross national income of the preceding year.’”

It would also deal with the problem of changes being made to the gross national income after the figures had been reported.

Amendment 5 is slightly different. It was tabled by my hon. Friend the Member for North East Somerset, who has disappeared for the moment. It proposes:

“Clause 1, Page 1, line 5, at end insert “when the central government net cash requirement is in surplus.””

That is an important change, given the overall position of our nation’s finances, and I am sure that my hon. Friend will have more to say about this and his other amendments before the House today.

Amendment 20 would

“leave out “met” and insert “progressed toward”.”

That would cut down on the number of times the Secretary of State has to account for not having met the target.

Amendment 6, which would amend clause 1, page 1, line 7, deals with the inclusion of a role for the Office for Budget Responsibility. This is perhaps one of the most important amendments being proposed this morning, because rather than leaving matters as are currently provided for in the Bill it would be much better if the responsibility for determining whether the target had been met was decided by the independent OBR.

The OBR has been much in the news this week, as it has given its report on the nation’s finances. Again, rather than having the current provision in the Bill, it would be much more sensible if this task was given to the independent OBR. It would not be much of a further imposition on its resources. It is the organisation that has these figures, and each week, each month and each year it has to report to this House. It will be the first organisation to know whether the figure—0.7% or any other figure that the House may decide upon—has been met.

New clause 7, also in this sub-group, was tabled by my hon. Friend the Member for Shipley and is entitled, “Applicability and expiry of the provisions of this Act”. Subsection (1) reads:

“This Act shall come into force on such a day appointed by the Secretary of State by an order contained in a statutory instrument.”

Subsection (2) provides that no order shall be made under subsection (1)

“unless a referendum has taken place in the United Kingdom and more than 50% of those casting a vote do so in favour of meeting the target.”

Subsection (3) provides that the

“Act shall only have effect in those years where the United Kingdom records a budget surplus.”

Subsection (4) provides:

The Secretary of State may vary the target mentioned in section 1 by an order contained in a statutory instrument in response to the UK leaving or joining a multilateral organisation which itself disburses ODA.”

Of course, that could be very pertinent if, for example, the UK voted in a referendum on our EU membership. Finally, subsection (5) provides:

“This Act shall expire on the anniversary of its coming into force in the fifth year of its being so in force.”

Essentially, that is a sunset provision.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch 10:15 am, 5th December 2014

I have not signed new clause 7, but its heart seems to be that the Bill will have effect only in years when the UK records a budget surplus. Does my hon. Friend agree that without such a provision the Bill will require the Government to increase borrowing to fund overseas aid?

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is absolutely right. While we are in deficit we are undoubtedly borrowing money to pay for the overseas aid budget. There is no getting away from that. It is a fact of economic life. Some might think it a good idea to borrow money with one hand and give it away with the other; others might not take that view. It would be an interesting referendum were one to be held on that question.

In one way or another, new clauses 3 and amendments 18 and 19 deal with the accounting period in the Bill. I might have missed it—I am happy to stand corrected—but nowhere in our proceedings have I seen a convincing explanation of why the accounting period by which our success in meeting the target is to be assessed is a calendar year, rather than a financial year, which we all deal in. The new clause and amendments would change the relevant accounting period from a calendar year to a financial year, bringing to the Bill much greater clarity, openness and transparency, because all the Government’s accounts are done in financial years. I cannot see why this aspect of Government expenditure should be any different. I hope that those amendments find favour with the House.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

Does my hon. Friend agree that, as drafted, the Bill will require a lot of extra expense and work? The figures are already calculated on a financial year basis, so changing the basis to a calendar year will incur additional expense.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is absolutely right. It makes sense for those who want to see the United Kingdom making the maximum impact with the money available for international aid, including some who have tabled amendments, to make the reporting requirements—everyone accepts we need some means of evaluation so there must be reporting requirements—as simple as possible. I cannot understand why we make them so complicated by putting them on a different basis from all the other Government accounts. It seems to me logical and common sense to assess the accounting period on the same basis as for all other annual accounts.

Amendments 21 to 26 would reduce the figure of 0.7% to 0.35%. Before anyone jumps up to say that this will mean cutting our aid in half, let me say that that is not necessarily so. This issue reveals the problem with the Bill. At the end of the day, the Government could continue to spend more than 0.35% on international aid; they could continue to spend 0.7% or even 0.8% on it if they were so minded. It is worth while considering why this figure of 0.7% has achieved almost mythical proportions.

Photo of Philip Davies Philip Davies Conservative, Shipley

Does my hon. Friend agree that we need some flexibility around what is affordable for the country? Simply having a very high target every year, irrespective of the country’s financial circumstances, is ludicrous. These amendments would thus allow some flexibility to take much more account of the nation’s finances.

Photo of David Nuttall David Nuttall Conservative, Bury North

My hon. Friend is absolutely right. I will not go into all the detail, but other countries have realised this point. If the suggestion of 0.35% were adopted and the Government decided on it—I do not think for one second that they will—it would put us in the pack rather than being second in the list, as we are at the moment. We would not be behind the rest of the world. It is worth looking at the detail of the figures. Anyone who does so will see that, rather bizarrely, for most of the last two or three decades we have spent around 0.35% and that it is only in the past three or four or probably five or six years—and incredibly since the financial crash—that there has been a huge increase at a time when the country can arguably least afford it.

I am conscious of the fact that there are many amendments, so I shall move on quickly to deal with the final two groups. My hon. Friend the Member for Christchurch has tabled three amendments, one of which is amendment 2. It sets out one of the criteria for evaluation of the policy and provides that it should be

“relevant, sustainable and capable of having a measurable impact.”

I look forward to hearing my hon. Friend’s explanation of the definition of “sustainable”. Perhaps he will convince me that that can be easily assessed. Amendments 8, 9, 10, 11 and 37 were tabled by my hon. Friend the Member for North East Somerset. I should mention in passing that any Member who looked at the Notices of Amendments in the Table Office yesterday should bear it in mind that at that stage amendment 37 appeared as amendment 10. The second “amendment 10” should have been “amendment 37”. I am sure that my hon. Friend will set out in convincing detail his reasons for believing that the amendments should be accepted.

It is right and proper for the Bill to be scrutinised this morning. Millions of people outside the House support this country’s aim and ambition to do all that it can to help those around the world who are starving and need help—no one denies that—but I do not think that giving special status to our aid programme has universal support in this country, and I think it important in a democracy for all sides of the argument to be put.

As I have attempted to say during the last few minutes, the amendments would not wreck the Bill. In fact, they would make it more understandable. If they were implemented, more rather than less money would be available for international development. They would make the Bill more straightforward and transparent, and would increase the funding available for international aid.

Photo of Gavin Shuker Gavin Shuker Shadow Minister (International Development)

I hope that we shall make good progress today, and respond to the concerns of those who have tabled amendments, new clauses and new schedules. Given the number that have been tabled, I shall not speak to each one; instead, I shall address the broad themes into which they can intuitively be grouped.

The first of the themes that I can discern is independent evaluation—the independent oversight of the duties for which the Bill provides. This group includes proposals for the evaluation to be overseen by, variously, the Independent Commission for Aid Impact, the Office for Budget Responsibility, and a newly created independent international development office—as well as, confusingly, a proposal that there should be no independent evaluation at all.

Jacob Rees-Mogg has called for the creation of an independent international development office. The hon. Gentleman’s late conversion to the quangocracy is a surprising development, which is somewhat at odds with his own preference for

“Parliament regulating things rather than handing them out to random bodies.”—[Hansard, 12 July 2013; Vol. 566, c. 720.]

I look forward to hearing his views.

I can reassure Members that

“the independent evaluation of the extent to which ODA provided by the United Kingdom represents value for money” was debated extensively in Committee—

Photo of Gavin Shuker Gavin Shuker Shadow Minister (International Development)

Just one second.

It was agreed, on a cross-party basis, to amend the Bill to provide for an independent evaluation while giving the Secretary of State flexibility in respect of the precise organisation that would be responsible for overseeing that scrutiny.

