JOINT COMMITTEE ON FOREIGN AFFAIRS debate -
Monday, 24 May 2004

Development Co-Operation.

Chairman

I am delighted to welcome you today to St. Patrick's Hall in Dublin Castle. I extend a special welcome to the representatives of the ten new member states of the European Union. I am delighted to have the privilege of hosting the first conference of Chairmen of the enlarged Union of 25 member states. For the European Union and Ireland as Presidency, 1 May was a proud day. You are all most welcome in Dublin. It was here in Dublin Castle that the early part of the accession day celebrations took place. We also have with us today representatives of the three candidate countries, Bulgaria, Romania and Turkey. I look forward to the day when they, too, join us as full members. Also present are the invited representatives of Croatia and the Former Yugoslav Republic of Macedonia. You are all most welcome.

Before I comment on today's agenda, I hope you enjoyed last night's reception and that you found the ideas offered by Dr. Dadush on the role of the World Bank in promoting development as thought provoking, as I did. Dr. Dadush will be participating again in today's discussions.

We have a full list of subjects on our agenda for the next two days and expert speakers from all sides of the development community. I trust the agenda contains subjects of interest to all here today and look forward to a lively debate over the next two days.

The overall theme of the meeting is: honouring our commitment to the developing world. We will start our proceedings shortly with an opening address by Deputy Tom Kitt, Minister for State with responsibility for overseas development and human rights who is thus responsible for the operation of Ireland's official development aid programme. He will brief us on the development co-operation priorities of the Irish Presidency.

When I was preparing for this meeting, I was struck by how diverse and complex were the issues that we will address over the next two days but I was also struck by the realisation that many of the solutions were already prescribed and to hand. They are contained within the pages of reports, the institutional memory and experience of the thousands of workers in the field and the organisations and Governments working on development issues. In short, we already have many of the solutions. Therefore, over the next two days I hope we can focus on the question of how we, as parliamentarians, can best use our position and influence to address the immediate development problems facing the world. Of course, I do not have all of the answers but would like to offer a few thoughts on this question. It seems that there are a few areas where we parliamentarians can make a difference.

First, we can make sure that our Governments honour the commitments they have already made. For instance, all EU member states are committed to the specific measurable targets set under the millennium development goals under which our Governments have pledged to do all they can to eradicate poverty, promote human dignity and achieve peace, democracy and environmental sustainability. The establishment of these goals marked a landmark in human development. For the first time all of the major players — donor governments, NGOs and the recipients of aid — represented by their Governments, agreed on what should be done and on how it is to be done. It is essential, therefore, that these goals are achieved and the commitments entered into by our Governments honoured. Our Parliaments, including their development committees, have an important role to play in ensuring the goals are met. We can hold our Governments to account for their performance in meeting them.

One of the ideas I intend to develop with my committee is that of requesting an annual report from our Government on its progress towards meeting the millenium development goal commitments. Some committees are already doing this. Most importantly, such an annual report should include a clear statement of progress made towards meeting the financial commitments required under the millennium development goals. The financial commitments our Governments agreed at Monterrey in 2002 must be honoured. They committed the global development community to mobilise the financial resources needed to achieve the millennium development goals. If our own house is in order, it will be possible for us to put pressure on other donor governments which have made the same pledges at Monterrey to honour their commitments.

Many of our Governments have also made commitments to achieve the UN objective of spending 0.7% of GDP per annum on overseas development aid. Ireland's Government has committed itself to reaching and sustaining this target by 2007. We reached a level of 0.41% in 2003. This puts us in about seventh position in the world in terms of our contribution per head of population. My committee will be making sure that there is no slippage in this commitment and that substantial progress is made annually towards this goal. We want to meet our commitment of 0.7% of GDP by 2007. Your committees can also pressurise your Governments to ensure they make progress towards the UN target. Those Governments that have not yet set time bound targets for achieving the UN goal should be encouraged to do so. Your committees will play an important role in obtaining this commitment.

Second, we can make sure that moneys allocated from the EU budget to development aid are spent and that if they are not spent within the timeframe allocated, they are retained for development aid and not re-absorbed into the EU budget. Any new expenditure priorities must not be funded with moneys diverted from development aid. New priorities must be funded with new moneys. This may require the setting up by the Commission of a separate and highly transparent development assurance fund.

Third, we can support the efforts being made by African countries to fight poverty and to transform their institutions to allow for economic growth. Large parts of Africa are blighted by war, famine and disease, among which the biggest killers are HIV-AIDS, tuberculosis and malaria. Africa has not shared in the wealth creation brought about by globalisation, nor have many African countries made progress towards meeting the millennium development goals. In many African countries, GDP per capita is lower now than at independence some 40 years ago.

It is vital we keep Africa on the agenda at the highest level. I recognise that much is already being done. The European Union already spends €2.5 billion annually on aid to Africa within the framework of the Cotonou Agreement and its other partnership agreements with South Africa and the countries of North Africa. However, recent new initiatives should also be supported and expanded whenever possible. For instance, the new partnership for Africa's development, NEPAD, is a hopeful sign that the African leaders are serious about their desire to end poverty and to reform their own institutions. NEPAD recognises that not only the donors but also the African countries have duties and responsibilities. There is a new focus on good governance and institutional and civil reform which are essential preconditions of sustainable development. While it is too early to say how successful NEPAD will be, we must support it and give it every chance to succeed.

The EU's new African peace facility, which commits €250 million of EU moneys to build up African capabilities for addressing and resolving conflicts through the deployment of peacekeeping missions, is to be welcomed. There can be no development without a durable peace. Other conflict prevention initiatives such as the recent Operation Artemis in the DRC and the EU's engagement in peace processes throughout Africa must continue to be supported.

Fourth, we should redouble our efforts to meet the concerns of the developing world in the WTO post-Cancún talks. We should support their efforts to enter the global trading system and must do more to ensure that our trade and agricultural policies do not harm producers and markets in the developing world. The UNCTAD conference in São Paolo next month will give us an opportunity to hear the urgent concerns of the developing world.

Fifth, we can prioritise the fight against AIDS-HIV. This disease is now the greatest obstacle to development in Africa and is spreading rapidly in Central and South Asia. More resources must be devoted to fighting its spread. The Global Fund for HIV-AIDS, TB and Malaria must be supported. Low cost, sustained and affordable treatment including generic drugs must be made widely available to fight the pandemic. These are just a few ideas where we parliamentarians can use our influence to make important changes in our governments' development aid policies.

Following the contribution by the Minister of State at the Department of Foreign Affairs, Mr. Tom Kitt, we will begin the debates with a session responding to the question, Does Development Aid Work? We have a number of key speakers from our official development assistance programme, from two of the largest Irish NGOs working in the field and from the private sector. At 11.30 a.m., following coffee, we will consider the issues related to aid, trade and debt post Cancún. The lead speaker will be Deputy Michael Ahern, Minister of State with special responsibility for trade and commerce.

After lunch we will reconvene for a discussion on the HIV-AIDS pandemic. Following that session, we will have the family photograph at 3.30 p.m. Today's final discussion, commencing at 4 p.m., will ask whether the political will exists to make decisive inroads into the development challenges facing the world today. We are privileged to have Mr. Norbert Mao, M.P., Uganda, as our keynote speaker.

We will have a session tomorrow morning devoted to promoting fair globalisation. This discussion will be based on the report of the Foreign Affairs Committee of the French National Assembly, which has been circulated to delegates. The discussion will be initiated with an address by Mr. Hervé de Charette, Vice-Chairman, Foreign Affairs Committee of the French National Assembly. I thank Mr. de Charette and the French National Assembly for providing this report and I look forward to a stimulating discussion. We expect to conclude proceedings by 12.15 p.m. tomorrow.

I am conscious that our time is limited and that we have a substantial agenda. We have more than 30 delegations here, all of whom I expect will wish to contribute to the debates at some point. I ask delegates to limit the time that they hold the floor and to keep their contributions as brief as possible. To set a good example, I will conclude my remarks and introduce my colleague, the Minister of State at the Department of Foreign Affairs with responsibility for overseas development and human rights, Mr. Tom Kitt. Deputy Kitt is a representative of County Galway which is located in the west of Ireland. However, he has taken a seat in Dublin from another candidate. That illustrates how vigorous are the people from the west. His brother, Mr. Michael Kitt, who will chair a session of this meeting later, is a Senator. He has wide experience in human rights and overseas development and was Minister of State at the Department of Enterprise, Trade and Employment with special responsibility for labour affairs, and consumer rights and international trade from 1997 to 2002.

