The real "poverty barons" are multinational companies

Foreign aid should be investigated, but in the right way

 

On Monday, the new International Development Secretary Justine Greening launched an investigation into the millions of pounds of UK aid money diverted into the pockets of private sector consultants such as the staunchly pro-market Adam Smith International (ASI), following an investigation by the Sunday Telegraph.

This is certainly welcome news. The World Development Movement has for years argued that money made by highly paid consultants like ASI, forcing privatisation, is a dubious use of public funds at best. As early as 2001, ASI was paid to facilitate a water privatisation project in Tanzania, including earning a handsome £250,000 to promote a pop song.

But the worrying thing is that the use of the aid budget in this way is only the tip of the iceberg.  Increasing consultancy spend is part and parcel of a wider undying faith that DfID has in the private sector to deliver poverty reduction.

In one stark example, UK aid money is currently paying for consultants to advise the Bangladeshi government on the establishment of new special economic zones aimed at attracting private-sector investment. Existing zones give multinational companies tax holidays and subsidised land while placing severe restrictions on trade union activity to an extent where the average wage inside these Bangladeshi "export processing zones" is around £30 a month. Here, the scandal goes well beyond the approximately £14m that we are paying the consultants. The heart of the issue is the fact that we are using aid to support a project that will do everything to benefit multinationals like Adidas, which made 671 million Euros in profit last year, and next to nothing for the supposed beneficiaries.

But the government’s pursuit of development policy that focuses on the private sector doesn’t stop at promoting pro-market solutions through consultants. Increasingly, we are seeing multinational corporations replace aid agencies, governments and NGOs as the implementing partners in aid projects.

For example, DfID’s Girl Hub project aimed at getting policymakers to prioritise the needs of girls is being implemented by the Nike Foundation. At the hunger summit hosted by David Cameron during the Olympics, it was Unilever and Glaxo Smith Kline, not NGOs or governments who were named as the major partners.

The problem with all this is that the core assumption – that private sector solutions will be somehow better and more efficient than public sector oriented ones – is based on ideology, not evidence. Nike’s Girl Hub project was slammed as having “serious deficiencies in governance” by the independent aid watchdog ICIA.

There have been myriad inquiries into aid policy over the past decade, but none have broached the key question that needs to be answered: do pro-market, private sector models of development work better for the poorest people than approaches that focus on using and strengthening the capacity of the public sector? The World Development Movement’s 2007 research on water provision showed precisely the opposite.

Justine Greening should look towards supporting an independent Parliamentary inquiry into this broader and more vital question, and put ideology aside and in the interests of genuine poverty reduction. Until this happens, there will remain doubts about whether the government is serious about an aid programme focused on the poor rather than promoting market ideology alone.

Deborah Doane is director of the World Development Movement

Food aid is collected in a Kenyan refugee camp. Credit: Getty Images
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French presidential election: Macron and Le Pen projected to reach run-off

The centrist former economy minister and the far-right leader are set to contest the run-off on 7 May.

Emmanuel Macron and Marine Le Pen will contest the run-off of the French presidential election, according to the first official projection of the first-round result.

Macron, the maverick former economy minister, running under the banner of his centrist En Marche! movement, is projected to finish first with an estimated 23.7 per cent of the vote, putting him marginally ahead of Le Pen. The leader of the far-right Front National is estimated to have won 21.7 per cent, with the scandal-hit Républicain François Fillon and the left-winger Jean-Luc Mélenchon tied for third on an estimated 19.5 per cent each. Benoît Hamon, of the governing Socialist Party, is set to finish a distant fourth on just 6.2 per cent. Pollsters Ifop project a turnout of around 81 per cent, slightly up on 2012.

Macron and Le Pen will now likely advance to the run-off on 7 May. Recent polling has consistently indicated that Macron, who at 39 would be the youngest candidate ever to win the French presidency, would probably beat Le Pen with roughly 60 per cent of the vote to her 40. In the immediate aftermath of the announcement, he told Agence France Presse that his En Marche! was "turning a page in French political history", and went on to say his candidacy has fundamentally realigned French politics. "To all those who have accompanied me since April 2016, in founding and bringing En Marche! to life, I would like to say this," he told supporters. " 'In the space of a year, we have changed the face of French political life.' "

Le Pen similarly hailed a "historic" result. In a speech peppered with anti-establishment rhetoric, she said: "The first step that should lead the French people to the Élysée has been taken. This is a historic result.

"It is also an act of French pride, the act of a people lifting their heads. It will have escaped no one that the system tried by every means possible to stifle the great political debate that must now take place. The French people now have a very simple choice: either we continue on the path to complete deregulation, or you choose France.

"You now have the chance to choose real change. This is what I propose: real change. It is time to liberate the French nation from arrogant elites who want to dictate how it must behave. Because yes, I am the candidate of the people."

The projected result means the run-off will be contested by two candidates from outside France's establishment left and right parties for the first time in French political history. Should Le Pen advance to the second round as projected, it will mark only the second time a candidate from her party has reached the run-off. Her father, Jean-Marie Le Pen, reached the second round in 2002, but was decisively beaten by Jacques Chirac after left-wingers and other mainstream voters coalesced in a so-called front républicain to defeat the far right.

Fillon has conceded defeat and backed Macron, as have Hamon and the French prime minister, Bernard Cazeneuve. "We have to choose what is best for our country," Fillon said. "Abstention is not in my genes, above all when an extremist party is close to power. The Front National is well known for its violence and its intolerance, and its programme would lead our country to bankruptcy and Europe into chaos.

"Extremism can can only bring unhappiness and division to France. There is no other choice than to vote against the far right. I will vote for Emmanuel Macron. I consider it my duty to tell you this frankly. It is up to you to reflect on what is best for your country, and for your children."

Though Hamon acknowledged that the favourite a former investment banker – was no left-winger, he said: "I make a distinction between a political adversary and an enemy of the Republic."

Mélenchon, however, has refused to endorse Macron, and urged voters to consult their own consciences ahead of next month's run-off.

The announcement sparked ugly scenes in Paris in the Place de la Bastille, where riot police have deployed tear gas on crowds gathered to protest Le Pen's second-place finish. Reaction from the markets was decidedly warmer: the euro hit a five-month high after the projection was announced.

Now read Pauline Bock on the candidate most likely to win, and the NS'profiles of Macron and Le Pen.

 

Patrick Maguire writes about politics and is the 2016 winner of the Anthony Howard Award.

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