As Deputy Noonan, our spokesperson on Finance, pointed out, Fine Gael agrees in general with the initiatives in this Bill, the purpose of which is to make the payments authorised by the Government under the debt relief package announced by the Ministers for Finance and Foreign Affairs on 16 September 1998. The total package is £31.5 million over 12 years, £17 million of which is being paid up front in 1999.
However, following consideration and extensive briefing from people who are particularly well informed about Third World debt, the Debt and Development Coalition of Ireland, which has been in correspondence with all Deputies in this House, we have serious reservations about the Government's decision to fund the enhanced structural adjustment facility. Because of the Government's decision to fund the ESAF, we cannot support this Bill in its entirety.
Debt is a key burden in developing countries. That is directly related to the lack of social programmes in many countries. Important education, health and infrastructural development programmes cannot be pursued because of the compulsion to pay back large amounts of debt. In Tanzania, for example, 40 per cent of the population die before their 35th birthday and it spends six times more on debt repayments than on health. In Zambia, servicing external debt accounts for five times the expenditure on education. In Ethiopia, more than 100,000 children die annually from easily preventable diseases, yet debt repayments are four times the amount spent on health.
When the debt burden is so onerous, agencies such as the IMF must be careful when taking measures to reconstruct the economies and budgetary accounts of such countries that the medicine is not too strong for the patient, that in trying to correct the problems in the economy they do make the poor poorer so that more children die, more children drop out of education, life expectancy is reduced, etc. Those of us who have visited Third World countries know most of these countries are not in a position to fund the provision of clean water – let alone proper mains – and sewerage facilities to basic standards which existed in Ireland two centuries ago.
As a number of Members, including Members on the Government side, pointed out already, the ESAF programmes have many faults. In general, the aid agencies have three main concerns about the ESAF programmes which are shared by most Members. The proposed contribution to the IMF's ESAF programme is our main concern and it is also the main concern of the aid agencies. The Bill allows the Minister for Finance to make further payments to the IMF and the World Bank beyond those detailed in the Bill, without Oireachtas agreement. I ask the Minister to clarify that matter which was raised by the aid agencies. There is no provision for accountability by the Minister to the Oireachtas on policies pursued by Ireland in the IMF and World Bank.
In 1996, the Government decided not to contribute to the IMF's ESAF programme following representations from people around Ireland, especially the aid agencies. At that time the aid agencies raised concerns which still prevail today. Fianna Fáil, which was strongly against the proposal at that time, also raised these concerns. The IMF programmes undermine democracy. They are designed in the IMF's offices in Washington. IMF officials deal mainly with Ministers for Finance and governors of central banks. Elected parliamentarians and parliaments are bypassed.
A further concern is that IMF monetary policies do not take into account human development needs. They result in a decrease in primary school attendance, increased malnutrition, the collapse of local industry and widespread unemployment. Across Africa, for example, there is no semblance of whole infrastructures which existed 50 years ago. As Members will be aware, society is collapsing in several parts of Africa. Much of this has to do with the way in which those countries have been manipulated, not only by outside investors and imperial forces, but by IMF policies. We should be wary of that. Another concern is that IMF conditions are so inappropriate and onerous that three-quarters of its programmes break down.
That is why we are questioning the Government's proposal to contribute to the ESAF while cutting back on funding to Irish Aid. The IMF is not a developmental institution. This money could be used more effectively and in a more accountable fashion in Irish Aid. In the past Ireland has had a good record as regards aid, although we have probably not provided as much as we should because of economic problems here. According to my contacts with people who benefited in various ways from these programmes, many Irish aid agency programmes have been effective. We have certainly saved lives. Even the farming organisations' simple scheme to provide a cow to communities in parts of Africa has been effective in its own small way.
As a nation, Ireland is inclined at times to be insular. In the past through our missionary zeal we looked towards Europe and beyond. However, we have now become more selfish. Overseas aid is not at the top of the list of priorities. We should adopt a more proactive approach and be more sympathetic to Third World countries. We know from experience that we can make a difference.
The Bill authorises the Minister for Finance to make further payments to the IMF and World Bank other than those provided for. It is the view of the aid agencies that no contributions should be made without the agreement of the Oireachtas. I agree. To ensure accountability Ministers should be required to place regulations before the Dáil for its approval. The current practice is to place them in the Oireachtas Library. The same should apply in this instance. Any contributions should be brought to the attention of the Oireachtas. The IMF and World Bank operate behind closed doors. There is no accountability to member states. To ensure value for money the Minister for Finance should be required to present an annual report on actions taken.
Why should Ireland contribute to ESAF? Two years ago the then Government decided not to contribute in response to representations received. There was widespread opposition. Fianna Fáil condemned the proposal. It has now done a U-turn. What has changed in the meantime?
The opposition of the Debt and Development Coalition is based on the negative social impact of ESAF programmes. The IMF aims to reduce deficits, not poverty. Human need is not a priority. ESAF programmes undermine democracy and are designed in Washington without reference to member states. They have failed to tackle the debt crisis. The debt burden doubled between 1985 and l995. This counters the argument put forward by the Government.
The role of the IMF in the HIPC – highly indebted poor country – initiative is unhelpful. Eligibility is linked to a six year track record in an ESAF programme. Given the high breakdown rate, the IMF is hindering debt relief, the provision of which in Tanzania and Nicaragua is being delayed because of problems with ESAF. The IMF is refusing to provide the necessary resources to meet its contributions. It has called for donations to cover the cost, even though it has provided billions to bail out private investors in New York, London and Berlin who lent irresponsibly in Thailand, Korea, Indonesia and Russia. It has access to large amounts of capital funding. Some of the £86 billion should be used to fund the work involved. Despite efforts at political level to report progress and present the HIPC in a positive light, it was stated in the Financial Times in November that the initiative was running out of steam.
We have an obligation to Third World countries. We all know of someone – a relative, neighbour or friend – working in the Third World as a volunteer, missionary or preacher. It is important that we support their efforts by providing as much as possible. We can afford to do so. We should target health and education in particular. The high rates of illiteracy are alarming and give no grounds for hope. The low health status of African countries, in particular, is also of concern.