Aid agencies have broadly welcomed the Australian Government’s response to an independent review of aid, with suggestions that it could benefit millions of people living in poverty around the world.

Launched in November last year, the review – the first since 1996 - looked at the effectiveness of Australia’s foreign aid in order to give direction to the future of the program. Around 300 submissions were received from Australia and the international community. 

The review, overseen by a panel under the leadership of former Olympic chief Sandy Hollway, made 39 recommendations – which range from the establishment of a “transparency charter” for the aid program to an increase in funding for research by Australian and international organisations - all of one but which were agreed or agreed-in-principle by the Government.

Other recommendations included that decisions about which country’s aid goes to be based on “poverty, national interest, capacity to make a difference, and current scale and effectiveness”. 

"The public have wanted assurance that the aid program was saving lives. Here is a comprehensive review to give them that assurance." 

- World Vision Australia chief executive Tim Costello.

The Government responded that it would adjust its programs in-line with this, meaning that aid to Pacific island countries, South-East Asia, Afghanistan, Pakistan, Africa and the Middle East would increase while bilateral aid to China and India would be phased out and any future increases to aid in Latin America and the Caribbean would be modest. 

Announcing the Government’s response in Federal Parliament this week, Foreign Minister Kevin Rudd said the Government’s efforts to strengthen the effectiveness of the aid program, including its response to the review, represented “some of the most far-reaching changes to the aid program in more than a decade”.

Mr Rudd said he wanted to see an aid program that was “world-leading in its effectiveness” and delivered real and measurable results in reducing poverty.

Micah Challenge Australia - part of a global movement of Christians speaking out against poverty and injustice in support of the Millennium Development Goals - welcomed the Australian Government’s response, noting that the organisation’s key campaign areas – which include water and sanitation, child and maternal health and the climate and environment – were all among areas highlighted as priorities in terms of aid delivery.

“The geographic focus of the aid program will remain on the Asia Pacific region, while also recognising the potential for Australia to contribute to global initiatives focused on Sub-Saharan Africa and South Asia where the majority of the world’s poor live,” the organisation said in a statement. 

It also welcomed Mr Rudd’s reaffirmation of the existing bi partisan commitment to increase aid to 0.5 per cent of Gross National Income by 2015, and his acknowledgement of the potential for Australia to do more. 

“This represents a big change from the 0.23 per cent we fell to in 2002-03,” said John Beckett, Micah Challenge’s national coordinator. “When we reach 0.5 per cent, we will have reached the average of the world's wealthiest countries, but no more.”

World Vision Australia’s chief executive, Tim Costello, described the review as “profoundly important” and said it should “give confidence” that Australia’s aid program is saving lives and is cost effective. 

"It is vital that all Australians understand that our aid program brings value for our economy, for regional stability, but most critically discharges our moral responsibility as international citizens for people in poverty,” he said. 

Mr Costello particularly welcomed the finding that AusAID focus more on partnerships with NGOs and multilateral organisations. The organisation was also pleased with news of the introduction of a transparency charter and the recognition of the importance of empowering women and girls and the fundamental role their health and education play in good development outcomes.

Christian child development and advocacy organisation Compassion Australia also welcomed the announcement by the Government. DJ Konz, the organisation’s director of child advocacy, said the outcomes should lead to a “stronger, more transparent aid program”.

In particular, he said Compassion welcomed the Government’s addition of “saving lives” as one of five core strategic goals for the overall aid program and said it had included specific objectives to increase spending on water, sanitation and hygiene initiatives as well as child and maternal health through immunizations and the provision of safe birthing environments.

“The core strategic goal of ‘Saving Lives’ is especially timely now, with less than five years until the 2015 Millennium Development Goal (MDG) deadline,” the organisation said in a statement. “Progress on MDG 4 (reduce child mortality) and MDG 5 (reduce maternal mortality) are still lagging significantly behind their respective targets. “

Mr Konz said the announcement suggested Australia “is more committed than ever to investing in highly effective life-saving strategies such as large scale disease prevention.”

The one recommendation which the Government didn’t agree to was to add the words ‘international development’ to the title of the Minister for Foreign Affairs. It responded instead that this was “noted for further consideration”.