What Happened to Aid in the Budget?

The federal budget, delivered on Tuesday night, revealed that despite a strong economy and predicted surplus, Australian aid will be kept at its least generous level ever.

Budgets are moral documents.

They reveal our nation’s priorities and provide an insight into our soul.

But on Tuesday night, we found out that despite a strong economy and predicted surplus, Australian aid will be kept at its least generous level ever.

So was Foreign Aid ‘Cut’ this year?

The answer is yes.

Effectively, aid was cut because the government will not grow the aid budget in-line with inflation.

In fact, the budget revealed that total aid expenditure will fall by $117 million, with the aid budget dropping from $4.16 billion this financial year to $4.04 billion in 2019/20.

This is because, as announced last year, aid has been frozen and will not growing in line with inflation, until indexation is resumed in 2022-2023.

How many ‘cuts’ have there been now?

Since 2013, the Coalition have made more than $11 billion of cuts to aid.

This means Australia’s aid budget has fallen from $5.05 billion in 2013/14 to $4 billion in 2019/20. And with this latest announcement, Australian aid will remain at its least generous level ever.

Australia will now give just 0.21% of our Gross National income to combating poverty worldwide. That’s just 21 cents in every $100 we make as a nation.

This will drop to 19 cents in 2021-22, before indexation kicks in 2022-2023.

To put this in perspective, Australian Aid was at its most generous level ever in the 1960s. And that was under a Liberal Party Government who gave 0.48% of GNI to Australian Aid.

But it’s been a disappointing story for aid since then, with some small increases but some even bigger cuts.

This is despite, the Coalition announcing that there is a $7.1 billion surplus coming in 2019-2020.

Not rising to the challenges in our world

But what is really concerning in this budget, is that we are cutting support to our poorest neighbours at a time when we are facing some of our biggest global challenges ever.

With this budget came cuts to aid programs announced in: Indonesia, Cambodia, Pakistan, Bangladesh and Nepal.

For example, direct bilateral aid to Pakistan will be halved from $39 million to $19 million.

Aid to Cambodia will drop from $56 million to $43 million.

What about the Pacific?

There’s been lost of talk about the Pacific ‘Step -up’ in this budget.

And funding for the Pacific was the government’s main centre-piece in the foreign aid budget:

The Foreign Minister Marise Payne announced that:

The Morrison Government will invest an estimated $4 billion in Official Development Assistance (ODA) in 2019-20, with our aid to the Pacific at a record high level of $1.4 billion. 

This basically means that the budget confirmed, what our sector feared: that the Government will use the aid budget to fund part of its $2 billion Australian Infrastructure Financing Facility for the Pacific.

A total of $500 million will be given over four years to fund the new infrastructure facility for the Pacific. But nearly $100 million is set to be cut from Australian aid to Bangladesh, Cambodia, Indonesia, Nepal and Pakistan in 2019-20 to be redirected to the facility.

In other words, the government is not adequately funding both, instead funding Pacific infrastructure at the cost of development programs in other nations (particularly South Asia and South-East Asia).

Why Should we as Christians Care about this?

This budget there has been lots of talk about falling house prices, low wages growth, the poor Newstart allowance and the ongoing impact of drought on communities.

And these are real issues impacting the lives of Australian citizens.

But while we consider the impact of issues like high-energy prices, we must remember that millions of the poor around the world are barely hanging on to survival, living in mud huts or under no roof at all. Poor families around the world are right now starving to death. And if we continue cutting Australian aid, we can be sure that millions will die.

So we need to ask ourselves as Christians,  “What sort of a neighbour do we want Australia to be?”

The Bible clearly doesn’t specify the level of aid we should give. Instead it tells us in the book of Proverbs, Isaiah and elsewhere, that as followers we should:

‘Speak up for those who cannot speak for themselves, for the rights of all who are destitute. For those who are poor and needy.’

We know our role as Christians is never to simply stand and criticise the government.

And that we each have a responsibility in our churches and in our own lives to be being generous with what God has given us first and foremost.

But at Micah we do believe we have a prophetic role to call on our nation to act justly and love mercy.

To consider all that we have been blessed with, and to ensure that we are being a blessing to our vulnerable neighbours in return.

light at the end of the tunnel?

Despite a tough week for aid, there may be good news on the horizon.

Just one day after the budget, the Foreign Affairs and Aid Sub-Committee of the Parliament’s Joint Standing Committee on Foreign Affairs, Defence and Trade presented its first report for the inquiry into Australia’s aid program in the Indo-Pacific.

This is a bipartisan report, released through parliament. Some key recommendations were:

  • The need to ‘strengthen Australians’ confidence in the aid program.’
  • The importance of measures to raise awareness about the benefits of Australia’s aid program in the public.

And most importantly, the report has recommended that:

‘The Australian Government, within a year, commit to a set timeframe of no more than five years for increasing Australia’s funding for Development Partnerships (aid) to at least 0.5 per cent of gross national income.’

Our Executive Director, Tim Costello welcomed this report saying:

“After another devastating blow to the aid budget this week, there is finally some good news on the horizon.”

“This report shows that politicians on both sides clearly know the right way forward for our aid program and have recognised that a serious injustice has been done to the aid budget over the past few years.”

“What has happened has not been fair, nor has it been smart.”

“I am calling on both Prime Minister Scott Morrison and Opposition Leader Bill Shorten to back this report on aid and show bipartisan leadership.”

What’s next? The Election:

We are only moments away from the Election being called.

Now, more than ever, is the moment to speak up for the world’s poor and vulnerable show your local parliamentarian you care about aid.

There are a few ways to do this: