International Development (Reporting and Transparency) Bill [Money]

House of Commons, 13 February 2006.

Gareth Thomas (Labour, Harrow West)

I beg to move,

That, for the purposes of any Act resulting from the International Development (Reporting and Transparency) Bill, it is expedient to authorise the payment out of money provided by Parliament of—

(1) any expenditure incurred by the Secretary of State in consequence of the Act;

and

(2) any increase attributable to the Act in the sums payable out of money so provided under any other Act.

I was delighted that the measure, which was promoted as a private Member's Bill by my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr. Clarke) was granted an unopposed Second Reading by the House on 20 January. The money resolution was tabled on 23 January. It is likely to have some expenditure implications for the public purse, which relate to Department for International Development staff and non-staff costs that are needed to complete new policy work on implementing the new work that the Bill requires, and to prepare an annual report to Parliament. No provision is included for the costs of implementation by other Departments as they are considered minimal.

The Bill aims to increase transparency in the provision, reporting and use of aid and to promote coherence in Government policies on international development. To that end, it requires my right hon. Friend the Secretary of State to make an annual report to Parliament containing a series of quantitative and qualitative assessments.

The Bill requires extensive reporting on UK development assistance provided both directly to developing country partners and indirectly through multilateral agencies. Data on bilateral aid will be broken down by region and by sector, and data on multilateral aid will be broken down according to the groups of multilateral agencies through which the UK contributes. The report will specify the proportions of aid that go to low-income countries. It will also include data on the debt relief that the United Kingdom provides to developing countries.

The Bill specifically deals with tracking the UK's progress towards the United Nations target for expenditure on official development assistance—ODA—to constitute 0.7 per cent. of gross national income. Much of the financial information that the Bill requires is already reported voluntarily. However, to fulfil the Bill's detailed requirements, the Department would need to develop new financial and management information systems that are capable of producing data, disaggregated to the level of detail that the measure requires. That would require respecification of the management information systems that are currently under design in the Department and incur additional costs.

The Bill as drafted would require the Department to prepare regulations prescribing definitions for the terms contained in it. In terms of qualitative assessments, the Bill will, in the first instance, require my right hon. Friend the Secretary of State to assess the coherence of UK Government policies on poverty reduction and sustainable development.

The Bill also requires an assessment of the UK contribution towards achieving the UN millennium development goals.

David Davies (Conservative, Monmouth)

Will the Bill explain why some Department officials can travel first class rather than business class, at great expense? Why have they managed to ratchet up £9 million of travel expenses? Why can they travel in great luxury, in a way that not even Members of Parliament can do?

Michael Martin (Speaker, Glasgow North East)

Order. We are going a little wide of the motion.

Gareth Thomas (Labour, Harrow West)

I invite the hon. Member for Monmouth (David T.C. Davies) to take part in our consideration of the Bill on Report. I do not remember him taking part in the debate on Second Reading—more is the pity.

The Bill will require assessments of the effectiveness of British aid, and that, when necessary, revisions should be made to information included in previous annual reports. This will require an additional validation exercise to be carried out each year on the information in the previous year's reports.

Bill Cash (Conservative, Stone)

Will the Minister bear in mind my past remarks about the necessity for external audit if the internal public accounts committees of the member states in question are not prepared to do the job properly?

Gareth Thomas (Labour, Harrow West)

I will of course bear in mind the comments that the hon. Gentleman has made, both in relation to his own 10-minute Bill on the subject and in exchanges that he and I have had in the House on other occasions. I hope that, in turn, he will bear in mind my responses, in which I highlighted the full range of auditing opportunities that exist for British development assistance and for improvements in the Government systems that benefit from the aid that we give. I shall turn now to the part of the Bill in which I know that the hon. Gentleman takes a particular interest.

The last part of the Bill requires an assessment of the UK's contribution to promoting transparency in the provision and use of aid. As I mentioned on Second Reading, the Government agree with the thrust of the clause on transparency, but we believe that, as drafted, it is over-prescriptive. As drafted, the Bill requires the Department to undertake new work negotiating formal bilateral agreements with all countries to which the UK provides aid—some 130 in 2004–05—and to commission and publish independent monitoring and evaluation reports recording the development objectives achieved by those countries.

David Taylor (Labour, North West Leicestershire)

Significant concerns have been raised recently about the delays in distribution associated with some of DFID's activities following the tsunami disaster and the Pakistan earthquake. Will the Minister tell us whether the proposed reporting structure will be sufficiently flexible to deal with these massive and wholly unpredictable one-off events, so that we can judge DFID's effectiveness in responding to them?

