Following the recent announcement of where the Coalition Government is making cuts to Australia’s foreign aid budget, DAVID ADAMS asked Ben Thurley, Micah Challenge’s political engagement coordinator, what it all means…
Following the recent announcement of where the Coalition Government is making cuts to Australia’s foreign aid budget, Ben Thurley, Micah Challenge’s political engagement coordinator, explains what it all means…
The Government says it will spend $107 million less on foreign aid this financial year than the previous year. So where does the figure of $625 million in cuts come from?
“(Foreign MInister Julie) Bishop’s announcement stated that 2013-14 Official Development Assistance (aid) budget would be $5.042 billion. In the 2013-14 May budget, it was programmed to be $5.667 billion. So the Coalition is cutting $625 million from the amount already budgeted for aid this year. Aid expenditure in 2013-14 therefore will be $107 million less than was spent in 2012-13 – which was $5.149 billion.”
What programs/initiatives are being impact most by the cuts?
“All regions are having aid cut, both against the 2013-14 budget and against 2012-13 expenditure (except East Asia, where the revised budget is less than the original 2013-14 budget but slightly more than was spent in 2012-13 – mostly due to the spending in Indonesia – $532.4 million – and The Philippines – $109 million).
“Aid to sub-Saharan Africa has been cut by 41 per cent – from $224.9 million in the budget to a revised level of $133 million – vastly less than was spent in 2012 ($211.2 million). Given that this is the region where the poorest people in the world live, this is a very harmful cut.
“Similarly, aid to humanitarian and emergency relief and for refugees has been cut by 22 per cent – from $339.6 million in the 2013-14 budget to a revised level of $264.2 million (also substantially lower than the 2012 expenditure of $285.2 million).
“Given the scale and impact of extreme weather events, conflict and other humanitarian emergencies (for example, in The Philippines, Syria, Sudan, and elsewhere) this is a critical area of aid.
“Finally, regional and global climate change and environmental sustainability programs have been cut from actual expenditure in 2012-13 of $91.6 million to $0.5 million in 2013-2014. (The previous government had budgeted these programs at $6 million in the May budget). The government is seemingly very hostile to climate change and environmental funding through the aid program, but not clear how we intend to contribute to the need for adaptation financing.”
Are any programs receiving increased funding?
“No regions, countries or programs are receiving more money than was originally budgeted in 2013-14. Almost all are receiving cuts, although a small handful are projected to receive the same amount on the Government’s revised estimates as was originally budgeted for in May – for example, in The Philippines $109 million or Nauru $20.7 million.
“This may reflect the particular circumstances of our aid to these countries – particularly Nauru as a key element in our refugee warehousing, but it may be that this money was also fully committed and savings were not able to be made.”
The government says it will now link the amount Australian gives in foreign aid to the Consumer Price Index – what does this mean in practical terms?
” It means that aid is likely to grow at a nominal rate in line with CPI (roughly 2.2 per cent annually) – which is the average rate of increase in the prices of a selected group of goods and services consumed domestically. CPI is likely to be less than the rate of GNI (gross national income) growth. This means that in practical terms, Australia will become proportionally less generous as it becomes wealthier.”
The government has pledged to give 0.5 per cent of gross national income in foreign aid (the Millennium Development Goals call for 0.7 per cent by 2015) but not set a timetable for this year. How does the most recent announcement by the Government affect that pledge?
“The 0.5 per cent GNI commitment is meaningless without a timetable. The government has walked away from a substantial bipartisan commitment.”
What is the current percentage of GNI given by Australia in foreign aid?
“Aid will fall to just 0.33 per cent GNI in 2013-14 and will stay at this level, or fall to 0.32 per cent GNI over the next four years.”
