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Baroness Howe of Idlicote: I am grateful to Members who have spoken in this short exchange. I hear what the Minister says. I would prefer to see the provision
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on the face of the Bill. For the moment, I shall withdraw the amendment and consider whether I need to bring it back again. I take account of what the Minister has said, which should, in itself, be reassuring.
The Committee adjourned at twenty-two minutes past six o'clock.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My honourable friend the Parliamentary Under-Secretary of State for Work and Pensions (James Plaskitt) has made the following Written Ministerial Statement.
On behalf of my right honourable friend the Secretary of State for Work and Pensions, the BFI inspection report on Boston Borough Council was published today and copies have been placed in the Library.
In 200405 the council reported that it was taking 57 days on average to process new claims to housing benefits. At the time of the inspection in July 2005 the majority of the management team had been in post only for a few months but performance was beginning to improve as the backlog of claims had been cut. Allowing for some misreporting of performance the council was taking an average of 47 days to process new claims in the first quarter of 200506. However, significant further improvement is needed to meet the standard of 36 days.
BFI found significant delays at each stage of the new claims process and in processing changes of circumstances. The longest delays were in the time taken to obtain all required information from customers. No monitoring of the throughput or clearance of work meant there was a lack of control over the flow of work. A limited management checking regime meant the council did not have reliable feedback on the quality of work done or the ability to identify areas where performance needed to be improved.
Excellent progress has been made on implementing the two key commitments on debt relief made by G8 leaders at the Gleneagles summit in July. In addition, the UK has granted further bilateral debt relief over
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the summer, and I take this opportunity to provide an update on the Heavily Indebted Poor Countries (HIPC) Initiative.
At Gleneagles, the G8 proposed 100 per cent cancellation of the debts owed by qualifying countries to the International Monetary Fund, the International Development Association (IDA) of the World Bank, and the African Development Fund (AfDF) of the African Development Bank. Since then, the proposal has been discussed by the board of directors of each institution and received broad support, including from African countries. The IDA and IMF components were agreed at the annual meetings of the World Bank and IMF. The approval process is underway at the African Development Bank. We are working with others to resolve outstanding technical issues, and are confident that implementation of the new debt relief will begin in 2006. Up to $55 billion will be cancelled for the current 38 HIPCs, and we estimate that about $1 billion a year will be freed up for spending on poverty reduction in 2007, rising to $1.7 billion by 2010.
Countries will receive this 100 per cent irrevocable debt cancellation when they complete the HIPC Initiative. There will be no further conditions attached. Countries that have already completed HIPC will need to demonstrate that they have maintained their commitment to poverty reduction and good macro-economic and public expenditure management. The allocation of additional donor resources through the existing performance based allocation systems will then maintain a strong incentive for good policy and performance. In addition, bank and fund staff will continue to monitor and report on the overall efficiency of public expenditure as well as on progress in reducing corruption and enhancing transparency in recipient countries.
To ensure that the financing capacity of the World Bank and African Development Bank is not reduced, we and other G8 partners have committed to cover our share of the cost of the debt cancellation for IDA and the AfDF. We will make funds available ahead of the debt cancellation to cover the costs to the World Bank and African Development Bank for the next three years. We have committed to meet our share of ongoing costs for the duration of the loans, which in some cases is 40 years. These funds will be additional to the resources we had already agreed for these institutions as part of the recent replenishments of the concessional funds of the World Bank and the African Development Bank. G8 Finance Ministers have agreed that in future replenishment rounds the costs of the debt relief initiative be reported separately to ensure that they are clearly distinguishable. Debt relief at the IMF will be funded through internal resources as far as possible, but donors will provide additional resources if needed to ensure that the IMF's financing capacity is maintained.
The G8 also made a commitment to the achievement of a fair and sustainable solution to Nigeria's debt problems with the Paris Club of government creditors. I am able to report that a deal was formally agreed at
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the Paris Club on Thursday 20 October. This deal sees approximately $18 billion of Nigeria's debt cancelled, the remainder being repaid by Nigeria using part of its oil windfall. The UK's share of the debt cancellation is approximately $5.1 billion. The deal will be implemented in two phases over the next six months, after which Nigeria's entire debt to Paris Club creditors will have been resolved. This is the largest single debt deal ever reached with an African country. The government of Nigeria have committed to ring fence the debt savings of about $1 billion a year to tackle poverty, and have invited national and international monitoring of all the spending, including by representatives of UK NGOs.
Steady progress is being made in implementing the Heavily Indebted Poor Countries (HIPC) Initiative. This targets the poorest, most indebted countries, reducing their debt burdens to sustainable levels, alongside reforms that help to ensure that resources freed up are spent on poverty reduction. Rwanda, Zambia and Honduras all completed the HIPC process earlier this year and received irrevocable debt stock reductions. Most recently Burundi completed the first stage of HIPC by reaching decision point and so qualified for relief on its debt service payments. We expect other countries to qualify or complete the process early next year. The IMF and World Bank have stated that several more countries will be considered for the exceptional debt relief under HIPC. This is a result of the extended "sunset clause" which now gives countries until the end of 2006 to meet the criteria for being considered under HIPCan extension that the UK was instrumental in lobbying for. A final list of countries is expected in early 2006. Both creditors and debtors need to maintain their efforts to ensure the full financing of the HIPC Initiative, and the full participation of all creditors. The UK is the second largest bilateral contributor to the HIPC trust fund, which helps multilateral organisations deliver their HIPC assistance in a timely manner. The UK has committed $436 million to date (including our share of the EC contribution) and in August made our latest payment$20 million to cover the costs to the African Development Bank of debt stock write-off for Rwanda.
Once implemented, the G8 multilateral debt cancellation deal will supersede the UK's Multilateral Debt Relief Initiative (MDRI) for HIPC countries. For other qualifying countries, we will continue to cover 10 per cent of their debt service to IDA and the AfDF.
In addition, the UK will give debt relief on about £42 million of development loans granted via the EU in the 1970s to 40 less developed countries. In 1978 the (then nine) EU member states provided the World Bank's International Development Association (IDA) with $428.5 million to be lent on concessional terms. Earlier this year it was agreed that these should be treated as bilateral rather than joint funds. Consequently we will manage the UK share of these loans in line with international and UK policy on debt relief. All the nine member states involved have agreed to cancel the loans to countries that have completed
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HIPC. In line with our policies, the UK will forgo payments from decision point and hold in trust payments between December 2000 and decision point; these moneys will then be repaid when countries reach completion point. The total cost to the UK of cancellation for the HIPC countries will be about £22 million. In addition, I have decided to provide relief on our share (about £20 million) of the loans to the poorest non-HIPC countries, provided they are committed to poverty reduction, human rights and sound public financial management.
I have decided to grant assistance to the government of Belize for a further year under the Commonwealth Debt Initiative (CDI). This decision will mean that Belize will not repay £1.458 million worth of official debt to the UK (representing payments that were due in the financial year 200304). The government of Belize will put the money towards agreed poverty reduction initiatives and associated economic reform.
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