My Lords, I know that the mere appearance on the Marshalled List of the dread words “the Treasury” will send a shiver through most of my former colleagues and a very large part of the House. None the less, I feel that this amendment might be more persuasive if people unconnected with the Treasury supported it. I feel an obligation to support the proposal of my noble friend Lord Butler, and I strongly disagree with what the noble Lord, Lord Davies, said, which was that this amendment is incompatible with the 0.7%.
There is no reason, as I shall explain in a minute—I shall speak very briefly— why the 0.7% should not be compatible with rigorous examination by the Treasury of the budget of the department. One of the fears that have been expressed by those who are sceptical about this Bill is that it creates a perverse incentive to spend money so that the whole focus is on the quantity, not the quality, of expenditure. There is a risk that we may be jet-hosing the programme with money, with the only objective being to meet the 0.7%.
The noble Lord, Lord Davies, quite rightly reminded us of our obligations to the poor, and he made the point that there are huge numbers of people in this world who survive on tiny incomes. There are 2.8 billion people surviving on less than $2 a day, and 20% of those people survive on less than $1 a day. That fact makes it very important that we see that this expenditure is economically and properly spent, because every bit that is saved, every bit that is not wasted, can be the difference between life and death for people living on the poverty line.
Exempting overseas aid from the public expenditure process is the removal of the process. The process of the public expenditure round is that departments have to make a case for spending money, not just for the global total. There is examination in advance of the major items that make up the totality of the programme. Getting rid of that entirely removes the discipline that a spending department, or in this case DfID, has to make for the money that it wishes to spend.
There a provision in the Bill for examining the expenditure retrospectively, but that is not the same as examining it in advance. Surely the department would benefit from having the effectiveness of its programme examined not just retrospectively, when nothing can be done about it, but in advance, when people can be warned and when projects can be examined by people outside the department. It is a great pity that there is no single body in the Bill, as far as we can see. At previous stages, the noble Baroness, Lady Northover, made the point that they did not want to have one department looking at this, but that re-emphasises the need for the Treasury to have a look at this in advance. That is compatible with the 0.7%, because all that would be involved would be the Treasury examining it and saying, “We would like you to look at this project”, and, “We think this project is better than that project”.
Incidentally, Clause 2(3)(b) refers to how, if the Government fail to meet the target of 0.7%, they have to explain how it may be due to fiscal circumstances. If you are going to have fiscal circumstances involved in the calculation of the 0.7%, it seems very sensible that the Treasury should be involved. Who else would know about the likely fiscal circumstances? Indeed, it is implied in the Bill that the Treasury would have to be involved because nobody else can talk very persuasively about the fiscal circumstances.
I believe that in order to make the Bill effective and to make sure that expenditure reaches the poorest of the world, this amendment ought to be supported.