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Disappointment Follows ‘Raid on Aid’ Budget

9 May 2018 at 11:29 am
Wendy Williams
Aid organisations have reacted with frustration after the federal budget reduced Australia’s overseas aid contribution to its lowest level in history.

Wendy Williams | 9 May 2018 at 11:29 am


Disappointment Follows ‘Raid on Aid’ Budget
9 May 2018 at 11:29 am

Aid organisations have reacted with frustration after the federal budget reduced Australia’s overseas aid contribution to its lowest level in history.

Those hoping for a reprieve were left disappointed when the budget, handed down by Treasurer Scott Morrison on Tuesday night, maintained the freeze put in place last year on future aid increases despite being on track to deliver a surplus.

It marks a total aid spending of $4.16 billion in 2018/19 or just 0.23 per cent of national income.

According to Australian aid organisations, following years of consecutive cuts, the government’s aid spend is now on track to decline to just 19 cents in every $100 of gross national income by 2021-22.

Nigel Spence, CEO of ChildFund Australia, said it was “deeply disappointing” to witness the aid program being reduced to its lowest level in history.

“It is an indictment of how little value we place on what is one of Australia’s most important strategic assets,” Spence said.

“Australian aid not only improves conditions for some of the world’s poorest children and families, but it also serves our national interests by fostering inclusive economic growth, creating new trading markets, countering instability and reducing conflict in our region.”

Australia now ranks 19th out of the 29 nations that give aid in Gross National Income (GNI).

Earlier this year, the country’s declining aid levels were criticised by the Organisation for Economic Cooperation and Development, which stated “the decline in aid flows, despite steady economic growth, has affected the scope of development and humanitarian programmes”.

Spence said Australia could afford to do better, and it was in the nation’s interests to contribute to a more prosperous, stable region.

“We are the lucky country. Just last year, Australia recorded the longest run of uninterrupted economic growth in the developed world. It is clear that Australia can afford to look after those at home as well as support a generous aid program to help those in need in our region,” he said.

Save the Children acting CEO Dianne Francois said difficult choices needed to be made to bring the budget back to surplus.

“We recognise tough fiscal trade-offs need to be made to strengthen the economy, but cuts made to Australia’s overseas aid budget have been short-sighted,” Francois said.

“Now is the time for the government to live up to its undertakings and to acknowledge that, as the ninth largest economy in the world Australia has the economic capacity to increase its investment in human capital to promote inclusive and equitable development overseas.

“Successive cuts to our overseas aid budget have come at a cost to Australia’s international standing and capacity to promote peace, stability and security in our region and beyond. Most crucially, they have come at a cost to the poor.”

Over the next four years of the forward estimates, the freeze equates to a new cut to aid of $141 million, bringing total cuts to $444 million.

Australian Council for International Development CEO Marc Purcell described the budget as a “lost opportunity”.

“This budget was an opportunity to show leadership and use some of the unexpected revenue to repair past damage to aid. Unfortunately, this is a lost opportunity and we are very disappointed,” Purcell said.

“There is a slight blip up in aid this year but the government’s decision to not keep aid increases linked to inflation in future years means aid will drop down to 0.19 per cent of GNI by 21/22.”

Purcell raised concerns that with the aid budget effectively capped, new spending projects in the aid budget outlined in this budget effectively amounted to “a raid on aid” that would mean critical poverty alleviation programs would end.

“The undersea communications cable linking the Solomon Islands and PNG to Australia (two thirds of which Australia will pay) will come out of poverty programs for Indonesia, Cambodia and multilateral funding,” Purcell said.

“But because of ‘commercial in confidence’ the government is not specifying how much the cable will cost and we call for greater transparency on this initiative.”

Aid for the Pacific was increased to $1.3 billion equating to 30 per cent of the overall aid budget.

Purcell said they welcomed the commitment to the Pacific region to back the government’s White Paper commitment.

