Unrevised transcript of evidence taken before

The Select Committee on Economic Affairs

Inquiry on

THE ECONOMIC IMPACT AND EFFECTIVENESS OF DEVELOPMENT AID

Evidence Session No. 17. Heard in Public. Questions 643 - 679

TUESDAY 31 JANUARY 2012

3.40 pm

Witnesses: Gordon Bridger, Charles Cullimore and Michael Shaw

USE OF THE TRANSCRIPT

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Members present

Lord MacGregor of Pulham Market (Chairman) Lord Currie of Marylebone Lord Forsyth of Drumlean Lord Hollick Baroness Kingsmill Lord Levene of Portsoken Lord Lipsey Lord Shipley Lord Smith of Clifton Lord Tugendhat ________________

Examination of Witnesses

Gordon Bridger, Charles Cullimore and Michael Shaw

Q643 The Chairman: Good afternoon gentlemen. This is the 16th and last public hearing

of our inquiry into the impact and effectiveness of development aid. On each occasion, I have

to say that copies are available of Members’ entries in the Register of Interests. Welcome to

our three witnesses and thank you for coming. Thank you, Mr Bridger and Mr Cullimore, for

your written evidence to us. We would be grateful if you could speak loudly and clearly for

the webcast and the shorthand writer. You have already submitted your written evidence.

Would you like to make an opening statement or go straight to questions?

Gordon Bridger: I just want to say, briefly, that in principle I support aid but I am concerned

about the scale and the way in which it is being disbursed. I have the support of many DfID

staff in this concern.

Charles Cullimore: I want to make it clear that, in addition to my paper, I am not in the

Dambisa Moyo camp. I am not opposed to all aid per se by any means, but I believe that

much of it is wasted and that some of it—notably budget support—can be harmful for the

reasons set out in the paper. I have other concerns about aspects of aid, which we might

come to in questions. It is not just budget support that I am concerned about.

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Q644 The Chairman: We will obviously deal with the size of the aid programme, its

effectiveness, value for money and so on. That is very much part of our brief. I want to start

with budgetary support, which is what your paper was mainly about. It was very interesting

to us. Many of the problems that you have identified emerge most sharply when budget

support is large relative to domestic revenue and when the recipient’s financial control

regime is weak. I do not know whether you have had chance to see the Secretary of State’s

evidence to us last week, but you will be aware that DfID is changing its attitude to budget

support. It seeks alternatives to budget support in exactly the circumstances that you are

implying and now requires much greater public audit and so on in relation to that. Do you

think that budget support, with the changes that DfID is bringing in, can be an effective

disbursement mechanism?

Charles Cullimore: I do not think so. As far as I can see, there is really no way around the

conflict between sovereignty on the one hand and the need for conditionality on the other,

particularly in the context of budget support. The question refers to possible commitment

by the recipient Government to improve “public financial management”. I can see that that

could be negotiated as part of an arrangement. It might be the deal, as it were, that that

would be part of the conditionality for the budget support. However, it would be very

difficult to monitor whether that was happening, still less to impose it. Therefore, I do not

think that it can be effective. Perhaps it is not an exact parallel, but look what is happening in

Greece.

Q645 The Chairman: The Secretary of State in evidence to us last week said that there

was a pretty fundamental change towards budgetary support. He said that, “driven into

budget support under us is the commitment to 5% per cent being used to monitor and hold

that money accountable”. He made it quite clear that he would look to see whether it was

and that it would be cut if that were not the case. He says, “That is why we have cut back

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significantly the levels of general budget support anyway, and it is also why we have stopped

in virtually every case providing money on an annual basis. We now live on a six-monthly or

even quarterly basis so that we are able to have much greater control to what happens to

our taxpayers’ money.” That is in relation to budgetary support. I take it that you would

support these changes.

Charles Cullimore: Yes. It is very welcome that he and Stephen O’Brien have made it very

clear that they are not fans of budgetary support. That is welcome and they have indicated

that they will be trying to reduce its level—if I understand the position correctly. To that

extent, it is good news. The problem is that it is not just about DfID’s budget support. One

has to look through the lens of the recipient country and the total amount of aid coming in

particularly to some of the smaller African countries in the form of budget support. As I said

in my opening remarks, one of my concerns is the level of multilateral aid that we are giving,

given that a good deal of the aid given certainly by the European Commission and now the

World Bank is actually in the form of budget support. Indirectly, DfID willy-nilly is still giving

support to a good deal of budget support.

Q646 The Chairman: I was going to ask you about multilateral aid, but you have made

your point. Does anyone else want to come in on budget support?

Gordon Bridger: The problem that DfID has is that at present it says that around 30% of its

aid goes in budget support. But in fact I would argue that all its financial aid is in budget

support. There is virtually no such thing as project aid. Most of the aid goes directly to

government departments. I heard the Minister state say that they would stop giving aid to

central governments and give it to provincial governments. So £330 million is going to

provincial governments and, as DfID staff have told me, there really is no difference at all.

Many of the programmes are funding government departments such as education and health,

which is a form of budgetary aid.

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DfID has two problems here. It has an increasing aid budget, so it has to spend money, and

how is it going to spend it if not by this easy-to-spend mechanism? Secondly, I would argue

that it is impossible to audit budgetary aid. Some 75% goes on personnel and so you have to

know who the personnel are in every single department—thousands and thousands and

thousands of people. The rest goes on service expenditure, which is also difficult to audit. In

fact, it is very dangerous to audit aid in most African countries. I do not think that a single

independent government auditor has been able to clear the accounts. It is one of the most

dangerous jobs in Africa and, quite honestly, to believe that outsiders can come in and audit

effectively is very naive.

Q647 The Chairman: Are you suggesting that the money that now goes directly to

education and health—the Secretary of State outlined how they were looking for outputs

rather than inputs in those areas—is effectively budgetary support and that it leaks?

Gordon Bridger: Yes, because you simply cannot disburse those huge sums unless you fund

a vast number of personnel, all of whom come under the general budget. Furthermore, I

think you are aware of the term “fungibility”. It is so easy for these funds to be directed to

other objectives. Studies that have been done in Africa show that something like 60% of

these funds get diverted to other objectives. A study by two American economists into

health assistance to Africa calculated that 63% of all health aid in Africa was diverted to

other purposes. That article was published in the Lancet in 2010.

Q648 Lord Forsyth of Drumlean: I may have misunderstood what you were saying. You

said that being an auditor was one of the most dangerous jobs in Africa. Do you mean that

they get attacked and are vulnerable? On what kind of scale?

Gordon Bridger: You dare not expose the goings-on.

