Seanad Éireann debate -
Wednesday, 9 Nov 1988

Vol. 121 No. 5

Multilateral Investment Guarantee Agency Bill, 1988: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. Farrell

I congratulate the Government on introducing this Bill in the House. Its provisions will help to alleviate poverty in other countries, allowing them an opportunity to borrow some money. Rather than seek charity they can borrow and repay these borrowings. Its provisions will provide much badly needed infrastructure and services in those countries.

We hear much talk about cutbacks in overseas aid. Therefore, it is difficult to understand opposition to this Bill. It amazes me that we say on the one hand we should give more charity but on the other hand say: we should not allow people to borrow, that they should be independent and make their own way. The provisions of this Bill will afford them some independence but then I have to say that socialist policy and philosophy always amuse and intrigue me. I just cannot recall the name of that great professor who spent his life preaching socialism. At the end of his days he realised the truth and wrote: socialism is preached by a class of people whom socialism itself would destroy. It always amazes me that many people today who preach socialism all over this country, who attack our bishops, and clergy are all people who have from two to four paypackets coming in. Yet I never hear of them giving any away. There are some in Sligo County Council——

Mr. B. Ryan

Very many. Declan Greene represents the best Sligo ever produced.

Mr. Farrell

It amazes me how those people can travel the world where they get all that money to travel. I find it difficult to take a holiday once a year for which I must pay. I am jealous. I am not in that category, when I might benefit from some of this free travel to the four corners of the world. It must be absolutely free because every one of them engages in the same old prattle. They follow the same line of thought. Or perhaps they all read the same document, have it off by heart — not a comma, not a dot, not an iota of difference; it is the same thing I hear from them all. However, while they are happy at it, we are happy to listen to them.

Mrs. Bulbulia

Would the Senator care to specify who exactly he is referring to?

Mr. Farrell

I am talking——

An Leas-Chathaoirleach

The Senator should be allowed make his contribution without interruption.

Mr. Farrell

I am talking about the socialist philosophy in general and the type of people I hear preaching it right across our country. I do not purport to be an expert on high finance. I am not going to get involved in that aspect. God knows, the management of household moneys and little business matters is as much as I can accomplish reasonably successfully.

I believe this is a very wide ideal. I am pleased that Ireland is joining with countries like Canada, Germany, Japan, the United Kingdom and the United States to provide capital and guarantees to international organisations, to provide moneys for many infrastructures and services within those developing countries. It is preferable to give such countries the money, allow them develop and repay, than continually give them handouts. Gorbachev is beginning to realise that the philosophies pushed on to people in Russia for many years were a failure. He is now giving land back to the Russian people, telling them to go out and till that land because they realise that their country is bankrupt. They have experienced all sorts of problems we have never encountered here. For so long they kept events in Russia under wraps and nobody knew what was happening. We did not know what was happening there — now we are getting some sight of events there. When all is said and done capitalism, with all its faults and follies, might be the best way for people to learn how to work, earn money, invest it and develop.

The provisions of this Bill afford an opportunity to many of those poor countries to develop in a way they would not have had in the past. I am delighted Ireland is playing its part and becoming involved in the economies of those Third World countries. When we look at television we see the terrible starvation, poverty and conditions those people endure. Yet had they the money to provide such facilities for themselves there is no reason they would not be self-supporting, even exporting in order to provide a better standard of living for themselves and their families.

It is tragic that such aid has been talked about since 1950 and only now coming to fruition. I congratulate the Government on their initiative in introducing this Bill.

I am delighted that the convention will involve research, innovation and investment opportunities. This is important because many of those countries have not engaged in research to date. Many do not even realise what is their potential, they have not a clue. Now, they will be able to engage experts of one kind or another — economists, engineers or others — who will be able to undertake the necessary research, advise them on how they can help themselves, how they can develop all the potential within their territories. Money spent in that way will be well spent. There is no way such countries could harness that type of expertise and manpower except through some form of loan being made available by this agency.