“The budget also features a nominal $10 million increase to the humanitarian spending but with the increased rate of climate-related natural disasters this is not enough and leaves our humanitarian capacity underdone,” he said.

“The aid sector also welcomes the $10 million friendship grant scheme that was unveiled by the government in this budget. But it is important that standards of child protection, anti-terror financing and non-evangelisation are applied.”

Purcell said the Foreign Policy White paper “set out the opportunity to build security and prosperity in our region through a strong and consistent aid program”.

“Yet after 30 per cent of cuts to the aid budget, Australia is increasingly seen as an unreliable development partner and a fair-weather friend in Asia and Africa,” he said.

Oxfam Australia said the government’s “continued gouging of the aid budget” was “at odds with the vision it holds for a peaceful and prosperous region”.

“Spending on aid is such a miniscule part of the budget; Australia has the ability to support both an aid program that does its fair share to reflect the government’s own vision of a stable, secure and prosperous region – and beyond – and spending here at home,” Oxfam Australia chief executive Dr Helen Szoke said.

“An aid budget that reflects Australia’s role in tackling the world’s most pressing challenges looks further and further from our reach.

“This year already saw Australia fall behind in meeting our international obligations, dropping from 17 to 19 of the 28 OECD aid-giving countries. We are seeing demonstrably effective, long-term aid programs being cut back globally.”

Szoke said while a small increase to the Protracted Crises fund of $8.8 million was welcome, there was no increase in the budget to the Humanitarian Emergency Fund.

“But overall, it is simply not enough given current multiple humanitarian crises. To meet urgent need, the government should commit to at least doubling its total overall spending to the fund to $300 million,” she said.

“It shouldn’t be a case of either or – long-term development to reduce poverty, inequality and build resilience is as important a part of the equation as funding for humanitarian crises response.

“With no increase to Australia’s roughly $200 million annual contribution to international funding for climate action, once again we’re seeing very little recognition of the important role our nation must play in our region, especially in the Pacific, when it comes to addressing the growing risk of disasters and some of the most dramatic impacts of climate change.”

Jody Lightfoot, director of campaign for Australian Aid, said the budget lacked vision for a fairer world.

“The character of a nation isn’t based on how you treat the big banks, but how you treat the most vulnerable,” Lightfoot said.

“Australia should be stepping up to tackle global inequality, instead the government will reduce aid to its lowest level ever to give big corporations a tax cut”.

Lightfoot also raised concerns over the inclusion in the budget of a $3.8 billion loan scheme “designed to ramp up Australia’s credentials as a global arms dealer”.

“We could become a world leader in eliminating poverty, but instead the government wants to become a world-leading arms exporter,” he said.

“If we want to create a safer Asia Pacific region, we should focus more on getting girls and boys into school, rather than getting weapons into the world.”

Meanwhile, more than 100 young adults from the advocacy group Micah Australia hosted a banquet on the lawns of Parliament house on Wednesday morning to call for a fairer deal for the world’s poor.

Matt Darvas, campaign director of Micah Australia, said it was an opportunity for leaders and politicians to hear from young people about their vision for a more “compassionate and generous Australia”.

“We heard last night about the strong position our nation and economy is in, yet our government has chosen to not use that position to look after those who are most vulnerable in the world,” Darvas said.

Tim Costello, executive director of Micah Australia said the choice had been made by the country’s leaders “to continue to balance our books on the backs of the world’s poor”.

“Despite revenue rolling in and being in a much stronger economic position, we are left wondering why we are not moving to a more generous Australian aid commitment,” Costello said.

“We blessed in this nation, and clearly in a situation where we can do more for our neighbours, but tonight the familiar cries from our government of ‘we’d like to do more but we can’t’ has echoed once again through the chambers of Parliament.”

Our 2018 budget coverage is brought to you by Community Sector Banking.

Community Sector Banking

Wendy Williams  |  Editor  |  @WendyAnWilliams

Wendy Williams is a journalist specialising in the not-for-profit sector and broader social economy. She has been the editor of Pro Bono News since 2018.

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