Question Time – The decline of Australian Aid spending

Senator DAY: My question is to the Leader of the Government, representing the Minister for Foreign Affairs, on Australia’s aid budget. The Howard government committed itself in 2000 to reach 0.7 per cent of gross national income spent on aid. In opposition, the current government committed to a 0.5 per cent target. The Millennium Development Goals target, an OECD target, is for nations to reach 0.7 per cent of GNI. However, the largest saving in the government’s first budget was to reduce aid spending by some $7 billion. Australian aid today stands at 0.25 per cent of GNI, and the Parliamentary Budget Office indicates that aid will steadily decline to 0.18 per cent of GNI by 2025-26. Will the government (a) insulate Australian aid from more cuts and (b) commit to increasing aid over the forward estimates as the budget is repaired?

Senator BRANDIS: Thank you very much indeed, Senator Day, and thank you for the courtesy of giving me advance notice of this question. I can give you some information. I acknowledge, by the way, your longstanding interest in this area and the important contribution you make to the public discussion of it. In 2015-16, Australia will provide an estimated $4 billion in official development assistance. That makes Australia the 13th largest donor in the OECD.

Senator, you will understand that the current level of spending in this and other areas is in the context of the budget position left us by the Labor government and imposed by Labor through their current irresponsibility. Despite the budget constraints imposed by Labor’s legacy of debt and deficit, the coalition is delivering a responsible, affordable and sustainable aid program. We remain committed to ensuring that appropriate funding flows to the most effective programs and will continue to focus on priorities outlined in our aid policy, Australian aid: promoting prosperity, reducing poverty, enhancing stability.

In addition to maintaining a generous aid program, the government is committed to improving the real outcomes of our foreign aid. We have introduced new performance benchmarks to enhance accountability and ensure a stronger focus on results and value for money in the aid program. In March 2015, the Minister for Foreign Affairs launched a $140 million InnovationXChange within the Department of Foreign Affairs and Trade to transform the way we deliver aid.

Australia is continuing to make a strong contribution to humanitarian efforts globally. The Emergency Fund remains at $120 million. We have also established a competitive Gender Equality Fund of $50 million to enhance women’s participation in decision making and leadership, promote women’s economic development, and help end violence against women and girls in our region. 

Senator DAY: Mr President, I ask a supplementary question. Australia now ranks 13th in OECD economies in its aid contributions. The UK government was the first G7 donor to reach a 0.7-per-cent-of-GNI target. Chinese aid is now larger than Australia’s. Why can other nations prioritise aid, but we cannot?

Senator BRANDIS: Senator Day, I think Australia should be proud of being one of the world’s leading foreign aid donors, as we are. You said so yourself: 13th. Of course, I am not in a position to comment on the aid policies of the United Kingdom and China, but I can tell you, Senator, that the coalition is committed to delivering an aid program which is not only generous but also targeted and effective.

I do have to mention that, sadly, the government has had to deal with a budget position inherited from the Labor Party. The aid program will continue to contribute to international efforts to achieve the Sustainable Development Goals. The Foreign Minister recently led the Australian delegation at a special UN summit in New York, in September of last year, which reached consensus on the 2030 Agenda for Sustainable Development. We cannot commit to a prescriptive, time-bound aid target as a percentage of GNI until Australia is in a fiscally strong position to support that aspiration. 

Senator DAY: Mr President, I ask a further supplementary question. The government made an announcement to coincide with the recent Paris climate conference that at least 20 per cent of Australian aid—that is, over $1 billion—will be repurposed for so-called climate relief. When the UK government did similarly, they were accused of robbing Peter to pay Paul. Which poor Peter countries is Australia going to rob to pay climate Pauls?

Senator BRANDIS: Senator Day, it is indeed true that at the leaders event during the UN climate change talks in Paris the Prime Minister announced that Australia would provide at least $1 billion to build climate change resilience and reduce emissions over the next five years. That commitment is equivalent to around five per cent of the aid program for each of the next five years.

These funds are from our overseas development budget and will fund programs that work towards the achievement of the overarching goals of that aid program, to drive economic growth and reduce poverty in our region. There are already significant climate related programs underway within the aid program. No aid programs have been scaled back to fund these climate activities. Future activities will be financed according to priorities agreed with partner governments. The Australian government is working with developing countries to ensure the greater predictive ability of finance flows. 

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