Stephen Kinnock (Aberavon) (Lab): It is a pleasure to serve under your chairmanship, Ms Vaz. I congratulate the hon. Member for Somerton and Frome (David Warburton) on securing this important debate.

I must declare an interest. I worked for many years at the British Council, with overseas postings in Brussels, St Petersburg and Sierra Leone. I will always remember my time at the council fondly and with a sense of pride. In Brussels, I saw how British skills and know-how could be deployed to support the transition of the former eastern bloc countries to democracy and the market economy, through the European Commission’s aid programmes. In St Petersburg, I was proud to be the director of an operation offering young Russians the opportunity to learn English and engage in a range of cultural and educational projects. In Sierra Leone, I was honoured to be a part of the huge impact of the council’s work in building the capacity of that country’s Government. It is for those reasons and more that I am such a firm believer in the organisation we are discussing today.

As hon. Members will know, the British Council is the world’s outstanding example of a successful soft power institution. It is the model that all other countries try to emulate when developing their soft power networks. It is respected, professional and diversified and we are fortunate to have such a positive face to present to the world. As the hon. Member for Somerton and Frome has already mentioned, the council was founded to create

“a friendly knowledge and understanding between the people of the UK and the wider world”

and has been promoting the values of fairness, democracy, tolerance and dialogue across the world for decades. But the magic of the British Council is that it does not promote those values by way of megaphones or propaganda; rather, it operates through the mediums of exchange and long-term relationship building.

The council understands that communication at its best will be a two-way conversation between the UK and the rest of the world, with each side listening to and learning from the other. It is founded on the principle that the Brits do not have all the answers. It is a vehicle for building trust through honest and open dialogue, as opposed to banging the drum for Britain, which can be so counterproductive. At a time when we are more interconnected as a planet than ever before and trust is a rare commodity, the long-term trust and confidence-building work of the British Council has never been more important; its values are the ones we require if we are to minimise culture clash and the violence that can often result from it.

Through the British Council, we engage civil society in countries where the Governments are not always our closest allies. We propagate a love for our art and music around the world. We can build grassroots understanding of democratic practices, harness the power of sport to inspire and engage young people from all over the world, and promote ourselves as a top-rung tourist destination and trading partner. Through the council, we ensure that the propaganda our enemies disseminate about us is dismantled. Why then is the council facing such huge cuts, when we can all agree that its work is more important than ever?

This year, the council’s FCO grant was increased by £10 million, to reflect its effectiveness in delivering ODA.

Mr Gregory Campbell (East Londonderry) (DUP):
On the issue of spending and the ODA, does the hon. Gentleman agree that the British Council’s valuable work is put in jeopardy by a reduction of more than 50%, looking back just five years, in terms of ODA spend and that that needs to be examined very closely in the forthcoming review?

Stephen Kinnock:
I do. The ODA has been given as a demonstration of the effectiveness of the council’s work in least developed countries. The major challenge the council faces is the reduction in the FCO grant, which has been eroded constantly over the years. As the hon. Member for Somerton and Frome mentioned, the fundamental problem is that that increases the council’s reliance on commercially generated funding. We all acknowledge and welcome the council’s ability to raise that type of funding, but the reduction in grant funding reduces its flexibility to operate wherever it needs to in this rapidly changing world. I absolutely agree that the reduction in the grant is having a negative impact on the council’s ability to deliver across the board.

Mr Baron:
In addition, is not there another concern about the decrease in FCO funding? It will not simply be a case of having to make up the lost income—and with regard to commercial activities, that can be many times the factor of the income required, as a turnover of £100 million may just about produce a profit of £10 million, and the reduction from the FCO grant would be £50 million over five years. As the British Council becomes more commercial to make up the lost revenue, its integrity and credibility could also be threatened. Does the hon. Gentleman consider that a risk as well?

Stephen Kinnock:
I do. Also, as I will go on to argue later, the council’s English language teaching and exam work is important, makes a big impact and is very lucrative, but it tends to be for the elites in the societies where the council is operating. It is the high end of English language learning and people pay top dollar for it. If we are saying that it is important that we engage with the disaffected, disfranchised youths who are potentially going to become a security risk for us, it is arguable that that section of society will not be able to pay for those English language courses. Looking at the council’s strategic objectives and values, it is important that its reach is wide and that it goes into sections of society that its English language teaching and exams administration simply cannot reach.

The grant represents just 16% of the British Council’s funding. The rest is earned, as we have been discussing, and those earnings are projected to increase. Despite that good news, all is not financially rosy at the council. The FCO grant was reduced to £154 million in 2014-15, down from £201 million in 2009-10, so despite the extra £10 million in ODA, cuts to projects are having to be made. The choice for the council is stark: either a managed decline in its scale and reach, or growing its self-generated income to continue its work. The council has been forced to choose the latter, but should it have to and do we want it to?

Of course, it is truly commendable that the council’s English teaching and exam management can generate enough income from those who can afford to pay to fund projects aimed at those who cannot. Work done administering exams, managing international contracts and fostering corporate partnerships is important, but the more money that is raised from commercial sources, the more the British Council’s core purpose becomes divorced from its soft power potential. My concern is also that language teaching and exams are expensive, and so tend to benefit elites. Grant-funded activity is far more likely to have a wider reach.

We must recognise that, if the British Council is to remain an important wing of British diplomacy, public funding must remain an important element of its financial base. That is crucial for accountability and flexibility, and to supporting the council’s activities in fragile, unstable states, where it is harder for the council to raise the private funds to enable it to build long-term, mutually beneficial relationships with future leaders. It is an important fact that one in five world leaders studied in the UK; we are talking about a brand that we can, and do, export, but without public funding, it stops being linked to Britain as a country and becomes just another product.

ODA money is specifically for British Council work in areas that are of key interest from a security and stability perspective. Those areas are current flashpoints, and the money is crucially needed. In Tunisia, for example, a fledgling democracy is trying to embody all the original hopes of the Arab spring, but more of the foreign jihadists in Iraq and Syria originate there than from any other country. The British Council runs debating clubs across Tunisia—a programme that it wants to grow tenfold and that successfully engages young people at risk of radicalisation. For Tunisia, whose economy relies so much on tourism, the good publicity afforded by successful British Council projects feeds into confidence that the country can move on and rebuild after recent horrors.

ODA funding also goes towards co-operation work with countries such as China and India, where engaging with societies that are growing increasingly prosperous is an investment in our future.

The debate is about how best to build trust between Britain and the rest of the world, and nobody does that better than the British Council. More ODA money would maintain its public funding and consolidate its position as a respected arm of British diplomacy. The Government’s spending review is coming up, and my colleagues and I urge the Minister to communicate that request in the strongest terms to the Chancellor.

During his Grant Park acceptance speech in 2008, Barack Obama famously stated that the true strength of a nation is demonstrated

“not from the might of our arms or the scale of our wealth, but from the enduring power of our ideals”.

I urge the Minister to take note and to ensure that the outstanding nature of the work done by the British Council is adequately reflected in the comprehensive spending review.