Five reasons… why the Coalition government has lost the plot on overseas aid

Executive Officer, Kate Lee takes a look at five reasons why the Coalition government has lost the plot on overseas aid and an alternative aid agenda.

  1. Lost vision – poverty alleviation is no longer the key objective of the Australian overseas aid program. The Coalition Foreign Minister, Julie Bishop, and the Minister for International Development and the Pacific, Concetta Fierravanti-Wells have reiterated that the key purpose of aid is to promote Australian business interests overseas.
  1. Lost public benefit in favour of big business – Australian aid is increasingly focused on ‘aid for trade’ which rose to 20% of the 2016 May budget (up from 17% in 2015/16). This is aid with strings, as a bargaining chip to open up markets for Australian companies. The ‘business partnerships platform’ within the aid program offers 50% funding for any corporate initiative that can ‘deliver a combined social and financial return on investment’. Corporates are directly subsidised by aid, for example, ANZ and Westpac in the Pacific, have secret MoUs with DFAT, subsidising Australian banks to get more customers in poor countries. This model is to be extended to other corporates in the ‘new aid paradigm’.
  1. Lost dollars – Under the Rudd/Gillard administration, aid funding was planned to increase to 0.5% of GNI by 2020. The cuts to the aid budget mean that $12 billion has been lost from these forward projections. Abbott’s 2013 Commission of Audit recommended delinking aid from %GNI (the international standard is 0.7% of a country’s GNI), linking instead to the ‘fiscal context’ (Rec 31). As a percentage of Australian GNI, aid spending has now fallen to 0.2%.In addition, real spending in the aid budget has declined. Here’s the spending breakdown since the Coalition took office in September 2013:
    2013-14 – $5.032 billion
    2014-15 – $5.027 billion
    2015-16 – $4.052 billion (-19.5% -$980m cuts)
    2016-17 – $3.828 billion– (-5.5% -$224m cuts)
  1. Lost relevance – with the impact of climate change falling squarely on the shoulders of the world’s poorest countries, and Australia still being ranked the world’s highest per capita emitter of greenhouse gases, the Coalition is still missing-in-action on climate change. Take for example, the global Green Climate Fund, set up by the UN to help poor countries counter climate change with adaptation and mitigation programs and practices. The Australian government committed $50 million per year for four years, well below global expectations, and raided the existing aid budget in doing so, again to domestic and international criticism. At the 2015 Paris conference on climate change, the Australian government committed to overall ‘climate finance’ of $1 billion over 5 years ($200m a year) – but this is no increase on the previous commitment made by Labor while in government. The UN agreement requires government commitments globally of $100 billion a year and Australia’s share is estimated (by the aid sector’s peak group, ACFID) to be at least $500 million a year in additional funds.
  1. Lost public support – is it any wonder public support for an overseas aid program is at an all-time low? Seen as a government slush fund – for corporate interests, diplomatic manipulation, for funding anti-refugee policies on Manus Island, Nauru and Cambodia – to the punter, this doesn’t look like ending poverty or providing humanitarian relief, and it isn’t! ANU polling shows support for overseas aid falling, but also that Australians overwhelmingly support aid on humanitarian grounds (75%), over aid for commercial or political interests (12%).The more the Government pursues its ‘new aid paradigm’ for Australian business interests, the easier it will be to cut aid, assisted by this populist anti-aid rhetoric.

An alternative aid agenda!

Aid is for partnership with local communities in poor countries, not for market ideology, and for real development, not for narrow Australian business or political interests.

Priority aid must address growing inequality and climate change – by tackling root causes and through a framework that puts the needs of the most vulnerable and disadvantaged first.

We must continue to campaign against aid budget cuts but also against the ‘new paradigm’ of national interest and private finance.  What’s the point of having a fair aid budget if most of it goes to boost profit for big business?

We need to foster public support by doing what Australians want – an Australian aid program to help communities find a way out of poverty and to reduce inequality. Increasingly, Australians want to stop climate change destroying the lives of those who are most vulnerable.

Here’s all you need on the commitments on aid from all political parties this federal election., and here is the AID/WATCH Report Card on Aid under the Coalition.


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