• Harsh aid cuts and an unhappy new year

    Posted by Ben

    20 January, 2014

    On Saturday, the Government confirmed that it is cutting $625 million from the 2013-14 aid program, making the 2013-14 aid budget $107 million smaller than in 2012-13 – marking the first time aid has gone backwards since the year 2000. It also finally (after almost 5 months in office) confirmed which countries, regions and programs will be affected. In short: all of them.

    All regions of the world and all program areas (governance, infrastructure and rural development, disability, education, health, water, sanitation and hygiene, environmental sustainability) will be cut. Some deeply.

    Aid to Sub-Saharan Africa, where the world's poorest people are to be found, is being cut by almost half from a budgeted level of $224.9 million to just $133 million (vastly less than the $211.2 million that was invested there in 2012-13).

    Our contribution towards dealing with humanitarian and other emergencies as well as global refugee support has been cut by $75 million (from $339.6 million in the May budget to just $264.2 million). Cross regional and global environmental and climate change programs have been cut to just $500,000 – whereas $91.6 million was invested in this type of aid in 2012-13.

    The Asia-Pacific region is the most disaster-prone in the world – and our near neighbours are particularly vulnerable to floods and cyclones that are intensified by climate change – so these cuts seem particularly counterproductive if the Government's aim is to prioritise poverty reduction and development in our region. It seems we are both less committed to helping prevent disasters and less committed to responding to them when they happen.

    The Foreign Minister takes pride in Australia having a $5 billion aid budget – although this represents only 0.33% of our $1.5 trillion economy.

    In fact, as a proportion of our national income, Australia lies in the bottom half of developed country donors in terms of our generosity. Of 24 wealthy countries, we are ranked just 13th for the generosity of our aid program as a proportion of our wealth.

    While aid is not the only way that Australia helps to reduce poverty, tackle global challenges, and build shared security and sustainability, we do make a very significant contribution through our aid program. The nations of the world have long agreed that one benchmark for a generous and effective aid program that all wealthy countries should meet is an investment of 0.7% of Gross National Income – 70 cents in every $100 of national income. By cutting our aid to just 33 cents in every $100 (0.33% GNI) we are rapidly walking away from this long-standing international aid commitment.

    Of course, all of these cuts have real impacts on real people in real communities. There are lives that will not be saved. Children who will miss out on learning. Families who will not be assisted to move out of poverty.

    The cuts also fly in the face of the statements of both the Prime Minister and the Treasurer at the time of the election that they were not going to cut aid, merely "slow the rate of increase". However, these are cuts, real and deep. And the Government should not be allowed to claim or pretend otherwise.

    There is a further dimension to this question of trust. As part of the cuts, even Australian aid organisations who had won a tender process to deliver some of the Government's official aid program (under a scheme called the AusAID–NGO Cooperation Program – ANCP), and which had signed four-year funding agreements with the Government, had their funding cut more than halfway through the financial year.

    These Australian aid organisations – such as CARE Australia, Plan Australia, and World Vision – had been recognised as well-performing organisations, able to help deliver effective aid in often difficult circumstances. And yet, in making these cuts, the Government has breached its own funding agreements with them. Can you imagine the uproar if the Government reneged on funding agreements with service providers in other areas – for example, Jobs Network providers?

    In short, these cuts make us a less generous nation. They harm the urgent and ongoing work of tackling the scourge of extreme poverty. They raise serious questions about the trustworthiness of our Prime Minister and Treasurer. And they do not advance Australia's interests in reducing poverty, and building a more secure, sustainable and prosperous world.

    You can read our latest media release here.


    Ben Thurley is the Political Engagement Coordinator of Micah Challenge Australia.