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Future of CDC

I certainly agree that we want a partnership that looks at the best way of optimising and maximising production from which the community can benefit. I know that the Government have said that they are unwilling to direct CDC into particular sectors, but I hope that the Secretary of State will indicate that he will also not be telling it not to go into particular sectors. I hope that the Government will listen to the Committee's view that CDC should try to explore such an area because that approach would give it an expertise that would be beneficial and could be replicated elsewhere. Although today might not be the appropriate time for the Secretary of State to comment on this, he will be aware of the engagement that we have all had in our development programme in India. He has set a target of 50% for the level of Indian overseas development assistance going into private sector development by the end of 2014-15. For absolute clarity, I should say that the Committee did not dissent from that as a principle, but we were concerned about whether the mechanisms existed, or would exist, to achieve that figure. It will be interesting to see the role of CDC and equivalent partners in relation to that, particularly because the Government of India have made it clear that they are not keen on the UK Government's aid programme being used to subsidise private sector investment. To return to the example I cited with regard to the Highlands and Islands Development Board, there were projects in the states that we went to—Bihar and Andhra Pradesh—that probably would yield a return, but are unable to attract investment because they are off the sexy horizon of where people want to invest in India. It is possible for the Secretary of State's objectives to be achieved, but the revamped CDC and the equivalent model may have to be worked up to a point where that can deliver. That is not possible at present and, to be fair, the Secretary of State has not said that it should happen as of today. However, a lot needs to be done in the next three or four years if that is to be delivered. I can summarise things with a slightly personal view. I have been Chair of the Committee for six years, including throughout the previous Parliament. As I have said before, the creation of DFID was a considerable achievement of which the previous Labour Government had every justification to be proud. I have no hesitation in saying that. However, after that length of time and with a new Government in office, it is also right and proper to review, reprioritise and reassess. Until recently, DFID was not comfortable with the role of interacting with the private sector. What people in DFID do in development terms is brilliant and world class. Indeed, I am not criticising the people involved because they did what they were asked to do. However, whenever there was a discussion about private sector co-operation and partnership, there was a tendency to say, ““Well, that's what CDC does. We'll park that and get on with our development job.”” In future, there needs to be more of a mingling of the two. When one role is more risky, complicated and difficult, there is always a worry that it could compromise the other. I understand those concerns, but the relationship between the Department and CDC as it changes needs to be slightly more hands on. There needs to be more parallel working between CDC in country and DFID programmes in country, and a greater understanding about them between the two. My final example about that comes from a briefing the Committee enjoyed—my hon. Friend the Member for Mid Derbyshire (Pauline Latham) was there in Aberdeen—from the Wood Family Trust, which I hope will give evidence to us in the autumn on a different inquiry. The trust was engaged in a project in east Africa on making markets work for the poor. It is a private family foundation, and it started off by saying, ““We're going to give the money we've made””—predominately out of the oil and gas industry—““and put it into development in Africa, because that's about putting something back. We're business people and we'll do the business thing.”” Indeed, that was precisely what it was doing. However, it rapidly realised that it could not do what it wanted without being in partnership with the public sector. It is interesting to note that the public sector needs to partner the private sector and the reverse is also true. It is the working together that delivers the best results. I commend to the Secretary of State the fact that, when the Committee is visiting any bilateral partner in the future, we are likely to get a briefing about what is happening between the development programme and CDC in that country. We have not had that in the past—CDC has almost been a different organisation. I commend our report to hon. Members. I am very grateful to the Secretary of State for attending the debate and, indeed, for his constructive response to the report. I look forward to him updating us because I am aware that since our report was published, things have moved on a bit with regard to initiatives to revamp and reinvigorate CDC. The Committee is very much looking forward to hearing about that.