Pat Breen (Clare, Fine Gael)
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I welcome Ms Lorna Gold, head of policy and advocacy with Trócaire, Mr. Sorley McCaughey, head of policy and advocacy with Christian Aid Ireland and Ms Eilis Ryan, co-ordinator of Debt and Development Coalition Ireland.

The purpose of this meeting is to provide a briefing to the joint committee in advance of the financing for development conference in Addis Ababa. The format of today's meeting will be an opening statement to be followed by questions from members. This is an important year with three very important meetings on development coming up, the first in Addis Ababa in July, the meeting in New York in September and the Paris meeting on climate change at the end of the year.

Much of our work and some of our sessions between now and then will focus on that because it is a template for moving forward over the next ten or 15 years.

I remind witnesses, members and people in the Gallery to ensure their mobile phones are switched off completely for the duration of the meeting. If they are in silent mode, they can cause interference with recording equipment being used in the committee room. I remind members of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person or body outside the Houses or an official either by name or in such a way as to make him or her identifiable. By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the joint committee. However, if they are directed by the Chairman to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given. They are asked to respect the parliamentary practice that, where possible, they should not criticise or make charges against any person or entity by name or in such a way as to make him or her identifiable.

The witnesses are all very welcome. I ask Ms Gold to make her presentation. When that is complete, we will get members to ask questions. I ask all three witnesses to feel free to get involved at any stage.

Ms Lorna Gold:

I thank the committee for giving Dóchas an opportunity to make a presentation on the third financing for development summit. As has already been outlined, 2015 represents a critically important year for international development. Three interlinked summits this year will determine the development framework for the next 15 years. The first of these events is the financing for development summit in Addis Ababa, which is the third summit in the financing for development process that started in 2000 following the first millennium summit. The second event is the critical negotiations at which decisions will be made on the post-2015 sustainable development goals. Ireland and Kenya will co-chair these discussions, which will take place at the UN in September. The third of the crucial 2015 events is the conclusion of the United Nations Climate Change Conference process, known as COP, which will take place in Paris in December. Therefore, 2015 represents an exceptional year in terms of the potential for a breakthrough in international development issues and, in particular, in addressing the structural causes of injustice which keep people in poverty today.

The first of these negotiations will take place in Addis Ababa. In the absence of a step change in the financing mechanisms and structures to achieve substantial breakthroughs in the sustainable development goals, those goals will not be achieved. The three agendas this year are deeply interconnected, yet are separate. There are interdependencies between them, but the negotiation tracks remain separate. Today, we want to highlight four issues that we are bringing before the committee: the need for a recommitment to international public financing, in particular development assistance; debt; tax justice; and the role this committee might take in ensuring there are robust follow-up mechanisms on foot of these processes.

The first issue we are highlighting is the 0.7% target for public financing for development. The scale of the ambition to meet the sustainable development goals and address climate change requires a step change in international financing. The harnessing of new resources is a core part of this. The international community has placed an emphasis on ways to leverage and ensure new resources to ensure the sustainable development goals. At the same time, however, the existing commitments to official development assistance need to be honoured and met. It is hard to put too much emphasis on this point at this stage in the delicate negotiations on financing for development. Official development assistance is both an expression of trust in the multilateral process and a concrete commitment with practical development outcomes.

Developed countries first committed to giving 0.7% of gross national income to overseas development aid as far back as 1970. This commitment was reaffirmed in 2002. Official development assistance increased throughout the 2000s and was aligned to the millennium development goals. Despite this, there remains a delivery gap. Globally, just 0.3% of gross national income is spent on official development assistance. This means that a gap of 0.4 percentage points of gross national income remains, by comparison with the commitments made to the delivery of official development assistance. Moreover, allocations to the least developed countries continue to fall. They fell by 5.6% in 2013 and by a further 16% in 2014. Least developed countries rely most on official development assistance due to their limited capacity to raise domestic resources and avail of other sources of external financing. Therefore, commitments to additional sources of public finance are absolutely critical at this stage of the financing for development process.

Ireland first committed to the 0.7% target at the 2000 UN millennium summit. Ireland recommitted to this target at the review summit in 2005 and again in 2007. Ireland's official development assistance, as a percentage of its gross national income, reached a peak of 0.59% in 2008. We maintained our aid budget during the financial crash. We have managed successfully to stabilise it at approximately €600 million per annum. It is to the credit of the current Government that it has managed to sustain official development assistance at this level. However, the 0.7% target remains in the Government programme. As the economy has picked up, the percentage of gross national income going to official development assistance has steadily declined. We are now at 0.39%, according to the figures for 2014. This level was last seen over a decade ago.

