May I compliment the Minister for his robust reply to the debate and ask him to explain something for me? It concerns the £9,660,000 which is in question here in Ireland's contribution to the eighth replenishment. My understanding of the Bill is that this is a mandatory payment on our part. It is something to which we are contractually and legally bound. In his reply on Second Stage I thought the Minister rather muddied the waters, or clouded the issue, or in some way indicated that this was a discretionary item on the part of the Government. My understanding is that negotiations on the eighth replenishment began in Paris in January 1986 and were concluded in Rome in December 1986. The decision was made on what the varying amounts would be from the different countries and there was a commitment which we were obliged to honour. There is no question of largesse in relation to this £9,666,000; it is a mandatory, committed loan on our part. Would the Minister please clarify that?
International Development Association (Amendment) Bill, 1987 [ Certified Money Bill ]: Committee and Final Stages.
I am not sure whether the Minister's speech was related to the issue but it was definitely robust. I would like to pursue the same line of questioning with the Minister. Perhaps he would elaborate on what is in his Second Stage speech, that the negotiations on the eighth replenishment of IDA which is the subject of the Bill took place in 1986 and were conducted by officials. The conclusions reached by these negotiators were endorsed in June 1987. Could he explain to us what those conclusions were? Did they involve a specific sum of money? Did they involve a commitment to make a specific proportion of the total contribution? Could he possibly quote from those conclusions? I am not persuaded. I accept that as late as June 1987 the Government could have thrown the cat among the pigeons and refused to endorse that agreement at the meeting of the board of governors. I have to say I am not convinced that the Government had as free a hand in this as the Minister would have us believe. Perhaps he could give us some more details on what was the outcome of the negotiations in 1986.
Perhaps when the Minister is clarifying the points raised by Senators Bulbulia and Ryan he would refer to Ireland's position as a Part I member and the process by which agreement is reached for contributions by Part I members. Of course, initially, there would be an open discussion and a voluntary examination of the issue on the basis of the needs of the developing countries and the manner in which the money from IDA was to be allocated. As I have understood it, at some stage in that process it gets beyond being purely voluntary and there is a commitment which was finalised in June 1987.
It is important that the House should be clear on the nature of the approach. For example, would it have been open to the Government to have come before the House and said they were only going to make a contribution of, not $13 million but $10 million and were only going to make a contribution of the punt equivalent to that in the actual amendment of the IDA Bill, after June 1987? I would be grateful if the Minister would clarify that.
There is one thing I am not clear on. It is the question of whether this allocation of money under section 1 is not making up for the shortfall from the super powers. In other words, will all the contributions from all the countries be making up for the shortfall caused by the super powers who have cut back and directed a lot of their money into armaments? It is not clear in the Minister's Second Stage speech whether this is hidden inside that part of the amendment. We have a problem in this sense; if there is such a hidden situation, we must take some exception to the fact that the super powers have cut back. This would, therefore, take a little bit away from the argument about us cutting back. I am not clear on whether we can have something written into the Bill to the effect that we are taking up the slack for these people who have cut back. We are caught in a cleft stick by being inadequately able to argue that our contribution is not good enough.
The second thing that needs clarifying is whether in the light of all the circumstances we are in a position — which should be our position because of our cutback, whether or not it is through supplementing someone else's cutback — to lay down the conditions for those who should be engaged in the whole question of pursuing the banishment of poverty and the growth of social justice in the poorest developing countries. It opens up a whole series of arguments. It is not clear either in the Minister's Second Stage speech or in section 1 of the Bill whether we are dealing with that. If we are not, we are really codding ourselves to some extent. When we are producing a Bill like this, if there is a shortfall or a hidden situation in it, since we are talking about Irish taxpayers' money and since there is a great feeling about reducing our contribution, we should not be afraid to say that our contribution is there although there is a cutback in it, that we are, together with all the other countries, making up the shortfall in a collective way. It seems to me that there could be something hidden in the Bill.
If there is any logic in my line of argument you are trying to get the richer countries to give full support. At the same time, because you are not getting the support and because it is not written into the Bill, you cannot build up the dialogue on it. Therefore, you cannot pursue the twin objectives in normal discussion at a Paris conference or wherever it is. You are not in a position to be anything but rhetorical, if you like, on the question of banishing poverty and providing for growth. We are in a mess if we do not know whether or not there is something hidden in the Bill. In the long run economics and politics are inextricably entwined and if we put up with the super powers cutting back and redirecting money into armaments, we are only into the business of rhetoric. The contribution will never do justice to the babies who will be under-nourished and suffer throughout their lives — a situation which should not exist. This is all due to a lack of resources because of the reduction of funds. Nobody is in a position to lay down any hard and fast rules as to how to go about this business of banishing poverty and promoting social justice.
I would like to thank Senators again for the various points they have raised. To clarify some of those points, in the initial negotiations and discussions the main purpose was to achieve the highest possible level of replenishment based on the traditional contributions from the members of IDA involved. Negotiations proceeded along those lines and the maximum area of agreement that could be reached was that there would be an overall replenishment based on traditional contributions of $11.5 billion. Ireland and some other countries were not satisfied with this and we wanted to bring that up to a higher figure. It was eventually agreed that that figure would be $12.4 billion. Ireland offered to make a special contribution above that which we are required to make. We are only required to make a contribution to maintain membership of IDA. We could contribute £100,000: we could contribute £1 million: that is a matter for the Government of the day. Our contribution, in order to reach the $11.5 billion, would have been £9.4 million. In order to make a contribution to the $12.4 billion we offered to and will make a contribution of £9.66 million.