As for the 0.7%, several creative alternatives—

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

On a point of order, Mr Speaker. The hon. Gentleman has misspoken in attributing an amendment to me. It is not my amendment, but that of my hon. Friend Philip Davies. I am sure that the hon. Gentleman would like an opportunity to correct the record.

Photo of Gavin Shuker Gavin Shuker Shadow Minister (International Development)

I am delighted to correct the record, Mr Speaker. It is absolutely true that the hon. Member for North East Somerset attached his name to the amendment rather than moving it himself.

Several creative alternatives to the 0.7% figure were advanced in the 54 or so amendments tabled, including 0.35%—try as I might, I simply could not establish the correlation of this to 0.7%—and 0.67%. It is a bold move to try and renegotiate the terms of a 40-year international agreement to which we are signatories, which states that all developed countries should devote 0.7% of GNI to meet official development assistance commitments. Perhaps most entertainingly given the hon. Members’ apparent hostility towards the 0.7% figure, they advocate that all Ministers should be liable to a £1,000 drop in salary if it is not met, which presumably has made the Minister rather grumpy, as well as putting in place a rather perverse incentive indeed.

On the third grouping we could discern, which is on the calculation of ODA and GNI, there were several technicalities.

Photo of Philip Davies Philip Davies Conservative, Shipley 10:30 am, 5th December 2014

The hon. Gentleman is rattling through these amendments at a rate of knots, and we can barely keep up with his arguments. He glossed over the subject of the international development body to scrutinise this. He voted for that on Second Reading, and he voted for a money resolution to put that into being, so could he give us some detail as to why he seems now not to support something that he voted for on Second Reading and voted for a money resolution for?

Photo of Gavin Shuker Gavin Shuker Shadow Minister (International Development)

Forgive me for teaching the hon. Member how this place works, but we vote for the principle of the Bill on Second Reading and then we go into Committee and vote for amendments that allow for the Bill to enact that principle. We viewed, on a cross-party basis, that this was the best way to go forward, and so I will move on.

On the calculation of ODA and GNI, the amendments dealt with the time frame of calculation, opportunities to synchronise aid reporting with financial accounting, and the detail of which payments should be included within the calculation of ODA. Given the hon. Members’ widely acknowledged preference for turning back the clock, I suppose we should not be surprised by the amendment changing the calculation for ODA to be based on the UK’s GNI from 1975—when, I am assured, a packet of Spangles cost just 2p. I was more perplexed by the move from the internationally accepted calendar year as the calculating period to the financial year of April to March, and of course in their amendment 19, their redefinition of “financial year” to a period of little over 100 days. I am sure the House will be relieved to hear that, again, the terms of this calculation form part of the same internationally agreed covenant.

That concern led to arguments on which payments should be included in the calculation of ODA, and specifically the hon. Members’ contention that this 0.7% figure should include payments to the EU, welfare benefits paid to foreign nationals and welfare benefits to UK nationals living abroad, among others. I am afraid ODA is officially defined and therefore this amendment would clearly frustrate the will of the Bill and the principle moved on Second Reading.

Finally, I come to the applicability and expiry of the Act and other technicalities, and the amendments concerning a public referendum, implementation once we have achieved budget surplus, and a sunset clause that limits this Bill to a period of just five years. I do not know whether the hon. Members are experiencing a personal crisis of confidence in their own representative capabilities, but they might be interested to know that 29.5 million of the British public give charitably each month, and that on average the British public believe we should give not 0.7%, but around 1.5% of our nation’s wealth to help development. I hope that will reassure Philip Davies in particular, who worries this Bill enjoys the support of only

“a few middle-class, Guardian-reading, sandal-wearing, lentil-eating do-gooders with a misguided guilt complex” and helps them to

“feel better about themselves”.—[Hansard, 12 September 2014; Vol. 585, c. 1232.]

I can also reassure him I have never voluntarily eaten a lentil.

Moving to the five-year time limit, the hon. Gentleman may be surprised to learn that I, too, want to reach a time where we are able to repeal this Act, not because I aspire to living in a UK that is less generous, but because I aspire to living in a world which is more equal, and where each country has the resources, institutions and industry that it needs to be independent of foreign aid. With the greatest respect, when this moment arrives it will be dictated by the humanitarian need that remains, not the diktat of a few Members of Parliament determined to frustrate the passage of this Bill.

We reject these amendments. It is time to pass this Bill.

Photo of Desmond Swayne Desmond Swayne The Minister of State, Department for International Development

The Bill places a simple duty on a Minister to report to this House. The amendments fall into four categories. The first is those that seek to negate or reduce that reporting duty, or indeed place the burden of that reporting duty on somebody else—a new body or the OBR, or, indeed, make it subject to judicial review. I, however, prefer the simplicity and the authority of reporting to this House.

The amendments in the second category seek to change the means of calculation on which the report is based, either by changing from a calendar year to a financial year, by adopting a figure of 0.35%, by using the preceding year’s gross national income or by including other payments, such as those made to the EU. I, as a Minister, would find a couple of those amendments quite convenient, but I do not believe that it is the purpose of this House to make Ministers’ lives more convenient. As Gavin Shuker has said, these matters are defined internationally. The purpose of the Bill is to meet an international commitment, and to mess about with the calculation would be to undermine the fundamental purpose of the Bill.

The amendments in the third category are those that are mischievous—namely, those that would seek to reduce the salaries of Ministers if we were to fail to meet the commitment. We know, however, that those who have tabled those amendments would be glad that Ministers had not met the commitment—indeed, they would probably wish to pay them more for not having met it. The amendments in this category also seek to provide for a referendum, a sunset clause or some other such impediment to implementing the Bill.

The amendments in the fourth category are those that are, frankly, trivial. Those who have tabled them would have us argue today about the meaning of commonly understood terms such as “value for money” and “reasonably practical”. It is my estimate that none of the new clauses or amendments would improve the Bill. Indeed, they all seek to undermine it. I call on those hon. Members to withdraw them and, if they do not do so, I call on the House to reject them.

Photo of Philip Davies Philip Davies Conservative, Shipley

I want to begin by saying how regrettable it is that the Minister and the shadow Minister have treated the House with such contempt this morning by making no attempt at all to engage with the debate. Basically, they think they have a right to just come along, stand up and sit down without offering any explanation of the Government’s position or that of the official Opposition, in an attempt to railroad through the House a Bill that has very little public support. They really should be ashamed of themselves for treating the House with such contempt today. We are no wiser about the position of the Government or the Opposition on the amendments, or about their arguments for or against them, even though they supported some of them on Second Reading and supported the money resolution passed in the House. It is unfortunate that the Minister and shadow Minister have chosen to adopt this tactic today; it does neither of them any credit. I will attempt to fill in some of the gaps that they have left unfilled today.

If you will allow me, Mr Speaker, I will go through the new clauses and amendments tabled in my name first. Then I will comment briefly on those tabled by my hon. Friends. New clause 3 deals with the relevant period for annual reporting. The international agreement, which we keep being told makes the Bill so essential, actually dates back to the mid-1970s, yet all of a sudden it has become a matter of urgency that, in 2014, we should implement something that was agreed back then. That agreement included provisions for reporting on a calendar basis, and the Bill proposes that the target should be reported and calculated on that basis. However, we do not work on that basis in this House. We have a financial year. We could end up with some unintended consequences with this legislation, whereby it tries to put into a calendar year what this House does in a financial year. The Office for Budget Responsibility, the Treasury and all Departments calculate things on a financial year basis—all departmental budgets operate on that basis. So it is just not practical to decide that one Department should be able to opt out of that framework and have its budgets determined on a calendar basis, unlike every other Department.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

Is it not worse than that, because the Bill suggests that it should start on 1 June 2015, which is the beginning of neither a calendar year, nor a budgetary year?

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is right about that. I know that what he says reflects a proposal that he has put forward, with which I have much sympathy. I will discuss it a little later, if he will allow me.