Ireland's aid programme is widely regarded internationally as one of the best in the world. In fact, Ireland is part of a very small group of donors that remain committed to the highest quality of poverty-focused aid. Our aid is still 100% untied. We have one of the highest percentages of aid going to the least developed countries, which need it most. Some 52% of our aid goes to such countries. This means our aid has a genuine poverty focus. Our aid remains 100% grant-based. Given the quality of Irish aid, and the role Ireland is playing in the international negotiations on the sustainable development goals, Dóchas firmly believes now is the time to recommit to the 0.7% target and to show leadership in the international community, particularly within the EU. The Government needs to set out an annual timetable to meet the 0.7% target by 2020. I will now hand over to Ms Eilis Ryan, who is going to talk about the debt situation and how it relates to the financing for development process.

Ms Eilis Ryan:

I will pick up where Ms Gold left off by speaking specifically about the situation around debt. I will explain why debt restructuring is critical for developing countries in an international context, with specific reference to the sustainable financing of fair development. Many people here will be familiar with the debt crises of the 1970s and 1980s. This is often seen as an historic issue for the developing world that has been dealt with. Debt will be particularly critical during the Addis Ababa negotiations for three reasons. First, approximately 14 cent of every euro that a developing country receives in aid is spent on repaying debts. That is not a particularly effective use of aid coming from OECD countries such as Ireland. Second, the debt crises in Africa, Asia and Latin America, which had decreased before 2006, have started to increase again since then. As repayments have escalated, the number of countries that cannot afford to made debt repayments has started to grow. Third, many types of new financing will be under discussion in Addis Ababa.

In particular, private financing and public private partnerships will be discussed which, in the long term, will lead to the state taking on more debt because it is effectively the lender of last resort for many essential services.

In terms of civil society's position globally on how debt should be dealt with, a number of key points emerge but I wish to focus on the need for an international mechanism to deal with sovereign debt crises when they happen. At the moment when a country enters a sovereign debt crisis, unlike a private individual or corporation, it does not have a mechanism through which it can negotiate bankruptcy. There is always a scrambling around, with ad hocsolutions proposed to facilitate the debtor and also the creditor, who obviously wants some level of repayment. Civil society organisations contend that the absence of such an international mechanism means that debt crises always escalate beyond what is necessary. Recently an initiative was taken by the Argentinian Government to create a sovereign debt restructuring mechanism at the United Nations which received the overwhelming backing of developing countries, including all of Irish Aid's partner countries. Including that mechanism and backing it up in the outcome document of the financing for development negotiations in Addis Ababa is essential to ensure that developing countries due not suffer under unjust debt crises.

The fact that there is overwhelming backing from developing countries for this mechanism provides a strong impetus for the Irish Government to show its true partnership with the countries it works with in development. The Bolivian Government in its statement on debt in the context of the financing for development negotiations called the establishment of a UN mechanism on debt restructuring key to achieving the Millennium development goals and the sustainable development goals post-2015. That statement was made on behalf of a group of 77 countries which includes Ireland partner countries. In the countries in which Ireland invests the most money, particularly in terms of humanitarian spending, there are growing debt crises. The IMF considers both Zimbabwe and Sudan to already be in a state of debt crisis. Ireland's humanitarian spending is heavily focused on both of these countries but there is strong evidence to suggest that the effectiveness of humanitarian spending is limited when countries are in debt crisis.

Mr. Sorley McCaughey:

I will move straight on to the issue of domestic resource mobilisation as a central outcome for the financing for development agenda. Mobilising domestic resources is critical because tax represents the most sustainable, dependable and predictable source of income for developing countries. It is the income that is most likely to lead to sustainable development and it is the expansion of the public purse that will underpin a state's ability to deliver on its human rights obligations. Indeed, there is increasing recognition that tax avoidance schemes that deprive states of their ability to collect revenue represent a human rights abuse. Any proposals as part of the financing for development agenda to strengthen domestic resource mobilisation must be focused on supporting tax systems that generate sufficient revenue, address inequality and have a redistributive effect. They also need to be fully accountable to governance institutions that are representative of the needs of people living in poverty. We know, and this committee is familiar with, the obstacles in place that prevent developing countries from generating sufficient revenue. The most recent figures from Thabo Mbeki of the High Level Panel on Illicit Financial Flows from Africa puts the amount at €50 billion on an annual basis. The IMF argues that the impact of tax avoidance on developing countries amounts to as much as €212 billion every year. These numbers are huge and we need an increase in financial transparency to address this issue. We need to change the rules of the global tax system and we need more inclusive and democratic institutional frameworks under which such changes would happen. We also need to acknowledge that while a lot of changes in the international taxation system are happening under the OECD's Base Erosion and Profit Shifting, BEPS process, this process is not representative of the needs of developing countries and cannot address their needs and concerns.

