• Is aid being streamlined, sidelined or undermined?

    Posted by Ben

    19 September, 2013

    Although Prime Minister Tony Abbott promised methodical and purposeful government with no surprises, it certainly has been a surprising few weeks for Australian aid. First, Treasurer Joe Hockey announced plans to cut the aid budget in the final hours of the election campaign. And now, just as the new Government was being sworn in, the Prime Minister has revealed that AusAID will be "integrated" into the Department of Foreign Affairs of Trade.

    In this longish post, I just want to walk through what we know and don't know of these two decisions and the implications that are immediately obvious and those yet to be realised. I also want to make clear that while the new Government is entitled to all our respect and prayers, we will not cease from seeking to be a voice for the voiceless, and calling the Government to defend the rights of the poor and needy. We hope you will continue to raise your voice with us. Together, our voices can be powerful.

    1. The Cuts

    We were all shocked as we learned at the last minute that the Coalition planned to fund a large part of its election promises on the backs of the poor by cutting $4.5 billion from the aid budget over four years – including a $656 million cut in the current year.

    Some have been confused or questioned whether we are accurately representing the Government's position. After all the Prime Minister said at the time, "We are not cutting foreign aid. We are simply slowing the rate of growth."

    However, a simple glance at the costings/savings document (pdf) released by Joe Hockey less than 48 hours before the election shows that this is not the case. Although we are already well into the 2013-14 financial year, the Coalition plans to cut $656 million from the current aid budget (almost 12% of the amount budgeted for 2013-14), which will be a 3.6% cut from 2012-13 levels in real terms.

    $656 out of the current year. An aid budget that is almost 4% smaller than last year's budget in real terms. These are cuts by anyone's measure. 

    Cutting almost 12% of this year's aid budget part way through the financial year offers nothing but stark choices. Will it be mothers in Bangladesh who will no longer have their pregnancies and births attended by skilled health workers who pay the price for these cuts? Will it be infant boys and girls in Papua New Guinea no longer being immunised against deadly childhood diseases? Will the price be borne by communities in our near neighbour Timor-Leste who are drinking clean water for the first time because of programs supported by Australian aid? Or will it be the women of the Pacific who pay for these cuts by losing access to counselling, legal support and other programs that help combat the scourge of sexual violence?

    A Nepali woman leads a buffalo

    The Government has yet to level with the Australian people – let alone with the communities, countries and organisations to whom we have made commitments through our aid program – about who, exactly, will be asked to pay the price for these cuts. 

    If the Government goes ahead with these cuts, then its commitment to increase aid to 0.5% of Gross National Income over time – affirmed multiple times by Prime Minister Abbott – appears to be a dead letter. It's hard to see how a genuine commitment to increase aid is achieved by cutting it hard in the first place.

    We recognise that we have a new Government with new budget priorities. But it should be noted that gone are the days when governments could quietly cut aid and receive little community outcry and with no media interest. The Government has already been surprised by the strength of the reaction to the cuts. Australians are extremely generous, and we want our Government to represent these values by supporting a generous and effective aid program. We intend to campaign to ensure that every Parliamentarian is confronted with the hard question, "Who will pay the price of the aid cuts?" The fact is that the Government does not have to proceed with these cuts, and if the Prime Minister is to be true to his word, it must not cut aid.

    2. The end of AusAID?

    Just after the swearing in of his Government, the Prime Minister announced,

    "I intend to recommend to the Governor-General that the Australian Agency for International Development be integrated into the Department of Foreign Affairs and Trade, enabling the aid and diplomatic arms of Australia’s international policy agenda to be more closely aligned."

    It is not yet clear exactly what this will mean. It could be as minor a change as AusAID losing its status as an "executive agency" and reporting more directly to the Department of Foreign Affairs. It could mean the disbanding of AusAID as an autonomous agency, with all its staff and functions being rolled into the Department of Foreign Affairs and Trade (DFAT). Most informed commentators, such as the Centre for Policy Development and the Lowy Institute, are suggesting that it is likely to be a major change and they are expressing grave concern.

    This would turn back the clock to before 1974 when an autonomous aid agency in Australia was first established. In forty years we have learned a lot about how to improve aid's effectiveness to impact poverty and it's not clear that this move will help the aid specialists build on that learning and continue to improve the aid program, as we have seen in the last few years particularly.

    The real risk, though, lies in the aligning of aid with other aspects of Australia's international policy – such as diplomacy and trade. The risk is that if AusAID is fully absorbed into the Department of Foreign Affairs, then its purpose "to help people overcome poverty" will be entirely subordinated to, and possibly undermined by, DFAT's purpose, which is "to advance Australia's interests."

    Tim Costello is concerned that Australia's commercial, trade and other foreign policy interests would be placed ahead of a clear commitment to improve people's lives by reducing poverty. Experience in Canada, which has recently gone down the path of dissolving its stand-alone aid agency, suggest that these are real fears. Canadian aid has been cut substantially and Canada's aid priorities have become much more aligned with Canadian mining interests.

    It is possible that bringing the agency back into DFAT will improve policy coherence and connections in the complex work of reducing poverty and contributing to human security and sustainable development, a work in which aid plays a part but is not the only part. However, the massive uncertainty around the change – with many likely job losses – itself is likely to undermine the predictability, transparency and effectiveness of the aid program in the short term.

    3. The Way Ahead

    While the tone of this analysis has been fairly gloomy, for me that is not the end of the story. There are some bright spots in the Coalition's foreign affairs policy (pdf) that should be commended. Particularly, the commitments to look into increasing the Pacific Seasonal Guest-Worker program and to establish a ministerial level human rights dialogue in the region.

    I am excited that Julie Bishop, Australia's first female Foreign Minister, is committed to work for political and economic transformation with female leaders in Asia and the Pacific – though I suspect her hand would have been strengthened here if she wasn't the only female in the new Cabinet and only one of 6 females in the entire 42-person ministry.

    But mostly I am not gloomy – just determined – because in 1996 when aid was cut very few people cared. There were no media reports at the time questioning the Government's priorities. How different today, when tens of thousands of people have stood up calling for Australian politicians to champion a generous and effective aid program.

    We have changed the state of play. And we are totally committed to working with passion and persistence to continue changing the state of play.