Lord Forsyth of Drumlean: Are you saying that this is widespread?

Gordon Bridger: Yes.

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Lord Forsyth of Drumlean: Are you saying that they will be killed?

Gordon Bridger: I did not say that they would be killed. I have an interesting example here

from a certain country. The auditor tells a DfID representative that his travel budget has

been cut in order to restrict his activities and he cannot do anything about it if he wants to

collect his pension.

Lord Forsyth of Drumlean: Right. I can see that that would be disagreeable but not

dangerous. You said that it was dangerous.

Gordon Bridger: Yes. I think it is, yes.

The Chairman: So you think it will be extremely difficult for DfID to fulfil its objectives in

looking at budgetary support.

Gordon Bridger: There are two things. With the scale of aid available, it simply cannot

spend X amount of money with the target that it has. There is so much aid needed that

there is a great queue of donors waiting to spend aid in Africa.

Q649 Baroness Kingsmill: To clarify the point that you made about violence, was that

man suggesting that because his travel budget had been cut, he was not able to travel as

safely, or at all, and that if he did travel he would be killed or attacked? I am just trying to

clarify what you said because it was rather an oblique remark and it would be helpful to

know what you took it to mean.

Gordon Bridger: I meant that if he wants to collect his pension, he had better keep quiet.

Baroness Kingsmill: You mean, if he wanted to survive?

Q650 The Chairman: Can I come back to the multilateral aid point? Are you suggesting

that the changes that DfID is bringing in now by evaluating more correctly, with more vigour

and more effectively than when the aid went on budgetary support, are not happening in

multilateral aid agencies and European aid agencies?

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Charles Cullimore: I am not suggesting that it is not necessarily happening but there is very

little that DfID can do to make sure that it does happen. Certainly, in the case of European

Commission aid, the amount that we give depends on a formula that we have signed up to,

so I see that DfID has a genuine difficulty there. I do not ignore that fact but one is still

concerned that this means that a very large amount of money is going to organisations that

spend a large proportion of it on budgetary aid. I am not happy about that.

Q651 Lord Lipsey: Listening to the Secretary of State last week—he did a very

convincing job—I think you would have come to the conclusion that this was a golden age

for British aid, and that we were vastly more effective at promoting growth through our aid

programme than we have been at any point in time. You gentlemen have been observing the

scene for some time; would you share that perspective?

Charles Cullimore: Going back to my Ugandan experience, the focus has very much shifted

since then—it is now beginning to shift again—to budgetary support from what used to be

project aid in various forms. Yes, that has made it less effective. I think there was a question

about the standing of DfID in the eyes of its peers around the world and the suggestion that

DfID perhaps blazes a trail for everyone else. I just point out two examples that perhaps

point the other way. Years ago I remember a Japanese colleague, who was the head of JICA

and in London at the time, saying that he was utterly bemused that there was still an

argument going on about what the objectives of the aid programme should be in order to

bring about development. He said that when JICA was set up in the 1960s, fresh from Japan’s

experience of reinventing and developing its own economy after the war, it was simply

axiomatic that the number one objective was to encourage the development of the private

sector in developing countries. That has certainly not been a DfID objective in the past. I had

a conversation the other day with a representative of GIZ, the German aid agency, who told

me that it does not do budget support. It just does not do it.

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Q652 Lord Lipsey: The budget support argument is not entirely closed. There were

reasons for preferring budget support at one point. It was not just because it got money

through the door. It gives you leverage over Governments, so it was argued that it improved

their performance, and the simple fact was that many projects that would have benefited

from project aid were also ripped off in one way or another. Are you saying that your

perception that there has not necessarily been this improvement at DfID is entirely because

you believe that the argument is tilted against budget support, or are there other failings?

You have mentioned private investment, but Mr Mitchell assured us that he was putting that

into DfID’s DNA, so that problem is solved.

Charles Cullimore: With due respect, I do not know whether it is solved. One welcomes

the various small initiatives that there have been, but the amount of money allocated to

them is tiny in relation to the total aid budget. There are other problems. Comparisons are

odious, but there seem to be serious management problems—perhaps Gordon has more

inside information about this—particularly around the obsession with targets. That brings us

to the question of the 0.7% artificial target, which I am very unhappy about. I do not think

that we should have subscribed to it. Within that, the culture of setting specific targets for

different bits of the aid programme puts all sorts of artificial pressures on to staff. There is a

management problem there, as well.

Q653 Lord Lipsey: You mentioned the target. Is it the view of all of you that this UN

target is rather an artificial aim to have in mind? In particular, Britain proposes to make it a

permanent legal obligation. What do you think about that as an act of policy?

Gordon Bridger: I find the policy difficult to take seriously. Can I answer the question about

targets and the reputation of the British aid programme? I have been associated with it for

around 40 years and I am sorry to say that I think it has got worse. I will give you eight

reasons for that. First, it has become a target-led programme. This means that if staff want

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to be promoted, they have to accept their targets. I have here an e-mail from a DfID staff

member, which says that with staff cuts, the introduction of many new bureaucratic

procedures, the pressure to ensure that rapidly rising budgets are spent and the effective

loss of DfID’s reputation for technical and management competence in the field, DfID staff

morale is now very low. There are eight reasons why the programme has gone wrong and

the first is targets.

Secondly, there has been a shift away from programme aid to budgetary aid. When Barbara

Castle established the Ministry of Overseas Development, she decreed that we should get

rid of budgetary aid because it undermined local effort. It was difficult to challenge and meant

that you were approving all a Government’s policies. There was a lot of fungibility and it was

very difficult to audit.

The third reason is bonuses. I do not know if you are aware that senior staff get bonuses for

effective programmes. I was asked by a DfID staff member to complain to the National Audit

Office that this was distorting evaluations carried out by consultants because they did not

want to upset senior managers.

Fourthly, the amount of aid now pouring into Africa is creating inflation and distorting

exchange and interest rates. DfID staff members have made the following statements: there

is too much money being given as aid. It is seriously distorting things and encouraging

corruption. It drives up exchange rates to uncompetitive levels; it costs more to stay in most

African capitals than in the UK. Across Africa, the countries getting budget support do not

have to bother too much about raising their own revenue. Meanwhile, DfID is dumping as

much money as it can with international bodies as fast as it can. DfID is making a huge

contribution to them and it is really just a way of getting rid of aid. These are genuine

comments by very concerned DfID staff members and the reason why I am here.

Q654 The Chairman: Are these very recent e-mails?

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Gordon Bridger: Last year, yes.

