I shall deal with a number of specific questions first and then try to take some more of these general issues raised in the course of the debate. Obviously, the specific questions relate to the purpose of the Bill itself and how our commitments under it can be implemented. The general questions are of major importance in the whole context of the North-South dialogue Senator Cooney has been touching on and also the interdependent role of the developed and developing worlds at this stage. Senator Keating and Brugha inquired about the total amount in this replenishment. I indicated, in my opening statement, that the total will be 12 billion dollars. The directors of the International Development Association regard this, in present circumstances, as being a satisfactory outcome to the negotiations between the members of the association on a bilateral basis, in the first instance, the executives of the association and, in a multilateral framework, between each other. That is the answer to the first precise question.
Senator Brugha asked me to name those who are not contributing to this. It is easier to name those who are. Most of the developed countries of the Western world are contributing. I cannot think of any exception, there may be one, but I am not immediately aware of one. From the Eastern European countries—this is significant—only Yugoslavia is contributing though Rumania has indicated its intention to contribute to the sixth replenishment. One might say in that context that not being members of the World Bank group through which this action is taken the Eastern bloc socialist countries are excluded from contributing. That would be to give a very easy let-out to those countries. I share the views of Members who say the response from the Western world generally is inadequate—I will deal with that at greater length later. However inadequate the response from the Western world is, what is crying out shamefully is the lack of any response in this area from the Eastern bloc countries, particularly from the Union of Soviet Socialist Republics. The fact is—the developing countries have noted this themselves and it is a view that was conveyed to me when Minister for Foreign Affairs during the Lome negotiations—that while they see some reason for being actively involved at the liberation stage of the struggle for freedom and independence of these countries and hold some reasons for maintaining a level of influence in those countries, when that has been done there is no real evidence at all, even on a basis that would compare with what is admittedly an inadequate response for the Western world, of any effective continuing aid programmes to the developing countries.
It reminds me of a point made by Senator Cooney that as the Brandt Commission pointed out in the very comprehensive analysis and clear call and demand on the world in this area, the amount of money being spent on armaments dwarfs by comparison the amounts being contributed in this area. As he has indicated, the amount of 400 billion dollars is certainly a stark contrast to the amounts being provided in this area of development co-operation. The amount spent on armaments by the Soviet Union is in very stark contrast with the level of its activities in development co-operation through any of the multilateral organisations or on a bilateral basis. If we are to get a degree of inter-dependence throughout the world perhaps this might be a good area to start. Perhaps it can now be seen, from the relatively wealthy countries, whether one speaks of the Soviet Union, East Germany, Poland or Hungary or any one of them who will be influenced by the decisions of the Soviet Union, that they have a role to play in this whole operation. If the existing structures of the International Development Association do not immediately meet their requirement in that they may see it, for one reason or another, as being dominated by the Western world, simply because it is the Western world by and large that is contributing to it, then it is open to them to make a case for a new structure which would enable them to make contributions which were hitherto all too obviously lacking in this or in any other area. That is the first clear point that emerges from the perusal of the countries that are involved. One is immediately struck not so much by those who are involved but even more by those who are not involved.
In relation to our own contribution, I should like to say that while Senators have welcomed the Bill, Senator Keating said that our contribution over the years was small. That is the level of contribution that was fixed in respect of us in this area. I do not want to make too much of this, but let me say nonetheless for the record that the vice-president of this association called on me recently for the specific reason of thanking Ireland not just for the level of the contribution but rather for the early commitment we gave which was helpful in the course of negotiations to get matching contributions from other countries of our size or association. I was encouraged by that recognition of the role we played in negotiations and pleased to note that.
While I would never overstate what Ireland, as a small country, can achieve, nonetheless neither would I understate the effect or moral impact of our achievements of this sort. When the vice-president indicated this to me it is a measure of the significance of a contribution which is not measured in terms of the money that we apply alone.
