Politics: Short outlines ethical aid policy

Clare Short yesterday launched the first White Paper on overseas aid for 20 years, pledging no more "aid for trade", and a commitment to work towards halving world poverty by 2015. Steve Crawshaw looks at the rhetoric and reality.

"We can succeed." Perhaps that may prove to be one of the most significant phrases in yesterday's White Paper - a remarkably upbeat statement, in place of the downbeat realism that we have become accustomed to.

One obvious change is that aid and trade are no longer inextricably linked, as they once were. The pounds 73m Aid and Trade Provision programme, which helped to fund the controversial Pergau dam project in Malaysia, has been axed.

The ATP supported British businesses seeking contracts in the developing world, where trade was sometimes perceived as more important than aid. Sir Alastair Goodlad, shadow spokesman on international development, criticised its abolition, saying it "provided important projects". But Ms Short, the Secretary of State, retorted that he should be "ashamed to bring this up", arguing that the ATP had "brought the aid programme into disrepute".

Ms Short praised Baroness Chalker, her predecessor at the Overseas Development Administration (as it then was), but noted that the previous government had "cut her aid programme, and restricted her in what she wanted to do".

The White Paper emphasises that "trade and investment policies form a key part of the Government's approach to development". Trade and investment are described as "crucial to poverty elimination" - including an emphasis on "promoting ethical business".

The White Paper pledges to "start to reverse" the decline in UK spending on aid, and "reaffirms" a commitment to the United Nations declared target of 0.7 per cent of GNP.

The response from aid agencies was divided. The World Development Movement complained that the Government was "kidding itself" if it thought that poverty could be halved by 2015. But Dianna Melrose, policy director of Oxfam, said the targets were "good news for the millions of people living in poverty around the world". She talked of a "forward-looking strategy" which "represents a major step forward".

Simon Maxwell of the Overseas Development Institute, a think-tank on international development, argued that the White Paper "gets us to the starting gate - the challenge now is to run the race".