There are specific results that we would like to see coming out of the financing for development process that address the issues of transparency and the rules of democratic institutions. One is the introduction of a country-by-country reporting standard for multinationals so that we know exactly what they are doing in every country in which they operate. We need to change the rules of the global tax system; we need to change it from the current OECD system to something that is more representative of the needs of developing countries. We also need to establish a UN-based tax body. At the moment the international taxation system is being governed or guided by the OECD and is not representative of the particular needs of developing countries. We would like a concrete outcome from the financing for development process to be the establishment of a UN body to look after international tax matters.

I will leave it at that for now.

Pat Breen (Clare, Fine Gael)
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If the presentations are finished, I will move on to member's questions.

Mr. Sorley McCaughey:

If I may, I was also asked to give the key requests for this committee. What we are asking this committee to do is ---

Pat Breen (Clare, Fine Gael)
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That is important; we need to know what we can do.

Mr. Sorley McCaughey:

We would like the committee to consider writing to the Taoiseach requesting that he ensures Ireland is represented by a senior member of Cabinet in Addis Ababa. We have tried to outline the seriousness and the interconnectedness of the three conferences taking place this year and it would be appropriate for the Taoiseach to ask a senior member of Cabinet to attend. We would also urge the Government in the negotiations in Addis Ababa to support those modalities of financing for development which produce equitable and sustainable development results for the world's poorest. These should include a commitment to the attainment by 2020 of the UN target of 0.7% of GNI for overseas development aid; a continued commitment that Ireland's overseas development aid is untied and focused on the poorest communities and countries; the establishment of an intergovernmental body under the auspices of the UN; and the establishment of a UN-led mechanism for resolving sovereign debt crises. These are very concrete requests that we would like the committee to consider.

Pat Breen (Clare, Fine Gael)
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That is excellent. I know the Minister of State at the Department of Foreign Affairs and Trade, Deputy Sherlock will be part of the Irish delegation but the final composition of the delegation has yet to be decided. I also know that it is top of the agenda for the Minister for Foreign Affairs and Trade, Deputy Flanagan.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I thank the witnesses for their presentation. The issues covered are ones with which we would broadly agree and are very important. In the context of coming up with a successor to the Millennium development goals, it is very important that issues not covered by that process are dealt with, such as climate change, governance, political rights and so forth. There is an opportunity, in the development of new goals and strategies, to ensure that those very important issues are included this time and given the attention they deserve.

Regarding the role of this committee, we would naturally be very supportive of the Government being represented at the most senior level possible at the forthcoming talks. It would also be very advantageous and beneficial if the Government was in the position to give a commitment on the timescale for reaching the 0.7% GNI target. There has been a drop in the percentage of our income spent on overseas development aid in recent years. I do not think there is any question of us not continuing our commitment to untied aid which has been a hallmark of Irish overseas development aid for decades. That is a very important message to send out and we should remain, as a country, fully committed to untied aid.

Regarding the establishment of an intergovernmental tax body, I totally support the views expressed on the need to minimise or eliminate tax avoidance and evasion. At the same time, however, an intergovernmental tax body would not be an easy structure to put in place.

Every sovereign state is naturally protective of its own financial arrangements and fund-raising abilities. If one were to take the European Union alone, taxation remains within the competence of the national governments. If a taxation measure were to be introduced at EU level, it would require unanimity, which means that each country could opt out, thereby ensuring it would not happen at all. I can see that is a very difficult issue, which is not to take away from the point, when we read of multinational corporations and their scandalous evasion of tax, that this irks the public greatly. Such money could be put to good use in many of the countries where they raise serious funds for their companies and earn huge revenues, yet we see the destitution of many of the people in those countries. The difficulty lies in trying to establish the mechanism that will not override the sovereignty of a country and its ability and competence to put in place its own taxation and fund-raising principles, but I do not take away from the general principle.

In the submissions, the point was also made that one of the desired outcomes from the Addis Ababa conference would be an adequately resourced, permanent institution. I would like to tease that matter out further. We have spoken on many occasions at this committee about how dysfunctional the United Nations is in many instances at present. The architecture of the United Nations is totally outdated. As we know, it was established after the Second World War when there was a different geopolitical scene throughout the world. New political powers have emerged. The structure and composition of the Security Council does not reflect the political realities of today and there is a crying need for a restructured United Nations, not just to deal with the very important issues before this committee today, but also with many other issues as well, such as responding to other crises and catastrophes that happen throughout the world.