Lord Smith of Clifton: You implied there was more than one. Could we know how many

of those comments came from different people?

Gordon Bridger: I have them from at least three. In fact, I have these personal comments all

the time. There is a terrible problem, and it has been the case with aid for a long time, that

once you establish targets, desk officers have to meet them. It all started with McNamara at

the World Bank. Staff at the World Bank immediately had to meet those targets. The World

Bank has missions in which the desk officer has to come back with a £10 million project or

he will not get promotion. That applies to all. You have seen the effect of targets that we

have had in this country on government departments. It distorts management effort and time

because they have to meet them.

Q655 Lord Levene of Portsoken: Mr Bridger, you say that these targets distort effort,

and yet you earlier said that there was pressure to ensure that rising budgets are spent. This

is a bit like Alice Through the Looking Glass because, if we were dealing with any other subject,

we would be in a situation in which demand is rising while there is increasingly less money to

spend. You are saying that here there is more money to spend and the pressure to spend

the money and see the results of that is not the number one priority. You are saying that the

number one priority in all these areas is to spend the money as quickly as possible.

Gordon Bridger: Yes, absolutely, because the aid programme is going to rise.

Lord Levene of Portsoken: The aid programme is predicated on spending all the money

that has been allocated to it, irrespective of what comes out the other end.

Gordon Bridger: Yes, because you have a target.

Q656 The Chairman: I do not know whether you read the Secretary of State’s evidence

to us last week and the papers sent to us that are coming out of DfID. They put much more

emphasis on outputs rather than inputs, looking clearly in health and education for the

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practical outputs rather than the money put in. Have you had any reactions to that in e-

mails?

Gordon Bridger: Yes. The problem is on monitoring increasing outputs—how do you do

that? It is all very well to tell the public that you have been able to vaccinate so many people

in this part of the world effectively, but if you give that Government £10 million or £20

million, it is a problem of a totally different order. You need a very efficient administrative

system to cope with this. These Governments do not have such systems, so I am afraid that

most of the money is going to be wasted.

Q657 Lord Shipley: I should like to hear from Mr Cullimore and Mr Shaw on what Mr

Bridger has been saying. Do you agree with everything that Mr Bridger has said?

Charles Cullimore: I agree with the general thrust of it, yes. I am not privy to the

conversations he has had with various people in DfID, but on the whole I do. I am very

puzzled, I have to say. I heard the Secretary of State’s evidence given on the 26th and it was

fascinating to learn that at a time when they say they are trying to move out of budget

support they are—and I heard this for the first time—developing an exit strategy for 16 of

the 27 countries to which we give aid. Those two things are happening while they are also

cutting back on administrative expenses. How all of that will be possible against a rising aid

budget leaves me completely mystified. There seems to be a contradiction there. Surely, if

you are moving out of a major element of aid and are phasing it out in more than half the

countries you give it to, and you are also cutting back on you staff, what are you going to do

with all this extra money? I am totally bewildered really. In particular, how on earth can you

make sure that it is being used effectively and in accordance with the assurances given to the

British taxpayers?

Lord Shipley: I wonder whether Mr Shaw would like to respond to that question.

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Michael Shaw: If Gordon Bridger is correct, which I believe he is, the problem is likely to

be getting worse, not better. I am particularly struck by the way corruption in Kenya was

swept half under the carpet in order to maintain the aid budget to that country. This is a

classic example and I am sure that Mr Gethongo told you when he was here that he was

asked to downplay, according to the book, the extent of corruption in Kenya because it was

going to wreck the DfID programme.

Q658 Baroness Kingsmill: Why would they be more concerned to maintain their

programme than to avoid corrupt payments?

Michael Shaw: Because they would not have spent their budget.

Baroness Kingsmill: And they do not mind spending their budget corruptly.

Michael Shaw: No, I do not think that the actual budget was being spent corruptly. But if

the British aid projects in Kenya had been interrupted by the British Government’s concern

about corruption, the budget would not have been spent.

Q659 Lord Forsyth of Drumlean: I do not want to take us away from the points about

the percentage target, but I am fascinated by what you are saying. Throughout this inquiry,

the worry at the back of my mind has been this huge expansion in the budget while cutting

back on the staff to administer it. How do you ensure that the money has been properly

spent, therefore? One of the points put to us is that the Independent Commission on Aid

Impact has been established. After a bit of effort, we discovered that its entire budget is

under £1 million, about half of which is spent on this. How realistic do you think that

Independent Commission is as a vehicle to ensure that the concern you are expressing is—

without putting words into your mouth—delivered on?

Charles Cullimore: All I can say on that is that for weeks and even for months we have

been trying to get an opportunity to meet them. It has proved impossible to do so.

Lord Forsyth of Drumlean: Because?

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Charles Cullimore: I do not know.

Lord Forsyth of Drumlean: Leave aside that you cannot meet them. Mr Bridger, you

have said that being an auditor is the most dangerous occupation in Africa. You are all saying

that there is a vast increase in budget while there is no one actually to monitor it. The

solution being presented to us is an independent body that will look at the budget and I

wonder whether you think that it is realistic to have such a body. If there were such a body,

what would be the kind of scale in which it would need to operate, and on what scale, in

order to do the job?

Gordon Bridger: I have suggested that there should be an evaluation of budgetary aid, which

I am pleased to say they are doing now. I am sure that they could do a reasonably competent

job on one or two aspects of the aid programme. Although we have been trying to see

them, we have submitted to them comments about budgetary aid and I am sure they will

come up with some sort of solution. The problem is that the PAC, which did a very good,

thorough job with the DfID programme, was very critical, but they all thought that you

could solve the problem of auditing by putting in more staff and making more effort. You

need very determined, well-qualified people—you need auditors and accountants to do this,

not economists. Sending three economists to try to audit Nigeria is just laughable. It is one

of the most difficult jobs because you have to deal with thousands and thousands of

personnel and you have to know who they are. You also have to ensure that those funds are

not being shifted somewhere else. My view, which my colleagues share, is that it is

impossible effectively to audit this type of aid. Therefore, we should shift out of it, as Barbara

Castle very sensibly did 40 years ago. It is not auditable and it undermines local effort.

Q660 Lord Tugendhat: It is in the nature of things that officials want to spend their

budgets. A question occurred to me as I was listening to you. We hear a great deal about

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performance-related pay, normally in other sectors, but it exists in the public services as

well. If officials spend their budgets, do they benefit from that in their remuneration?