I congratulate the Government on their initiative and foresight in introducing this Bill. I would ask them not to be too worried about some of the criticism raised here today. We are in good company when we are being criticised continually, when we are grouped with our bishops and priests. Remember that our bishops, priests and nuns have done a tremendous amount for our poor, have given of their own time and energy for low pay or none. Were it not for them, many of their critics, today might not have had any education. They should remember that they might have a hod on their backs or shovels in their hands were it not for the good education provided by many priests and nuns throughout the length and breadth of this country. It is a bad dog that bites the hand that feeds it. That is exactly the analogy to be drawn in the case of many people who criticise. I regret that that should be the case.

I exhort the Government not to be diverted from their course in any way. They are doing a good job and should be allowed to continue to do so. They are now going to do a good job for the Third World. I am delighted they are proceeding along that path. Long may they remain on it.

Mr. Manning

I listened with great interest to Senator Farrell who is, as we all know, one of the most respected and decent Members of this House, but I was a little surprised at the line he was taking. I am afraid his last remarks in particular sent alarm bells ringing in my head. I felt he must have a very poor argument when he starts sending up smokescreens like those he was emitting in the last few minutes.

Everyone knows that some of the major critics of the Government's abysmal performance on development aid over the past few years — I do not mean the bishops, the bishops are too cute for that — have been the priests and the nuns who have been working in the field, the workers themselves, who have seen the decline in the overall contribution from this country to Official Development Aid. All any Member of this House has to do is talk to the people working on the ground, who are at the hard end of all of this, to realise the sense of disappointment many of them feel at the reversal of policy in recent years. They feel a shame that in the orgy of cost-cutting in which the country is indulging at present, we have not been able to safeguard this area which in the past, in spite of cuts in other areas, was always preserved and in many cases helped more in difficult times.

It is in the nature of such people that they do not go public, that they do not issue statements and so forth, that they make their views known elsewhere. Senator Farrell, I am sure, has many friends among the nuns, the priests and the other workers who have done us all proud over the years. Neither Senator Ryan nor anybody else was making any criticism of these people. If Senator Farrell approaches them and talks to them, he will get a full picture of what they feel about all of this.

Like Senator Ryan, if I am not misquoting him, I am a little surprised at the new found vow of silence of so many of our bishops on this subject. The strict observance of the vow of silence which they seem to have imposed upon themselves sits rather at variance with their performance through the lifetime of the previous Government — that is just in response to the remarks of Senator Farrell. I would say, of course, that one exception to all of this among the bishops has been the bishop of Galway, Dr. Eamonn Casey, who has been critical of this Government and critical of the last Government; he has not pulled his punches in what he had to say.

We in Fine Gael welcome the Multilateral Investment Guarantee Agency Bill, not only because it is a useful addition to the range of instruments available to us in helping those in the Third World but also because it does give us a chance to discuss the abysmal performance of the Government in this area. This Bill gives Third World countries the opportunity to help themselves by producing more goods and sending them overseas. It is, therefore, preferable to merely doling out money in the form of aid to try to keep them satisfied in their present position.

The Bill does have one major shortcoming. It tends to benefit middle income developing countries and it does little or nothing for the least developed countries. This, coupled with the massive cuts, and they have been massive, in the Government's bilateral aid programme, means that the Irish Government aid to the poorest of the poor in these countries targeted for Irish bilateral aid, Tanzania, Zambia, Lesotho and Sudan, is now at a disgracefully low level.

When Fine Gael left office in 1987 the overseas aid programme had increased to about £45 million. There had been slow but steady progress towards the attainment of the UN target of 0.7 per cent of GNP. Senator Farrell must recognise this as a fact. Fianna Fáil in office have undone all of that progress. In 1988 the Government slashed Official Development Aid by 26 per cent. Irish aid to the Third World fell from £43 million in 1987 to £32 million in 1988, leaving Irish aid at the lowest level it had been since 1981 when Fianna Fáil had previously been in power. This is a cut of 26 per cent in aid compared with a reduction in total Exchequer expenditure of less than 6 per cent. That is where the axe really fell.