The public has been very supportive, whether it is its appreciation of the work of different Governments over the decades in building up our overseas development aid or the huge work that is done by many in non-governmental organisations, such as those of the delegates, in promoting, advocating and putting in place services in the most deprived areas. I do not know if the public would welcome another permanent institution. It is one suggestion with which, on first reflection, I would have a serious difficulty. Would there be some unit within the United Nations that could be tasked with dealing with that particular issue rather than creating a new body that will eat up more money and that will probably be dysfunctional as well? That area would need further teasing out. Perhaps I have taken a wrong meaning from what was proposed, but it is an issue that I would like to see addressed further. Again, I emphasise that the United Nations in its present format needs radical restructuring to deal with many crises that are, unfortunately, constantly hitting the globe. I thank the delegates for the presentations. The views outlined are, in general, views that all of us could wholeheartedly support.

Pat Breen (Clare, Fine Gael)
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I call Deputy Maureen O'Sullivan, after whom I will revert to the witnesses.

Maureen O'Sullivan (Dublin Central, Independent)
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I thank the delegates for the presentations. I have a bit of a difficulty with sustainable development goals, when we put them in the context of the millennium development goals. While we see statistical improvements, we know that the reality, after many years of millennium development goals, is that we have not seen the progress and improvements it was thought they would bring about. We still see rising inequality and poverty. The scaling-up nutrition initiative is vital and excellent, but for what are we scaling up children if they are going into famine conditions and if they are coming into situations in which they are going to be hungry as adults? When we look at opening up access to primary education, statistically there has been success, but again for what are we educating these young people when we know the level of growth in youth unemployment? The big one, of course, is gender equality, which was a major millennium development issue. We know that has not been achieved. It is, therefore, difficult to get excited about sustainable development goals when we are not coming from a brilliant position of having achieved all the millennium goals. One positive thing is that they are going to be applied to all countries. I am totally behind it, in particular, the climate change one and the tax. In my opinion, those two things should have come first. That they did not has undermined some of the work that has been ongoing.

I acknowledge all the work the groups have done on the tax issue. What has been lost to the developing world at this stage is horrific and frightening. One thing which I think has come about because of the groups' work is a greater awareness of the issue. Whatever good it does, and I think it is positive for the developed world, there is greater awareness of how they are giving with one hand and taking with the other. Have the groups seen any examples of good practice developing in certain African countries? We cannot look at Africa without looking at the role of the Chinese. We had, through the Association of European Parliamentarians with Africa, AWEPA, the new Chinese ambassador talking to us at a meeting not too long ago. It was very interesting to hear his perspective, but there is no doubt about the kind of loans they are making available and the rate at which they are making them available. Will that upset the apple cart?

Trócaire's recent report, Where Aid Meets Trade: Ireland's role in the changing development landscape in Africa, was excellent. It raised questions about untied aid. Ireland came out very well but there is no doubt untied aid is under threat. If it comes under further threat, the sustainable development goals will be undermined. Where will that be dealt with during the conference at Addis Ababa? One of the aspects coming out of the report was that economic growth does not necessarily equate with a reduction in poverty. If that is what we are really talking about, there are concerns.

The frequency of the reviews - at least once every four years - is not enough. The other issue concerns the accountability of national parliaments and parliamentary democracy, in particular in developing world countries. Unless they are supported, there will be difficulties. I think those are all my questions.

Pat Breen (Clare, Fine Gael)
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I will let Deputy O'Sullivan speak again if she wishes. I call Ms Lorna Gold.

Ms Lorna Gold:

Following up on Deputy Smith's and Deputy O'Sullivan's comments on the question of untied aid, I agree with their view that the principle of untied aid is under threat, which is why we are seeking to reaffirm it and asking the Government to reaffirm its commitment to untied aid. As was highlighted in the recent Trócaire report, Where Aid Meets Trade: Ireland's role in the changing development landscape in Africa, which was launched together with AWEPA, the framework for international development and the framework for development assistance is shifting very much in favour of looking at where aid can benefit the donor country. This could be in different ways, be it through benefitting their own commercial trading interests with a particular country or as a benefit in respect of its foreign policy. Many governments have shifted in recent years towards this new framework. I am thinking in particular of the Australian Government which now states clearly that unless its aid is of benefit to its own national foreign policy interests, it will not be legitimate aid spending.

This is becoming the new norm within the development sector. As our report stated, the Irish Aid programme has maintained its untied aid status, but it is under threat from this new dominant way of thinking and the pressures to examine the efficiencies of Ireland's aid itself. For instance, are there possible win-wins for Irish business in its aid programme, particularly within the agricultural sector. This is the area that is put forward as a potential area for a win-win relationship. Certainly, win-wins are possible, but it is critical that the stated objective of overseas aid in the One World, One Future policy remains poverty eradication.

Ireland's standing internationally has been based on the principle of 100% untied aid and will continue to be based on this principle.