This is only part of our official development assistance. In fact, it is somewhat less than 10 per cent. I agree that the whole relationship between the developed and developing countries is now a crucial one. Radical solutions are required to deal with the imbalance that exists, as Senators pointed out. Understandably this morning we were talking of the impact on us of recent developments in the world economies, particularly having regard to the increase in the price of oil. It is nothing compared with the impact it had on developing countries where the whole export earnings in a year in many cases go to paying for the increase in the cost of oil. That, in itself, demonstrates graphically, and tragically, the impact of this latest imbalance on these, the poorer countries.
I agree with all Senators who said that the magnitude of the problems and of developments of that nature are scarcely reflected here, however severe they are in our own conditions. After today's debate, and during the course of the debate on the remainder of the Finance Bill, we can recognise the severity of it in our own conditions, but however severe they are they are but a pale reflection of the impact on other parts of the world, particularly in the developing countries.
I agree in relation to armaments that there is a major issue here. I should like to say to Senator Cooney that not only is that proposal enshrined in the Brandt Commission but, perhaps, he might be more reassured to know that the former Taoiseach, Deputy Lynch, when he addressed the special sessions on disarmament at the United Nations made a proposal exactly in line with that contained in the Brandt Commission in that context. There is no doubt that this is an area in which we have a major role to play. We have had a consistent position in relation to disarmament down the years. Anything that can be done to salvage, for the starving of the world, some of the moneys being stockpiled to inevitably create, either as a threat or a reality, further problems for the poor of the world must be a matter of urgent preoccupation for all of us.
I should like to say some general words in relation to what is being received as a cutback in our aid generally in this area. A number of Senators referred to this. I should like to remind the House that the total amount allocated for official development assistance this year is £16.226 million. In this area I will be trespassing, inevitably, into the area of one of my colleagues, although I am pleased at the same time to put these things on the record. That figure represents an increase of 12 per cent. The figure allocated last year was £13.313 million for official development assistance and this year there is an increase of almost £3 million.
On an issue of this kind it is as well that we do not make political issues but in view of what Senator Cooney said I should like to state that during our days in Opposition he was a member of the Government who made a commitment in 1973 to reach a target of .35 per cent over a number of years. In the first year it fell far short of that target. The total amount for 1974 was £2.7 million. The amount actually allocated in 1975 was £3.45 million, an increase of £.75 million. In the first year we fell behind the commitment given in that year.
It was in that climate that I said that that kind of commitment, given and then reneged on—that word is being used in respect of the Government now but in that year there was clear and significant evidence of reneging in that year—that I said we should fix targets which are outside of the normal budgetary preoccupations. In 1975 the figure was increased to £3.45, in 1976 that became £5.71, an increase of £2.3 million and in 1977 it was £7.3 million, an increase of £1.6 million. From 1976 to 1977 it fell in total terms and was less than the increase from 1975 to 1976. The issues which face the Government today are no different from those which faced the Government of that day. There are two members of that Government sitting in the Opposition benches now. I do not know what exigencies forced them to the conclusions they came to, but there was a real reduction in the extra amount provided. From 1977 onwards things improved dramatically, I am pleased to say. The amount provided in 1978 was £9.638 million, an increase of £2.3 million over the previous year, and in 1979 the amount increased to £13.313 million, an increase of almost £3½ million. In 1980 the increase, as I indicated, will be something short of £3 million.
For that reason it is not quite an issue on which one would want to divide politically. It is a little difficult to accept members of the previous Government and distinguished members of their party, criticising the performance of the Government in this area this year. The percentage of GNP last year was .18 and this year it is .19 or in volume terms an increase of almost £3 million and it is difficult to accept that they can be consistent, either in their criticisms or convinced of the factors of the basis of that criticism, having regard to the experience they themselves had.