Minister of State at the Department of Foreign Affairs (Mr. T. Kitt)

I thank the Chairman for his introduction. I hope delegates will find the time during their stay to explore some of the west, including Galway. Dublin is a fantastic city but many other parts of this island are worth exploring. I have witnessed enormous developments in the west of Ireland. When speaking of the developing world, it is fair to say Ireland has come on in leaps and bounds even in recent years. I remind delegates that Ireland suffered a famine 150 years ago with places such as the west suffering particularly badly during that time. In this country we have in our psyche a famine memory which is part of the drive many of us have that ensures we make our contribution to the developing world. Some of our NGOs who reflect that tremendous commitment will address this conference later.

This country has seen huge developments in recent years. The west, which used to have many small sustainable farms, now has larger farms and not so many people live off the land. The country has changed from an agricultural based economy to a high-tech information based one. It is time now for us as developed nations to share our collective experience with our friends in the developing world.

I am privileged to address this conference and will try to be brief as possible. I have had the honour of addressing the foreign affairs committee in a similar capacity. I have been keen to keep in touch with our Parliament during our EU Presidency. We have a new structure of addressing the Joint Committee on Foreign Affairs before our General Affairs Council meetings. This has been a fantastic development for us as we can debate the issues openly. The process has been beneficial for both Ministers and parliamentarians.

I have addressed the European Parliament as is normal procedure during a Presidency. I also addressed the EU-ACP joint parliamentary assembly in Addis Ababa in February. I have also addressed the Irish Parliament on a number of occasions, not just the Dáil but also the Seanad, which is the upper House and which has a huge interest in this work. I am privileged to have had a number of opportunities to do so.

We have been working hard during our Presidency and are not finished yet. Our key development themes are as follows: the overriding aim of EU development assistance should be to eradicate poverty; renewed efforts should be directed towards the achievement of the millennium development goals, as already mentioned by the Chairman; Europe requires a strong voice in multinational institutions such as the United Nations to help focus efforts on helping the poor; the EU needs to improve coherence in its various policies to better meet the concerns of developing countries; the EU needs to continue its efforts to maximise the effectiveness of its aid, in particular European Community aid which is managed by the Commission; EU-Africa relations are a priority, something we have always maintained and an issue we have pushed during our Presidency; and in the light of HIV-AIDS, which has become a major stumbling block to long-term development, the EU has a major role to play in combating the pandemic. I will outline later what we have been doing in that area.

When we discuss stability in the African context we tend all too frequently to focus on conflict situations. It is customary to view instability in terms of war, physical and social destruction, violent regime change and forced movements of people. In Africa there is no shortage of the kind of violent conflict which makes progress towards development impossible, and which destroys lives, livelihoods and communities. However, instability is not confined to such situations. For many Africans living in countries which we would consider to be stable, peaceful and safe, other types of instability threaten their livelihoods and lives and limit their attempts to escape from poverty and further their own development.

HIV-AIDS is a key priority of the development agenda of Ireland's EU Presidency. Some 12 months before the start of our Presidency I decided we would make this a central element of our work. I will now outline what we have been doing. We organised a number of events, the first of which was held in this building. Some people may be aware that we decided to focus first on the HIV-AIDS situation in Europe and Central Asia. A major conference, Breaking the Barriers — Partnership for an Effective Response to HIV-AIDS in Europe and Central Asia, was held here on 23 and 24 February. It provided a unique opportunity to raise awareness and mobilise political commitment to fight HIV-AIDS in this region, and led to the endorsement of the Dublin declaration which provides a framework for the countries of Europe and Central Asia to respond to HIV-AIDS. Youth representatives from countries like the Ukraine, Belarus and other countries in that region were delighted with the conference because in their countries they have no institutions or frameworks, and in some cases no government organisations, to deal with these issues. We now have a clear action plan through which we will work in those countries and with all here.

A seminar was held between European and African parliamentarians on the challenges HIV-AIDS presents to governance in Africa. This significant seminar was held in Dublin last month. It is clear that this issue is mainly concentrated in Africa. As part of the last leg of our attention to these priorities, on 24 June Ireland will co-host a final Presidency conference entitled New Preventive Technologies: New Options to Stop the Spread of HIV-AIDS. This meeting will focus on the importance of investing further in the development of an effective vaccine against HIV-AIDS and on the need for further research and development of an effective microbicide. It will be co-hosted with The Netherlands and will be used to symbolise the handing over of the Presidency to The Netherlands. The prediction is that it will take us ten years to develop a vaccine and if we manage to do so, we will have an important solution on our hands. We have been clear about agreeing with following Presidencies the handing over of agendas. The European Union is beginning to work in a manner which hands on the baton to the incoming Presidency. It is vital that The Netherlands continues the work on the HIV-AIDS agenda and I know it is keen to do this.

Since the demise of the Development Council at the Seville European Council, development co-operation Ministers generally meet once every six months to consider a cluster of development matters at the General Affairs and External Relations Council. On 27 April this year I chaired the EU Council discussions which considered six issues relevant to the global development debate and where Ministers took some important steps towards ensuring the EU makes a more effective contribution to the eradication of global poverty. We considered the follow-up to the Monterrey commitments. The Union took its obligations towards the developing world seriously by making a number of commitments prior to Monterrey on aid volumes and on the effective use of that aid. The Commission was asked to monitor our progress towards meeting our commitments. We agreed to work to increase our aid volumes and to find ways of making our aid money go further, for example by co-ordinating our aid efforts. Much work needs to be done to achieve the millennium development goals and the EU needs to make greater efforts to fulfil its part of the bargain. In 2005, the UN will hold an important stocktaking of progress towards meeting the millennium development goals. At the start of the Irish Presidency we decided the EU should play a leadership role in that stocktaking, given that together we are the largest donor of development assistance worldwide and can therefore do much to help the developing world achieve the MDGs.

Last month the GAERC gave the Commission a mandate to begin an internal EU stocktaking of how the EU has contributed to the MDGs. The stocktaking will focus mainly on issues such as increased ODA, coherence, trade and debt. The UN has welcomed our work and we will be talking to the UN and other agencies such as the OECD about how to prepare the stocktaking and how to drive the process forward after 2005.

Much more needs to be done if the MDGs are to be met. Already there are signs that progress towards the MDGs in sub-Saharan Africa is faltering and that most of the goals are unlikely to be achieved by 2015. At last month's Council we made some progress towards ensuring the EU plays its part. However, we know there is no room for complacency in the fight against poverty and we need to sustain our efforts.

Developing countries are often dependent on a small number of commodities. Short-term price fluctuations and long-term price decreases for those commodities are hampering poverty reduction efforts. The problems faced by cotton-producing countries in West Africa are especially grave. As a result of reforms agreed by the EU's Agriculture Council last month, the General Affairs Council was able to agree a package of measures that will significantly improve the situation of commodity-dependent developing countries. This is an important step towards helping those countries to meet the MDGs.

EC aid reform is a controversial subject. EU parliaments and NGOs have not been happy with the way the Commission has managed EU aid. However, the Commission has introduced a number of important reforms such as deploying more people in offices in the field and reducing bureaucracy in Brussels. Aid backlogs have also been reduced. While the situation is far from perfect, as I am aware from my visits, it is improving and we need to constantly reassess how the Commission is performing. On 27 April, Ministers heard a presentation from Commissioner Nielson on the reform process and we discussed what further reforms are needed to ensure the EC contributes effectively to meeting the MDGs. We discussed this issue already in January and it is again on the agenda for discussion at the informal meeting I will host here next week.

Ministers also discussed last month how the EU can help ensure a positive outcome to three upcoming international development conferences, namely UNCTAD in June, the Small Island Developing States Conference in August, and the World Summit on the Information Society in November 2005. As of 1 May, the EU has expanded and gained more clout internationally. We need to take advantage of our greater influence in multilateral organisations to make sure developing countries get a better deal on issues that are important to them. To do that we need to work together and to develop co-ordinated positions, which was the objective of last month's ministerial discussion.

During my last visit to Africa at the ACP meeting in Botswana concerns were expressed by many of our African colleagues that the enlargement of the Union might divert attention from Africa. I made the case, which I believe was accepted, that we are now a stronger body with more players, constituting approximately 15% of the United Nations. All of the new countries have signed on to our agenda. I feel that I convinced those who had any doubts that the European Union is now in a better position on EU-Africa relations.