In the area of sustainable development, Deputy Maureen O'Sullivan raised concerns around the expansion of the sustainable development goals, SDGs, to cover 17 different goals and 167 targets, and Trócaire shares those concerns. The millennium development goals, MDGs, comprised eight clear-cut targets, and for all their flaws they represented what could be achieved in terms of a global agenda, but we now have a global agenda which is so large and so diverse that it is difficult to see how it can be applied. It is difficult to see what mechanisms could be put in place to achieve all the SDGs within a comprehensive framework. SDGs represent the whole gamut of public policies that need to be agreed by nationally accountable democratic governments. The fact that the SDGs have become so expansive puts the onus on the financing for development, FFD, process to deliver on the systemic drivers of poverty and injustice and on environmental sustainability. Issues of systemic injustice in the monetary, financial and tax system will enable individual governments to deliver on the SDGs as they are applicable to their own countries.

Mr. Sorley McCaughey:

Deputy Brendan Smith asked about the establishment of a new permanent institution, and he makes a valid point. The financing for development process already has a secretariat in place, but it is woefully under-resourced and it does not have a mandate such as we would like it to have. It is not a question of establishing a new institution but of providing it with the resources to do its job properly, which would include generating monitoring reports, holding individual governments to account in respect of their commitments under the FFD process and generating annual reports. At the moment very little happens between one FFD process and the next, and that is in part down to a lack of accountability on the part of the commitments that individual governments are forced to make. It is also because there is no adequately resourced secretariat to provide the accountability and monitoring that are required to make it effective.

I do not think the Deputy had in mind the establishment of UN bodies when he asked about tax. Nevertheless, although individual countries attach great importance to the sovereignty of their tax systems, it is clear that it is not working. Individual countries are losing billions every year, in part because of the degree of competition in which they are engaged with other countries. We have got to the stage at which tax sovereignty is so important that people do not consider the benefits that might accrue from greater co-operation in taxation matters. Christian Aid and others have been advocating greater co-operation for a long time in parts of Africa where there are already economic blocs working in co-operation. Greater co-operation on taxation issues would have very real benefits in maintaining and widening the tax base and enabling these countries to tax appropriately. The system at the moment is not working and greater co-operation on tax issues is desirable.

I could not agree more on the question of reviewing UN institutions. It is something Christian Aid and the broader sector have spoken about, but a review of the institutions needs to include a review of the mandate and governance structures of organisations such as the World Bank, the IMF and the OECD, all of whom have inherited or taken on hugely influential roles, particularly in the areas of finance and taxation. We would support any calls to review institutions, but not just those of the UN. A review would have to include the Bretton Woods institutions too.

Michael Mullins (Fine Gael)
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I join with colleagues in welcoming the visitors this morning and I thank them for their briefing ahead of the July UN conference on financing and development. It is encouraging to hear that the Irish aid programme is one of the best in the world. It is 100% untied, and despite our difficult economic situation in the past number of years, we have managed to maintain the level at approximately €600 million per annum. All of us in this room support the various goals and objectives described by the witnesses this morning. It is critical that our Government recommits to the 0.7% target by 2020 and that we maintain our objective to keep the aid untied and target it towards poverty eradication. As Deputy O'Sullivan said, it is disappointing that the millennium development goals have not delivered to a much greater extent, and much greater effort and commitment will be required to ensure the sustainable development goals are delivered on.

Nobody referred to the fact that much of the failure to deliver as much as had been hoped for may be attributable to political instability in many of the African countries about which we are talking. Will we not be fighting a losing battle until efforts are made to address the real issues in the region? These issues are war, conflict, political instability, corruption and human rights abuses, and much of the resources of those countries are spent on armaments, which causes huge poverty in the various regions of Africa.

How would the UN-led mechanism for resolving debt crises work? Is there any support for a UN tax body within the EU and other countries? Do the witnesses envisage that a review of the working of various organisations such as the UN and the World Bank will be a central plank of future developments?

Jim Walsh (Fianna Fail)
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I thank Dóchas for its submission. Ms Gold talked about sustainable goals. Are they too broad? Do they need to be much more focused?

Interestingly, last week I was in New York at a meeting in the United Nations on these issues. Sometimes, it is more about promoting an ideology then targeting and dealing with the real issues. Interestingly, population growth often comes up. In Europe, one of the major weaknesses, particularly in Germany and other parts of Europe, is the demographic winter that is taking place, yet we seem to target countries which are above the population replacement rate of 2.1. If we look back at the history of the western world and economic growth, much of it came about following the baby boom which succeeded the Second World War where many of the economic drivers were because of those changing demographics in young populations. Do we need to rethink what we are about and leave the ideological players on the sideline rather than giving them centre stage in some of these areas?

The delegations’ point about debt was well made. Without a doubt, if one is aiding countries, as we are doing, and 14 cent in the euro of that, a significant proportion, is used to repay loans, it is like giving the aid to countries which do not need it. I know there are issues where if people are not repaid, there will not be funding in the future. There are issues there and we have a good example of that in Greece at the present.