What is in the Bill will mean that in a financial year in this House the Government may not be spending 0.7% of their budget on overseas aid—they may be spending more or they could be spending less. Whatever this House decides, it must treat the Department for

International Development in the same way as every other Department, and a financial year should be the basis for that. I hope that the Government will reflect on this matter, because I do not know how this arrangement will work otherwise. I have no idea how they propose it will work either. It would have been helpful if the Minister had set out how it would work from a Treasury, OBR and general reporting perspective and what implications there may be. As he failed to take the opportunity to do so, we are none the wiser.

New clause 4 would set the Bill back up as it was on Second Reading, by putting in place the independent international development office. That was deemed necessary by the Bill’s proponents on Second Reading, but now, all of a sudden, it has become completely unnecessary. We have been given no explanation from anybody today as to why a few members of the Committee decided to strike it out. No doubt the shadow Minister, the Minister and the promoter of the Bill all connived to take it out, yet no explanation has been given this morning as to why they choose to do so. That is why I say that they have treated the House with contempt. We have been given no explanation as to why the Committee chose to act in the way it did. My new clause has provided the opportunity for the House to revisit this matter. If it thought this body was important on Second Reading, I want to know why it is no longer important.

I worry about this situation very much. I am not one for having bureaucratic bodies set up willy-nilly, with limitless budgets, in order to empire-build for no particular purpose, but when Michael Moore proposed the Bill he thought that this independent international development office would have a serious purpose. That purpose was to evaluate

“the relevance, impact, value-for-money and sustainability of ODA.”

It was also to

“develop systems to verify the extent to which ODA is spent efficiently and effectively.”

We have to worry about why the Government and the official Opposition are so keen that that is no longer the case. Does that mean they do not want any body being given a remit to evaluate the relevance, impact, value for money and sustainability of overseas aid? Might it be embarrassing for the Government and for the official Opposition—if they one day hope to be in government? Their actions will not now be independently monitored by a body that commands any great confidence—that seems to be the implication of the Government and the Opposition taking this bit of the Bill out. It means that they do not want to be scrutinised on how well this money is spent—and no wonder. We have seen time and again—I gave some examples on Second Reading, which I will not rehearse again today—that money has been spent on the most ridiculous things in the name of overseas aid. These things would not command any support among the British public, but they come under the overseas aid budget. Of course what is happening here is that Ministers do not want that level of scrutiny.

My hon. Friend Mr Nuttall has proposed an alternative, and it may well be that it makes more sense than mine.

I am not precious about whose new clause is accepted, which body we have or whether an existing body could do the job properly. That is of no concern to me. My concern is that there is some independent evaluation and scrutiny of how the money is spent. Many people around the country feel that overseas aid is about taking money from poor people in rich countries and giving it to rich people in poor countries. They see millions of pounds siphoned off by dictators around the world for a new fleet of Mercedes, or whatever it may be. Dictators of some countries probably think that the Government should include a Mercedes catalogue with the aid that they are giving. Those are the legitimate concerns of many of my constituents and many people around the country. Those concerns will only be enhanced when they realise that the two main parties and the promoter of the Bill have removed from the Bill any attempt to ensure that the money is spent effectively, wisely, and for the good of the people it is supposed to help. We have not had any explanation as to why they have made that decision today.

My concern about overseas aid spending, which some bodies may have been able to reassure people about, is that it does not work. The fact that countries in Africa, into which we have been pouring billions and billions of pounds, are no further on than they were when we started pouring in all that money demonstrates that it is not effective. An independent body would be able to give some reassurance that the money being spent was having some effect.

My other concern is that, while domestically we are very much against welfare dependency—certainly the Conservatives are—overseas aid is entrenching welfare dependency on a grand scale. Some of the poorest countries do nothing to improve their rule of law or their democratic accountability. They just sit there, waiting for the next handout from a richer country, which is welfare dependency on a huge scale.

Photo of Philip Davies Philip Davies Conservative, Shipley

The hon. Gentleman says “absolute rubbish” from a sedentary position, but there is lots of evidence that that does happen. In fact, he makes my case for me. If he thinks it is rubbish, then let us set up a body to prove that it is a load of rubbish. What his party and the Government fear is a body that points out that these things are happening, and so they have done away with it, because it may be embarrassing for all these things to be out in the open. We should have a body, which this House voted for on Second Reading, to scrutinise objectively what the Government are doing to ensure that the money is being spent wisely. How on earth can anyone disagree with that? What is there to disagree with about ensuring that the money is spent wisely and for the purposes for which it was intended? Why does no one have the nerve to stand up and disagree with it? They would rather slouch in their seats and try to railroad this Bill through Parliament.

My hon. Friend the Member for Bury North mentioned the Independent Commission for Aid Impact. Chief Commissioner Graham Ward said:

“We saw very little evidence that the work DFID is doing to combat corruption is successfully addressing the impact of corruption as experienced by the poor.”

When Stephen Doughty says “rubbish”, he is at odds with what the ICAI chief commissioner said about corruption. Indeed, the chief commissioner went on to say:

“Indeed, there is little indication that DFID has sought to address the forms of corruption that most directly affect the poor: so called ‘petty’ corruption. This is a gap in DFID’s programming that needs to be filled.”

When we have the ICAI making that point for us, it is perfectly obvious that signing up to a blank cheque of overseas spending needs to be properly monitored. The ICAI has made it clear that the Government are not doing that effectively at the moment. Now it seems that the Government do not want anybody to judge how well they are spending the money. It is completely unacceptable to taxpayers to expect them to hand over money without any proper scrutiny.

New clause 5 requires a calculation of overseas aid spending for the purposes of clause 1 and asks that the calculation of ODA includes the amount paid by the UK to the EU, welfare benefits paid to foreign nationals and welfare benefits paid to UK nationals living abroad. All those things should be included in the 0.7% target, as I do not see how they could not be described in one way or another as overseas aid.

Let me give an example to illustrate. We as a country hand over to the EU just short of £20 billion every year and I think that we receive back about £8 billion a year, although my hon. Friend the Member for Bury North is the expert in these matters. One purpose of the money that comes back to the UK is for it to be spent in the areas of greatest deprivation in the UK. That is what the European Union does and, fortunately I guess, the UK clearly does not have that many areas of mass deprivation in an EU context, which is why we get so little back compared with what we put in. The extra money that we have put in is then diverted around the rest of the EU, in effect to prop up the poorest countries and to try to bring their economies up to a level similar to that of the rest of the EU. That is the purpose of how the EU is funded: it is about taking money from the richest countries and handing it over to the poorest. If that does not constitute overseas aid, I do not know what does.

If the Minister had had the courtesy to speak for more than five seconds flat, we might have known his opinion on this, but I thought that the purpose of overseas aid was to take money from the richest countries in the world and transfer it to the poorest. That is exactly what our funding to the EU does on a European basis. That seems to me to be overseas aid, without any controversy. It therefore seems quite extraordinary that everybody now argues that that is not overseas aid, that it should not be counted as such and that it should be paid on top of it. That means that our overseas aid spending will be not 0.7% but considerably higher— probably 2% of GDP by the time we add in all these other factors.

There is a clear case that our money to the EU should be classed as overseas aid and therefore form part of this target. Then, of course, we have welfare payments paid to foreign nationals. In recent years, far too many people from other countries have come to this country and, to be honest, migration is at levels that we cannot cope with. We are regularly told by people who are in favour of all this immigration that all these people will not stay here but will go back so we should not worry about it at all. I do not believe that, but I am humouring those people. That is their argument, but if that is the case it is perfectly clear that people are coming over here to get some of our British money, as we might want to describe it, to take back to their much poorer country. That seems to me to qualify as overseas aid by anybody’s standards, because in some cases the money is passed back to the country of origin while the person is in the UK. We are basically handing our money out to benefit the economy of those much poorer countries and we give a considerable amount in that way.

The third part of the new clause involves welfare benefits paid to UK nationals living abroad. Again, this is a considerable amount. I cannot find the figures offhand, but from recollection I would say that in the region of £3.8 billion a year is given by the Department for Work and Pensions to UK nationals living in countries around the world. That money does not benefit the UK economy in any shape or form. It benefits the economy of the country where those people reside, so that is clearly UK taxpayers’ money going out to benefit the economy of the other countries around the world. It seems to me that that is also overseas aid according to anybody’s reasonable definition.