Two other things changed the pattern of the allocations in Government of that day and the allocations in Government since we took office. I am not sure if the figures I have given for 1975 and 1976 actually represent what was estimated or what was spent, I know that for each year that Government were in office—I am sure Senators Cooney and Keating are acutely aware of this and, perhaps, acutely embarrassed by it—if the contributions to any of the multilateral organisations were not taken up in a year they were not reallocated to any bilateral aid programme or any other part of the official development assistance programme. That remained the pattern until I was able to persuade my colleagues in Government that the unspent part of the multilateral commitments—even the Leader of the Fine Gael Party acknowledged, as he put it, that I was able to achieve something he had not been able to achieve; I would see it rather as a measure of the Government's position in these areas—be reallocated to ensure that it was applied to other areas.
Funds were not spent or taken up on the multilateral side last year. It might be that funds for something such as this association or the European Regional Development Fund for the Lomé Convention were not spent. However, there were funds hanging over from 1978 that had not been taken up and the Government, instead of taking them back into the Exchequer, rightly and properly, as they had done since 1977, applied them to our bilateral aid programmes as an addition. It is fair to say that the amounts made available last year were not just the amounts I mentioned in the Estimate of £13.313 million but in fact £14.5 million. There was a carry over of £1.2 million which had not been allocated for the purposes for which it was intended. That happened last year.
I should like to make two points in relation to the bilateral programme though it is a matter for the Minister for Foreign Affairs but I understand he has already made a reference to this in the Dáil and, in any event, we have discussed it together. However, what he has said has not received very much publicity so it is important that I should say it here.
First of all, our commitments under the bilateral aid programme will be honoured. There will not be any cutback in the commitments that we have made in any of the areas we are operating in. That is a matter of great significance in view of the work that has been undertaken and the immense development of our bilateral aid programme over the last number of years and particularly over the last two years.
If any of the funds that we are voting now in the multilateral area, whether it be here, through the World Bank Group, through the Food and Agricultural Organisation, through the United Nations Development Programme or through the European Economic Community Development Funds, are not taken up —and from time to time they are not—they will be reallocated to the benefit of our bilateral aid programme. I understand and appreciate the concern of those engaged in bilateral programmes when they see that the growth of the commitments we have in the multilateral framework mean that their allocations on the bilateral side are not growing at the same pace and would seem to be curbed to a certain extent. The contribution they make is a matter of vital importance, and I hope that they will be reassured by what the Minister for Foreign Affairs has already said and by what I am saying now. The commitments will be honoured and any funds that are left over by virtue of not being taken up in a multilateral framework will be reallocated, as has happened over the last few years.
Some points have been made on general issues. Senator Conroy stressed that one cannot generalise about the type of development required in particular countries. That is true. In the very poor countries the International Development Association have found that agricultural and rural development are very important. Their priorities are in the areas of infrastructural development projects particularly. The association makes money available to help support high priority projects which foster economic development in the developing world. The bulk of these projects, over 46½ per cent over the last three years, are in the agricultural and rural development areas. They aim directly at improving the lot of the poorer sections of the populations of the countries involved.
Incidentally, while I was absent for a little while during the course of this debate, I was listening to the contributions over the communications system in the room where I was working at the time, so I heard what was said even though I was not physically present. The balance, 24 per cent, goes to the basic infrastructural projects such as power, telecommunications, transportation; 9½ per cent is for industry and organisation projects; 16½ per cent is for population, water supply, energy and other projects; the balance of non-project loans is 3½ per cent. Senator Conroy said that a major hospital development which would be too sophisticated to manage and administer and staff even in a developed country could be an example of wasteful expenditure. As far as the priorities of this programme are concerned they are based on criteria that Senators themselves would recommend. I would like to repeat the credit terms, the soft loan provisions. There are 50 years to re-pay; ten years before repayment of principal begins, low interest charges and there is an annual service charge of three-quarters of the disbursed portion of each credit to cover the association's administrative costs. So not only is it on appropriately favourable terms but also the targets of the programme are geared towards alleviating the causes of the poverty and suffering as distinct from treating the symptoms of it.