On the finance side, I agree we need to have a target and reach it. Should we be moving towards sustainable economic measures? There is the old adage: “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.” I am not sure I see much of that in the development goals. I might be missing it, but that message does not seem to resonate as strongly as I believe it should.

With regard to tax, a point that was not emphasised is good governance. Ireland has a good record of charitable donations and of various non-governmental organisations, NGOs, which are well supported by the public. Where that aid money is seen to be sequestered by individuals and where there is a level of corruption which is fairly obvious, it affects people’s willingness to contribute. What needs to be done in that area? Should it be a more significant part of the millennium development goals, MDGs? I know it is difficult to interfere in the internal affairs of countries. However, on the other hand, if considerable numbers of people are being left behind, suffering discrimination and poverty, that becomes a breeding ground for conflict. They are all interrelated and need to be tackled in a more holistic way.

I probably would have a little difference with Mr. Sorley McCaughey on the tax avoidance issue. Various tax avoidance schemes have been used, not just in Ireland but elsewhere, to drive particular economic sectors and have been successful in that regard. If one does not create that wealth in the first instance, there is nothing to redistribute. A taxation system should be fair but often there is not sufficient emphasis on how the money is spent. We have seen it in this country. There is not a Department that is not wasting tens of millions of euro which could be avoided with better management and if we had proper effective monitoring and controls and accountability in our public system. Where people are contributing through taxation, money they earned themselves which is going to the State for public services, the corollary of that has to be that there is equal attention given to the efficiency of how that money is spent and ensure it is not squandered. When we look at Third World countries, I am sure the situation with regard to expenditure is probably even worse than it is here.

Maureen O'Sullivan (Dublin Central, Independent)
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I tabled a parliamentary question on Irish attendance at the forthcoming Addis Ababa conference. It appears the Minister of State, Deputy Sherlock, is going. I know his interest in the area of development. He was the first Minister of any European Government to visit Sierra Leone after the outbreak of Ebola. While it is no disrespect to the Minister of State, it is disappointing it is not a Minister at a more senior level attending Addis Ababa. My understanding is that the African attendance is at a much higher level. Can the delegation outline that? What is the role of civil society and the NGOs at the Addis Ababa conference?

Pat Breen (Clare, Fine Gael)
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What do the delegations see as the main obstacles to achieving the new mechanisms for financing the whole development situation?

Ms Lorna Gold:

Senator Mullins asked how we address the real issues and the failures of the MDGs. All reports show it is a mixed picture in terms of delivery with MDGs. Part of the issue around that has been the time lag it takes for a global agenda to percolate down to become a national and regional agenda. The MDGs, it is said, took the best part of a decade to percolate down to the realignment of national policy processes. It is quite ironic that just as the MDGs seem to have built up a head of steam and a new kind of traction to deliver them in the national context, we seem to be moving towards the SDGs, sustainable development goals. We need to learn from the time lag process when dealing with the SDGs.

Members highlighted conflict, fragile states, human rights abuses, corruption and armaments. These are real issues in many of the African countries in which Trócaire and other Dóchas members are present. We cannot resolve all of these through a global process like financing through development or SDGs because there are context issues specific to those countries. However, the financing for development process and the scope of the issues in terms of systemic drivers of conflict and inequality that are contained within that agenda could go far to addressing the underlying burning issues that result in conflicts, for example, resource grabs, the tax injustice that Mr. Sorley McCaughey spoke about, as well as the drivers of extreme poverty and inequality. They are there within the financing for development agenda.

Senator Walsh raised a point about aid and good governance. Aid is not the whole answer to international development. What I sought to underline is that we do not want to move towards a new fad or trend that absolves developed countries of their existing responsibilities. Basically, we want to avoid moving the goalposts for development finance and development aid when there is a strong need for aid to remain as a cornerstone, especially in the least developed countries. Aid can be used carefully and very well to good effect to bolster good governance. Some of the programme work that Irish Aid has been doing has gone far in this respect in using aid to support State credibility and using State institutions such as Comptroller and Auditor General and other institutions that enable receiving states to be accountable and increase the possibility of good democratic accountability.

On the question of whether the sustainable development goals are too broad, the reality is that at this stage, there is simply very little scope to change them. As they are more or less agreed, whether they might be too broad or too narrow remains to be seen. What is good about them is that they incorporate governance issues as part of the framework. This means that those who are most concerned about issues of governance can now point to the SDGs as an additional method for holding governments to account.