Photo of David Nuttall David Nuttall Conservative, Bury North

Does my hon. Friend find it astonishing that jobseeker’s allowance is included in those benefits? It is difficult to understand why the country is paying people jobseeker’s allowance when they are not even in the country.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is absolutely right. You would not let me get sidetracked into discussing the definitions of benefits and how they should be paid, Mr Speaker, and I do not want to do so either, but it is worth mentioning in passing that £1 million a year of jobseeker’s allowance goes to people who live abroad. Like my hon. Friend, I am not entirely sure how they can qualify as a jobseeker, but that is a slightly incidental point.

I have the figures now for your benefit, Mr Speaker. In 2013-14, £3.6 billion of DWP money was given to people living abroad. That is a considerable amount of taxpayers’ money that benefits those countries and I do not really see why it should not count in the overseas aid budget. On all three counts, the Minister might want to explain why his Department does not think that that is the case, because he has given no indication of that at all.

New clause 5 also covers the administrative costs of the Department for International Development, its agencies and its associated public bodies. My hon. Friend the Member for Bury North touched on this and I am grateful to him for his support for my new clause in that regard. I am not entirely clear where the administrative costs for DFID and its agencies stand, and if people did not rattle through their speeches so fast, we might all actually learn something. Are administrative costs counted as overseas aid or do we say that overseas aid is paid over and above them? I am not entirely clear. I am clear, however that they should be included in the overseas aid budget because, as my hon. Friend said, that gives the best possible guarantee that the Department will cut its cloth to ensure that as much money as possible is handed over to the people who need it most rather than being spent on self-serving bureaucracy. We are none the wiser today, but perhaps that might be clarified at some point in the future.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

My hon. Friend’s point about administrative costs is very important. Does he recall that when Margaret Thatcher was Prime Minister, she vetoed having the Department responsible for overseas development based in what is now Richmond house in Whitehall? She thought that that would be an ostensible gross waste of money and that money being spent on overseas aid should go to the countries in need rather than being spent on administrative costs.

Photo of Philip Davies Philip Davies Conservative, Shipley

I am grateful to my hon. Friend for that intervention. As in virtually everything, Lady Thatcher was right about that. To be honest, it is a pity that her views do not carry more sway today because we would not find ourselves debating such a ridiculous and pointless Bill if she were still at the helm.

New clause 6 is about the calculation of gross national income, which, in many cases, is one of the most important parts of the Bill. We certainly should not gloss over this quickly because it involves the spending of a considerable amount of taxpayers’ money based on whatever happens to be the calculation at any one time.

This is very serious. The Minister is a good man normally—I have no idea what has come over him today. He should be ashamed of himself for not treating the matter with the seriousness that it deserves. He should explain the Government’s position.

The Bill supposedly puts into law a pledge that this country made back in the 1970s. We can argue the merits of Governments and Parliaments binding their successors, but our principle in this country is that that cannot be done. To try to fulfil a pledge that was made 40 years ago in completely different economic and financial circumstances is idiotic, but we are where we are and we have to deal with the Bill as it is. The pledge made then referred to about 0.7% of GDP. I still hear Members speak about that, but since those days there has been a recalculation. We now speak of gross national income, which is calculated differently.

Those who say that we are entrenching a promise that we made back in the 1970s, no matter how foolhardy that in itself may be, are not correct. The Bill tries to fulfil a completely different promise from the one that we made then. As the Bill stands, the Government are trying to base their spending on a calculation of what GNI will be. That is why it is so important that we get this element right. The money spent will be based on an ongoing calculation through the year of what GNI will be at the end of the year. The Government will, in effect, be spending money on a guess of what the figure will turn out to be.

We saw a good example of that this year. The Government were bragging, although I am not sure it was anything to brag about, that they had hit their 0.7% spending target, but as we saw in the autumn statement—I am sure we are all grateful for this—our GDP or GNI, whichever one wants to call it, has been revised upwards this year. From that recalculation of the country’s economy, we found out that we did not hit our 0.7% target this year; we hit about 0.67%, rather than the 0.72% that the Government thought they had hit.

On that basis, in order to meet the law that we are passing today, the Government will at some time in the future have to dig out from somewhere hundreds of millions of pounds—I know that the Opposition do not care as they think money grows on trees—to spend on a non-existent project somewhere in the world that had never before been contemplated, in order to hit an arbitrary target that we are passing into law.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset 11:00 am, 5th December 2014

The situation is even worse than that. There will be pressure always to overspend above the target because in years when GDP turns out to be less good, there will be no means of clawing the money back, but where it has grown faster, there will be an expectation that more money will be paid or a statement laid. Therefore, there is a pressure in the Bill for there to be more than 0.7%.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is right. Nobody could deny that if the recalculation means that we have underspent, everyone will be clamouring for the extra money to be found for a non-existent project somewhere in the world just to satisfy themselves, but if the GDP figure is downgraded, there will not be many in the House calling for some of the money to be clawed back. The Bill, in effect, sets a minimum target for spending, not an amount. That is not what most people have in mind. The public will be confused about why they have to spend an extra £550 million—I have no idea where the money would come from—to meet this arbitrary target because it did not happen to match the projection that was made. That is ridiculous.

My new clause 6 means that none of those adjustments would be made. If the calculation was wrong but the money was spent in good faith on a good-faith calculation, that should be that. There should be no end-of-year recalculation of the budget based on an upgrade or a downgrade—it could work either way and I cannot predict which way it would go. It strikes me as ridiculous that the Treasury should have to dig out money from nowhere just to hit a particular target. That is why the new clause is so important.

The way that GNI is calculated is changing: 0.7% of the old GNI is quite different from 0.7% of the new GNI. For no reason other than statisticians deciding to calculate things differently, the taxpayer will have to find hundreds of millions of pounds extra in order to hit the 0.7% target.

Photo of David Nuttall David Nuttall Conservative, Bury North

Will my hon. Friend make it clear that the Office for National Statistics has had to change the way that national income is measured because the ONS was required to bring it into line with the rest of the EU? It is because we are members of the EU that we have to do this.

Photo of Philip Davies Philip Davies Conservative, Shipley

I am grateful to my hon. Friend for that. I am sure everybody in the country will be pleased to know that the taxpayer has been stuffed because of the European Union—not for the first time and, no doubt, not for the last time.

The fact remains that we have a new calculation. This is not a pledge that was made in the 1970s or even when the proponents of the Bill first wanted to enshrine it in law. We are being asked to sign up to something entirely different from what we were originally told, and it will cost the British taxpayer more. If 0.7% of the old calculation was good enough, why can we not stick to that figure and that calculation? Why do we have to move to the new calculation? What evidence is there that that is necessary? What is the thinking behind it? We have had no explanation of that. Nobody has even touched on the issue. The taxpayer is expected to hand over a few extra hundreds of millions of pounds. Some in the House do not care that they are spending other people’s hard-earned money willy-nilly, but I care about people’s hard-earned money and the taxes that they pay, and I want to make sure that those are spent properly. It is just an accountancy figure to many Members, who do not care.

The GNI figure is essential. By passing the Bill unamended and without my new clause, we are at the whim of any future recalculation of GNI which requires the Government to hand over even more to hit the arbitrary 0.7% target. We should not allow that to happen. My new clause 6 would put in place safeguards for the taxpayer.

