As followers of UK political news will be aware, the party conference season has recently concluded. As the major parties return to Westminster after their trips to Brighton (Lib Dems), Birmingham (Conservatives) and Manchester (Labour), this RESULTS blog post reviews remarks made by the UK’s key decision makers about microfinance and on increasing access to financial services.
The Liberal Democrats kicked off their conference in Brighton on the 22nd of September, reiterating their support for legislation that would require all future UK governments to spend 0.7% of Gross National Income on overseas development assistance. As previously discussed on the RESULTS blog, enshrining this commitment into law would help the world’s poorest people and ensure a guaranteed funding flow to aid making the UK a world leader in this area.
Regarding microfinance specifically, 2010 Dods ‘Female MP of the Year‘ Annette Brooke MP spoke at a conference fringe session about her interest in microfinance and the potential for increased access to financial services to relieve poverty. As the founder of the All-Party Parliamentary Group on Microfinance, for which RESULTS hosts a secretariat, Ms Brooke is familiar with the changes to people’s lives that microfinance can bring, though she also spoke of the need to better measure the impact of microfinance. Ms Brooke also discussed the importance of ensuring that microfinance continues to serve poor people’s needs rather than simply becoming a means of generating profits. In this regard she pointed to the 2010 crisis in the Indian state of Andhra Pradesh as evidence of the terrible consequences that can result from a failure to supervise microcredit organisations in competitive markets.
The Lib Dems’ partners in government, the Conservatives, held their autumn conference in Birmingham, where both PM David Cameron and the newly appointed Secretary of State for International Development Justine Greening MP mentioned initiatives that make use of mobile technology to expand access to financial services. During his speech to the party faithful in the packed main hall, Mr Cameron made reference to Monitise, a British firm that works with financial institutions in countries around the world to enable banks and other financial service providers to offer their services via mobile phones. Mr Cameron invoked this example to illustrate the dynamism of British industry, but companies like Monitise are also making it easier for people in developing countries to safely transfer money, pay bills and deposit savings.
In her speech to the conference, International Development Secretary Justine Greening spoke about M-PESA, a scheme offered by Kenyan mobile phone operator SafariCom (a partially-owned subsidiary of Vodafone) that allows people in Kenya and several other East African states to make payments and conduct other financial transactions with their mobile phones. M-PESA was originally established with financial support from the UK’s Department for International Development, and now handles transactions equal to a large proportion of Kenya’s GDP via its mobile platform.
Both Cameron and Greening also spoke of the Government’s support for 0.7% legislation, with Greening stating ,”It’s right that next year, for the first time ever, it will be a Conservative led government that meets the target for 0.7 per cent of National Income to be spent on development.”
At the Labour Party Conference, microfinance did not feature prominently. They were, however, supportive of the government’s plans to dedicate 0.7% of GNI to international development. Ivan Lewis MP, Shadow Secretary of State for International Development, said in his speech to the conference that Labour “will support the Government if they honour our commitment to meet the 0.7 target by next year.“