About half of Ireland's aid is consequent on membership of the European Community and the UN and cannot, therefore, be cut no matter how much the Minister and others might like to do so. The cuts have fallen disproportionately on the other half of the programme; bilateral aid to individual Third World countries which has been cut by £11 million indicating that the Government sees aid to those suffering from hunger, malnutrition and starvation as the soft option.

In recently published estimates our official aid was again severely attacked leaving us in the shameful position of being third lowest of the OECD countries in the provision of aid. The bilateral aid fund has again been slashed by 10 per cent in the 1989 Estimates. As in 1988, the Government have allotted a ridiculously small sum of £1,000 for disaster relief aid.

I could mention the shameful situation of the pledges given to the members of Irish Shipping, that their pension rights would be safeguarded, that an Irish marine service would be restored. In this as in so many other areas this Government have broken their commitment to aid to developing countries. The difference is that the people who are suffering from these cuts cannot complain to their local TDs or to their local Senators. They cannot write to the press, they cannot march on the Dáil, they are not in a position to call press conferences in or outside the House. They are unable to defend themselves from these harsh measures. They depend on the elected representatives of the Irish people in this House. They depend on us to cry "no", to say that we will not stand for further cuts in Official Development Aid; to say that this Government must stop picking on the poorest of the poor because these cuts will cause death.

That is the stark reality as we talk here in this comfortable House in November 1988. The cuts which have come about in Official Development Aid do mean death, death that could have been avoided had they not been made. We have to ask ourselves if we can stand by and let this happen.

The Fianna Fáil attitude on the whole question of our official aid programme has been both cynical and hypocritical. For example, in 1975 Deputy Michael O'Kennedy, Foreign Affairs spokesman, said that Fianna Fáil would and I quote "set aside year after year the appropriate sum to ensure that we reach at least the target set by the Minister. "That is 0.35 per cent of GNP within five years. Thirteen years later we are moving down from rather than towards this target which is still much lower than the UN target of 0.7 per cent. Similarly, in 1982 the present Taoiseach dismissed the reappointment of a Minister of State with responsibility for overseas aid as superfluous. He described the appointment as being supernumerary. But in 1984, when Fianna Fáil were in Opposition, Deputy Charles Haughey had the gall to claim that the problem of famine in Africa was of such proportions that Ireland should have a full Cabinet Minister to deal with it. Such an appointment has not been made to date by the Fianna Fáil Government. Maybe in the upcoming reshuffle the Minister might suggest to the Taoiseach that such an appointment might well at this stage be appropriate.

Mrs. Bulbulia

What an excellent idea.

Mr. Manning

I am sure the Minister seeing the size of the problem could not but support the idea of a Cabinet Minister with responsibility in this area and certainly we, on this side of the House, would give full support to that idea. I would be interested to see the Minister express his support for it.

The question is whether we in Ireland have an obligation, as the 27th richest country in the world, to the people of the poorest countries, four of which — Tanzania, Lesotho, Zambia and Sudan are targeted by our bilateral aid programme. On what moral basis can we accept our entitlements to European Community support for the poorest regions of the Community, of which we are one, when we ignore the plight of those in a much worse position than ourselves such as the people of Bangladesh, Ethiopia and Sudan? Surely, and we all agree on this, we have a moral obligation as a Christian country to help those millions of people in need, to try to narrow the gap in living standards between the industrialised countries and those of the Third World?

Obviously, the ordinary people of Ireland, the generality of people in this country, believe that we have such a responsibility to those in developing countries. The Irish people are known for their generosity in contributing to organisations such as Trocaire, Concern and GOAL who help in such a constructive, structured and organised way the starving people of the Third World. The Irish contributed more money per capita in Live Aid than any other nation gaining us recognition worldwide for this contribution. The attitude of our people is reflected in the results of a survey carried out for Trocaire in October 1987 where almost three-quarters of those surveyed favoured the Government giving aid to the Third World, even in the current climate of recession.