In terms of the obstacles to implementation, when I consider the whole context of international development today, the main obstacle I see is the significant shift in global partnership towards the substantial use of unaccountable private entities to deliver on new global agendas. There needs to be a shift back towards democratically elected governments and the role of public finance, in terms both of aid but also other public finance flows in terms of tax and so on, as the cornerstone of the delivery of the sustainable development goals. What is on the table at present is very weak in this regard, and it shifts too much responsibility onto private, unelected and unaccountable multilateral institutions. There must be a shift that would see the international agenda being put back into the hands of democratically elected governments.

Ms Eilis Ryan:

I will take Senator Mullins's question in regard to the UN sovereign debt restructuring mechanism. In an ideal world, there would not be recurring debt crises. As long as such crises remain the reality, however, we need some way of dealing with them when they happen. It is useful to compare this requirement with the need for personal insolvency legislation, which has become increasingly important in this country in recent years. As long as we are in a situation where people are facing crises in terms of repaying debts, it is critical that we have in place a rules-based mechanism detailing how creditors are obliged to engage with those people.

In terms of what a debt restructuring mechanism would look like, the first thing we would like to see is that it be located within an independent body and, in particular, that it be independent of creditors. The IMF, for example, is a significant creditor to developing countries and, as such, it is not appropriate for any mechanism to be located within that body. As Mr. McCaughey said, notwithstanding the concerns people have about the UN, our view is that it is the only legitimate place within which to locate a debt restructuring mechanism. Locating it within the IMF would be similar to locating a personal insolvency mechanism within one of the private banks. There is a conflicted interest in both instances.

The second thing we would like to see is that it would be mandatory for all creditors to engage with the new mechanism. We are hearing a lot in Ireland about vulture funds and the negative role they are playing. Where a developing country gets into debt difficulties - we saw Argentina in that situation recently - 85% to 95% of creditors might be on board with restructuring debt, but if 2% or 3% of them are vulture funds, they may hold out and refuse to do a deal. Taking that stance is sufficient to renew the country's debt crisis.

In terms of the support that exists for a debt restructuring mechanism, the proposal put through the General Assembly of the UN for such a body received overwhelming support, with 124 countries out of 176 supporting it. That is reflected in the support for the proposal in the financing for development negotiations. Unfortunately, however, no European country supported the proposal and there is a continuing failure to engage with the negotiations on it. There is a clear division, in short, between European and other wealthy countries, on the one hand, and the rest of the world, on the other hand, on this issue. We have heard from the Government that some of this is down to failed diplomacy between different countries. Our view is that if those concerns are real, they should nevertheless not be used as an obstacle to progress. We should not bite off our nose to spite our face. It would be good to move past those concerns and agree that the UN is the place within which a debt structuring mechanism should be located.

Mr. Sorley McCaughey:

On the question of how a UN body would work, it is important to look at it from the perspective of what is available to developing countries at the moment in terms of their taxation systems and policies. The reality is that there is nothing at present which represents their concerns and needs. That is the starting point. A report issued last week by the Independent Commission for the Reform of International Corporation Taxation, ICRICT, referred specifically to this issue and how the OECD process, while it has established itself as the mechanism through which international taxation reform will happen, is not representing the needs of developing countries. There is a requirement for an international body. Everything in the world these days has an international representative body. This includes everything from football, via FIFA, through to whatever one wants to name.

Maureen O'Sullivan (Dublin Central, Independent)
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FIFA is probably not a good example.

Mr. Sorley McCaughey:

That is true. There is a need for a body that is representative and inclusive. That is the basis on which developing countries' concerns can be articulated more effectively. There is a demand from African countries, in particular, and other countries of the global south to have such a body established. There is, of course, a degree of resistance among European countries to it. It is not uniform, across-the-board resistance, but there are some who are very attached to the sovereignty of their own tax systems. As I tried to articulate to Senator Walsh, we need to start looking at taxation less as a competitive race to the bottom and more as something that could generate benefits through mutual co-operation. The only body in which that can happen is one that is UN-led.

The issue of tax avoidance might be a conversation for another day. I will point, however, to the IMF data released last week showing that $210 billion is lost each year to developing countries as a consequence of tax avoidance. Those numbers speak for themselves. "Tax avoidance" is a phrase that is bandied about a lot and the concept is generally put forward as being entirely legal. There is an increasing body of work which would question that. We only say it is legal because we do not know if it is illegal; it has not actually been tested to see whether or not it is illegal. It is very important to move away from the idea that tax avoidance is always legal. There are many tax avoidance schemes with which we are all very familiar that could ultimately be proven to be illegal, but they never get the exposure we have been asking for to determine whether or not they are, in fact, legal. This goes back to the question of transparency around the activities of multinationals. Let us get them out in the open through a country-by-country reporting standard, which would allow us to build a bigger and clearer picture of what these tax avoidance schemes are all about. Let them be stood up to public scrutiny to see whether they are actually legitimate in the laws of the land and in the eyes of citizens.