Gordon Bridger: I have not been able to find out the criteria but I complained to the

National Audit Office—not on my behalf but on behalf of DfID staff—that consultants were

writing favourable reports in order not to endanger the senior managers’ bonuses. The

National Audit Office, to its shame, refused to investigate this because it was assured by a

senior manger in DfID that no attention was paid to consultants’ reports when deciding

bonuses. However, I can tell you from my contacts in DfID that staff do not like to upset

their seniors and will not oppose projects if they think they will come out badly. I am

absolutely appalled that the Civil Service is giving bonuses. It undermines the whole sense of

public service that so many of us believed in. If you would like to investigate something

extremely useful, it should be how those bonuses are allocated.

Q661 Lord Tugendhat: On a different subject, in a recent policy paper DfID stated that,

“We want private sector thinking to become as much part of DFID’s DNA as our work with

charities and governments”. To what extent do you think UK aid policy reflects this greater

emphasis on the role of the private sector? If you think it does, are you able to give any

examples?

Gordon Bridger: The total aid budget is £7.5 billion per year. The Minister is saying the right

things about the private sector, which is very important in Africa—much more important

than the public sector. However, if you ask how much of that £7.5 billion is devoted to the

private sector, I think the sum is quite small.

Charles Cullimore: One hears these statements, which are obviously welcome, but we have

still to see any results. DfID is a long way from having it in its DNA; I wish it had. There have

been some small initiatives over the past few years. You asked for examples. The Investment

Climate Facility is a particularly good model. It came from the Blair commission but DfID is

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supporting it strongly and it seems to work well. That is in partnership with the private

sector, with the private sector in the driving seat over how it should operate. That is

proving quite effective. Of course, it has support from other donors as well. It is not just

DfID that is supporting it.

There are one or two other very minor initiatives. There is the Business Innovation Facility,

which works in four or five countries in a very small way. There are lots of things that one

could say. I should like to make one comment if DfID is serious about this. I accept that it

probably is. If it is to try to devise a mechanism for facilitating and encouraging the

indigenous private sector—I do not mean the UK private sector—which would be very

difficult, I hope that, before it goes too far down that track, it will consider bringing in a small

working group of practitioners from the private sector from African countries and the UK

to advise on the design of such an initiative. I think that is terribly important.

Obviously, one’s personal experience colours one’s views. There is the example of

Pro€Invest, which was a European Commission initiative to try to do this sort of thing. It

was designed by bureaucrats in an ivory tower and it simply has not worked. Two or three

years ago it had to employ a firm of British consultants to advise companies on how to

approach Pro€Invest because it had been made so bureaucratically complex that no

company could understand it. I just hope DfID will not go down that road.

Lord Tugendhat: I was going to ask whether you thought that the right balance was struck

between the interests of external private investors and those of the local private investors,

but from what you have just said I would be surprised if you gave an affirmative answer.

Charles Cullimore: That is right—I would not.

Q662 Lord Hollick: From your experience, which initiatives would you recommend to

the Government to help the private sector in aid-recipient countries?

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Michael Shaw: You have to start by creating a proper environment for private investors to

come in. If you do not have that, whatever you do to attract them will not work. By that I

mean that you need a secure environment, good governance, the rule of law and proper land

registration—all those things around which a decent Administration revolves. If you do not

have those, the whole aid programme is a waste of time, as we discovered in Sierra Leone

one year when we poured in £34 million and at the end of the year had absolutely nothing

to show for it. The one thing that DfID and the British Government should be doing is

concentrating on those good governance factors that have to be in place before you can

bring in private investment.

Lord Hollick: Can you think of any examples where that route has been followed

successfully?

Michael Shaw: Namibia, perhaps. It now has a reasonable level of government, with proper

laws, judges and so on. I do not think that we have an aid programme there any longer

because we do not need one. It has attracted incoming private investment. The same would

probably apply to Botswana and now, gradually, to Ghana, which is getting its act together.

Interestingly, it applies to Somaliland, where we do not have an aid programme and which

we do not even recognise. Eritrea might have gone down that route but it has flipped. Is that

enough?

Charles Cullimore: That is at the macro level. I think you were also asking about the micro

level. I quite agree that you have to get the basic conditions right; if they are not there, it is a

waste of time. However, if they are right, there are a range of small-scale things that DfID

can do to facilitate and give technical assistance, such as putting an accountant into a local

company to help it to get its accounts in order; getting a marketing man to show a company

how to market its produce; or bringing people across for training. Facilitating access to

capital for small companies is a particular issue where that is otherwise very expensive.

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Financing or co-financing investment conferences and generally facilitating partnerships

between international and local companies where they can benefit from each other are

other areas.

Q663 Lord Levene of Portsoken: I want to go back to something that Mr Bridger said,

if I understood correctly. Were you saying that there is now a bonus culture within DfID,

that the efforts of the staff there are directed towards delivering the amount of money that

they have promised to commit to a programme, and that their bonus is based on that, rather

than on any tangible outputs from it?

Gordon Bridger: You understood correctly in general terms. In general, the first objective is

to meet targets. That should not surprise anyone.

Lord Levene of Portsoken: Does “targets” mean spending money?

Gordon Bridger: Yes, the 0.7%. That was a very important objective. I am sure that you all

appreciate that your desk officers will not easily get promotion if they do not meet their

targets. As a subsidiary factor to this, there is the question of bonuses. They are not bonuses

of banking proportions. I understand that they are quite small—probably about 20% of

salary. I have not been able to find out. It is a factor about which DfID staff have complained

to me. They do not want to upset their seniors.

Lord Levene of Portsoken: You say that we should have no difficulty in understanding

but, in most organisations, if you want to achieve your targets, there is something that you

need to do. You are saying that the one thing they need to do, above anything else, is spend

the money that they have been allocated, irrespective of what comes out at the other end.

Gordon Bridger: I very much regret to say that that is so. We have seen this in Kenya and

in other countries. I have been told this. It did not affect us in the days when I worked with

aid programmes, but it certainly affected the World Bank.

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Lord Forsyth of Drumlean: Surely the target cannot be that you have to spend £10

million in order to get your bonus—a cash target.

Gordon Bridger: Yes. I could give you an example from the World Bank. I advised the

British Government and when we were asked to provide the World Bank with another £50

million in a month’s time I said that it could not spend the money. So I went over to

Washington and I discussed the World Bank’s targets with its desk officers. I said, “Can you

increase your aid programme by about a third?” “No, of course we can’t.” I said, “Well, it’s

in your budget.” “Well, we don’t know anything about it.” I went back to the finance officer

and do you know what he said to me? He said, “We don’t pay any attention to desk officers

because they’re always so negative.” Now, this is what happens when you have a target

culture.