In relation to the Brandt Commission, Senator Cooney might say that I might have made a much more detailed speech. That would not be my function but the function of the Minister for Foreign Affairs. My function as Minister for Finance is to simply describe to the House the purpose of this. Obviously in the course of the debate issues of a broader nature would arise and I am prepared to deal with them on that basis. But I would not like to think that because I did not go into the whole question of imbalances and North-South relationships, the Brandt Commission and matters of that sort which warrant very serious and very detailed study, that is being taken as an indication of a lack of urgency or a lack of interest. It is not. The simple fact is that one introduces a Bill, states what the purpose of the Bill is and then it is a matter for the House to broaden the scope of the debate and they did that.
In relation to the multilateral programmes particularly, the growth of these is significant in terms of our IDA contribution. I welcome this but it is not obvious. We do not see immediately here the visible evidence of Irish participation because it is being contributed through the World Bank Group, the FAO, the EECDF, and the United Nations Development Programme.
We do not see it and therefore we do not seem to be associated with it as directly as with a bilateral aid programme. That is understandable and quite inevitable. But as we involve ourselves more at a multilateral level, either voluntarily or on a mandatory basis, obviously those commitments will grow and grow. In this year particularly they have grown to an unprecedented high level by comparison with our previous commitment. It is that in fact that explains that while the level of our overall commitment certainly has not dropped or been cut in any way—it has increased by almost £3 million—the total figures are such that within that the bilateral growth has not been of the same extent.
I want to put one point on the record in this connection. I was involved as President in office of the EEC in concluding the negotiations of the second stage of Lome which those who were involved with both negotiations indicated were very much more difficult and more complex than the first Lomé negotiations. When one is doing something for the first time it is new and it is welcome. But when one is doing something for the second time it is a little more difficult. People naturally take for granted what they have and want to work through a second stage. But I would like to think that I was able to persuade my partners in the EEC that the level of the commitment was greater than their original disposition was to apply. We spent many late nights in our own environments, that is, as nine foreign Ministers of the EEC, deciding what the level of that commitment would be before we ever negotiated with our Lomé partners, and I am simply pleased that I had the opportunity of bringing it, not as far as I would have wished, but certainly much further than it would have been brought if we had not spent those late nights. As a consequence of that our own contribution has grown significantly. It is important that that should be noted.
Senator Conroy also mentioned that we are not members of the Asian Regional Bank. We are not members of any regional bank. Any decision on joining these, whether it is that or the Latin American Development Bank or whatever, would obviously have to be taken by the Government after full and due consideration of our capacity to meet immediate and continuing commitments and the need to maintain the desirable mix between financing international institutions and our bilateral programmes. I hope that it is clear from what I have said that if we are to involve ourselves further in other banks or other arrangements on a multilateral basis it could well be one of the consequences of these that the pressures on the bilateral programme, if these are mandatory commitments in the other areas, will grow because, in difficult times, there is no point pretending that there is an unlimited amount of money available though obviously one would like to be stretched as far as possible even to the point of pain.
It is a matter for the Minister for Foreign Affairs rather than for me to ensure that our bilateral commitment can be maintained and strengthened rather than stretched into other areas. Having said that about the Asian regions, particularly in relation to Thailand, the Philippines and countries that obviously have problems, I was also involved in negotiating between the Community and the Asian countries the new trade arrangements between them. This is a preferential trade arrangement between the Asian countries and the EEC. It is not an aid programme in the sense of the Lomé Convention. That too has significant consequences for Ireland in terms of access for their exports to the European Community market, some of which are in direct competition with some of the most vulnerable industries in the EEC. It is important for that reason to recognise that the Community is, in a whole range of areas, whether one looks at the Asian countries or Turkey—and we can be called to make contributions there as well—the African group, the Latin American group where negotiations are now going on, or any other areas, at least as active as any other developed part of the world. When the Community make an arrangement then we too make an extra commitment in all of these areas either by way of extra funds or by way of trade concessions. The balance would be rectified if other blocs, both political and economic, showed the same degree of response as the European Economic Community countries are doing.
Senator Mulcahy asked whether our contribution to the International Development Association is tied to purchases of goods here. It is not There is no restriction of that nature and there are no conditions attached to our contributions.