As delegates know, the EU has a privileged relationship with the African, Caribbean and Pacific states. The Cotonou Agreement with the ACP states covers all aspects of that relationship. Last month, Ministers gave the Commission a mandate to negotiate some changes to that agreement with the ACP side. The purpose of our proposed changes is to make the Cotonou Agreement work more effectively to reduce poverty in what are some of the world's poorest countries. Negotiations with the ACP side officially commenced at the ACP-EC Ministerial Council, which I co-chaired in Botswana earlier this month.

Given the scale of the challenges facing developing and developed countries alike as we strive to meet the millennium development goals, the advantages of the European Commission and the member states working together are obvious. At the beginning of Ireland's Presidency, we set out what we believe the Union's development policy should be about, namely poverty eradication, with a focus on meeting the MDGs; greater coherence between EU policies that affect developing countries so our aid money can go further and be more effective; and enhancing the voice of developing countries in multilateral institutions such as the UN, the Bretton Woods institutions and the WTO.

I would like to mention a major forthcoming event of Ireland's Presidency. I am looking forward to welcoming my EU development co-operation colleagues to Dublin for an informal meeting on 31 May and 1 June in Dublin Castle. Last December, the European Council agreed on a set of priority issues for the Union in its multi-annual programme for 2004 to 2006, including in the area of development co-operation. As the first of six Presidencies to take place during this period, it is appropriate to try to reflect some of these ongoing development themes in our discussions at the informal meeting. Among the priority issues identified in the MAP were making progress towards the MDGs, taking forward the EU security strategy, implementing the 2000 Council-Commission Development Policy Statement, aid effectiveness and budgetary management.

Our ministerial discussions next week will consider issues such as making EU development policy more effective. We need to look at progress in the implementation of the 2000 EU Development Policy Statement, what further reform of external action needs to be considered and the institutional structures that will best help to meet our development objectives in the coming years. We will also consider the question of the relationship between development and security, which is very important. Recent global events have demonstrated the need to protect populations against the threats posed by terrorism and weapons' proliferation. We in the field of development co-operation have long recognised the impact of conflict on the poor in developing countries. Synergies can clearly be found between development and security goals, but equally we must maintain the integrity of our long-term objective of poverty reduction, which is now more important than ever. This subject is increasingly a topic of discussion for foreign affairs, and justice and interior ministers, and development co-operation ministers need to make their voices heard in this debate.

I also intend to consider issues related to the African continent. We have made some collective progress this year already including on the peace and water facilities for Africa and increased contributions to the global fund for AIDS, tuberculosis and malaria. We need to consider our views on further concrete measures that might be considered for Africa such as, for example, on debt, trade and HIV-AIDS.

Given that there is no longer a dedicated development Council and that a cluster of development matters is usually considered by Council only once per Presidency, the regular informal meetings of EU development co-operation ministers are of the utmost importance.

As I said at the outset this morning, the parliamentary element has played a significant element throughout the Presidency. The contribution made by Members of Parliament to development policy has been enormous. I am closely aware of how committed the members of the Irish Parliament are to the development agenda and we have very useful engagement with our parliamentarians. When such commitment is coupled with the dedicated efforts of civil society positive results can almost always be assured.

Chairman

I thank the Minister of State for giving us an overview of the EU Presidency priorities for development co-operation. The script of his speech will be made available afterwards so that we can peruse it at out leisure. As the Minister of State must leave, I thank him and wish him well in the work he is doing to which, as delegates can see, he is deeply committed.

We now move to the session during which we will ask whether development aid works. Our lead speaker is Mr. David Donoghue, Director General of Development Co-Operation Ireland. Mr. Donoghue has considerable experience and is very deeply involved in this area. He has spent periods in Rome on behalf of the Department of Foreign Affairs and from 1978 to 1983 worked in the Irish Embassy in Bonn, Germany, which of course has now moved from there. He was seconded to the French Foreign Ministry in 1984 and to the Italian Foreign Ministry in 1985 as part of the Troika secretariat for European political co-operation. He has served as first secretary in the Anglo-Irish division and on the permanent mission to the United Nations in New York. He has been first secretary at the Irish Embassy in London and he was Irish ambassador to the Russian Federation. He has been the Assistant Secretary General of the Department of Foreign Affairs with responsibility for the development co-operation division, which is now called Ireland Aid, since September 2001. I ask Mr. Donoghue to give us his presentation on the question of whether development aid works.

Mr. David Donoghue

I am delighted to have been given a chance to take part in today's conference. I look forward to the debate. I am delighted that friends and colleagues from Ireland's NGO community are taking part in this event. The question of whether development aid works is a challenging one. I will not attempt to answer it, but I will highlight a few matters of interest.

There is a body of empirical evidence to demonstrate the effectiveness of aid. More people are alive, literate and healthy in developing countries than ever before. The standards of education in such countries have improved, partly as a result of the provision of aid. Living standards in developing countries have increased significantly in the last three decades. The increase in private consumption per capita averaged 1.4% per annum during the 1980s, but it grew by 2.4% per annum during the 1990s. The proportion of the world’s poor living in extreme poverty, defined as those living on less than $1 per day, has fallen from 29% in 1990 to 23% in 1999. The number of poor people has remained constant, roughly speaking, even as the world’s population has grown. The growth in average incomes has been accompanied by substantial improvements in social indicators.

The infant mortality rate has fallen from 107 per 1,000 live births in 1970 to 59 per 1,000 live births in 1999. A child born today can expect to live eight years longer than a child born 30 years ago. Life expectancy has increased by four months each year, on average, since 1970. Immunisation has possibly been the greatest public health success over this period. Just 5% of infants in developing countries were vaccinated against the six major child-killing diseases in 1980, but coverage rates had increased to 80% by 1990, as a consequence of a massive effort that had been made. Deaths from such diseases have decreased by three million per year and at least 750,000 fewer children have been left blind, paralysed or mentally disabled. The growth in food production has been substantially in excess of the increase in population. Rapid progress in primary school enrolment has been reported by Governments. There has also been an increase in adult literacy rates, from 53% in 1970 to 74% in 1998. Gender disparities have narrowed.

Wide regional disparities persist, however. While there has been great progress in alleviating poverty in the areas I have mentioned, the improvements have been far from even. An examination of the global picture highlights significant regional differences. Rapid population growth in developing countries has added greatly to the challenges we face. The HIV-AIDS pandemic, which has decimated societies, threatens the development gains made over the last three decades. Poverty continues to rise in sub-Saharan Africa, more so than anywhere else, because of factors such as poor governance and the endless cycle of famine and drought in many areas. The proportion of the world's poor living in sub-Saharan Africa increased from 18.4% to 24.3% between 1987 and 1998 and per capita incomes have declined in real terms. Half of Africa’s 800 million people subsist on $0.65 or less per day. I spoke a moment ago about a general upward trend in respect of life expectancy, but the trend is not evident in many parts of sub-Saharan Africa, particularly those countries affected by AIDS.

There are many complex and inter-locking reasons for the suffering that continues to afflict those living in sub-Saharan Africa. It would be simplistic to conclude from the problems presented by sub-Saharan Africa that aid does not work. The quality of governance has varied greatly across the region, affecting the impact of aid on poverty reduction. As power in Africa still rests with national Governments, the quality of their governance is crucial. The best-run countries in Africa tend to be those that show the fastest progress in development terms. Relatively higher standards of governance in Mozambique, Uganda and Botswana have produced good development results, attracted some investment and promoted economic growth.

A World Bank study in 1998 showed how aid can be made to work. David Dollar and Lant Pritchard found that developing countries with sound economic policies, good institutions, respect for the rule of law, effective bureaucracy and good anti-corruption policies benefited from aid. Per capita income in well-run countries increased a little if they received a little aid, but it grew by much more if such countries received a large amount of aid. By contrast, countries with bad policies and institutions stagnated or grew poorer, even with substantial aid.

We continue to face significant challenges in this field. Matters have been complicated in the last ten years by the fact that international aid levels have been tapering off, partly because of budgetary pressures and partly because of a degree of donor fatigue. The Chairman rightly drew attention to the millennium development goals. The overall prospects for achieving the goals on time are not encouraging. Many of the goals are unlikely to be achieved if we proceed at the current rates of progress. It is incontrovertible that aid has helped to lift millions out of poverty. It will have a crucial role to play in closing the substantial gap on the millennium development goals. Different aid modalities are extending the impact, range and effectiveness of aid. Not only do we have stand-alone projects, but we also have regional programmes, area-based programmes, sector-wide programmes and general budget support.