Gareth Thomas (Labour, Harrow West)

The issue of reporting on the effectiveness of humanitarian assistance was raised on Second Reading, and I am sure that we shall return to it in Committee as well as on Report and Third Reading. I do not accept my hon. Friend's recollection of delays in the delivery of assistance of relief or reconstruction, in response to either the tsunami or the Pakistan earthquake. Indeed, we have been praised for the speed of the delivery of our assistance in both cases.

I recognise the importance of the Bill, and, with the expectation that amendments made to it in Committee will hold the costs to Parliament of its implementation to a minimum, I commend the motion to the House.

Mark Simmonds (Conservative, Boston and Skegness)

As the Minister has said, this is the money resolution for the International Development (Reporting and Transparency) Bill promoted by the right hon. Member for Coatbridge, Chryston and Bellshill (Mr. Clarke). The resolution and the Bill would, if passed, require the Department for International Development to report annually, directly to Parliament and in a transparent and accountable way, on its progress towards achieving 0.7 per cent. of gross domestic product—with which we agree—and on the effectiveness of its aid programmes in alleviating poverty.

The money resolution is concerned with authorising expenditure for those aims, and I acknowledge that this debate should not extend to the related Bill. However, I would like to place on record that the Conservatives support the general principles of the Bill, and were pleased that it was given an unopposed Second Reading. As I am sure the House is aware, the resolution lays down the maximum charge—which amendments may reduce in scope, but not extend—either of the amount of expenditure or of the area of its operation.

We understand and hope that the Government intend substantially to amend the Bill to widen its scope and extent to include many of the provisions raised on Second Reading by Members on both sides of the House. I am pleased that this may be the case, but, as things stand, we have yet to see any Government amendments, so it is extremely difficult to know how extensive the changes might be. I am worried that the Government's delay in tabling their amendments—required by the rise of the House today in time for the Committee on Wednesday—makes it difficult not only for there to be proper scrutiny of the money resolution, but for us to table our amendments, as we expect the Bill to be greatly altered.

Eric Forth (Conservative, Bromley and Chislehurst)

I understand my hon. Friend's concern, but does it reassure him that, on Report at least, there will be a more than adequate opportunity to table further amendments should Members who were not on the Standing Committee wish to do so? He should not be unduly concerned about the Committee stage.

Mark Simmonds (Conservative, Boston and Skegness)

I am grateful to my right hon. Friend. He took part in the Second Reading debate, and he takes an extreme and consistent interest in these matters. I look forward to his contributions on Report.

This debate is vital. The Government are considering extending the Bill to include a provision allowing the effectiveness of British bilateral aid spending to be assessed in more than just the 10 largest recipient countries as specified in the Bill, and possibly doubling the number. As I am sure all Members will agree, the money resolution would greatly strengthen the assessment of aid effectiveness. It would ensure accountability for more than just 44.2 per cent. of bilateral aid spending and would include countries such as Mozambique and Kenya—which are currently excluded—as recent allegations demonstrate the necessity for increased accountability and transparency. Such an amendment may involve a corresponding increase in costs, which may or may not be covered by the resolution. Similarly, a proposal to increase the Bill's scope to include humanitarian aid—to which reference has already been made—could have a varying impact on its financial implications, particularly as the number and extent of humanitarian aid programmes are unpredictable.

I hope and trust that the resolution will authorise general expenditure resulting from the Bill, probably covering issues that I and others have raised, such as independent monitoring and assessment criteria relating to the millennium development goals. However, I think it is still important to consider how such expenditure may arise, and the nature of any proposed amendments is therefore of great importance.

While I understand the generic nature of the money resolution, the Minister said that he had an idea of the maximum charge that must not be extended. Can he also tell us whether he expects the estimate for future financial years to be the same as the first-year estimates? Are the costs front-loaded, or will they increase over time as the aid budget grows exponentially towards 0.7 per cent. of gross domestic product? The Minister spoke of plans for expenditure covering only three years. Why should that be the case, given that the 0.7 per cent. will not be reached until 2013, seven years from now? Can the Minister assure us that the cost of the Bill will be financed by the reduction in leakage that its implementation will facilitate, and will not have a negative impact on poverty alleviation?

As it stands, the motion will not prevent any amendments tabled after Second Reading from being discussed in Committee. However, it would have been useful if the Minister had tabled Government amendments earlier, so that their possible implications could have been discussed during this debate.