Lord Lipsey: These are important suggestions that are being made. We should put them to

DfID and ask for a written response and ask how its bonus scheme works.

The Chairman: I have just made exactly that note.

Baroness Kingsmill: I am familiar with this style, no so much in relation to bonuses but in

other departments, where if you do not spend your budget, it is cut the following year. So

there is a great deal of pressure on people to spend the budget regardless of what it is spent

on.

The Chairman: As suggested, we will ask the department to comment on these particular

points.

Q664 Lord Smith of Clifton: The emergence of new and commercially savvy players

such as China, India and Brazil is dramatically changing the economic landscape in Africa and

elsewhere. What are the implications of that in the way that British aid programmes should

be structured?

18

Charles Cullimore: Perhaps we could learn one lesson from the Chinese. They have moved

in to do a whole range of long-term infrastructure projects, most of which were badly

needed—a lot of this is not a specific criticism of DfID; it is a criticism of the whole western

aid industry. They are not being done by the west, including DfID, partly because project aid

had become pretty unfashionable, for all the reasons that we have discussed and I outlined in

my paper. It was not fashionable in the aid industry to do these infrastructure projects and

the private sector was not interested in them because the return on capital was too slow. So

they were not being done, but the Chinese started moving in and doing them. We are now

talking about where some of the DfID money might be going. I should like to see a new

emphasis on trying to identify viable and sustainable genuine long-term infrastructure

projects and a bigger effort to leverage private sector capital together with DfID money into

some of those projects. We would be learning there from the Chinese, which is one lesson

we could learn. I certainly do not think that we should be trying to imitate the Chinese

across the board—far from it—but perhaps we could do a little less preaching from the

table top. There is scope for saying things from behind closed doors, perhaps, but not always

preaching to African Governments about how they should behave and what they should be

doing. The Chinese are rather good at not doing that.

Q665 Lord Smith of Clifton: Apart from the Confucian ethic, how is it that China has

beaten us to the draw in terms of having a better strategic view on the building of

infrastructure project?

Charles Cullimore: It is able to take a long-term view.

Michael Shaw: Did they? I have been around long enough to remember the Tan-Zam

railway that the Chinese build in the 1960s or early 1970s, which is now a wreck and

practically no more. Interestingly, in today’s Financial Times there is a picture of the new

Africa Union headquarters in Addis Ababa—you may have seen it; a great doughnut thing—

19

which has been given by the Chinese and is going to be maintained by Chinese staff for

several years because they dare not hand it over to the locals in case the whole project

collapses.

Lord Smith of Clifton: They have learnt from the Tan-Zam railway.

Michael Shaw: They have learnt from the Tan-Zam railway. Perhaps I could mention

another factor in this. The other day I asked an African friend of mine about China’s

influence. He said, “China is seen by many of us here in Africa as a partner in development

projects and in the infrastructure sector. It lends without conditions”—that is what he

says—“so we can access resources from China when we fall out with the west.” That seems

to me to be taking us back to the bad old days of the Cold War in Africa when the two sides

competed to acquire rather dodgy friendships and you ended up with people like Mobutu. I

think that everyone is agreed that that was a pretty disastrous period. It is terribly important

that if we have these new players coming into Africa, we do not end up competing with

them.

Gordon Bridger: I would like to make three quick points. It will make it much more difficult

for us to disburse aid, because they are there. Secondly, it will make it much more difficult

for us to monitor and impose conditions because the Chinese do not do that—they give

them everything. Thirdly, it is true that the Chinese are finding recurrent costs for a while,

but the time will come when they will stop funding recurrent costs. That occurred in the

1970s, when the Chinese rushed in and put in rice fields and railways and all sorts of things,

and then walked out. They then collapsed. You must therefore take into account the ability

of a country to fund those capital improvements in the longer run.

Q666 Lord Forsyth of Drumlean: You say that the Chinese are not imposing

conditions, but I thought that the Chinese were saying, “We’ll build you this infrastructure

project, but we’d quite like to have our hands on your mineral or other resources.” Some of

20

the evidence we have heard—and I am sure you have all been part of this culture—is that

the British way of doing things is not to have conditionality and that we should try to get the

Chinese to change their ways. I have to say that that seems to me to be a tad unrealistic.

Michael Shaw: I was quoting a Rwandan friend in his perception of the way that the

Chinese behave in Africa at the moment. But the reality is rather different, I think.

Lord Forsyth of Drumlean: How do we deal with that?

Charles Cullimore: We need to distinguish between two separate things. There is the

conditionality attached to a particular project: “Okay, we’ll do this project for you and in

return we want to have X% of your oil, your gold or your diamonds”, whatever it is. That is

a straight commercial deal, really, and of course the Chinese are doing that. What I meant

was that they do not then go on to say, “It is terribly important that you should respect all

the democratic norms and you should have parliamentary elections in five years”, and all that

kind thing, which we tend to do. We used to do that but I think we do it a little less, and

that is what I meant.

Lord Forsyth of Drumlean: So they want the business but we want the governance.

Charles Cullimore: I cannot improve on that.

Michael Shaw: They want the business more than we want the governance.

Q667 Lord Shipley: Can I go on to last year’s aid reviews, which signalled a decisive shift

of British aid towards fragile states? Is that wise? In your experience, can development

assistance really do nation-building in post-conflict environments?

Charles Cullimore: It is unwise to try to generalise. Every country is different. Also, what

exactly do we mean by a failed state? It is possible to nation-build in some places. Again, I

have to draw on my Ugandan experience. It had nothing much to do with me but at that

time—if the phrase had been invented, which I am not sure that it had—Uganda in the early

1990s would probably have been regarded as a failed state, or as having just come back from

21

being a failed state. At that time, in those circumstances, in that country, with Museveni then

head of state, we were able to do some key things that helped to rebuild that nation.

However, these were very much in the form of projects, hence my preference for project

aid, although it is not perfect. I will give three quick examples. The Owen Falls rehabilitation

scheme gave Uganda electrical power, which it practically did not have at the time, by

rebuilding the dam and, in effect, all the generators. That was a huge project—our biggest in

Africa at the time. The second was the police. Training and transport was provided and,

where there was no police force, we helped to put one there. Without police, you had only

the army administering law and order of a sort. The third was the rather modest one, in

financial terms, of seconding no fewer than three British judges to the high court to get the

legal system, particularly the high court, up and running again. That is an example of a failed

or failing state where you could do great things because the environment was right. Sierra

Leone might be another example. However, it would be very unwise to generalise from that

and say that we should therefore go into Somalia or South Sudan and try to do the same. It

might not work.

