The depth of budget cuts to foreign affairs and overseas aid has been underscored by the slashing of 500 bureaucrats jobs and warnings that Australia will slump in international rankings of aid generosity.
Aid organisations reacted with anger to Tuesday’s budget revelation that $7.6 billion would be ripped from foreign aid spending, accusing the Abbott government of another broken promise.
Staff at the Department of Foreign Affairs and Trade were told 500 jobs would be shed this year and next, partly stemming from the merger of the former AusAID agency into the department.
An analysis by the peak group the Australian Council for International Development found that Australia’s aid as a share of gross national income would fall to just 0.29 per cent by 2016-17, a far cry from the 0.5 per cent to which the former Howard government signed up as part of the Millennium Development Goals.
This would put Australia into the bottom half of OECD countries on aid spending and amount to less than half the 0.7 per cent that Britain dishes out.
Tuesday’s budget revealed that aid would be frozen at $5 billion a year for two years, not even keeping pace with inflation. Marc Purcell, executive director of ACFID, slammed the decision as a broken promise.
“When you’re talking about people living on $2 a day, every dollar counts and we’re incredibly disappointed to see the government fail to honour its election commitment,” Mr Purcell said.
Australian National University foreign aid expert Stephen Howes wrote in a blog post that the cuts were “disproportionate” to Australia’s fiscal problems.
UNICEF Australia CEO Norman Gillespie said the cuts would put Australia among “the least generous” donors in the OECD.
“We are disappointed aid should be treated as an easy target,” he said.
While the Coalition will restore $375 million that Labor stripped from aid to pay for asylum-seeker processing, it will give an extra $60 million to Papua New Guinea as part of the Manus Island detention deal – a move Professor Howes branded “hard to justify”.
Australia’s biggest single aid budget, for Indonesia, will hold firm at $542 million in the next financial year, or $605 million if regional aid spending is included.
Aid workers on the ground said cuts had already been made to programs this year to meet a $58 million budget cut imposed last year.
The budget would allow most existing aid programs in Indonesia to continue but a number of mega-programs, which had been planned and designed with expected large-scale new funding in mind over future years, now needed to be scaled down dramatically in light of the smaller pipeline of funds.
One disaster risk management program that was designed to spend $230 million over five years had been cut to $30 million and would need to be radically redesigned, sources say. Indonesia is one of the most disaster prone nation’s on the planet.
Other planned $200 million-plus projects in social protection and tertiary education would now become significantly smaller in scope. The latter was attempting to bring Indonesian universities up to an international standard.
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