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Future of CDC

I endorse and congratulate the right hon. Member for Gordon (Malcolm Bruce), the Chair of the Committee, on the way in which he has introduced the report. As I am a Committee member, it would be rather surprising if I said that I disagreed with the report, so I will say that I agree with it, having participated in its compilation. In addition, my life on the Committee would not be worth living if I said anything else. I would like to ask the Secretary of State a couple of questions. In a sense, this picks up where the right hon. Gentleman finished. He talked about the join between the Department's private sector activities and those of CDC. I am still a bit uncertain about where that join is and how the Secretary of State sees it. When we visited India, that issue came home to me when we came across a target of 50% for how much of the Department's budget should be spent in the private sector. I had not heard of that before. It is obviously very well known that the Government felt that more of the Department's activities should be channelled through the private sector—I do not necessarily demur from that—but it was the first time I had heard that there was actually a target of 50%. A number of my colleagues and I found that a bit surprising because, if DFID is about doing what is right to combat poverty, the private sector should be utilised where it is appropriate, and what in some places might be called the third sector and the public sector should be utilised where that is appropriate. The objective should determine the percentage. That is not what seems to be happening here, where the percentage is in danger of determining the objective. As we asked more questions about that, I got more confused about exactly what the policy was. When the Secretary of State winds up, will he clarify where the 50% figure comes from, rather than 40%, 30%, 60% or 80%? Why 50%? If such a target is appropriate for India, is there a 50% target for other areas where the Department is operating? If so, what is that based on? Is it based on the same criteria as for India or is it based on different criteria? If the figure is not 50% for other areas, how did he arrive at the different percentages? I am genuinely confused about how that works. I would also like to know what the join is between that figure and the role of CDC. Certainly there was an uneasiness among some of our interlocutors in India about DFID saying that it wished to devote 50% of its activities to the private sector. That was not because the people we spoke to considered private sector investment to be unimportant. Indeed, a number of the most creative projects that we saw there could go under the heading of private sector projects, and they were often very small scale and very pro-poor. As the right hon. Member for Gordon mentioned, the people concerned were questioning whether, if this is going to be done on an industrial scale and on the basis of a particular percentage, it should be a private sector-led activity—the private sector investing—rather than something done by DFID directly.