Michael Shaw: The trouble with fragile states is that you do not always know when they

will happen. Therefore, making a decisive shift in that direction would depend on events that

might be out of your control. Sierra Leone suddenly blew up, having simmered for years, and

we had a desperate situation. Incidentally, there was a case for budgetary aid there for a time

because the Government had no ability to raise revenue of their own. It depends on the

circumstances of each individual fragile state that you are looking at. In Uganda and Sierra

Leone, we had a locus. I am not sure that we have in Somalia. It would depend very much on

whether we had the ability to do anything. In the same sort of way, we had some ability to

intervene in Libya, but we do not in Syria, so we have a different policy.

22

Gordon Bridger: I have two quick comments. It just occurred to me that in both Uganda

and Sierra Leone we knew their culture and understood something of their Administrations.

I had a team working in Uganda for quite a long time in the 1990s. It worked well there.

However, I suspect that we are out of our depth in trying to work in countries with very

different cultures, such as Afghanistan, Somalia or Iraq. The majority of our staff would be

out of their depth.

Q668 Lord Shipley: Could I pursue the evidence that was given to us by the author

Michela Wrong about the spectrum of the Arab spring, in which increasingly authoritarian

leaders of weak states, who had been supported by Britain and other western donors, used

their revamped internal security systems to suppress domestic political opposition? Do you

share her concern? What do you feel DfID should be doing to ensure that its support of

fragile states prevents this possibility from occurring?

Michael Shaw: It is a very fair point, which arises from the propensity of African leaders to

remain in power for perhaps rather longer than is desirable or necessary. I said earlier that

you need to create a secure environment and good governance to bring in private

investment. One of the niche areas of that is to ensure that the sorts of organisations you

are talking about are under proper democratic control, if you can achieve that. That involves

making sure that they have reasonable legislation and some form of parliamentary control,

and that the public have the ability to complain and so on. I think that we have managed to

put in place in a number of countries in Africa laws that, if they are followed, which is the

next step, help to ensure that leaders cannot use organisations in this way.

Q669 Lord Currie of Marylebone: I should like to ask you about the effects of

corruption in recipient countries. Clearly, one consequence is that aid flows simply get

diverted from their intended purposes towards other ends. What are the broader

consequences of corruption, perhaps for growth and development?

23

Charles Cullimore: One could go on. Clearly, one of the problems is what you mean by

“corruption”, which covers a multitude of sins. It clearly diverts resources hugely from

productive deployment. An obvious example is using aid money or money through fungibility

for the purchase of expensive defence toys that are neither necessary nor productive.

Perhaps even more important is the very large but difficult to quantify outflow of funds from

developing countries, particularly in Africa. I think that this is an African problem, rather than

one of corruption. On the whole, the money seems to leave Africa. Many people have

commented that there is a lot of corruption in China but that it does not much matter in

economic terms because it all gets reinvested in China anyway, so China does not suffer.

However, that is not the case in Africa. That is one of the consequences.

I also think, although some would disagree, that it inhibits investment very seriously. If an

investor looks at a country and sees, for example, that judges can be bribed, he does not

know what the legal system will be like and how it will work if he has any legal problems.

Perhaps customs officers can be bribed, or officials can be bribed over the giving of

contracts, the allocation of land or whatever it may be. That is clearly a disincentive.

Certainly, when we have done surveys of our members on perceived obstacles to

investment, corruption is always up there among the top two or three reasons for not

investing. Those are some of the consequences.

The Chairman: Gentlemen, I am afraid that we have a Division, so we will have to adjourn

for a few minutes. As many as possible of our Members will come back. Do you mind waiting

until we have voted? Thank you.

The Committee was suspended for a Division in the House.

On resuming—

The Chairman: We will now start again.

24

Q670 Lord Hollick: Do we just have to accept that corruption is an inevitable part of

this and that there is going to be leakage? If we take the step of cutting off aid because there

is corruption, that will deprive the people whom we are trying to help. Is it just part and

parcel of the business?

Michael Shaw: Life is grey, not black and white, is it not? If you are going to say,

“Absolutely no corruption whatever”, you will not get anywhere in life. You will not even

get anywhere in–dare I say?–local government in this country.

Lord Hollick: That is probably the subject of another inquiry.

Michael Shaw: I am sure that it would be, but there are limits. Where you have blatant,

clear corruption, as there was in Kenya, I think that something needs to be done. You

probably need to get somebody taken out and hanged, as it were, pour encourager les

autres. If you do not, it will permeate all the way down through society to the very bottom. I

once went upcountry in Sierra Leone after the terrible events. We went through 54 police

posts and each one of them asked us for money. I am glad to say that we pushed our luck

and we did not pay any of them, but that was the extent of the corruption in Sierra Leone at

that point. You could have gone in at the top and found corruption, and you would have

found it at the bottom. But if you say, “We can’t start giving them aid until all that is totally

eradicated”, you are living in cloud-cuckoo-land.

Charles Cullimore: I agree with that. Certainly in African countries, but also anywhere, a

great deal depends on the man at the top—the head of state. “Corruption” is such a difficult

word and one has to accept that in an African society a big man is going to have to help his

extended family. He has obligations that are much stronger than they would be, for instance,

in this country. If you call that “corruption”, that is not what I mean, but if he is grossly

corrupt in terms of taking huge backhanders and demanding huge bribes to do this, that and

25

the other, there is not much chance of tackling corruption in the country because he himself

will always be open to blackmail.

Q671 Lord Smith of Clifton: But where should the line be drawn? We can do this at

either end, but when it comes to policy implementation, is it 10% or 20%?

Charles Cullimore: I do not know what the right answer is. I agree with Michael that, sadly,

you cannot realistically go for zero tolerance. However, it is very difficult to say where you

draw the line.

Gordon Bridger: Of course it really is a political decision because, as my colleagues say,

there will always be a certain amount of misplacement of funds. I do not know whether you

should tolerate 10% or 20%, but our concern is that the way in which aid is now being given

facilitates widespread corruption because it is impossible to audit. The crude calculation

indicates that probably around 60% of funds that are given in this form are diverted to other

ends. I do not find that implausible at all when you think of the countries to which we are

disbursing aid: Nigeria, Kenya, Tanzania, Ethiopia, Zambia and Malawi. The level of

corruption in those countries is unacceptably high. There are some which are perhaps more

reasonable, but as long as we continue to give this aid in a very easy way to divert, we will

facilitate corruption and continue to support very nasty regimes. There are academics in

Tanzania who have complained to DfID about corruption and DfID has ignored them. There

are Ethiopians who have complained about the Ethiopian aid programme and DfID has

ignored these. We are undermining the very people whom we are supposed to be trying to

assist by giving aid in this form.