Non-governmental agencies are key partners for donors like Ireland. Such organisations have an important contribution to make at the policy and service delivery levels. They have a central role in short-term humanitarian relief and longer-term development. We value them greatly as partners. Civil society in developing countries is of critical importance to the achievement of the millennium development goals. Irish NGOs, such as those represented at this forum, have a vital role to play in strengthening civil society and improving governance, the culture of human rights and the commitment to democracy in such countries. Most crucially, such organisations save countless lives. We value greatly our dialogue and partnership with them.

There is a good prospect that the aid provided by donors like Ireland will be effective if such countries work in an environment in which the relevant government pursues strong pro-poor policies. The governments of countries that receive aid from donor countries should endeavour to achieve better governance, to have a genuine commitment to human rights and democratisation and to make serious efforts to combat corruption. It is important that Ireland and other donor countries should have tight controls. Other factors acquiring increasing importance are the need to harmonise international donor efforts and reduce the administrative burdens on developing countries. Clearly, it is a waste of energy if a country like Tanzania or Uganda must receive several hundred incoming missions a year. Common sense dictates that as donors we should pool our efforts and work collectively to reduce these burdens and free up energy for more productive purposes. Ireland is one of a number of countries taking the lead in this area. The harmonisation effort will result in more effective aid.

Coherence within the policies pursued by developed countries is also vital. Trade, to which reference has been made by the Minister of State, Deputy Kitt, is a particularly important arena for more coherent policies. Ireland's aid is completely untied which makes it more effective. The risks of aid dependence psychologically and economically are ever present. More emphasis is being placed nowadays on the two-way nature of the relationship between developed and developing countries. We provide focused aid which is measured against specific results and predicated on the carrying out by the recipient country of governance and policy reforms. Furthermore, aid is provided not merely in response to moral and humanitarian impulses but also to facilitate the emergence of future markets for northern goods and services. It is a two-way street in various respects.

Developing countries themselves are conscious that in many instances, particularly with regard to middle income countries, they stand to gain far more from a liberalisation of world trade and the ability to participate on equal terms than from aid. There is a statistic which suggests that developing countries stand to gain eight times as much from the liberalisation of trade than from traditional forms of aid. These countries call for the ending of trade-distorting agricultural subsidies operated by richer countries to strengthen domestic agricultural production and improve export performance. Developing countries are already suffering from the severe collapse over the past decade in the prices on world markets available for the commodities which they export.

On the initiative of the Minister of State, Deputy Kitt, we have been devoting particular attention to the difference our Government can make with our funding to the strengthening of the private sector in developing countries, notably in agriculture. Assistance is provided to help these countries to compete more effectively on the global market in agricultural products. The Minister of State has established task forces to deal with agriculture, the private sector and information and communications technology development.

Aid can only work through the holistic effect of a range of interventions towards developing countries. The provision of direct aid bilaterally or multilaterally must be supplemented by policies which free up the trading potential of developing countries and promote the resolution or pre-emption of the conflicts which plague Africa in particular, good governance, respect for human rights and the active combating of corruption within developing countries themselves. Aid cannot be effective in a vacuum. It requires a supportive environment with the features I outlined in the countries to which it is provided. Aid must be provided by donors in ways which are sensitive to local economic conditions and cultural traditions. Northern models of perfection are not necessarily the solution. It should not be accompanied by price tags or conditions designed to bolster northern economic, political or strategic interests. Aid should be provided on completely untied terms and backed by the gradual removal of protectionist arrangements operated in the north which deny poor countries access on equal terms to global markets.

Macro-economic support is helping governments in developing countries to target resources at key social sectors including health and education. Debt relief is an important instrument in this context. The condition is always made that the funding which is freed up must be spent on social sectors. General budget support is an increasingly employed instrument to bring governments and donors together in a budget planning and implementation process with a view to ensuring poverty reduction dominates everything else. Strict agreements are reached with the partner countries to ensure the aid we provide is carefully monitored and cannot be side-tracked for military expenditure or personal enrichment.

The elaboration of detailed poverty reduction strategy papers with clear target indicators and monitoring systems is an essential part of our relationship with developing countries. Many questions remain to be answered. We must assess how to prevent the economic growth the provision of aid may create in a developing country from being undermined by corruption or other factors. It must be allowed to reach the grass roots and benefit directly the poorest people. We must find ways to ensure the increased expenditure by governments on social sectors as a result of aid is spread evenly across all parts of the population. We must seek to ensure that the poorest people participate fully in the development process and become co-owners of it. We need to find ways to ensure the emergence of a healthy civil society in developing countries as an essential counter-balance to the traditional pre-eminence of governments and armies.

These are challenges for everybody gathered around this table, governments, parliaments, non-governmental organisations and civil society, in developed and developing countries. The reduction of poverty in the world calls for a sustained collective effort. There are no easy answers or quick fixes and it is too early to offer categorical judgment about whether aid works. While the evidence I mentioned earlier indicates that it does, there is also evidence which suggests that in parts of the world aid has not worked as effectively as we would have liked. Success comes only in the long term and requires considerable patience. As the Minister of State indicated at the beginning of this meeting, while Ireland has achieved considerable developmental success, it required the best part of a century to do so. In Africa, it has only been a few short decades since independence.

I have covered most of the issues I intended to raise to stimulate debate. There is no easy consensus on the way forward. The view taken by successive Irish Governments is that poverty in developing countries can be tackled effectively through a mix of approaches which combines the provision of direct aid with policies which are supportive of the interests of developing countries in other ways. The role of parliaments and foreign affairs and development sub-committees is vital in mobilising parliamentary support for the work which we must all do to achieve the millennium development goals. Parliaments can also play a wider role in building public support and helping to provide public and parliamentary support for vital overseas development aid provisions.

An active dialogue with Government is an essential part of the process. In Ireland, we are pleased and proud that we have in the last couple of years developed a much closer relationship with our Parliament in this vital area of Government policy. I very much welcome the initiative taken by the Chairman of the Committee on Foreign Affairs in convening this conference. I thank the conference for its attention.

Chairman

Those wishing to table a question on this section may do so and it will be included on the list.

We will now hear a presentation from Mr. Niall Mellon, Chief Executive of the Niall J. Mellon group. Mr. Mellon is a relatively young man — all these matters are relative — who started his own business aged 19 years. His main area of business is property development. The projected turnover of his company for 2005 is approximately €1 billion. Mr. Mellon has been actively involved in charity fundraising for ten years which he has combined with his work in business. In 2002, he launched an innovative charity building project in Cape Town which involved building houses for people in the city. In 2003, he organised 150 people to participate in an Irish overseas volunteers programme to South Africa and in the same year received the Irish People of the Year Award.

Mr. Mellon has stimulated thinking about what people can do and has persuaded many workers in the building trade to go to South Africa to build houses over several weeks before returning home again. Participants have enjoyed the experience and spoken very highly of it. He has huge plans for the future in that respect. Mr. Mellon shares my belief that one should not sit around talking but take action. He is a good example of a person who has done something. I ask him to make a short presentation on his work.

Mr. Niall Mellon

Thank you, Chairman, for your introduction. I am delighted to be here. I take this opportunity to echo the Chairman's words and extend a very warm welcome to the delegates visiting Ireland. It is a great honour to speak to the committee and I hope it will find some of the points I make worthwhile.

The Chairman has introduced me sufficiently. As I come from a business background, I am not as qualified on the issue of aid as many here today. My experience has been based mainly on a project I set up in South Africa. Perhaps some of what I have learned from the project will be of interest.

As the Chairman stated, my business is property development. In 2005, I am on target to build at least one in every 100 homes in the United Kingdom with one tenth of the staff levels of most of my competitors. While my business success is important, it is not the reason I am speaking here. I am addressing the committee in the context of a separate part of my life, my charity work in South Africa and in particular the volunteer aspect of the programme I have established.

We have been asked to respond to the question posed for discussion today, namely, whether development aid works. I will give a typically Irish answer by answering it twice, first, based on my experience in South Africa and, second, as a member of the general public. My first answer is a firm "Yes". Development aid has worked for the recipients and for me. I deliberately separate "the recipients" from "me" because it is imperative that each party clearly understands from the outset what it expects from each aid relief project.

I will briefly give some background on my project in South Africa. I first visited Cape Town five or six years ago and, like many people, I was struck by the appalling living conditions visible on the roadside in the form of shack dwellings. I wanted to see first hand what living conditions were like inside the townships and arranged for a friend to bring me into one of the communities. While I was disturbed at the living conditions, I was impressed by the spirit and character of the people living in these dreadful conditions. The warm hand of friendship they extended to me was truly astonishing.