New clause 7 is also extremely important. It deals with one of the assertions from the Opposition. It provides that the Bill would take effect only after a referendum had taken place and had resulted in more than 50% of the people voting in favour of the target. I am constantly told that the target is extremely popular out in the country, that everybody wants to see it met, and that only a few reactionaries do not. I am prepared to take my case to the country and have it tested in a referendum. If more than 50% of people vote to spend all that money on overseas aid, I will be the first to accept that. I will try to make sure that the money is spent as well as possible, and I will accept the will of the people in a referendum.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

My hon. Friend makes a good point. The 2012 British social attitudes survey shows that, when asked what should be the priority for extra Government expenditure, 42% of respondents said health, 30% said education and 0.5% said overseas aid.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend makes the point particularly well. I am pretty confident that the majority of the public are on our side on this issue. It is important to note, in relation to new clause 6 and the percentage of GNI, that the OBR’s figures, published only this week, show that spending in every Government Department—that includes spending on health, defence, schools and education—will go down as a proportion of GDP over the next five years. I suspect that the majority of my constituents would want to protect the health budget, if anything, as a proportion of GDP.

Is not it extraordinary that we are effectively being asked to rubber-stamp a provision that will ensure that although spending in every other Government Department will go down as a proportion of GDP, spending on overseas aid will remain the same as a proportion of GDP? I cannot accept that that is the will of the British public. In fact, I am not entirely sure that we will see that it is the will of the House. I have proposed that 50% of the public should have to vote for it, but I suspect that we will not get anywhere near 50% of MPs voting for it today. Let us have some democratic legitimacy for the policy. Let us have it out in a referendum. Let the people decide what they want their taxes to be spent on.

I suspect that I will be proved right and that those arguing for the Bill will be proved wrong. Of course, if they are right, they have nothing to fear from a referendum. I want to know why they fear the public’s opinion so much—we did not hear it today because they were so determined to rattle through their speeches. I think that we should put this to the people in a referendum, given that we seem to be embarking on a new constitutional settlement. In our constitution we have never gone down this route of protecting spending for one Department as a proportion of GDP. Let us see whether the British public are in favour of that new constitutional arrangement. I fear that they are not.

Of course, if the Bill is not amended today, overseas aid will become a bigger and bigger proportion of Government spending every year, because spending by every other Department will go down as a proportion of GDP. Nobody has admitted it so far, but that, in effect, is what the Bill will sign us up to. Is that really what Members think the public want, when there is so much pressure on our public services, our military and our transport system? Do they really think that they want a higher and higher proportion of Government spending to go on overseas aid? I do not think they do. My hon. Friend Mr Chope has given us the polling, which suggests that is not the case either. I would like other Members to trust the public with their own money.

Subsection (3) of new clause 7 states:

“This Act shall only have effect in those years where the United Kingdom records a budget surplus.”

We are borrowing more than we expected this year. The Chancellor gave us the figures this week. He has done an excellent job in getting the deficit down—I am the first to praise him for that—but it is still far too high. It is about £5 billion higher than he anticipated it would be at this stage. Gavin Shuker talked about how much money the British public give to charity. We are very generous in this country when it comes to helping those less fortunate than us. That is a proud tradition that I suspect and hope will continue. I would much prefer individuals to decide which charities to give their own money to, rather than the Government deciding what they should and should not be supporting through their taxes. That is an essential principle of mine.

I do not think that any Member of this House would advise their next-door neighbour to get into debt by giving money to charity. I am pretty sure that we would all say, “Yes, that’s a very good cause, but give only what you can afford to and don’t get into debt as a result.” So why do some Members think that the country should live on a completely different footing? Why do they think we should effectively be giving to charity money we simply do not have?

We are literally borrowing money from other countries around the world in order to hand it over to different countries. In fact, when the Labour party was in office, we were borrowing money from China and giving overseas aid to China—you could not make it up. Thankfully, my right hon. Friend Mr Mitchell, who is in his place, ended that ridiculous state of affairs when he was Secretary of State.

It is absolutely ridiculous that we borrow money from countries around the world—money we do not have—hand it over to other countries and then pay interest on it to the countries we borrowed it from. It is not clear from the Bill, but I suspect that because we will have to pay interest on the money that we will have to borrow to fund the 0.7% promise, the cost to the taxpayer will be much more than 0.7%. That does not seem to have been included in the Government’s plans either.

That is why new clause 7 proposes that the Act should come into effect only when the United Kingdom records a budget surplus. We would therefore be spending only money that we had and could afford to hand over to other countries. It is ludicrous that we are spending about £12 billion a year at the same time as borrowing about £91 billion a year. That cannot make sense.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch 11:15 am, 5th December 2014

Will my hon. Friend clarify that he is not saying that there should be no expenditure on overseas aid until we have a budget surplus, but that this rigid formula should not come into effect until such a time?

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is absolutely right. I would be the first to say that when countries face some terrible humanitarian situation or natural disaster, the United Kingdom should always be at the forefront in helping them in their hour of need. However, if anybody thinks that our entire overseas aid budget goes on helping countries in their hour of need, they need to study much more closely what the budget is spent on.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

When other countries are in their greatest hour of need, it is often our armed forces who come to their rescue soonest. It would therefore be better to spend the money with them so that they can respond.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is absolutely right. I do not want to go down that cul de sac either, but it is worth noting in passing that we made a promise to spend 2% of GDP on defence, and that promise does not appear to have been legislated for anywhere. In fact, the OBR has calculated that, on current projections, it will actually drop to 1.5% by 2020. My hon. Friend makes a very good point on what is the most worthwhile thing to spend our money if we are to help other countries around the world.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

Is my hon. Friend aware that that promise is incorporated in the Defence Expenditure (NATO Target) Bill, which the Government have consistently blocked?

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend makes his point well and I agree with it, but I will make no further comment, because we would be going off the rails if we started debating a different Bill.

Subsection (4) of new clause 7 would allow the Secretary of State to

“vary the target… by an order contained in a statutory instrument in response to the UK leaving or joining a multilateral organisation which itself disburses” overseas aid. I think that we need more flexibility in the Bill. We might join an organisation that is giving aid to something we already give aid to, in which case it would be ridiculous to in effect doubt the money that is already being spent. We have no idea what our future international relationships will be and what these international organisations may or may not be doing. The Bill should therefore have some flexibility whereby if we join an organisation that is already doing what we are doing, we do not, in effect, end up doing it twice, and the Government can adjust the target to take account of that.

The final part of new clause 7 is a sunset clause whereby the Act would cease to exist in the fifth year of its being in force. I am a big fan of sunset clauses generally; they should be used more widely. Often when we pass legislation in this House, we guess or second-guess its implications, and then find that it has no end of unintended consequences, yet it stays there on the statute book causing problems because nobody can be bothered to get rid of it or find the parliamentary time to do so. It would be much more sensible if, as a matter of routine, we introduced sunset clauses so that we were forced as a House to assess how legislation was working and whether it needed to be tweaked. That would force people to come back either with the same proposal or a revised proposal taking into account what we had learned.

If overseas aid is doing what it should be doing, then it should not be there in perpetuity. This goes to the heart of why this Bill is completely ridiculous. We should be saying to countries around the world: “You’ve got some issues that you need help with. It’s your responsibility to sort out your own issues, but we’ll give you a helping hand. We expect you to sort out your own arrangements on the rule of law and governance and so on to enable inward investment to be encouraged. Once you’ve sorted yourself out with our helping hand, we can then walk away and leave you to stand on your own two feet.” Surely the purpose of overseas aid, if it has any purpose whatsoever, is to help countries to stand on their own two feet; it should not be there in perpetuity. Why, therefore, does this Bill enshrine this level of spending in perpetuity? Are we accepting that overseas aid does not make any difference to these countries—that they do not get any long-term benefit from it and it is just a short-term sticking plaster to make us feel better? If it is achieving anything on a longer-term basis, then surely we should not need to keep spending all this money but should instead be tapering it off.

A sunset clause is a sensible provision to allow us to assess five years hence what is an appropriate figure for us to spend in order to deal with the world as it then is. It is complete lunacy to say that we are going to spend 0.7% in future years when we have no idea of what the world’s circumstances will be—what countries will need help, and how much.