It is interesting how the device of opinion polls is able to tell us something which we all perhaps intuitively recognise: for example, the intuitive negative reaction to the way in which the national lottery has been abused but also in a positive way, the sense in which people would be prepared even in difficult times to give more to causes which they see as manifestly just and deserving. The Fianna Fáil cuts in the overseas development agency budget not only crippled the people of the Third World but also genuinely offend and embarrass large sections of the Irish people who do not like to see their Government being so niggardly, so parsimonious, so cheeseparing, so mean, when they themselves are prepared to give so much to individual organisations.

Although the primary motive for giving Official Development Aid is moral and humanitarian, it has to be remembered that such aid does not constitute a one-way traffic. There is a return to the country at many levels, including the financial level. For example a recent DEVCO report indicates the substantial overseas earnings mainly in the developing world of our semi-State bodies now totalling about £100 million. The developing countries provide a growing market for Irish exports. In 1987, of the £17.29 million provided by Ireland as bilateral assistance to developing countries, approximately 70 per cent, over £12 million, was spent either on goods and services in Ireland or as payment to Irish personnel working with the bilateral aid programme.

On the positive side, bilateral aid also helps Irish companies compete in international markets generally by creating a positive impression of Ireland abroad and by providing Irish companies and personnel with vital expertise and the opportunity to demonstrate this expertise to prospective multilateral clients. Thus, Fianna Fáil's drastic cutting of the Official Development Aid budget means more than the loss of vital development resources to the poor in the Third World, it also involves a loss of international credibility and moral authority in Ireland and a number of economic costs not the least of which is the threatening of the jobs of over 600 people currently employed as a result of Irish bilateral assistance. A reduction of the ODA budget, therefore, involves a far smaller saving to the economy than might at first sight appear to be the case. It is, again, one of these false economies. It looks bigger on paper. When the hidden costs are investigated, in fact, in many ways, apart from the moral implications, it is a false saving.

I now call on the Minister to reverse immediately the present trend in Irish Government aid to the developing world. It is yet another national disgrace, caused by the Government, that overseas aid should be slashed so drastically at a time when malnutrition and infant mortality is increasing in many countries. With over 500 million chronically hungry in the Third World and 25 children dying every minute, the Irish Government can no longer pursue the present policy of milking the ODA budget for all it is worth.

The ODA budget is about to run dry. Official Development Aid is crucial for Ireland's priority aid recipients. Cuts in this such as the ones suggested in the Book of Estimates will cost lives. I am calling on the Minister to try to bring about a drastic change in Fianna Fáil's attitude to such aid. It cannot be regarded as a soft target. The budget must be returned at least to its 1987 level of 0.25 per cent of GNP and the Government must commit itself to seeking an all-party approach to a phased increase in our aid, with a time table agreed for the attainment of the UN target. Otherwise Fianna Fáil's policy will continue to endanger and even cost lives in the Third World.

In conclusion, I have to say that one of the most retrograde steps taken by the Government was their refusal to re-establish an all-party committee on development aid. That committee in the last Oireachtas was, I believe, the most successful of all the Oireachtas committees. It focused public and official attention on the problem, it raised consciousness to a hitherto unknown level, it acted as a force to educate people from all parties as to the realities of development aid and the politics of Third World countries. It was a genuine force for good in this House and some of its most active members were those who are today on the Government side. The decision not to reconstitute that committee was a cowardly, shortsighted decision. It was done perhaps because it was felt that such a committee might be an embarrassment or perhaps the Government did not want well-informed criticism coming from the Houses of the Oireachtas.

The failure to re-establish that committee, together with the continued failure to establish a committee on foreign affairs, indicates the poverty of thinking of this Government in this area, their unwillingness to submit themselves to detailed searching criticism from backbenchers and from members of all parties in the House. But more than all of that, they are losing an opportunity to develop public opinion in a positive way to allow these committees to become agents for change so that this country can go back to being where it was a small number of years ago, a country moving in the right direction, seeking to fulfil decent targets in our obligation to provide aid to these countries.