Senator McDonald asked a question about South Africa. He asked particularly what help we could give to the Union of South Africa. I take it he is talking particularly about the black population of South Africa. In all of these areas the most important thing is to be able to ensure that we can work on a government to government basis, that we have the agreement of the government involved to not only allow, but to channel effectively to those who need it the level of aid, the assistance, the medical aid and so on. I have no evidence whatsoever—though I have to say it is not something I can state categorically has been tried—that the Government of the Union of South Africa would be prepared to accept an aid programme from a country such as ours towards the people of the townships of Soweto or any of the regions. They do not choose to acknowledge that those people have needs, and if they do not choose to acknowledge that they have needs I do not suppose that they would accept any aid that we would want to channel to them. But maybe all things are possible. I will convey what Senator McDonald has said to my colleague, the Minister for Foreign Affairs, and see what he has to say in that connection.
I will refer generally to the points Senator Cooney raised. He raised some important points which I did not refer to on opening because it would not be appropriate for me to refer to them on opening as some of these areas are at least appropriate for my colleague the Minister for Foreign Affairs. I said on Second Stage of the Finance Bill that one of the most urgent problems facing the world economies at the moment is to establish a new economic world order, a new monetary stability and programmes that recognise our interdependence. In the whole North-South context so much so obviously requires to be done that one sometimes wonders why it is not being done. There are some areas that need to be activated immediately. Very many more countries must become involved than are at present involved. The OPEC countries, for instance, have very significant dollar surpluses at this stage. They have a role to play that up to this moment they are not playing. It is not too long ago since they themselves featured in the panel of developing countries, and indeed some of the programmes that were voted through here would have been applied to some of the OPEC countries not too long ago.
That pattern has changed now and as far as I can recall one of them that has a significant contribution to make to this programme is Saudi Arabia. I do not see evidence of others who could make contributions figuring in this programme at all. It is of vital importance, either through this programme or through the recycling of the OPEC surpluses that at the various financial agencies, the IMF or the World Bank, we agree at this stage to have a new substitution account, a new arrangement whereby we can guarantee the economic and monetary stability of these developing countries particularly, something that will in turn also guarantee the outlets, if not in the immediate short-term at least in the medium-term, from the developed world. As we, in a sense, have exploited the outlets that exist in the developed world—and the developed world is obviously in recession at this stage—even if we thought only in selfish terms it would be in our interest to encourage and promote the economic capacity of the developing countries who in turn would become consumers of the products that we export. It is obvious then that there is a great need to move towards much greater co-ordination and programming of the structures for the world economy that exist at this moment.
I am impatient and unhappy about what has not been achieved. There has been a trend towards protectionism and it is undesirable. I hope that as we feel the pinch a little more in the western world, we will be activated to respond by taking a lead role—that is what I said on the Finance Bill—both in the European dimension and with our partners at every international forum so as to lay the basis for a more stable world economy. If we do not, while we may suffer, these people to whom this Bill is directed will suffer even more.
It is not appropriate for me to comment on other points like those relating to Gorta and Concern; that is more a matter for the Minister for Foreign Affairs. I would not have shared the view that Senator Cooney expressed. There may be priorities, but the real priority is to help people to help themselves. I know the problem is immediately pressing and urgent when a person is starving; obviously he needs food and medicine. On the other hand the most important thing is to ensure if possible that people will have the means of ensuring that they will not starve tomorrow. Our own bilateral programme has always been in that direction.
Finally, I have replied as widely as I can but decisions here are matters for Government. I have given the Government position as has been stated by the Minister for Foreign Affairs and myself on my own responsibility. It is not a matter for any one man, as Senator Cooney seems to imply. But he was in government and he knows how governments operate and if he says that he shows a very hazy memory of how government operates. To the extent that the contributions of the Minister for Finance are expressed through this Bill this is a step which I am glad that the Senators welcome. I hope that others involved in aid programmes will be reassured by what my colleague, the Minister for Foreign Affairs, has said and by what I have reiterated here this afternoon.