Initially, my personal offer of help was in the form of a scholarship programme for a dozen young people living in the community. In the second year, I extended this by approximately 25 scholarships. By that point, I had come to know some of the community leaders and told them I would be interested to find out if something could be done about housing. The township in question, which had 12,000 inhabitants, had built just six houses over a ten year period. I proposed a partnership arrangement between me and the community, whereby I would provide the finance, leadership and management experience to build houses, while the community would provide the necessary hard labour.

I divided my new community staff into small, independent units and agreed a fixed payment per team per house. I separately managed and provided all the materials on a per unit house basis with a simple and strict rule that if anything went missing, it would come out of each team's payments. The houses would not be free but would be free of bank interest, a relatively complex point to get across to the community. The idea of mortgages, assignment and security of houses was completely new to the people. Following considerable effort spent on communicating with them, they gradually, over a year to 18 months, began to understand that if they fell behind with repayments, they would lose their houses. In the past 12 months, we have built more than 200 houses of a higher than normal standard, though not at significantly higher cost.

From the outset, I made it an objective to involve Irish people in this programme, mainly because I believe that until we make a concerted effort to involve large numbers of our population at home in Europe in some shape or form in real visits, we will continue to struggle to make development aid a mainstream issue. I felt it was important to demonstrate to this poor community how Irish people living in the new, economically successful Ireland would be willing to help their South African neighbours. I set about trying to assemble 150 experienced builders who would volunteer and raise the cost of their own trip, plus some additional funds for building materials.

This trip was a major success. For ten days, 153 volunteers worked day and night completing 25 houses. These were built to a typical western construction standard, using blocks, concrete foundations, tiled walls, tiled roofs etc. The trip received considerable publicity both in Ireland and South Africa. Why? The reason was that we sought it. Our job was made much easier because the public were involved in large numbers, which made the issue popular news for the media.

Within the township in South Africa, the hard work and professional approach of the volunteers earned the respect of a poor but highly intelligent community. Many people throughout South Africa working in the public housing arena told me that it had lifted their spirits and gave them hope and encouragement to see that the outside world had not forgotten that, despite the great success of the new South Africa, eight million people still live in shacks and much remains to be done.

It was the visible presence of a large number of volunteers that made the most impact. While the trip in itself only built 25 houses, the intangible benefits were far more substantial. It put the housing issue on the front page of the South Africa newspapers for a couple of days, which acted as a boost for all the people in South Africa working in the housing arena. Back in Ireland, we also received a great deal of publicity. For a brief moment, it made Irish people feel proud that their fellow country men and women were going abroad to do volunteer work, even if only for a short period.

Is development aid working? As I mentioned, I am only qualified to answer the question in the context of my own project. It has worked in my case because we had a structured, clear purpose with defined goals and realistic targets and objectives. It is important that it has also demonstrated the value of public volunteerism. The significant interested reaction of the media when the public are involved in meaningful numbers cannot be underestimated. Every television station, radio and newspaper in Ireland, and most of those in South Africa, covered some aspect of the project.

I am sure there are some sceptics who have issues with this type of volunteerism. They would perhaps ask questions about the cost of sending volunteers for short periods and want to know the lasting benefits of some trips. I agree that strict criteria must be set. People who have been on field trips are invariably glad they went and are even more aware of the imbalances that exist in the world and want to do more to help. I am not saying that arranging volunteer groups is not a headache but it is an essential one.

We should designate a fixed week each year where every EU country sends various specialist volunteer groups for short trips of one to two weeks. That would probably result in as many as 50,000 people in the first year going to 60 or 70 different countries. Doing it in a collective manner would have an impact in terms of the world media. Let us imagine what a powerful positive image that would be for the European Union. I am sure some people can already envisage the positive spin off.

I said at the outset that I would like to answer the question twice, the second time from the perspective of a member of the public. Does development aid work? It is safe to say that most people would not know the answer. The reason for that is because they are not properly informed. The most powerful media tools — television, newspapers and radio — are not being used sufficiently to communicate this essential information.

I know that some countries have conducted their own research over the past few years only to be told what they already knew, that most members of the public in Europe do not have the slightest idea where their money is being spent or whether it is being spent in an effective manner. How then can they be expected to continue to give their support and the extra moneys required to improve the lives of our neighbours throughout the world? I accept that the tide is turning and most national aid agencies have some plan in place to better communicate what they are doing. However, what is being done is not enough. Annual reports from aid agencies should include a reliable independent survey stating the number of people in every 100 who know or do not know what an agency has done that year.

Once the principle has been agreed, the target would be to increase that figure on an annual basis. In order to do this, an appropriate budget must be allocated, which would require at least 1% of total funds for aid relief to be spent on a national awareness campaign. It should be a prerequisite for every national aid agency to have a proven brand manager. It is more about recognising how we can grow the generosity of our home markets by instilling feelings of national pride and goodwill. One should state it loudly if one is at the top of the pile. Competition is good for us and would inspire other countries to narrow the gap. An effective campaign would make it much easier to generate significant extra funds by making it part of our culture.

I will conclude with one simple suggestion. The business world must be included. It should contribute a percentage of turnover to overseas development aid. I propose that all firms which tender to supply goods or services to government or semi-state industries in the EU should have to include a statement of what percentage between .01% and 1.0% of its tender figure it would be willing to donate to the European business aid development programme. I am in business and know this area. The business world would grunt and groan but they are a determined breed of people and would not be put off tendering for a European contract in which they were interested. They would simply want to ensure that their tender would qualify and, if that meant a contribution to keep other people happy, they would do it. The contribution could be deducted automatically from each payment. A figure of as little as 0.25% would generate billions of euro. We should not say it cannot be done; if we say it can, that will make it happen.

Chairman

I thank Mr. Mellon for a stimulating contribution. Our next speaker is Mr. Tom Arnold, chief executive of Concern Worldwide. He has long experience in working on hunger and is a member of the UN hunger taskforce. He was previously an assistant secretary in the Department of Agriculture, Food and Rural Development. He has been chairman of the OECD committee on agriculture and has worked on the directorate general for development in Brussels. He has also been chairman of EURON aid, a network of the main European NGOs. He has been deeply involved with the European movement and the Institute of European Affairs. He has wide and relevant experience.

Mr. Tom Arnold

It is a pleasure to be here and share the platform with the Chairman and colleagues like Mr. David Donoghue from the official Irish aid programme, Mr. Niall Mellon and Mr. John O'Shea.

I was delighted to hear Mr. Mellon's contribution because it shows not only his extraordinary commitment but the sheer creativity of some of his ideas. In the development business, creative ideas are one of the crucial ingredients.

To address the specific question of whether development aid works, again, there is probably no great disagreement; the answer is "yes, but" or "yes, under certain conditions". Towards the end of his contribution, Mr. Donoghue spelled out the elements of what one would call the supportive environment necessary to make development aid work.

I would like to briefly try to identify the lessons that need to be drawn from what we know about what is needed in order to make development aid work. There are lessons at three levels — for governments in developing countries; governments in developed countries; and the NGO sector. The focus that has been given this morning by the Minister of State, Deputy Tom Kitt, and the Chairman, is that placing aid within the framework of the millennium development goals is an essential starting point.

The great benefit of the millennium development goals after years of, at times, divisive debate about what the agenda should be, is that they at last represent a shared agenda for developed and developing countries and different aspects of civil society that are clear and simple to understand. The targets have timeframes and can be measured. In that regard, the earlier comment by the Chairman that his committee will focus on reports which will track this country's contribution toward the achievement of the goals is very important.

At the end of the day, aid will only be a small part of any overall national development effort. We must keep that very much in mind. The responsibility for development is ultimately in the hands of the political leadership of the countries seeking development. There have been vast differences in the economic performances of developing countries over the past 30 to 40 years. The reasons for this are complex and interlocking. Let us consider the overall picture regarding developing countries in entirely simplistic terms. Asia, by and large, has moved forward; Latin America has had a rather patchy performance, with some progress but not a great deal in many cases, and there are still huge inequalities; and Africa has a dismal record. The reasons for the differences in performance ultimately lie in politics, economic policy and the choices that are made. Conflict is also a reason because, clearly, it is impossible to achieve development if there is conflict. Corruption is also a reason in some African countries and others.

There should be a very clear understanding that "it is about politics, stupid." There are political choices to be made and responsibilities to be taken by political leaders. In very blunt terms, if certain political leaderships are not prepared to face up to these realities, their countries will be left further and further behind because the world is not waiting for them. In that context, as was stated earlier, there have been some positive developments in terms of NEPAD such that African leadership in particular is committing to certain principles of operation. The critical question is whether they will be delivered over the coming years.

