• Overseas aid and refugees in Australia

    Posted by Ben

    19 December, 2012

    The leaked report that the Government is planning to divert $375 million from the aid budget to help meet the rising costs of support for asylum-seekers and refugees at home has caused quite a stir. 


    The Foreign Minister, Bob Carr, has offered some justification and precedent for the decision, which is largely driven by the political imperative to bring the budget back into surplus. But the fact is that this represents a massive reallocation of Australia's aid budget away from poverty reducing programs overseas to meet domestic refugee support costs. The way the decision has been taken also raises disturbing questions about the integrity of the aid program. 

    The Foreign Minister says this isn't a cut to foreign aid, and in a strict sense he is right. Under Organisation for Economic Cooperation and Development (OECD) rules (pdf), governments are allowed to report the first 12 months of in-country support costs for refugees as Official Development Assistance – the bureaucratese for "aid". The Foreign Minister even points to three donor countries who claim more refugee assistance as aid than Australia is reportedly planning to claim, the US ($895 million in 2010), France ($435 million in 2010) and Sweden ($397 million in 2010). 

    Of course, the developed country donors set the rules for what can be reported themselves, so there's understandably some self-interest in what they give themselves permission to report as aid. Many donors, too, such as the UK, South Korea, Italy, Ireland, Luxemburg, and Portugal don't report any aid (or very little) in this way (pdf).

    Australia, too, in the past has generally not reported much domestic refugee support as ODA. During the eleven years of the Howard Government, it reported around $232 million in this way. If the Foreign Minister gets his way, the Gillard Government will outstrip that in a single year. 

    The Foreign Minister also has argued that supporting refugees overseas is not really any different to supporting refugees at home. I suspect, though, that most people can tell the difference between Kenya and Australia, and would be able to give a pretty clear answer to the question, "Which country do you think has the most capacity and resources to care for refugees, Lebanon or Australia?"

    Displaced person camp in Nepal

    Leaving that aside, though, the sad fact is that if this goes ahead, it will make Australia the third biggest recipient of Australia's own country aid (after Indonesia and Papua New Guinea). The Opposition is, rightly, making merry with this. Though Julie Bishop confirmed that the Opposition has no plans to restore this $375 million or meet its own pledge to increase aid to 0.5%.

    If it goes ahead, 7% of Australia's 2012-13 aid budget would be devoted to the domestic costs of supporting refugees in Australia. The Foreign Minister has also indicated that further reallocations are likely in the 2013-14 budget. This represents an enormous shift in the priorities of Australia's aid program whose fundamental purpose, AusAID informs us, is to help people overcome poverty. It may not be a cut to the aid budget as a whole, but it is a cut to poverty reduction programs.

    The Government hasn't identified which programs will be cut or suspended or delayed to divert $375 million in this way. Until they announce where they intend to find this money, we don't know if this cut will force children out of school, or claw back life-saving vaccines, or reduce the number of community health workers and midwives we train. What we do know is that this will reduce the amount of good our aid is able to do in poor communities around the world.

    World Vision has estimated that in the last year alone Australian aid money saved at least 200,000 lives, provided education for more than half a million children and gave disaster assistance to more than 10 million people. It is these outcomes that are threatened by this plan.

    Not only these outcomes, but the integrity of our aid program is called into question by the decision, and the way it was made. Rather than putting this plan through the normal budget process, it was reportedly intended to be released only days before Christmas, presumably to reduce public scrutiny and uncomfortable media questioning. Although that has clearly not worked.

    But if Australia's aid can be diverted so easily to meet domestic priorities, then where does that leave our international commitments?

    Multi-year predictability of aid flows is a key factor in whether or not aid is effective or not. Without this kind of predictability, partner governments and organisations aren't able to plan programs, monitor and follow through with the often long and complex work of supporting sustainable development and reducing poverty. Can our partners expect to see Australia's aid arriving as promised, or do they now have to wonder when and if it will be diverted again?

    Finally, this is not an "either / or" question, – support refugees or meet our overseas aid commitments. Australia has the resources to both process and support refugees fairly and to help poor countries and communities overcome poverty. The UK, with higher unemployment, a slower-growing economy, and harsher budget cuts than Australia, will increase its aid budget to 0.7% of gross national income next year – almost twice as much as planned in Australia. The UK also uses only 0.1% of its aid budget to fund domestic refugee programs.

    It's not too late for the Government to change its mind on this. If you haven't already, please join us to tell them not to divert aid.


    Ben Thurley is the Political Engagement Coordinator for Micah Challenge Australia. Ben previously worked with TEAR Australia and has just spent four years in Nepal volunteering as an advocacy advisor to a local Nepali organisation.