The question of how the money is spent is a very important one. During a visit to Dublin in February this year, the UN special rapporteur on extreme poverty and human rights made the observation that more than any Green Paper or White Paper, one can tell a government's real priorities by how it taxes people, who it incentivises and who it disincentives. How a government spends its money tells one all one needs to know. How the money is spent is the other side of how it is collected, and we need to see these two issues as very much two sides of the same coin.

There was a question about the role of NGOs in the Addis Ababa negotiations. Some members of Dóchas are being included in the official Irish delegation, while other NGOs will be attending in their own right. I expect they will all be working very closely together in pursuit of many of the issues we have detailed in our paper today. Indeed, my expectation is that there will be close collaboration between the official delegation and civil society. Let us say it will be a collaboration that is both mutually critical and mutually supportive.

Pat Breen (Clare, Fine Gael)
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That is very important.

Mr. Sorley McCaughey:

Indeed, it would not be worthwhile otherwise.

Collaboration is important for civil society. Most of our organisations work on a partnership basis, and most of those partners with whom we work will be represented at the conference in Addis Ababa. Therefore, the conference is important in terms of solidarity and for strategising with our partners, located in different parts of the globe, on the issue of financing for development. We could do this work electronically but there is nothing quite the same as spending time together at such a forum. Perhaps the other witnesses also want to say something on the issue of civil society.

I shall finish by responding to the question on what are the main obstacles. I fully support what Ms Gold has said. I would add the question of follow-up. It is one of the biggest issues in this process and many other non-binding UN processes. How do we ensure that what comes out of the conference is followed up, implemented and governments are held accountable?

Pat Breen (Clare, Fine Gael)
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Will countries make financial pledges at the conference?

Mr. Sorley McCaughey:

That is not my understanding.

Pat Breen (Clare, Fine Gael)
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Will it be more policy statements than financial pledges?

Mr. Sorley McCaughey:

Yes. The conference would be an opportunity for the Government to recommit to the 0.7% target, for example. That is probably a more realistic expectation. It is a question of follow-up and the adequate resourcing of the secretariat of the FfD to hold countries to account to what they say in Addis Ababa. That will probably be an obstacle but it will also be an opportunity, if adequately resourced.

Pat Breen (Clare, Fine Gael)
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It will be a policy document. Deputy O'Sullivan expressed her concern about only having a review every four years. Is McCaughey concerned about the same matter?

Mr. Sorley McCaughey:

Yes, we share that concern. To come back to the issue of financing for development, once every five years is insufficient to address the systemic issues that prevent adequate financing for development. We need the reviews to be returned to an annual basis. We have proposed that such work is done through a resourced and mandated secretariat that would produce annual monitoring reports.

Pat Breen (Clare, Fine Gael)
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So that parliaments, in various countries, could monitor the same as well?

Mr. Sorley McCaughey:

Yes.

Ms Lorna Gold:

The mechanism for follow-up from financing for development also needs to be strengthened at a European level. Throughout the 2000s there was an annual monitoring report on what became known as the Barcelona commitments. Following the Addis Ababa conference that element needs to be reinvigorated. It would be of benefit to have some kind of annual follow-up process at a European level.

Maureen O'Sullivan (Dublin Central, Independent)
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Representation by some of the African delegations seems to be at a much higher level than that of Europe.

Ms Lorna Gold:

Ms Ryan may have such information but I do not.

Ms Eilis Ryan:

My informal information from colleagues is that representation is, generally, at deputy prime minister level, from African countries.

Pat Breen (Clare, Fine Gael)
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It is probably in their best interests to have the highest level of delegation in their own countries.

I thank the three witnesses for attending. This matter shall not go away and we are not going away. Next week the director general of Irish Aid and his officials will be in attendance and we will discuss this subject.

The Irish UN representative is David Donoghue and we congratulate him on his new role. In preparation for the Addis Ababa conference he will join us on 9 July and we expect to have him in here on the previous Thursday. I congratulate him and his Kenyan counterpart on the work that they have done to co-facilitate the final phase of the negotiations post-2015.

I wish to acknowledge the presence of the Ambassador of Ethiopia, Mrs. Lela-alem Gebreyohannes Tedla. We can all remember the terrible famine that struck Ethiopia in the 1980s and we can see how it has been transformed. It is now a wonderful country which is growing all of the time. Ethiopia is an example to other African countries. Let us hope that what happens in Addis Ababa lays the foundation for a more productive Africa and that the continent benefits and eliminates the challenges posed by poverty, hunger, disease, conflict and climate change. The latter is a big part of what is happening in the region.

I thank the witnesses for coming here this morning. I assure them that we will work closely with them over the next six months or so.