There is no doubt about why Labour Members agree to these things. They believe that people should be judged simply on how much money they spend on something—that it is all about input. That is what the Labour party is all about. I remember, years ago, asking the then Government why truancy had got worse under their stewardship. They told me that they had spent £1 billion on tackling truancy, as if that made it all right; they wanted to be judged simply on their input. I thought that the fact that they had spent £1 billion on something that had got worse was terrible, but that is because I am a Conservative. I do not doubt that Labour Members think they should be judged on how much they spend and that it is all about input. What astonishes me is that people who like to describe themselves as Conservatives think we should be judged only on how much we spend and on our input, and have no judgment made on our output whatsoever. A sunset clause would help by making us look at the output of what we had done and whether it was worth persevering with.

I have previously outlined the difficulty of basing how much money we spend on an ongoing calculation throughout a year. Under amendment 16 the 0.7% figure that we spent would be based on the final adjusted figure for gross national income in the preceding year. No guesswork would be involved—it would be the final adjusted figure that everybody accepted as such. The figure that would be spent the following year would be 0.7% of the previous year’s GNI.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

I accept the thrust of the amendment and what my hon. Friend is trying to achieve. However, the Office for National Statistics keeps on revising things over such an extended period that I would like to know when the final figure is deemed to be the final figure. He will be aware that the apparent double-dip recession that the socialists accused us of having turned out not to have existed once the figures were revised. This has become an increasing problem as the ONS has made more and more revisions to historical figures.

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend makes a good point. My amendment does not give any particular date for a final figure; it refers to just one. By definition, it would be the final, final figure, whenever that was reached. It may well be that as a consequence of my amendment we would be dealing with figures from two or three years previously; I am not entirely sure.

My amendment would mean that we were not guessing the figure, so the Department could work in a certain year knowing what its budget was going to be for that year and not having to guess what it might be. That has to be a much more sensible way of managing its budget than having to second-guess things. It would also avoid what might be described as local authority syndrome. Once local authorities get to the end of the year in March—in this case, it would be December because we have this ridiculous new regime for DFID—they use up the rest of their budget because they have more money than they had anticipated. Let us not have any illusions that that would not happen if we stuck to this Bill in its current form.

Amendment 16 would allow the Department to know with certainty how much money it had for the year so that it could make plans for its spending based on that certain figure. Wherever one stands on overseas aid, that has to be a much more sensible way of dealing with things. I am sure that the Minister would appreciate knowing with certainty what his budget was going to be for the year rather than having to second-guess it.

Amendment 20 would mean that we would not have to have achieved the target but only to have “progressed toward” it. That would give the Bill more flexibility so that we do not need to have huge spikes in spending to meet an arbitrary figure, but the progression would be in the same direction.

Amendment 18 refers to replacing the calendar year with the financial year. I have spoken before about why it is so important that we should do that. Nobody else reports on the basis of a calendar year. The OBR does not, and the GNI figures are not worked out on that basis. The Minister could have helped us with this. I have no idea of who is going to calculate the 0.7% figure for the calendar year. We rely on the OBR for these figures, but it does not calculate them in that way, so how will we know whether we have hit the 0.7% figure?

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

Is it not obviously absurd to have one Government Department accounting on a different basis from all the other Government Departments? We cannot have one Department working to a calendar year when the whole Government budgetary process is based on a financial year. That is the fundamental flaw in the Bill.

Photo of Philip Davies Philip Davies Conservative, Shipley

I have made that point, but I agree with my hon. Friend.

Who will calculate the calendar year figure? As far as I understand it, it will not even be domestically set, because the OBR works to a financial year and so it will not be doing it. I suspect that the decision on whether we have hit this figure will be determined solely by the international body that calculates these things on the basis of a calendar year. In effect, we are setting up Government spending without any of our own controls over it—not even with our independent body determining it for us, but rather with it being done by international body in whose calculations and figures we may or may not have any confidence. Having our Government spending determined not by ourselves—not even in this country—but by an international body is a very dangerous precedent to set.

Amendments 21 to 26 are consequential amendments that flow from one another. They would remove several references to 0.7% and replace them with 0.35%. I believe that I may have been overly generous with the target of 0.35%, but I am a generous kind of chap. I set out earlier the fact that we give lots of overseas aid—whether to the European Union or in welfare payments—that is not covered by the Bill. When all those things were added on, even if we were to accept my amendments and make the target 0.35%, we would be spending way over 0.7%. My amendments are, therefore, rather modest.

As others have mentioned, a target of 0.35% would not prevent a Government from spending 0.7% of GDP on overseas aid if they so chose. At the moment, there is nothing to prevent any Government from spending 0.7% if they choose to do so. Believe it or not, we already do. The Bill is an unnecessary, pointless exercise in gesture politics, because it makes no difference to what the Government already do. My amendments would not prevent the Government from spending 0.7% if that is what they wanted to spend, and if they could command a majority in the House in favour of doing so. The amendments would simply mean that we did not have a ridiculous law underpinning that.

Given all the other things that I have mentioned, 0.35% seems to me to be a much more affordable figure. It is more or less the figure that we have spent in most years since the 1970s. Our spending has always been around that figure; sometimes it has been a bit higher and sometimes it has been lower, but that is approximately the level of support that this country has provided around the world since the 1970s, give or take a few years. A figure of 0.35% is not ungenerous at all. It would put us much higher than many other countries around the world, if we look at what they give. It is almost double what the United States gives in overseas aid as a proportion of its GDP. My right hon. Friend the Member for Sutton Coldfield will, I am sure, know the figures far better than I do—I am relying on recollection—but I believe that the United States gives approximately 0.19% of its GDP in overseas aid. That is a huge amount of money, but as a proportion of GDP it is quite small. If my amendments were accepted, we would give almost twice as much overseas aid, as a proportion of GDP, as the United States. That would put us higher than most of our European colleagues, who are a long way below that level.

One of my concerns about the proposal is that the more money we give in overseas aid, the more excuse we give other countries to say that they do not need to spend as much money on overseas aid. They may say that because the UK is doing all the heavy lifting, they can cut their spending to a level that they can afford. It is striking that other countries around Europe, which have also had terrible financial problems, have cut their overseas aid budgets. At least they have some common sense and they know that they should spend only what they can afford. They are allowing us to take up the slack. How stupid are we? They are taking us for mugs. Unfortunately, by going along with it, we are accepting that we are mugs. My amendments would deal with that, and I hope that we will reduce what we are legally obliged to give. To give an illustration, my amendments would put us more in line with Germany, which is at 0.38%, Australia at 0.34% and Canada at 0.27%. We would be more in tune with some of our European partners and Commonwealth friends.

I have already referred to amendment 19, which is consequential on trying to change the operational period from a calendar year to a financial year. I want to leave out clause 5, which was agreed to in Committee. It might be described as the pointless clause, because it got rid of any independent oversight of what the Department should spend and merely inserted:

“The Secretary of State must make arrangements for the independent evaluation of the extent to which ODA provided by the United Kingdom represents value for money”.

That, as I mentioned in a brief intervention earlier, is the ultimate in the Government marking their own homework. Parliament will not set up a body to scrutinise what the Executive are doing; the Government will set up their own body. One of Parliament’s key roles is to hold the Executive’s feet to the fire, but the Bill will not allow any of that. Parliament will not hold the Executive’s feet to the fire; the Executive will hold their own feet to the fire. You may trust the Executive to hold their own feet to the fire, Mr Speaker, but I have been here long enough to know that no Executive, no matter of which party it is made up, can be trusted to do that. Clause 5, which, as my hon. Friend the Member for Bury North has said, is not a new clause but a rewritten version of the original clause, is completely pointless and worthless. It basically gives the Government a green light to mark their own homework and, no doubt, produce a report to say how marvellously well they have done. I predict that the evaluation of the Government’s work every year will be that they have done a great job.

If I might deviate slightly, Madam Deputy Speaker, I am delighted to see you take your place and I wanted to take this opportunity to apologise to you for my behaviour last week. I spoke to you in a way in which I should not have done, and I said things that I should not have said. I think you realise that I felt aggrieved, but no matter about that. I should not have said what I said, and therefore I hope that you will accept, in a brief deviation, my apology, sincerely and genuinely meant, for what I said to you last week.

