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Arms to Africa? Policy coherence for development and power

Wednesday, January 31, 2007 4:23 PM by Alan Hudson

On Tuesday of this week, British MPs debated the decision taken in 2001 by the UK Government to license the export of an air traffic control system to Tanzania. Here, Alan Hudson, a Research Fellow at ODI, reflects on one of the many issues which the case raised, the issue of policy coherence for development.

In December 2001, British Aerospace (BAE Systems) was granted a licence to export an air traffic control system to Tanzania. The cost of the air traffic control system was £28 million. The International Civil Aviation Organisation had investigated the case and reported to the World Bank – which was considering whether to grant debt relief to Tanzania – that the system was “not adequate and too expensive”. In the UK, there was a dispute within Government about whether the export licence should be granted, with the then Secretary of State for International Development, Clare Short, the most vocal of those arguing against granting an export licence.

As a signatory to the Consolidated EU and National Arms Export Licensing Criteria, the UK Government was required to consider whether the export of the air traffic control system would seriously hamper sustainable development in Tanzania. Collectively, as has been the case in all but one application to export arms, the UK Government took the view that it wouldn't. Once Clare Short and her less vocal allies had lost the argument, and the licence had been granted, her department - DFID - decided to freeze £10m of UK aid to Tanzania. This clearly indicated that in her view the sale of the air traffic control system to Tanzania would do nothing to further progress on poverty reduction in Tanzania. And, perhaps, that providing aid to Tanzania would in this instance amount to providing aid to British Aerospace.

One good thing to come out of the case was some clarification of the criteria for assessing applications to export arms. This was one of the recommendations made by the Quadripartite Committee on Strategic Export Control, a Committee of MPs drawn from the Defence, Foreign Affairs, Trade & Industry, and International Development Select Committees (see paragraphs 115-135). But the case also raised a number of questions for those of us concerned with promoting and enabling poverty reduction in developing countries; questions about corruption, questions about arms exports and export control regimes, questions about sovereignty, and questions about the nature of the relationship between developed and developing countries.

Goal 8 of the Millennnium Development Goals commits governments, particularly those in the rich world, to build a global partnership for development. Such a partnership – even a partnership between “sovereign” states – entails responsibilities. In addition to providing more aid more effectively, developed countries must ensure that they do not marginalise development objectives when formulating and implementing policies in relation to other issues. Policies on issues which are "beyond aid" – trade, migration, investment, climate change and so on – ought to support, or at the very least not undermine, policies which are focused on development. This is the goal of 'policy coherence for development'.

Policy coherence for development matters. In its absence money spent on aid and development will be wasted as development objectives are undermined. There are signs that the UK, with DFID in the lead, is beginning to take policy coherence for development seriously. This year will see the first annual report by the Government, to Parliament, on policy coherence for development, following the passage into law of Tom Clarke MP’s International Development (Reporting and Transparency) Bill in 2006. Another positive sign is the steady, if rather slow, evolution of mechanisms to take account of development objectives in relation to issues such as migration, arms exports, money laundering, and, in some cases, corruption. But, as the Tanzania case demonstrates, when push comes to shove, and the pusher has the power, codes of conduct, criteria and guidelines can count for very little.

If governments are to take policy coherence for development seriously, and to make evidence-informed decisions, they need to know about the costs of incoherence and the benefits of coherence. This is important too for public accountability. The Foreign Secretary told the UK Parliament in 2002 that the decision on Tanzania’s air traffic control system had been taken on the basis of complex cost-benefit analyses (analyses which, despite repeated requests, have still not been provided to Parliament). In the absence of evidence about the likely impacts in Tanzania, performing a cost-benefit analysis which took account of likely development impacts, would have been a challenge. ODI and other research organisations have an important role to play in marshalling evidence about the costs of incoherence and the benefits of coherence. This will help those governments committed to policy coherence for development – whatever their political party – to make well-informed decisions, and demonstrate to the laggards that policy coherence for development matters.