Neither the Minister nor any other Member may amend the motion. That preserves its generic nature, and the guarantee that it covers all eventualities. If it has to be altered, the original version must be withdrawn and resubmitted with its scope extended. Such action would hinder the Bill's progress, and Conservative Members do not want that. I trust that the Minister will confirm that there are no circumstances in which such an eventuality would arise.

Conservative Members support the Bill's general principles and therefore, along with the Minister, commend the motion to the House.

Philip Hollobone (Conservative, Kettering)

Given the importance that the Government attach to the Bill's passage, what consideration have they given to speeding up the process by providing Government time rather than private Members' time on Fridays?

Eric Forth (Conservative, Bromley and Chislehurst)

This motion illustrates all too well the weaknesses of the money resolution process, as both the Minister and my hon. Friend the Member for Boston and Skegness (Mark Simmonds) have illustrated rather well. As is so often the case, the House is being asked to endorse what amounts to a blank cheque. That would be bad enough in the best of circumstances, but in the case of this Bill it is particularly egregious.

The money resolution states that

"it is expedient to authorise the payment out of money provided by Parliament of . . . any expenditure incurred by the Secretary of State in consequence of the Act; and . . . any increase attributable to the Act in the sums payable out of money so provided".

If that is not a blank cheque, I do not know what is. Because we normally know from a given Bill's Second Reading its parameters and detailed provisions, we can make a rough estimate of such expenditure; indeed, I seem to recall that on certain very rare occasions, Ministers have been kind enough to give the House some idea of the expenditure involved. However, this is a different case altogether.

As has already been reflected in the contributions made so far, this Bill, unusually—if I may quote myself, which I am usually very pleased to do—does at the same time

"too much and too little."—[Official Report, 20 January 2006; Vol. 441, c. 1114.]

At one and the same time, it contains too many provisions—a point commented on by the Minister and criticised by my hon. Friend the Member for Boston and Skegness—and too few. Indeed, many contributions on Second Reading suggested, very positively and helpfully, provisions that could be included in it.

All these issues will have financial ramifications. We are in the absurd position of being asked by the Government to approve a money resolution for a Bill that we know will be amended, both in Committee and on Report, by Ministers and, I hope, by other Members of the House when we are given an opportunity to do so. How can we possibly, on behalf of our taxpayers, sign up to the incurring of "any expenditure" by the Secretary of State in respect of a Bill whose provisions we know will be radically altered by both the Government and the House at large?

This surely is an absurdity and we should not be prepared to accept it. I shall therefore be very reluctant to give my support to such a money resolution, but I should point out that I am looking forward enormously to considering the Bill on Report. It is substantial, containing many clauses, and we know from Second Reading that the House will want to debate many aspects of it, probably at length, and to vote on it, probably repeatedly, in order to ensure that it is absolutely right and achieves the objectives set out for it. So although the money resolution is unfortunate, misdirected, mistimed and wrong, I hope that we can correct all that in Committee and on Report.

Gareth Thomas (Labour, Harrow West)

With your leave, Mr. Speaker, I shall reply briefly to one or two of the points that have been made. The hon. Member for Boston and Skegness (Mark Simmonds) may now be aware that Government amendments and amendments from my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr. Clarke) are being tabled as we speak. I recognise that Members like to have early sight of Government amendments; nevertheless, all will want the Government to take time to get them right. I hope that Opposition Members—and, indeed, Government Members—will appreciate the amendments that are being tabled.

The hon. Member for Boston and Skegness asked about the distribution of expenditure and whether some will be front-loaded. Some investment in new systems will indeed be required, so some front-loading will be necessary. He also asked why a three-year period is specified, given that it will take seven years to reach the 0.7 per cent. target. The three-year period relates to the comprehensive spending review period. We will not necessarily be able to speed up progress toward the 0.7 per cent. target; it would take the international finance facility to do that. If the hon. Gentleman is aware of any leakage, I hope that he will inform us of it, so that we can take action to correct it. I can reassure him that I foresee no scenario in which we will have to withdraw the money resolution.

The hon. Member for Kettering (Mr. Hollobone) asked whether Government time and other assistance might be needed to speed up the Bill's passage. Given that it has the support of Front Benchers in all parts of the House, there should be no circumstances in which Government time is needed to progress the Bill. Perhaps the hon. Gentleman could seek reassurance from the right hon. Member for Bromley and Chislehurst (Mr. Forth) that he agrees with that assessment.

The right hon. Member for Bromley and Chislehurst asked for more information on the distribution of costs. The regulatory impact assessment was, I believe, made available in the Library last week, and it provides some clarity on how the costs are set out.

Question put and agreed to.