Politics matters, as do economics and policies, and there are lessons to be learned in this regard. The speaker from the World Bank mentioned last night that governments must have a sense of ownership of the policies they are following. This is of crucial importance. However, there is not enough acknowledgement of another important issue. Ownership and good policies are fine but ultimately one has to have the capacity to implement them. There is a major capacity problem in many developing countries, particularly in many of the African countries. We speak of HIV-AIDS as a terrible problem, and it is such in terms of loss of life, but there is insufficient focus on the impact it is having on capacity in many developing countries. In some countries twice as many teachers are dying from AIDS as are being trained each year. This is frightening. Therefore, there should be a very clear focus on addressing the capacity issues at different levels.

Another crucial dimension to the approach to national development concerns the role of civil society. Governments, on their own, will never be able to achieve development. They must have allies and a civil society working in tandem with them. There is a major problem in many developing countries, particularly in Africa, in that civil society is not sufficiently tolerated or encouraged. I was at a meeting in Uganda about a month ago at which the President of Senegal said in a very striking address that civil society is being smothered in many countries. That is a reality. Governments should have the confidence to let go or promote and encourage the efforts of groups in civil society.

Let us consider the responsibilities of developed countries in this process. Until now I have focused on the responsibilities of developing countries, particularly of their political leaderships. Developed countries have a very clear responsibility in this project. The millennium development goals are conditional on better policies, but they are also conditional on more resources being made available. To put it at its simplest, if the goals are to be achieved, a doubling of development assistance is required. This must be spread out among the different countries concerned. Ireland, as was said earlier, is in a relatively favourable position in that it has made a commitment to reach the 0.7% target by 2007. It has gone some distance towards that, having reached 0.41%, but there is a distance to go and the NGO sector will certainly be looking to the Estimates next year to obtain a very clear signal that the Government will deliver on that commitment.

Another very positive development is that the Government, by way of holding the Presidency, has been pushing the EU to fulfil its commitments. At the meeting to be held in September 2005, the UN will assess its progress, one third of the way towards the deadline of 2015, in moving towards the millennium development goals. That will be a crucial meeting and governments and NGOs will have to focus very much on what emerges from it.

I have also dealt with the capacity issue in developing countries and reaching the associated goals. If developed countries are to administer aid programmes effectively, they too will have to consider capacity issues. The Irish Times today posed a serious question about the influence that one of our domestic policies, decentralisation, may have on the effectiveness of the Irish aid programme. This is not a subject I necessarily want to address in any detail at this meeting, but I wish to flag it. It is a very serious issue.

It is sometimes easier and tempting for NGOs to tell everyone else what should be done without necessarily reflecting on their own responsibilities. NGOs have very clear responsibilities in this regard. There is a very new environment emerging in many of the developing countries. As was said earlier, the role of civil society within developing countries is of crucial importance. Therefore, a critical question arises as to how international NGOs, such as Concern or GOAL, link with civil society efforts in developing countries to enhance their capacity and generally progress the development agenda. Very serious questions must be asked on what distinctive values international NGOs can bring to this process. What are we learning as an NGO community from the work we are doing on the ground? How are we transferring the lessons learned to work in other countries and generally within the organisation? These important issues challenge the capacities and vision of NGOs. Moreover, how does one link what one learns on the ground to the advocacy work associated with apprising governments in the developed world of what development priorities should be?

Chairman

I thank Mr. Arnold. Our next respondent is Mr. John O'Shea, the chief executive of GOAL. He is the founder of GOAL, which he established as a humanitarian organisation, and he worked as a sports reporter previously. Until 1992, he combined his roles as journalist and volunteer chief executive of GOAL, but he then quit journalism — he never really quit it, but says he did — to concentrate all his energies on GOAL.

Since its inception, GOAL has spent in excess of €250 million on humanitarian programmes in over 30 countries. Over 1,000 volunteers have worked in the developing world on GOAL's behalf and the organisation has responded to every major humanitarian disaster since 1977. GOAL is a non-political, non-denominational agency and it targets all its energies on one objective, the alleviation of the suffering of the poorest of the poor.

He has received many awards, including the People of the Year award in 1987 and again in 1992. He has the Ballygowan "Outstanding Achievement" award of 1988 and the Publicity Club of Ireland communications award in 1990. This is relevant. Mr. Niall Mellon has prepared the ground for him well, without being involved in any of this, because he said that if we want to be successful, we must publicise our work and ensure people know about it. The publicity and communications aspects are hugely important. John received this award from the Publicity Club of Ireland and he defines himself as a publicist on behalf of the poor and needy. He also received outstanding achievement awards in 1995 and the Tipperary Peace Award in 2004. I do not know how he got that peace award because he is quite a violent gentleman in getting publicity for the poor. However, I believe they took the circumstances into consideration.

Mr. John O’Shea

I do not need a public relations man when I have the Chairman. I am delighted to be here today — at my age I am delighted to be anywhere today. I welcome our foreign guests and I hope they have a fantastic few days here. We arranged good weather and the beer is on tap. If they have a chance, they should visit Dalkey, Killiney and Howth, which are beautiful places. They should not listen to this nonsense for too long because it is upsetting. They should get out while the sun is shining.

I am a sports journalist and I would like to talk about how Ireland will do in the World Cup or how Wasps fluked that victory yesterday. We do not like to see our cousins win too much. However, whatever little knowledge I have picked up from my involvement in the Third World over the last 27 years, I am anxious to impart in the hope that somebody else will do the job better than I or my colleagues have done. We, like everybody else, have really failed. The subject of this conference, development aid, has also failed despite a modicum of success. It has failed because so many people have died during our watch.

Development aid in isolation is a waste of time. It exists in isolation because, if we are honest, we should realise that the reason people are dying of starvation and malnutrition and are being treated like animals is the sheer indifference of the international community. That means the governments of the West and the largely corrupt governments of the Third World. Equated to a family situation, it means that if a mother and father are kicking the heads of their children, it does not matter how often the social worker calls because he will never be able to rescue the children unless he takes them from the parents or removes the parents from the children.

The international community has failed to honour its obligations to the poorest of the poor. Development aid is, in many ways, a cop out by the international community. It writes the cheque but leaves it to the NGOs or the missionaries, groups that are too small, or to private enterprise to do the job. Take a simple example. Let us say everybody here has six children and those children were locked in a room upstairs, a fire broke out and the fire brigade arrived with all the necessary equipment. After rescuing three of the children, the firemen retire to the local pub to have some beer. The parents would get quite upset and direct them back to the house. They would be stunned to be told by the firemen that they came here last year to a similar situation and rescued two children before they decided to get drunk, so that is a 33.3% increase. This is how the international community talks. It talks incrementally, not about the lives of human beings. Listen to representatives of the UN, the EU and governments. The talk is about the 10% improvement. The world can feed itself three or four times over. It has all the resources it requires but none of the will. It never has had any will and never will have any.

I do not know who is to blame. Perhaps it is the creator. Perhaps the wrong people, with the obvious exception of the man in South Africa, become leaders. Certainly, none of the leaders in the modern history of mankind can convince me that he or she cares two euro about whether people live or die. When I make such a statement, people are entitled to counter that I am exaggerating. Perhaps that is the case. However, look at history. That is always a good indicator of whether we are on the right track. My first encounter with abject poverty, devastation and horror was Cambodia. I saw what Pol Pot did to his people. I did not see any development aid there or any nation come to help the people, except the Viets who arrived because they wanted to take it over. Where was development aid? Where was the money? Where were the people? Even the international community failed to expose what was happening. It was a journalist, my colleague, John Pilger, who told us. What was the UN doing at the time? Nothing.

Then there was Ethiopia and one of the greatest bastards the world has ever known, Mengistu. He was the cause of that famine. He would not allow us to use trucks to take food to the people. He was using the trucks to move young men and children up to the front to fight against the Eritreans and the Tigrayans. He was getting development aid from the main countries of the West, yet he was the cause of the famine. If we told this to a Martian, he would think we were mad. We buried up to 2 million people there because the international community did not do its job. Again, it was left to the tiny aid community, whose hands were tied. In those days we needed a visa to cross the road in Addis Ababa and two to get back to the other side. Try mounting an aid effort in such a situation.