Alan Hudson
I am a Research Fellow at ODI, working on issues around governance and accountability, with a particular emphasis on cross-border issues. From 2001 to 2005, I was an advisor to the House of Commons Select Committee on International Development. In that capacity, I was also a member of staff on the Quadripartite Committee. This Committee has the task of scrutinising – after-the-fact – the implementation of the Government’s export controls policy. The Committee’s report for 2002 included extensive discussion of the Tanzania case and its implications.

 

Comments

# re: Arms to Africa? Policy coherence for development and power @ Thursday, February 01, 2007 12:26 PM

The Rt Hon Peter Lilley MP highlights his UK Parliamentary response, part of the debate over the 2001 decision to license the export of an air traffic control system to Tanzania.

This statement is extracted from Hansard and is part of the debate over the 2001 decision to license the export of an air traffic ocntrol system to Tanzania.  A link to the full debate is at the end of this comment.

I begin by declaring an interest. I shall shortly go to Tanzania as chairman of the globalisation and global poverty group to discuss development issues, including issues such as this, with Government officials and others, and to address the Democratic Union of Africa.

Tanzania is one of the poorest countries in the world. I had the privilege of living there when I worked for the east African common market some years ago, and I know it to be a beautiful country with a warm people—but a people living under a cloud of poverty, disease and hunger that few of us in the House can imagine. We should remember, however, that it is in that context that we are discussing this issue.
The House often discusses waste and misuse of money that occurs in this country, but that waste and misuse dents, at most, our prosperity. Waste and embezzlement of money in a country like Tanzania is a matter of life and death. It means diseases untreated, education forgone, and children going to bed hungry at night.

That is why the accusations that have been made are so important, including those that the right hon. Member for Birmingham, Ladywood (Clare Short) made outside the House and which we look forward to hearing today. I pay tribute to her because she does not speak now with the benefit of hindsight, as is the case for some of us, but she had the courage and foresight to speak out about her concerns at the time, and to make them known publicly.

I also have enormous respect for the right hon. Lady’s successor, the current Secretary of State for International Development. He is a man of sea-green sincerity and absolute dedication to the cause of alleviating poverty. Today he responded with great candour, and coped with the embarrassing task of defending decisions for which he was not responsible, which he knows to be indefensible, and with which he undoubtedly disagreed at the time. I do not blame him for seeking what refuge he could find behind the investigation by the Serious Fraud Office. However, that will not stop us debating the issue today, because we are asking not about that SFO investigation, but about the Government’s failure to investigate sufficiently, or act effectively upon, what they knew previously.

An even flimsier defence is just to say, as the Government amendment does, that the decision was made after “due consideration” and “full discussion at Cabinet level”.

The issue is not whether it was discussed, but what conclusions were reached and why. Why did the Cabinet disregard the advice of the International Civil Aviation Organisation, ignore the concerns of the then Secretary of State, and push through licence approval before the World Bank had put its well-known criticisms into a recommendation that would have been difficult to reject?

We know that Ministers did not conclude that this was a good deal for Tanzania. The ICAO had already advised that “The system, as contracted, is primarily a military system...If it is to be used primarily for civil air traffic control purposes, the proposed system is not adequate and is too expensive.”

At no stage has any Minister suggested otherwise. They have fallen back on what might be called the Pontius Pilate defence: “We knew it was a bad deal, and we suspected it was a dodgy deal, but we washed our hands of it and left it to the Tanzanians to decide”—the “sovereign decision” argument to which the hon. Member for Kingswood (Roger Berry) referred—“It’s just too bad if the Tanzanians are being ripped off and the poor lose out as a result.”

I am certainly not accusing the Secretary of State of taking that position. He would be the last person to argue that we should turn a blind eye to bad governance and waste of resources. His recent White Paper is entitled not “Let’s hope governance will work for the poor”, but “Eliminating World Poverty: making governance work for the poor”—making it work for the poor, not for the big man in Africa or big business abroad. The White Paper is robust about aid being made conditional on good governance. It says: “The UK Government has a responsibility to make sure that UK aid money is used for the purpose for which it is intended. We take this very seriously.”