Mr. McDonald

I welcome the Bill. All afternoon I have listened with great interest to the speeches that have been made and I support and sympathise with almost all of them. Senator Ryan made a very telling speech, as also did Senator Manning. I subscribe to the view that we need to make a determined effort to reach our commitment of, I think, 0.07 per cent of GNP as a contribution towards the developing countries.

I welcome the Bill because it is a positive development and an encouragement to multinationals or private companies, to invest in Third World countries. I have had the advantage over the past ten years of visiting some 27 or 28 of the African countries. I heartily concur with the sentiments expressed by my colleague, Senator Manning, who deplored the dropping of the Joint Committee on Development Aid because in my view no speaker, no matter how eloquent or how accomplished in letters, can adequately describe the abject poverty, the oppression, the usury, the slavery or semi-slavery in every modern form under which millions of people are forced to exist.

More Oireachtas Members should have an opportunity of visiting the under-developed countries and the media, who so quickly denigrate any and every mission abroad as a junket, ought to examine their role in the scandal of diminishing Irish contributions to under-developed countries and to the emerging nations. I would call on the Department to expose Members of the Oireachtas, right-wing, left-wing or centre, to the stench of human poverty and have them visit these refugee camps, some of which have been there for 20, 25 and 30 years and possibly longer. No Irish person can truthfully say: "We have never heard of Ethiopia."

Those of us who have had the opportunity of seeing Third World countries recognise the contribution in human effort that so many Irish people, both religious and lay, make in these situations. I would venture to say that even the most ardent tax dodger would have a different view if it could be brought home to him what the Irish contribution would mean. We are a Christian country with a particular sense of value of which we are proud but there is a missing dimension if we do not play our part and give a lead and shame the other countries who are financially capable of making a much bigger contribution because most of those large countries have milked those countries dry for several hundred years. That is the situation.

In this House for several years we have had impassioned speeches and pleas on cutbacks in Government services. There is one thing I can guarantee. You cannot cut back Government services in 40 countries on the African Continent because the services scarcely exist. You may have to travel several hundred miles to a clinic, not to mention a hospital. We are talking about a different ball game. Clean water is a luxury.

Our missionaries for the past 50 years have done marvellous work. They have been joined since the sixties by lay people. The late President Kennedy made it fashionable to give of one's time to Third World activities. He encouraged young people to donate a couple of years of their lives to this work.

Last August when I had the honour to represent this House at the inaugural meeting of the new Houses of Parliament in Canberra I took the opportunity en route of visiting a couple of African countries on behalf of a charity with which I am associated. What a small number of people can achieve there is very encouraging. People would indeed be very generous if they could see what a measly contribution, even a ten penny piece, can do to improve the quality of life of so many people out there.

I welcome this Bill because I hope it will encourage investment in all of these countries. I do not subscribe to the strong views expressed by Senator Ryan on the composition of the list of countries in category two. Even if we get a partial improvement under this, we can carry the categories that some people might find objectionable. In the entire area of the Third World the small print does not count for very much. I hope this Bill will have the result that is intended.

From a cursory glance at the Bill it is obvious that my old friends in Finance are taking a very firm grip on this piece of legislation, just like everything else. That is a great pity. The Department of Foreign Affairs have a network of embassies and listening posts and indeed development structures. It is a pity that this year they had to close one or two of those offices that were spearheading important work in some of the African countries. It is a pity we did not take the opportunity in this legislation of strengthening the operations of the Department of Foreign Affairs. I welcome the Bill and I hope the Irish contribution from here on will be stronger.

Mr. McGowan

I welcome the Bill. The purpose of the Bill is to enable this country to honour our financial obligations. We have to be prepared now as Europeans to harmonise our laws and to participate in every form of legislation that caters for peripheral areas. Major industrial development looks after those who are lucky enough to be covered by legislation. I am glad to see this Government introducing legislation that will provide for peripheral areas. The difficulty that I see, looking forward to 1992, is that we will have giants in Europe that are economically strong and financially organised to survive. Therefore, there could be serious dangers for small organisations and small industries, that are located in rural parts of Europe including——

Mrs. Bulbulia

I wonder if the Senator has grasped the implications of the Bill. It is not about peripheral areas in Europe, it is about investment in Third World countries. Maybe there is a misunderstanding.