Then there was Rwanda. Everybody stood back, had a good look and watched the children in Gikongoro having their heads removed from their shoulders. I remember being in a church there and the UN soldiers standing outside, taking notes on their computers. We have moved on from pen and paper but nobody did anything to stop the disaster. However, the people in power prior to Kigami were getting development aid. Afterwards, Kigami was given development aid to go into the Congo and kill half a million people. Not alone is development aid unhelpful at times, it can be extremely harmful and injurious to the health of the poorest of the poor.

A total of 2 million people poured over the border into the volcanic region of Goma. They were in a dreadful state. The UN could not provide clean water for them and cholera broke out. We had to throw the children onto the back of lorries, like a rugby scrum half, when they had died of cholera. Where was the development aid? It was being given to the Congo, to another tyrant who ruled and ruined that country for 29 years. There were few groups in Goma trying to save the lives of these people.

Have we made any progress since then? I do not believe so. Let us consider the country I have just mentioned, the Democratic Republic of Congo. We allowed nine armies to rape and plunder this country, leaving 5 million people dead. Every one of these nations is receiving development aid. I am embarrassed and ashamed that my Government is giving money to the Ugandan Government. Mr. Museveni has conned the world. Just because he makes some progress in the area of AIDS, he expects the world to turn its back when he sends his armies into the DRC to raid its coltan and diamond mines and leave 5 million dead. In Rwanda the same thing was allowed to happen. Due to the world's guilt about the genocide that took place there, we are prepared to let Mr. Kagami and his thugs do what they like in the DRC. What use is development aid if we are to give it to nine countries that send their armies to do such destruction to the most vulnerable people on the planet?

What about more stable places such as India? India receives billions in development aid, yet today it has more food in its larder than any nation on the planet. It has bigger grain silos than any other country, yet 50% of its children are malnourished. However, we still send development aid. We refuse to take on the Indian Government and ask why it does not look after its own as it is not politically correct to do so.

Angola has enough oil to keep half of Africa going for years, yet if one is in Luanda and needs an operation on one's ingrown toenail, it is tough. The hospital has no oil, because all of it goes out to the West. The resulting money is put into Swiss bank accounts by the Angolan Government. Yet Angola receives billions in development aid. It is appalling to think that we are still sending aid to these countries. Like Chamberlain, our attitude is that we must engage with these people. This did not get Chamberlain very far, however, and it is not getting us very far either.

Burma is in dire straits because of the military junta. Courage is needed to get Aung San Suu Kyi out of jail and reinstall her as leader. Then Burma will not need development aid — or if it does, at least the mines will have been swept away. By providing development aid to countries in which these things are happening, we are wasting our time. We will be at this for a thousand years.

The world, especially its poor, needs honesty and courage more than anything else. They need the international community to admit that it has failed the poorest of the poor. The Western leaders must admit this because we have the resources. The corrupt Third World leaders must be forced to admit they are treating their own countries as though they were private possessions and treating their women and children like animals. That is the first thing that needs to be done. We must find another Mandela. Somehow we must find someone at the top table who cares about the lives of the poorest of the poor, who has the courage to look Museveni or Kagami in the eye and ask them to remove their armies from the Congo, or else. However, this is not done. We are all much too timid. We pursue a different agenda, for whatever reason.

In my own country there is much talk about reaching millennium goals of allocating a certain fraction of GNP towards international aid, although I do not know much about it. This is utter nonsense. It does not matter one bit how much money is put on the table. What matters is who receives the money. If it goes directly from government to government, we can be sure the poor will never see most of it. It is difficult even in a developed society to ensure money is distributed fairly because of bureaucracy and corruption, both of which, I am sorry to say, we have here. In a Third World country, however, to expect the money ever to reach those who are suffering the most is an impossible dream.

Our attitude as an international community must change radically. We must put the poor of the Third World first. There should be no other considerations, whether political or economic. We should not worry about stepping on toes. We must be like the mother who will climb up the drainpipe to rescue her children while the lads are getting drunk in the pub. She does this because she loves them. This absence of love is the single biggest problem in our dealings with the Third World.

Do we know of any world leader who has identified with the fight against abject poverty? There is not one. Nor is there a single government that will take up the challenge. That is what I hope the Irish Government will do. We should forget about the money. I would much prefer to see the leader of our country go to the United Nations or to Mr. Blair or Mr. Bush and say that he wants Aung San Suu Kyi to be released, he wants the armies to withdraw from the Democratic Republic of the Congo and he wants the people of the Third World to be treated as human beings. Giving money is a cop-out. When one has no moral fibre, one goes to the cheque book but that will never solve the problem.

The committee has listened to this for long enough and it is sunny outside, so I will finish now. I thank the committee for listening to me. I agree with what Mr. Arnold and Mr. Mellon have said. We are not the answer. None of us will ever solve this problem. Every human life is precious and no matter how many children we manage to save in Goma or anywhere else, we will always bury more. The greatest job we can do is to try to force our governments, which have great power and influence as well as the ability to do the job, to develop the will to deal with this problem. If we pray hard enough, perhaps they will find enough love to do so.

Chairman

I told the committee that Mr. O'Shea would be passionate and provocative. He has raised issues that we must address in a practical manner. We must make sure that the help we provide reaches its target. I was hoping somebody was holding down Norbert Mao because I am sure, as an MP from Uganda, he would have liked to contribute. We will hear from him later, however.

The one thing that was emphasised particularly in Mr. O'Shea's remarks is the need for parliaments to take an active role and for all of us to be active, to speak out and to ensure that moneys are well directed and that support is given where it is needed. We also need to familiarise ourselves with these countries by visiting them, meeting their people and seeing the reality of the issues facing them. We must ensure that people such as Mr. Donoghue, who has put his whole life into working in this area, have the support they need to deliver results.

The first question on the list is from Mr. Neven Jurica of Croatia. I ask him to put his question.

Mr. Neven Jurica

I do not have any question, but I wish to make some remarks about whether development aid works. I am very pleased that Croatia has been invited for the first time as an applicant country to the Conference of Chairmen of Foreign Affairs (Development Co-operation) Committees. It is a recognition of the significant progress my country has made since gaining independence, particularly under the leadership of the current Government and Prime Minister, Mr. Ivo Sanader, who has mobilised all our capabilities in the direction of gaining EU membership in the shortest possible time.

Further development of the European Union is an important contribution to Europe and the world. Development and growth leagues show that Croatia is at the top of all countries in south-eastern Europe, our democratic institutions are mature and stable and our annual growth rate of GDP is between 4.5% and 4.8%. Also, our annual income per capita is at the highest level of all south eastern European countries. Therefore, Croatian accession to the EU would push the entire region forward, stabilise it and facilitate sustainable development.

The current process of enlargement of the EU should not be stopped now, it should be continued at a fast pace. A larger EU will be a stronger EU. Every new member state makes the Union more competent to fulfil the global role we are discussing today and to contribute to the development of the world. The accession of Croatia, along with the other countries awaiting full membership of the EU, will not cause any problems for the European Union. It will contribute to European unification but it will also be a cornerstone of regional development in south-eastern Europe. It will be the natural continuation of the recent enlargement. I hope and expect that during the meeting of the European Council in Dublin in June, a decision is reached that Croatia will attain candidate status and be given a date for the start of negotiations with the European Union. It is a substantial gain to be made as a contribution to the increased development in one important part of Europe.

Mr. Berndt Ekholm

I fully agree with Mr. David Donoghue about the mixed approach to the subject. Development works but we also must also agree that development aid is not enough and there are many areas that could be changed. Sweden has already reached the 0.7% of gross national income but the most important thing we can do is include other political areas in development co-operation — trade, agriculture, the environment and even education. I am not saying these areas should give money for development but national and EU policies must change. It is obvious that the agricultural policy is devastating for poorer countries and the situation will not improve if we continue with it. We must examine our trade policies and even education inside our own countries — it is important that education takes development into account so that young people learn about globalisation.

We must focus on these issues to be more effective and achieve more coherent policies. Development co-operation is only one of the policy areas that must work in a coherent fashion. We should use development co-operation as a catalyst for the other areas instead of as the main area for co-operation.

The Swedish Parliament in December decided on a new policy for global development encompassing all political areas. I have with me a summary of the policy which might be of interest to other delegates. I hope that the Chairman will allow me to add it to the information table. Readers will see that we have an objective for every policy field and a supplementary objective for development assistance, taking into account the perspectives of the poor and other perspectives and guidelines.

Lord Bowness

I thank the Chairman for his welcome and the arrangements made by the Irish Presidency for this meeting. I fear I will not be able to bring to my comments the same passion as Mr. O'Shea.