Is that influenced by the fact that the major powers have cut back so much?
Not necessarily. Russia is not a member at all. There is only one super power involved. It is an acknowledgement by countries like Ireland of the necessity to make a contribution to help to alleviate the misery and deprivation in these other Third World countries. Some countries clearly stated at the discussions that they were prepared to make their traditional contribution up to a figure of a maximum total of $11.5 billion. They indicated that they would not make any further contribution to arriving at a figure of $12.4 billion. Other countries said they would, and the figure of $12.4 billion has been arrived at.
The answer to Senator Robinson's question is "yes". I hope I have clarified that for everybody. In order to maintain membership as a Part I country, all we are obliged to do is contribute. The size of the contribution is a matter for the Government of the day. We were not contributing to any shortfall; rather were we acknowledging the position and showing the generosity of Ireland and the Irish people over the years in situations like this. I hope that answers all the questions. If it does not, we will come back to it.
May I ask a question of the Minister arising from what he said? I would be very interested indeed to know the different contributions from the various member countries of IDA. If the Minister has a list and if it is not too lengthy I wonder could he give us that information. My understanding also is that at this meeting the parameters were largely set out when the reality of the American situation was spelt out at the start of the meeting. The other member States then had to decide what their positions would be in view of the stated position of the United States of America and in view of the sum which it was prepared to commit to aid replenishment. I wonder can the Minister tell me if this was so.
Another thing I am unclear about is: was the sum of $12.4 billion decided on at the end of December 1986 or at the Paris meeting in June 1987? When was the actual decision made on the $12.4 billion and when was the decision made that Ireland's contribution would be £9,660,000?
I have here in front of me a report from the World Bank for the fiscal year 1987. I want to quote from it. On page 26 it states:
Negotiations for the eighth replenishment of resources of IDA were launched with a meeting of IDA deputies in January 1986 in Paris. Resources contributed under IDA-8 will provide the Association with funds for credit commitments in the period fiscal 1988-1990. Subsequent meetings were held on April 7-8, 1986, in Washington, D.C.; on July 15-16, 1986, in Paris; on September 23-25, 1986 in Washington, D.C.; and on September 15 1986, in Rome... The negotiations covered many issues; the key issues, however, were the size of the replenishment, burden-sharing, allocations and terms.
Later on it stated:
The donors agreed on a basic IDA-8 replenishment of $11.5 billion, with normal burden-sharing arrangements. In addition a number of other countries agreed to supplement their basic contributions... These supplementary resources brought the total funds available to IDA during the eighth replenishment period to $12.4 billion.
They have a table on page 29, "Contributions to the Eighth Replenishment of IDA Resources." In that table Ireland is listed as contributing, as the Minister quite rightly said, 0.11 per cent. That 0.11 per cent is equal to $13 million.
On the basis of the question I asked the Minister, as to when that was agreed, I have to refer to the fact that the conversion factors for converting from national currencies to dollars refer to the period from 1 March 1986 to 29 August 1986. Quite clearly the commitment to pay £9.66 million was made not by this Government but by the previous Government in 1986. To get out of that the Irish Government would have had to go back and welsh on an international agreement they entered into in 1986. It is, therefore, nonsense and pointless for the Minister to claim some credit for the present Government for doing it. It was all agreed, according to the World Bank reports in 1986. That is the point I would like to ask the Minister concerned about — it would have been very difficult to get out of paying and this Government deserve no credit for it.
I think if Senator Ryan reads again what he has quoted from the World Bank report regarding the criteria of contribution, on which the contribution was based in the period from 1 March to 29 August 1986, he will find the contribution negotiated in 1986 was based on the value of money for a particular period in 1986. That is the position, in order to retain the value of the replenishment as a result of the other replenishment terminating.
Senator Bulbulia raised the point that there are 32 countries in all making a contribution. I can go through them all if you wish but I doubt that it is necessary. Ireland's contribution is clearly stated as being 0.11 per cent. In comparison to other countries within the European Community we are very well up at the top of the league.
I am not going to let the Minister off until he tells me, if he can — if he does not know I will accept that — when did we agree to £9.66 million. As far as I am aware we agreed to it in 1986. I would like an answer from the Minister. He is not the Minister in charge of all of this and I shall not quarrel with him but if he does know, will be please tell us when we agreed to it. Was it in Rome in June 1987 or was it the present Government who decided on it?
To clarify the matter further and to remove any doubts anyone might have about the present Government's contribution, in the negotiations in 1987 we gave an indication that our contribution would be £9.66 million converting into $13 million. We cannot give any commitment until this Bill passes through this House. Going into the negotiations we knew that the minimum total of the fund would be $10 billion and the maximum would be $12½ billion. The meetings were called and the negotiations commenced on a base line of $10 billion and a maximum of $12½ billion to create the eighth replenishment for the IDA fund. We gave an indication during the negotiations in 1987 that we were prepared to contribute £9.66 million. We cannot give any firm commitment until the Bill passes through this House.
The Minister is referring to the same document: it is footnote on page 29 of the World Bank report in which Ireland has indicated agreement. I appreciate that it is subject to legislation. Nevertheless, it is true that Ireland indicated agreement at the latest in June 1987 and, it appears to me, quite likely back as far as 1986. Therefore, this Government were faced with two choices, either to carry out a commitment entered into by a previous Government or embarrass themselves in front of IDA.