In 2001, Britain had just given Tanzania £35 million of direct budget support for poverty reduction, yet when Tanzania decided to spend £28 million on a contract that the ICAO said was primarily military, not adequate and too expensive, the Government simply washed their hands. Governments face a difficult dilemma if the only way in which they can react to waste and suspicions of corruption is by cutting off further aid intended to help reduce poverty, but on this occasion we could have prevented this dubious contract by refusing or at least delaying a licence, without cutting off future aid.

The Secretary of State’s White Paper goes on to say that donor Governments
“need to be able to stop unscrupulous individuals or companies profiting from...paying bribes”, and that “where domestic capacity is weak, international codes of practice can encourage companies to work legitimately”.

Yet instead of enforcing the combined European Union and national code of conduct on military exports, the Government simply glossed over it, or gave it the most liberal interpretation possible.

The Government say that they had no evidence of corruption when the licence was given. We now know, of course, that 30 per cent. of the contract value was paid into a Swiss bank account, but the Government do not want us to talk about that now that we have some evidence. However, we do have the right to know whether Ministers asked themselves the obvious question at the time: why were the Tanzanians pressing ahead with a contract for something that they did not need and could have got cheaper elsewhere, and for which they had arranged some highly questionable finance—all against the advice of the ICAO, the World Bank, the International Monetary Fund and others? We know that the former Secretary of State asked herself that question, and that she reached the only conceivable answer: that someone had been offered big kick-backs. The deal stank—it reeked of corruption—but the Prime Minister persuaded other Ministers to hold their noses and let it through.

We in this country talk a lot about governance. We lecture the Governments of developing countries, telling them that they must investigate, be transparent and hold Ministers to account, but the sad truth is that on this occasion, the suspicions fell on a British company. It was British Ministers who turned a blind eye; it was the British Government who rushed a decision through before the World Bank could publish its report; it was the British Government who ignored their own code of conduct. The words “mote” and “beam” spring to mind.

Last year, I met one of the bravest men in Africa: John Githongo, the former anti-corruption tsar in Kenya, who tenaciously exposed massive corruption in the face of threats to his life and family. He said that Britain could still exert considerable moral influence—that anything that we did to highlight corruption and abuse would mobilise and strengthen the forces within African countries trying to clean up their systems. The sad truth is that this whole sorry episode will make it more difficult for the Secretary of State to exert that moral influence. I suspect that he would agree with me, were he in a position to do so.

Although tomorrow’s headlines will be captured by “cash for honours”, I believe that the episode that we are discussing today will leave a darker stain on this Government’s reputation. They put the well-being of poor people second to the interests of big business, undermined Britain’s influence for good and set a damaging precedent for the future. The stain can be erased only if this House is prepared to do what we demand of others—may I respectfully suggest that it do so through its Select Committee on International Development?—and render the dealings of Government thoroughly transparent and hold Ministers, above all the Prime Minister, to account. It will be to the credit neither of this House nor this country if we let the matter rest as it stands.

Link to full debate on Hansard

Peter Lilley

# Research - accountability - policy @ Saturday, February 03, 2007 6:32 PM

One of ODI's aims is to link research more closely to policy processes. As such, the active engagement of politicians such as Peter Lilley MP in ODI-hosted discussions is in my view welcome. Clear public statements of intention - such as his comment on this blog, and others' comments available in Hansard - provide a very useful benchmark against which politicians of whichever party can at a later date be held accountable. Processes of accountability - asking those with power to explain their actions - can play an important part in maximising the impact of research on policy. Readers of this blog might expect a future Conservative Government to insist on a stricter interpretation of the criteria relating to arms exports to developing countries, something which I for one would warmly welcome.

Alan Hudson