Fighting poverty with trade not aid

Justine Greening tells James Waterson why her international development department is focused on boosting investment

CONSERVATIVE activists have few kind words for the department for international development (Dfid) and its ringfenced budget, which many characterise as taking cash from a penniless nation and handing it to booming developing economies.

But some may be assuaged, at least marginally, by secretary of state Justine Greening, who is as likely to talk about Dfid’s plans for boosting British industry as she is the latest aid project in Africa.

“There will always be some people who think spending 99.3 per cent of national income on Britain isn’t enough,” she told City A.M. yesterday. “What I’m doing is making the case that this is in our national interest. It is about international development and market making.”

Traditional aid programmes – which saw basic services funded by the British taxpayer – are being joined by measures to boost living standards through the traditional Conservative methods of entrepreneurialism and economic growth.

“Aid has a role to play. We help build up services like health and education, clean water and sanitation.  But that’s not enough. India is a very good example of a country where 10 or 15 years ago our work was all core services. Now it’s about economic development,” Greening said. One way to think of her approach is as an NGO-flavoured version of the government’s scroungers versus strivers narrative: for too long large consultancy firms have earned big fees by telling the department how to give away its money. Far better, she says, to refocus aid money on helping UK businesses invest in developing countries – boost ing earnings both at home and abroad.

“I want to see an end to aid dependency through jobs. These countries do not want to be dependent on aid. They want us to help them grow. Labour didn’t have a strategy. There was some work done on ad-hoc projects but we did not have a strategy on economic development in each country – the focus was on basic services.”

Given that she was formerly a key member of George Osborne’s economic team, a few eyebrows were raised when Greening was moved to the department for international development in last September’s reshuffle. But despite reports that she was less than enamoured to leave her job as transport secretary, the fast-rising minister soon set about changing the way Dfid worked.

Early victories include ending traditional aid projects in India – now the world’s 10th largest economy – and promising to clamp down on the fees charged by third parties in the aid industry. But she still thinks her department needs to “up its game” and accept that economic development is now its focus.

The perils of overseas aid are easy to see in her predecessor Andrew Mitchell’s order to restore controversial funding to Rwanda on his last day in the job – “Andrew approached his decision using a process that I think was robust” – and her subsequent decision to block payments.

But she has a simple pitch to British businesses: “Now is the time to join us and get involved and be in these newly emerging markets. There’s no point trying to get involved when the rest of the pack is already there.”

CV: JUSTINE GREENING

Age: 43

Education: Graduated from the University of Southampton before an MBA at the London Business School.

Career: Trained as an accountant and worked at PwC, GlaxoSmithKline and Centrica before entering parliament in 2005 as MP for Putney.