Mr. McGowan

I am coming to that. I am coming to deal with the need to provide for Third World countries and peripheral areas in our own country as well. There has to be a balance. This Government have to recognise, just as other European Governments have to recognise, that while Third World development is very important, at the very same time there are underdeveloped areas in this country and they have to be considered.

It is all very well for somebody to get up and advocate increased expenditure. It is nice to be on the delivery side. I appreciate the number of agencies that are there. They call on the Government to provide more all the time but this can only be done as the wealth of our country increases. I recognise that this country has always participated, perhaps not as much financially as we would have liked. It is important that we are identified as contributors and supporters of the Third World and of those who are economically disadvantaged. That has been done. It has been done by agencies who have had a tremendous input. This country has contributed in a private way. People went out and organised aid. They participated in organising and contributing to the Third World.

In my opinion the Government can only contribute finance to the extent that the taxpayer can bear the brunt. These are difficult times. We have survived a serious financial recession in this country and, indeed, in Europe. Those who criticise the Government for not having had a big enough input should remember that it is very easy to call on the Government to contribute more money under different headings and to say that our contribution to the Third World should be greater. There are a large number of privately organised groups as well as individuals who are in the front line. They call for ever-increasing amounts of finance to support the worthy work which they are doing on the ground. It is not possible for the Government, in my opinion, to accede to the requests on every occasion.

The Government are doing a great job. They are recognising and financially supporting worthwhile projects. On every single occasion where there is a serious crisis such as damage by flooding or by earthquakes, the Government are quick to get involved. This may not involve millions but in proportion to our wealth and to the number of population the Government have never been lacking in making a worthwhile contribution. That can only be done and measured by the economic situation on the ground in our own country. We are by no means a wealthy country. People who call on the Government have to be mindful of the fact that we have a large number of people unemployed in this country. They are living at subsistence levels. They are depending on the tax-payer to sustain them. That has to be borne in mind when the Government are legislating and making provision for contributions to the Third World. It is nice to be part of the campaign but one has to be realistic. Aid has to be paid for by those who are already contributing out of their weekly income. It is very commendable work.

This country has to develop its natural resources. I hope that as we develop our natural resources here we will commit ourselves to an ever-increasing contribution to the Third World. That is our dearest wish, but it does not go down well with organisations of any kind or bishops or people who are very committed. All of us see the television pictures. All of us see the need. This is a matter that really touches the hearts of the people and one does not have to use too much pressure or persuasion. This is a very sensitive area. I commend the Government because they are mindful of the fact that there has to be a balanced approach. It is a very important matter and one that has to be pursued very carefully.

I commend the Bill, I commend the Minister for his alertness and awareness and for participating by the contribution that he and the Government can make to Third World development.

Minister of State at the Department of Finance (Mr. N. Treacy)

At the outset I would like to sincerely thank all the Senators for their very wide-ranging remarks. Some were very positive and some seemed to blame the Government for world poverty. It is the responsibility collectively of all the developing nations. Many Senators have referred during the course of this debate to our deteriorating Official Development Aid performance. There are a few points which I would like to make in response to that charge.

The Irish Government's contribution to development aid increased steadily through the 1970s and the early 1980s, rising from 0.08 per cent of GNP in 1975 to 0.25 per cent in 1985, a ten-year period. The very severe financial difficulties facing the country had made it necessary for the Government to cut back spending on all programmes, even the most desirable. In this context the provision for Official Development Aid for 1988 has had to be reduced to £32.6 million, a reduction of £6.5 million below the 1987 outturn.

Although there have been significant improvements on some fronts, the economic situation is still such that the Government must continue to adopt a restrictive approach to all spending programmes. However, it has been possible to increase the provision for Official Development Aid to £33.7 million. This would keep it at 0.18 per cent of GNP the same percentage as this year. This is as generous an amount as economic circumstances permit. It is sufficient to maintain a basic programme of assistance to developing countries. I should add that Ireland is meeting all existing commitments under our bilateral aid programme.