The Chairman: When you say “in this form”, do you mean budgetary support?

Gordon Bridger: Yes

Q672 Lord Hollick: You have cited a number of people in country as complaining about

the level of corruption. Has DfID done nothing to follow up on that?

26

Gordon Bridger: Ethiopia gets £330 million of aid. It is a country that I know as I used to

work there. It is a beautiful country and the majority of it is extremely fertile. There were

complaints from Ethiopians about corruption, so I contacted the Foreign Office under

freedom of information legislation, asking, “Could you please let me have your views on the

DfID aid programme?” It dodged the question, but the desk officer said, “You must read the

development assistance group report on Ethiopia. The aid programme is doing extremely

well. Would you like to have a copy?” I got 56 pages of very turgid aid-speak. If you look

carefully at pages 11 and 12, you will see that the report was carried out not by DARE but

by DfID. Secondly, it was a desk study; they had never been to Ethiopia. Thirdly, they did not

have time to address the particular complaints of people. This, I am afraid, is going on far too

often. You have seen it in Kenya, as we heard. There is a sad cult that we must somehow

spend this money.

Lord Hollick: Are these recent examples that you are citing?

Gordon Bridger: This is July 2010. It is the development assistance group report and it is

actually a dishonest report. I have worked in aid programmes all my life and especially when

people are undergoing so much social discomfort in this country I am most distressed by the

way that we are giving so much aid to corrupt countries. We are going to give £250 million

to Nigeria. It is going to increase from £146 million to £256 million. The African

Development Bank is going to have its aid doubled from £90 million to £197 million. You

cannot spend that sort of money in a development bank that quickly. Uganda’s aid is going up

from £96 million to £107 and Kenya’s aid is going up from £71 million to £112 million.

Ethiopia’s aid is going up from £241 million to £303 million. It is the target culture that is

destroying our aid programme and doing great harm to many developing countries to great

cost to taxpayers in this country.

27

Q673 Lord Hollick: Do you believe that DfID has the forensic skills to analyse the

amount of money that is going to corrupt ends?

Gordon Bridger: No, I honestly do not think so. Somebody who had been working in

Uganda explained this to me. I do not know whether any of you knows Uganda, but Mulago

Hospital used to be the gem hospital in east Africa. A television programme a couple of

years ago showed that it had become a slum. There were people who had been shot lying in

corridors. I asked a nurse who had been working in Uganda, “How could DfID allow this?”

He said, “Gordon, you must understand that they haven’t any longer got the experts to

assess the outcomes.” In our day, we had medical advisers and agriculture advisers who all

had experience and education. They would go round and look at the outcomes. DfID just

does not have the quality of expertise these days. They can make all sorts of claims about

outputs, but who has actually verified these facts?

Charles Cullimore: To be fair to DfID, one needs to recognise that it is a very difficult area.

Allegations of corruption can very easily be made, but substantiating those allegations can be

very difficult indeed. I think of a case in Uganda years ago, when very detailed allegations

were made to me by a British company about a Ugandan Minister, who was demanding a

bribe. The company was very unhappy about it and I took it up with Museveni, the President.

He said, “This is serious. It needs to be investigated, but we’ll have to do it through the

proper courts of law. Is your company prepared to get up and make this allegation in

public?” Of course, they were not and it was a large company, so how much more difficult

would it be for an individual to get up in a court and make those sorts of allegation? All I am

trying to say is that it is a very difficult area and allegations can be made very often that are

not necessarily true.

Q674 Lord Forsyth of Drumlean: I was just going to remark, in response to what Mr

Bridger was saying in particular, that what you are saying is totally at variance with what the

28

Secretary of State has told us the culture of the department is. Is it possible that you are

both right, because you are looking at a period prior to this? How can it be that we are

getting such diametrically opposed views? The Secretary of State’s message, broadly, is, “We

are focused on outputs. We are going to have people monitoring these programmes. We

are absolutely focused on value for money.” But you are telling us precisely the opposite;

you are telling us that they are just focusing on targets relating to inputs and that they do

not have the staff and expertise to measure what is happening to the inputs. Would that be

an unfair summary?

Gordon Bridger: I very much regret to say this, but that is my view. He gave you a whole

pile of figures about the number of children sent to school and so on. Where did those

figures come from? They came from Governments. They were not counted. I am afraid that

you have to look much more sceptically at the effect of the aid programme. I am not out of

date. I can assure you that there is a lot of concern within DfID about the way in which they

are being forced to meet targets all the time.

Lord Forsyth of Drumlean: The other thing that I found quite surprising listening to you

this afternoon is that, when I looked at the papers, I thought that you would come along and

argue pretty forcefully in support of what was happening in the department based on your

experience, but actually you are saying—I do not want to put words in your mouth—that

things have gone into reverse rather than moving forward.

Gordon Bridger: I am very sorry to say so and I have a lot of people within DfID who are

saying that, yes.

Q675 The Chairman: When you say “targets”, do you mean financial targets rather than

output targets?

Gordon Bridger: Yes. When you go to a country and say, “We are going to educate 2

million children”, how do you calculate that figure? Who provides that figure? That figure is

29

from the Minister of Education. You have given him £10 million and he will say anything you

want him to say. Uganda, for instance, has primary education for everyone, which sounds

absolutely fine, but because we have a link between Guildford and Uganda—I am not

opposed to aid in principle—we go to schools that have 70 to 100 children in a classroom

and they have no teaching materials at all. We have poured aid into primary education, but

what about the quality? We are producing thousands and thousands of primary school

children who are desperate to go to secondary schools, but they cannot afford to pay for

secondary schools. There are secondary schools in Uganda that have fences around them to

prevent children from getting in. We are creating a huge problem by concentrating so much

of our effort on education and health. The real problem in Africa is family planning. The

population has doubled in about 50 years. Africa is not a starving continent. The starving bits

are in the Sahel. Food production in most of Africa has increased quite remarkably. As far as

the aid programme generally is concerned, I think that it has its priorities wrong. We should

be spending much more on public administration, which has completely collapsed, and we

should be spending much more on family planning. The only reason why I am here is that I

am very saddened to see what has happened. I am afraid that I cannot support the claims

that are being made.

Q676 The Chairman: I am just wondering about this, Mr Bridger, because if you look at

what the Secretary of State has been saying and what the Government’s general direction

has been, it is in the direction in which you wish to go, but you are being very critical about

the difficulties of actually implementing all of that. Apart from spending money on public

administration and possibly food production, are you saying that we should be scrapping a

lot of the aid budget?