Photo of Dawn Primarolo Dawn Primarolo Second Deputy Chairman of Ways and Means 11:30 am, 5th December 2014

Mr Davies, that is very gracious of you. We both made our views clear last week, but today is another day. Of course I accept your apologies, because I know that you would not mean any discourtesy to the House or to whomever was in the Chair. Please continue with your speech in order.

Photo of Philip Davies Philip Davies Conservative, Shipley

Thank you for graciousness in accepting my apology, Madam Deputy Speaker, which is, I might add, typical of you.

After that brief interlude, amendment 37 would remove clause 6(2), which states that the Act will come into effect in June 2015. My hon. Friend the Member for Christchurch has tabled a sensible amendment, and I cannot see why anybody should object to it, to the effect that the legislation should come into effect the following January. It is the will of those who promoted and sponsored the Bill, and of those on both Front Benches, that it should be a calendar year operation. I think I have made it clear that it should operate on a financial year basis. Given that they have proposed that the Bill should operate on a calendar year basis, it is quite extraordinary that they have included the provision that it should come into effect in June 2015.

How on earth do we square that circle? How on earth will we determine, at the end of 2015, whether the Government have hit their half-yearly target? If they have overspent in the first bit of 2015 but underspent in the second bit of 2015, will the evaluation state that they have missed their target, even if they have spent 0.7% over the whole year? I am happy to be corrected by anybody who claims to know any better, but it seems to me that if the Bill comes into effect in June 2015, the Government will be required to have spent 0.35% on overseas aid between June and the end of the year, otherwise they will have broken the rules. If the Government had spent, for argument’s sake, 0.4% between January and June, and at the end of the year the international body that is set up to scrutinise how much every country has spent says that we have spent 0.72%, are we going to chastise ourselves because in the second half of the year we did not meet the legal requirement? I genuinely do not understand that. Perhaps the Minister could explain what his obligations will be under the Bill as drafted.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

My hon. Friend raises a very serious and important point, because it is not the usual practice of this House to pass retrospective legislation. Indeed, as a constitutional principle it is very bad to pass retrospective legislation.

Photo of Philip Davies Philip Davies Conservative, Shipley

I agree. I am not entirely sure how any money spent in the first half of 2015 will apply to the Bill. It is a shame that the Minister could not give any explanation as to why it should start in June. Perhaps the Bill’s promoter, the right hon. Member for Berwickshire, Roxburgh and Selkirk, can shed some light on the importance of June 2015. Surely it makes sense to begin at the start of a calendar year if the provision is to be judged on the basis of a calendar year.

My new schedule 2 is a consequence of new clause 4 and would bring the Bill back to how it was envisaged by its promoter when he moved its Second Reading. I am happy to leave it to him to explain why the IIDO is so important. He was the one who put it in the Bill in the first place and I presume he did so not because it was pointless, useless, unnecessary or ridiculous, but because it was very sensible. My new clause 4 and new schedule 2 give him the opportunity to explain why this particular international body is so important. Perhaps we could test the will of the House on whether it should be reinserted, given that the House as a whole voted for it only for a small Committee to take it out.

My hon. Friend the Member for Bury North made a very good case for new clause 1, which builds on the work of my right hon. Friend the Member for Sutton Coldfield and deals with the bodies that he brought into being. In effect, it would be a vote of confidence in them. Given the ICAI quote I gave earlier on the Government’s poor efforts in tackling corruption and how it affects the poorest people around the world, I think the ICAI rightly has a reputation for standing up to the Government and holding them to account. That is to the credit of my right hon. Friend and the ICAI. Given that it has shown its independence of mind and robustness, my hon. Friend the Member for Bury North made a very good case for giving it the independent oversight envisaged when the Bill came into being. There should be proper oversight of how the Government spend this money; they should not just be left to mark their own homework, as the Bill currently allows them to do.

New clause 2 was tabled by my hon. Friend Jacob Rees-Mogg and I have added my name to it. It would reduce the salaries of Cabinet Ministers by £1,000 a year if they do not meet the target they have imposed. Even though I have argued against the target and think it is a mistake, I do believe that Ministers should be held accountable for the legislation they pass. There is an important principle at stake. If the Government are going to pass such completely meaningless legislation, they should be held to account for it.

The Minister decried those of us who think that the salaries of Cabinet Ministers should be cut by £1,000 if they do not meet the target. He said that we were, in effect, arguing against ourselves, but the reality is quite the contrary—if the Government spend less than 0.7% and if Cabinet Ministers think it is so important, I would be very happy to see them topping it up with their own money. I do not think I am arguing against myself at all; all I am saying is that I would rather that those who argue in favour of spending all this money paid for it out of their own money rather than expect everyone else to cough up for their grandiose schemes.

Photo of David Nuttall David Nuttall Conservative, Bury North

Is my hon. Friend aware that, in an August 2012 report specifically on the introduction of targets in legislation, the Institute for Government made it clear that having no teeth or penalties to back them up

“brings into question the point of putting a target into law in the first place”?

Photo of Philip Davies Philip Davies Conservative, Shipley

I absolutely agree with that. Apparently this ridiculous Bill is very important, but there is no sanction if the Government do not deliver on it. Surely there must be some sanction available. If I understand the Bill correctly, the only sanction is that the Government would have to make a statement to the House—and that’s it! It does not even have to be an oral statement; it could be a written statement. What a complete joke! This is a piece of joke legislation and I am afraid that the Government are treating us with contempt by having no sanction in place if they do not deliver on it.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch 11:45 am, 5th December 2014

Is it not serious that we are proposing to pass legislation that will raise public expectations, which could then be dashed in such a spectacular manner because there is no enforcement mechanism?

Photo of Philip Davies Philip Davies Conservative, Shipley

My hon. Friend is absolutely right. This sort of thing brings this place into contempt with the public. We have to guard against that.

I agree wholeheartedly with amendments 5 and 6, which were tabled by my hon. Friend the Member for North East Somerset, who will be able to offer a much better explanation of their merits. He also tabled amendments 7 and 8. Amendment 7 is very good. At present, the only sanction is that the Government will have to make a statement on why they have not achieved their target

“as soon as reasonably practicable”.

When will that be? What does that mean? Will we have to wait for a report to come out a year hence? It is completely meaningless and I cannot believe that anyone has fallen for it. My hon. Friend’s amendment, which is very sensible indeed and should be welcomed by the whole House, says that the statement should be made after

“no more than 10 days during which both Houses of Parliament are sitting”.

That would genuinely hold the Government’s feet to the fire, but, of course, in their haste to get anything on the statute book, it appears that, as usually happens on a Friday, hon. Members on both sides of the House are happy to accept it, even though it is completely meaningless.

I have to say to my hon. Friend that I do not agree with amendment 8. He wants to leave out the subsections in clause 2 that give reasons for why the Government have not hit the target. I will conclude shortly, so I hope my hon. Friend will be able to offer an explanation. Perhaps I have read it wrongly, but it seems to me that there are some reasons in the Bill as drafted for why the Government may not have hit their target of 0.7%. I would like to see as many of those reasons as possible in the Bill, but my hon. Friend wants to take them out.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

I simply do not think it is right for a statement, which is a proceeding in Parliament, to be the subject of legislation. I think it is a direct interference in our proceedings through the legislative process.

Photo of Philip Davies Philip Davies Conservative, Shipley

I take my hon. Friend’s point. He is usually right on most things, so I always err on the side of thinking that he is right. I am still not entirely persuaded; he may be able to have a better go in a bit. I am happy to see some reasons for why the Government may not have been able to hit their target, and I would like to see them expanded rather than taken away. My hon. Friend has some work to do to persuade me to accept amendment 8.

Amendment 9 is very good. It basically says that if the Government do not hit the target, no action needs to be taken, which seems sensible. Amendment 10 does the same thing. Amendment 11 is a hybrid amendment in some respects, because I agree with clause 2(3), but disagree with subsection (4). My hon. Friend wants to take out both subsections. As I made clear earlier, I think that subsection (3) is helpful, because it gives reasons for why the Government may not have hit their target. Subsection (4) is completely pointless, so I agree with removing it.