Looking at our Official Development Aid performance, it is important to bear in mind the fact that our aid programme is wholly in the form of grants and that it is not tied to the provision of supply or other contracts to Irish agencies or companies. Official Development Aid from other countries can involve, and often does, a mixture of loans and grants and is sometimes tied in the way in which I have indicated. There are no strings like that attached to Ireland's contribution.

Finally, in this matter we should not overlook the substantial contribution of the various non-governmental organisations which are active in this field and to which many Senators have referred. Indeed, I was very impressed with the contribution made by Senator Bulbulia and the reference she made to the efforts of the people of Waterford for Sudan during the month of September. Many similar organisations throughout the country are doing trojan work. It is indicative of the spirit and the humane approach of the Irish people over the years and over the centuries which has continued in modern times. We can all take pride in that and hope it will continue in the future. We always seem to be able to give priority to those in need, both at home and abroad, irrespective of the demands that are placed on ourselves at any time.

Assistance from these sources does not count as Official Development Aid. However, the activities of the various voluntary organisations are a very particular feature of this country's aid performance and should be reckoned as such. In reply to the Second Stage debate in the Dáil on this Bill the Minister for Finance, Deputy Mr. MacSharry said:

I would like to put on the record of the House that we have honoured all our commitments in this year and last year.... When Deputies made their contributions about what we can do for the developing countries in the Third World generally everybody who spoke said they were all in favour of fiscal measures, financial control and order in the public finances... not one Deputy has said where we could get the extra few million pounds....

This was in respect of Official Development Aid. Similarly, we had many contributions today from Senators who castigated the Government. That is their privilege and is the privilege of any Member of the Houses of the Oireachtas on the performance of the Government. Nobody has mentioned that there is a serious financial crisis. We are being extricated from that crisis by a very dedicated, co-ordinated Government. Nobody has been able to identify where we can get the extra resources that are needed to meet all our commitments right across the board. We have a difficulty in that many organisations and individuals, both religious and lay, constantly demand resources from the Government and from Government agencies both at home and abroad, and particularly at home, so that we can eliminate poverty in our own country.

It is said that if there was a common approach and a strong political will it should be possible to eliminate poverty in one fell swoop within one year. It may be possible to do that. That would be a major political decision with serious connotations. To do that one would have to fold up some Department or abolish some Government agency which receives major State funding and put that funding into the poverty area. By doing that the Government could make an artificial contribution towards eliminating poverty, which would eventually lead to permanent poverty.

The political pragmatism that is needed must be such that the Government of the day must give priority to the demands that are there. They must ensure that the needs which are there are supplied with the necessary resources, taking into account the priorities attaching to each demand and taking into account the financial responsibility, the political responsibility and the moral responsibility that we have to our own people and to the people in the Third World.

Senator Bulbulia suggested that the Minister for Foreign Affairs should take over responsibility for MIGA. The position here is that the Minister for Finance has statutory responsibility for our relationships with the World Bank and its existing affiliated agencies. This responsibility derives from the Breton Woods Act of 1957 and the International Development Association Act of 1960. On this basis, it is only logical and proper that the Minister for Finance should have similar responsibility in relation to MIGA. It is the newest agency in the World Bank group.

While I sympathise with Senator Bulbulia's views on the nature of the South African régime, the fact is that South Africa remains a member of the World Bank and, as such, it is entitled to participate in affiliates of the World Bank. I would point out, however, that South Africa has not yet signed, never mind ratified, the MIGA convention. Neither for that matter has Kampuchea. It is useful to note also that Ireland signed the MIGA Convention in 1986 and to recall that Senator Bulbulia commended the role which the then Minister for Finance, Mr. John Bruton, played in developing the MIGA Convention and bringing forward this Act. I commend him, too, and say that he, in that Government as Minister for Finance, played a similar role to the job now being done by Deputy MacSharry in relation to this same matter. Obviously, that means that this is a financial matter. It is a matter to be handled by the Minister for Finance and not by the Minister of State at the Department of Foreign Affairs, or the Minister for Foreign Affairs. Consequently, that is why this Department are handling this Bill.