Gordon Bridger: Yes. Far too much aid is going into Africa. I would like to ask Mr Cullimore

to tell you about interest rates in Africa. The amount of aid going in is causing inflation, it

30

affects exchange rates and it is pouring money into the public sector when it is the private

sector that you really need to assist. Africa has done spectacularly well over the last five

years, but that is essentially due to increased primary food prices and oil; it has very little to

do with the amount of aid going into Africa. Perhaps Mr Cullimore could say something

about interest rates.

Charles Cullimore: The point is made in the paper, which you already have. If you care to

check, you will see that it is still the case that typically central bank rates, and therefore

commercial rates, in most of the smaller African countries are ridiculously high—15% to

20% is roughly the level. I have the list here and you can go through it. That obviously

crowds out local entrepreneurs and makes it almost impossible for them to access capital.

Some of you will know of Andrew Rugasira, who in my view is typical of the future of

Africa—I asked him whether I could quote this example, but he has not replied, so I am

going to quote it anyway. He is a Ugandan entrepreneur who has successfully developed a

rapidly developing coffee company. It is an African company, which he owns. He has broken

into the UK market with his good African coffee—sorry, this is not a commercial. He said

that in the early days, about five or six years ago, when he was trying to get started, he had

huge difficulties because of the very high rate of interest that he was going to have to pay.

He had to mortgage his house and all his possessions in order to get started. I am not trying

to argue that all of that was down to budget support, but I think that most observers and

analysts recognise that budget support has that effect in smaller economies. If DfID’s is only

10% of the budget in a particular country, it may not on its own be doing it, but then they

are getting this budget support from other places as well and I think that the effect is very

negative indeed.

Q677 Baroness Kingsmill: To go back to the corruption points that we have been talking

about, do you think that, in order to avoid the corruption that seems to be endemic when

31

dealing with Governments, it would be a good idea to give the money to NGOs and let

them deal with the issues? Or is that just putting the problem on to other shoulders?

Michael Shaw: I think that is just moving the problem elsewhere.

Baroness Kingsmill: However, the NGOs are often on the ground, are they not?

Michael Shaw: There are often too many of them, of course. There are good NGOs and

bad NGOs. If we start giving too much money to the NGOs, we end up with the problem

that we saw in Sierra Leone when we were creating part of the presidential office. We went

through a series of recruitment procedures and so on, which the civil service as a whole

started to copy. We trained the staff but they were then poached by NGOs offering them

twice the salary, so we had to start again. Similarly, take Nepal, another very poor country. If

you are an educated Nepali, the one thing that you would really like to do is to be employed

by an NGO where there are scores of NGOs. You are then made. It is a bit like going on

the social in this country.

Baroness Kingsmill: You are then lost as a resource for the country that trained you.

Michael Shaw: NGOs are outbidding the general levels of salary. That does not always

happen, but it is quite a serious risk.

Gordon Bridger: I do not know whether you have read Linda Polman’s book, The Crisis

Caravan, which is an evaluation of NGOs in Africa. It is a horrifying story. The number of

NGOs competing for projects is very great. The reason for it is that the Government

appreciate that providing funds to the public sector is not working, so they have been

pushing funds—as much as they can—into NGOs, but NGOs have a surfeit. Peter Gill, who

wrote a very good book called Famine and Foreigners: Ethiopia since Live Aid, calculates that

there are around 3,000 to 4,000 NGOs operating in Ethiopia. A DfID staff member told me

just the other day that she had been told to try to shift aid to the private sector in the

country in which she was working. She said, “I can’t”. I know that DfID is quite aware of

32

problems of the public sector, but in trying to shift them on to the NGOs and then the

private sector you have a capacity problem.

Q678 Lord Shipley: May I ask for clarification about whether your concerns relate to the

status quo, as it were, before the Government’s decision to spend more—up to 0.7%? Is it

about the increase that the Government are proposing, or is it about the speed of the

increase? Has target-setting meant that the speed with which the money must be disbursed

has become too great for the organisation to cope with, or is it a structural concern that

too much is going into budget support and the public sector, and not enough into the private

sector, with governance being very poor? Whether it is to do with the status quo, the

increase or the rate of the increase, would we face the same situation? I should just like to

be clear on exactly what it is you are suggesting the Government should do.

Charles Cullimore: As far as I am concerned, it is really all of that. It is not just about the

increase, which exacerbates all the problems that we have been talking about. As I said in the

paper, realistically what one would like to see—and could be achievable politically, although

that is for you to judge—is at least a cap on the aid budget. Implicit in everything that we

have said is that too much aid is going into most African countries, although one cannot

generalise. Therefore, ideally, there would be a case for reducing it significantly and, at the

same time, changing its direction, focus and priorities. It is about both those things.

Gordon Bridger: I happen to have here, by coincidence, the Conservative aid policy. I

suspect you know that I am not a Conservative, but that does not matter because I happen

to agree with it. David Cameron says that “we are absolutely clear that, as taxpayers feel the

pinch, maintaining public support for our aid programme will require a much greater focus

on performance, results and outcomes. Our bargain with taxpayers is this: in return for your

contribution of hard-earned money it is our duty to spend every penny of aid effectively”.

David Cameron has an easy political and moral out. He says that we will phase out

33

budgetary aid as quickly as possible, which means all types of budgetary aid. That would

reduce corruption quite drastically, while the reduction in aid to Africa would be a benefit. In

many countries it is now causing more economic and social problems than solutions.

Politically he has a strong case for saying that we will try to achieve the target, but it must be

done in a way that means that we are able to ensure that there is a reasonable amount of

honesty in the programme.

Q679 The Chairman: I think that it follows from everything that you, in particular, have

been saying that you wish to see the aid budget for Africa cut.

Gordon Bridger: Yes. I would not go as far as Dambisa Moyo but I refer you to a book by

Jonathan Glennie, who suggested that it should be cut by 50%. He was working for Christian

Aid in Africa and he saw the problems. There are at least 10 books on Africa that have been

very critical of aid, including those by Jonathan Glennie, Dambisa Moyo, Robert Calderisi and

Michela Wrong. It is not just me and it is not just DfID. There are a host of very respectable

journalists and academics who say that aid is being misdirected and is causing many

problems.

The Chairman: Gentlemen, this concludes our public hearing on this inquiry. We shall

now deliberate on our report. As I indicated earlier, we shall put a number of the points that

you have made to the department to enable it to respond. Meanwhile, I thank you very

much indeed for concluding our inquiry in this way.