The question of whether development aid works is an open one but it will not work if it is of a poor standard and inefficiently and ineffectively delivered. Bearing in mind the importance of European Union aid, we should concentrate on that. I refer to some of the comments made by Deputy Kitt, the Minister of State, this morning and to a report which the House of Lords European Union Select Committee has just published. The report contained an element of good news in that despite the severe criticism of the standard of European Union aid in past years, it found there had been considerable improvement, with the establishment of Europe Aid and the delegation of some responsibility to overseas organisations, and strategies focusing on human rights and good government.

That is the good news but we cannot be complacent. There are further important moves to complete the reform process, some of which have been mentioned by our colleague from Sweden. There must be greater coherence between the aims of European Union development policy and the effect of the Union's other policies in trade and agriculture. It is also true that while the European Union together with the member states, contributes more than 50% of official development aid, the geographical scope of the aid remains controversial and the amount focused on low incomes is too low. We need to be aware of the political pressures from an enlarged European Union to focus development aid on the new neighbourhood at the cost of the poorest countries. The European Union needs to work towards developing an objective set of global criteria to help assess need rather than criteria based on the regional allocations of the ACP.

As a result some countries may receive less than at present while others get more. European Union aid is skewed in favour of the ECP group to the detriment of other low income areas, particularly Asia. Perhaps controversially it was suggested that it would be a help if the European development aid fund was brought into the budget because that would help produce a more coherent system. It is probably too late now, but we thought it disappointing that development aid did not get a greater focus in the proposed draft EU constitution. We hope to see the next European Commission retain an independent development commissioner, placing policy and aid programming functions in a single directorate. It is to be hoped that this issue will not be avoided merely to accommodate the current difficulty of having 25 commissioners. It is important that EuropeAid is retained as an agency to implement aid. Despite the criticisms in the past, it would also be a mistake for European Union aid to be repatriated to the individual member states.

How does Mr. Arnold view the African Union regarding the question of aid to Africa, which is difficult? Will it be a useful vehicle with which the European Union can deal? Will it be able to apply some of the pressures suggested by Mr. O'Shea on some of the countries in Africa?

Professor Hanck de Haan

The major theme of today's economic discussion is how effective development aid is and many studies have been made of this issue. A major contribution has been made by a British development aid specialist who has done much research on project aid. The outcome of the study was that one third of this aid is very productive and profitable, one third has little effect and one third is a complete disaster. We must look at these figures. One reaction came from a former director of the International Monetary Fund. He said that no similar studies have been made of purely private investment, even in Ireland or the Netherlands, but if such studies were made, the outcome would be the same. The question of the effectiveness of development aid is relative. Who is taking care of the really poor countries?

We might look first at official development aid. The recent trend is reflected in the poverty reduction strategy. In strategy impact papers we stress the impact of so-called ownership. The result of this official policy of the World Bank, the Netherlands and Ireland too, is that the "winners" are the governments which are able to come up with excellent structural programmes and so on. Uganda and Mozambique are examples. We are picking the winners of official development aid. We always plead for greater participation of the private sector, which in Ireland and all over the world is not interested in the poorly governed, least developed countries with a great deal of corruption and so on. The big question, therefore, is who is taking care of the badly governed, least developed countries, rather than the winners like Uganda and Mozambique? I put that question particularly to the speakers from the private sector. How can we organise better support for these least developed, badly governed countries?

Chairman

Thank you. We must finish shortly so I will ask each one of the respondents to make a brief comment. Mr. David Donoghue had to leave to catch a plane and gave his apologies.

Mr. O’Shea

Was Professor de Haan referring to the recent African initiative take by Bono and Bob Geldof and Tony Blair? No. I wondered what Mr. Meles was doing on that group. I can assure delegates that it has no chance of success if he is there.

Many speakers have talked of the effectiveness or ineffectiveness of our financial aid. It is likely we will not find the moral fibre anywhere, certainly not in the foreseeable future, to do what I want done. It is probably a pipe dream, but being a journalist and a dreamer I must suggest it. I suggest that the delegates use their influence with their own governments to ensure that the bulk or all of the money set aside for development aid is directed at educating only the poorest. If a Messiah, a new Mandela, is to be found, it will not be in the West. The selfishness and greed of the West are too strong. The move will have to come from within Africa. The African people, if they become sufficiently well educated, will see for themselves, as many currently do not, that their leaders have no interest in them. They will find a way of removing their leaders, as we have done in the West. Education played a part there.

In terms of what we do with our money, that is what I would most like to see happen, rather than a "one for every member of the audience" approach which many governments take because of political or other considerations. If we are to find another Mandela, it will only be through education.

Mr. Mellon

Could the speaker from the Netherlands repeat his question to me?

Mr. O’Shea

He wondered why private enterprise is not more involved.

Professor de Haan

I was questioning the role of the private sector in development aid. I do not mean to concentrate on the private sector in Ireland and the Netherlands and so on. However, how do we stimulate private sector investment in poor countries? The background is increasingly of productive capacity in those countries. The point is that such private investments will happen only in successful, well-governed, less developed countries. How do we stimulate those investments in the least developed, poorly governed countries? That is my point.

Mr. Mellon

It may take me some time to work out the answer. It is a complex issue, since business will wish to go to the most advanced countries with market opportunities first. The answer lies in bringing the appearance of reward to business back closer to home, for example, an uplift in staff morale and the positive perceived image of the entrepreneurship of private enterprise going in on specific projects without any tangible reward coming from that country. I am absolutely certain that the modern model, particularly of larger businesses, is a balanced approach to reward and staff morale. The biggest threat to modern business is complacency and staff moving from company to company. One of the most successful methods of retaining staff and improving productivity is a feeling of engagement wider than just the particular job or occupation which people are doing.

There must be a brand value image associated with companies in a very public way regarding projects that may not have a financial reward. I would even take it as far as allowing companies which give a percentage of their staff time and money to put an EU-approved label on their headed notepaper. Businesses want to be seen as progressive and part of the community and I am certain that there are many different ways in which we can give them that rather than just looking for an economic reward and going for the most advanced countries.

Chairman

Thank you. Mr. Mellon reminded me of how, in 1967, I got a fellowship to Harvard to study marketing and business. I wanted to know how it all worked so that I could use it in my own way regarding our people in Ireland. One of the things that struck me there was that every time they built in a social contribution for private industry and they emphasised that in their lectures and discussions. I was very interested in that idea. It was built in as part of the whole package. In practice, we must ensure that it happens. It obviously does not happen as they intended and it is up to us to try to encourage it. That is partly what Mr. Mellon said in the first instance.

Mr. Arnold

I will try to address this issue. An important question was asked about the African Union and how significant a development its formation is, growing out of the 40 year experience of the Organisation of African Unity, which clearly had not been a great success. The African Union is potentially important as a political development for two main reasons. The first is that some of the principles to which African leaders have committed themselves are of crucial importance to long-term political and economic development.

The other reason is that, apart from the principle, it provides a potential vision for where the African Continent can go if certain things happen. That will resonate very much with many of the people in this room from the new member states of the EU and the applicant countries. The European Union, in the vision that it set out and the standards to which it committed itself in the late 1950s, has been a very powerful political instrument. By any standards it has been a remarkable success. However, it required the extraordinary vision of the founding fathers and that has been delivered step by step over decades. To that extent, the African Union is potentially significant and the European Union as a political entity has begun to develop links with it, which one hopes will progress from there.

However, there is an issue of credibility. If the African Union has set down fine principles, the political leadership will have to live up to them. A mechanism of peer review for governance in the African Union was built in at the beginning. That is just beginning and the delivery of results will be of critical importance. There will be some very short-term tests of that credibility. Within the past two weeks, an international UN team conducting a crop assessment in Zimbabwe was expelled before it had been completed. The information I have is that the food situation in Zimbabwe could get very bad over the coming six months. If that is the case, the African Union has a responsibility to do something to acknowledge that it is the ultimate responsibility of the Zimbabwean Government to allow a proper assessment of the food situation and do whatever is necessary nationally and internationally.

Chairman

I thank the Minister, David Donoghue, John O'Shea, Niall Mellon and Tom Arnold. They have all given us much to think about and it will be helpful in our work as parliamentarians. Our next session is on aid, trade and debt post Cancún. The Chairman, Senator Micheál Kitt, is with us at the top table and the Minister will be with us as soon as we are ready to begin. We will start again at 11.45 a.m, which gives us about 18 minutes for coffee.

Sitting suspended at 11.30 a.m. and resumed at 11.45 a.m.