The committee agreed yesterday to examine Pergau, which was linked to the sale of arms and the building of a secret special forces base at Mersing, eastern Malaysia.
Sir Tim Lankester, a former permanent secretary at the Overseas Development Administration, last week described Pergau as 'an abuse' of the aid system. The National Audit Office has condemned it as a waste of money.
The committee's decision is a setback for Mr Major, since unlike the Public Accounts Committee which extracted the criticism from Sir Tim, it can question ministers.
Douglas Hurd, the Foreign Secretary, and Lynda Chalker, the aid minister, can also expect to be questioned. Other possible witnesses are Baroness Thatcher, who negotiated the package when she was Prime Minister, and Lord Younger, her then Secretary of State for Defence, who signed a military memorandum in Malaysia which included a reference to the availability of aid.
Jack Cunningham, Labour's foreign affairs spokesman, has tabled parliamentary questions asking if discussions about Mersing took place concurrently with those on Pergau and if the Government would publish the Younger memo.Reuse content