Senator Ryan, in a very wide-ranging speech, posed many questions. In particular, he posed the question as to whether or not investment per se is necessarily a good thing. In reply to that point, I wish to remind the Senator that investments will be guaranteed by MIGA only when the prior consent of the host country has been given. This is a specific provision to ensure that the particular investment will accord with the development plans of that country. It is there as a clear security valve to ensure that potential investors cannot utilise the opportunities or the resources, be they physical or otherwise, or, indeed, the conditions to make a vast amount of money on their investment to the detriment of the developing country. This provision is there and we fully accept it.

The Members of the House can be assured that until agreement is reached between MIGA, the host country and the developer investor and until such time as the investor accepts the conditions laid down, then no sanction or guarantee will be available for any investment, development or project. I should also like to mention that MIGA will give particular priority to investments by developing countries in developing countries. It should not be used merely as a channel for investments from the industrial North to the less developed South.

Senator Ryan mentioned Cuba and the reasons why they were not in, whether it was by choice or by some other body's involvement. He did not say, or give any indication, as to whether they should or should not be in. This is purely a matter for each country. I could not give any reasons why Cuba are not in.

It is very easy to generalise and to say that a Bill like this does not make a contribution to developing countries. We must appreciate the fact that developed countries, industrialised nations and countries like Ireland are constantly trying to develop and expand and to ensure that equality of opportunity prevails for all. We are making a special contribution in a very structured, organised, formalised manner to ensure that we as we have developed and have the expertise and the resources — though they may be small — are making resources available in a very honourable way. We are making a positive contribution to developing less well-off countries who are not able to develop themselves without international co-operation, without international assistance, be it by way of financial resources and structures or in the way of expertise, technology and other assistance.

Senator Manning contended that MIGA only helped middle income countries and that it would be of no assistance to low income countries. I fail to see how the Senator could reach such a conclusion. Obviously, low income countries such as Bangladesh, Lesotho, Madagascar, Malawi, Sudan and Zambia think differently, because they have already ratified the MIGA Convention which is proof positive of how important they see this convention.

Senator Ryan was very critical of what he alleged was a one-dimensional economic approach to the problems of underdevelopment and Third World poverty. The Senator's view of the activities of the World Bank and its affiliates in trying to solve these problems is over-simplified. The fact is that the World Bank consciously and positively takes the problem of poverty into account in framing its development programme for these countries. It is an indication of its commitment in this area that a poverty action programme is now an integral part of the Bank's overall development programme for low income countries.

The Bank is also acutely conscious of the environmental needs of developing countries. No programme is now formulated without a specific environmental input to it. I can agree with the examples the Senator gave about the misleading nature of GNP as a measurement of welfare but that issue is not relevant to this Bill which is concerned with increasing the flow of investment to developing countries, thus increasing their output and reducing the poverty of their peoples.

I note Senator MacDonald, the Leas-Chathaoirleach, has welcomed the scope of this Bill. As I mentioned in my opening remarks, MIGA is still at a very early stage in its development. For the Senator's information, I should like to say that about 12 preliminary applications, totalling close to $700 million, have been received by MIGA to date. Among the proposed investments are mining projects, manufacturing projects, agricultural projects and the development of a financial institution. As yet, no detailed applications have been received. No guarantees have issued but we are confident that very positive, humane decisions will be made by MIGA in the final analysis after very detailed, careful consideration and analysis.

In conclusion, I should like to express my hope that Ireland will shortly be in a position to join those developed and developing countries which have already ratified the MIGA Convention and to unite with these countries in ensuring that the activities of the agency are serving the purposes of all its members and are making a major contribution to the elimination of poverty in the Third World and throughout the world at large.

Question put and agreed to.

Committee Stage ordered for Wednesday, 16 November 1988.