My hon. Friend the Member for Christchurch has tabled some amendments as well. Amendment 1, which would leave out clause 3, is very sensible. It relates to the point about accountability to Parliament. It is clear that it is a meaningless clause. There is no accountability whatever for the measures in the Bill. Rather than pretending that there is, we ought to put the Bill out of its misery, be honest that there is no accountability and leave it at that.

We have discussed amendment 3, which is about the Bill coming into force on 1 January 2016. I cannot see how anyone can disagree with that—it is just common sense.

Amendment 2 is also a very good amendment. My hon. Friend the Member for Christchurch has a track record of tabling telling and sensible amendments, and he has struck oil again. Clause 5 states:

“The Secretary of State must make arrangements for the independent evaluation” to show that there has been

“value for money in relation to the purposes for which it is provided.”

He wants to add that the way in which the money has been spent is

“relevant, sustainable and capable of having a measurable impact.”

I agree absolutely. Does anyone here disagree that the money should be spent in a way that is relevant, sustainable and capable of having a measurable impact? If they vote down amendment 2, they will, in effect, be saying that they do not think that it should be spent in that way. Of course it should be spent in that way. It would be helpful if the proponents of the Bill accepted that amendment as an improvement to the Bill to ensure that the money is spent as properly as possible.

The only point on which I take issue with my hon. Friend is the use of the word “sustainable”. It is one of those words that everybody bandies around, but nobody really knows what it means.

Photo of Christopher Chope Christopher Chope Conservative, Christchurch

My hon. Friend is absolutely right. That is exactly why I put the word in. I thought that it might appeal to the promoter of the Bill.

Photo of Philip Davies Philip Davies Conservative, Shipley

I applaud my hon. Friend for his ingenuity. Everybody is in favour of sustainability, but nobody knows what it means. It is a bit like social justice—everybody is in favour of it, but nobody really knows how to define it. Sustainability is definitely in that camp. I agree that it is hard to see how anybody can disagree with it, particularly the proponents of the Bill, as he says.

I have had a quick canter around an awful lot of amendments. I think that there are 30-odd amendments in the group. I apologise to the House for going through them so rapidly, but everybody wants to make progress. I look forward to hearing the proponents of the other amendments make a more cogent case than I have been able to make. As I made clear, I do not fully understand some of them. It is a great shame that the Minister and the shadow Minister have treated the House with such contempt and not even bothered to engage with the amendments that have been tabled or explain their position. One day, I hope that they will come to regret that. Some of my hon. Friends and I will keep arguing for common sense. I would love to hear why everyone in the House, other than a few of us, is against the Bill being put to a referendum.

Photo of Jacob Rees-Mogg Jacob Rees-Mogg Conservative, North East Somerset

I have tabled a number of amendments to the Bill, which I will speak to before turning to some of the amendments that have been tabled by my hon. Friends. I have tabled amendments in a number of categories. Some are intended to make the Bill achieve what it is intended to achieve, and some are offered up in a less friendly spirit towards the Bill, of which I fundamentally disapprove.

I will start with the most important proposal—the one that is intended to make the Bill serious. It seems to me that a lot of fine words are being spoken in passing a Bill that can do nothing at all: it has no sanction, but is merely an intention, an expression of good will. That is not the sort of reason for which legislation is passed. It does not have that majesty and authority that the statute book ought to have; it is a wish, a hope, a desire, but it is not something of fundamental strength and importance. Hence my new clause 2.

We hear from all parts of the House lots of pious talk and fine words about how important it is that we spend this money, but when it is suggested that there should be some enforcement of how the money is spent—that there should be some penalty if it is not spent—we hear that it is not possible, it is too difficult, it is unfair on the Ministers concerned. Surely it is simply a matter of making our legislative desire effective. If Ministers and shadow Ministers do not support new clause 2, one has to think that the Bill is merely a matter of fine words and pieties, and not a serious legislative desire.

That is why I challenge Front Benchers on both sides to accept new clause 2. I challenge them to do so on a bipartisan basis, because it is deliberately phrased so that the penalty comes into effect in the following financial year, so that if there is a change of Government, it will affect the incoming Ministers. Why? Because they all buy into this proposal. They are all in favour of frittering away public money overseas—of spending 0.7% of our wealth there, even though the statistical evidence is not available until some time after the money is supposed to have been spent. There are in-year revisions that inevitably lead to money being spent without the proper rigour being applied. Let them show that they really mean it, that they really are in this together, and that they really do subscribe to the pieties that they propose—to the fine words and grandiloquent sentiments that they express up and down the country—by saying that if they do not achieve it, they will accept a fine of £1,000 on their Cabinet colleagues in the following year.

One thousand pounds is the amount that has traditionally been used in this House to indicate the disapproval of the performance of a particular Minister in his or her duties, and it makes for a sensible extension to the Bill. I do not believe that anyone who supports the Bill can oppose new clause 2, because if they oppose it, they do not really mean what they say. Without this new clause, there is no effective mechanism of enforcement. My hon. Friend Mr Nuttall said that there would be no teeth to the Bill without the new clause. Without the new clause, there are not even dentures, there are not even gums, to gnaw away at the failures that there may be in implementing the details of the Bill. Let us put in some mild teeth—some teeth that will have a little bit of a bite, but not a huge one. One thousand pounds will not devastate the financial circumstances of a Cabinet Minister over the course of the ensuing year, but it will make them put their money where their mouth is.

That is important, because this House is very good at spending taxpayers’ money and very happy to send it around the world, but what happens if we say instead, “No, it won’t be taxpayers, but the Ministers themselves who find that their money is reduced if they don’t do what they say.”? They run away, they are scared, they are frit, they do not like it, but they are quite happy to spend taxpayers’ money all around the world on projects that may or may not succeed, with almost no accountability to this House or anywhere else.

I am surprised that the shadow Minister, who is a sensible and wise fellow, has not decided to take up my new clause and put it forward as an Opposition proposal. I thought that I could reasonably have expected the Opposition to add their names to it as an indication of their passion for overseas aid—not a passion that I share, but one that is honourable, as long as it is taken to its logical conclusion. Hence, new clause 2 tries to pave the way for people to support what they believe in and what they want to do, by ensuring that it has meaning and meat, rather than being a simple expression of will.

Why do I dislike mere expressions of will in legislation? I do not believe that mere expressions of will are what Acts of Parliament are for. Acts of Parliament are not there to say that we believe in motherhood and apple pie, even though I happen to approve of both. I think that motherhood is a wonderful thing and I like apple pie, particularly if the apples are from Somerset and cream and sugar are provided, but that is not a matter for legislation. To put wish lists into legislation is a poor way of legislating. All legislation needs to have a consequence if it is ignored. It must not be free of any form of consequence and, therefore, open to being ignored by any future Government.

The only penalty provided for in the Bill is that a statement must be laid before the House. Statements are laid before the House every day. If Members look at the back of today’s

Hansard

, they will find a very interesting statement by my hon. Friend the Minister for Culture and the Digital Economy on a meeting that took place in Brussels on 27 November 2014. It is an important statement and an important part of European scrutiny, but the Government are not going to stand or fall on a written statement. Whether he made it today, yesterday or in a week’s time is not fundamental to how this nation is governed, and so, as a sanction, it is entirely worthless. Not even an oral statement is required. One wonders why the promoter and sponsors of the Bill have not come up with a suitable sanction. They may have thought of one that was better than the one I could—

Photo of Mark Hunter Mark Hunter Liberal Democrat, Cheadle

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

The House proceeded to a Division.

Photo of Dawn Primarolo Dawn Primarolo Second Deputy Chairman of Ways and Means

I ask the Serjeant at Arms to investigate the delay in the No Lobby.

The House having divided:

Ayes 146, Noes 6.

Division number 106

See full list of votes (From The Public Whip)

Aye

No

Question accordingly agreed to.

Question put accordingly, That the clause be read a Second time.

The House divided:

Ayes 6, Noes 148.

Division number 107

See full list of votes (From The Public Whip)

Aye

No

Question accordingly negatived.