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Breaking Faith on Foreign Aid

Monday, 2 February 2015  | Barbara Deutschmann

How shall we celebrate the New Year? From where I sit, a minute's silence may be the best response.

I work for an Australian aid and development agency, one that waits to see where the latest round of cuts to the aid budget will fall. 

Here is what we know: On top of the $7.6 billion in cuts to aid since it came into office, the Abbott government will take a further $3.7 billion out over the next four years, with 1 billion to be extracted from the coming year's budget alone. How much will be cut from the part of our aid that is delivered through non-government agencies like mine, remains to be seen. Wherever it falls, the impact will be brutal. 

For a time, from 2004, buoyed by the commitments of Labor and Coalition governments to the United Nations Millennium Development Goals (MDGs) and the resulting increasing aid levels, we saw the maturity of the aid and development sector grow. Importantly, we saw improvements in the things that the MDGs measured: more children at school, more babies born safely, more communities with safe water systems.


Australian aid does lots of good things. It enables us to invest in regional and global partnerships with cross-border programs to stop the spread of disease, to harness and share natural resources, and to help displaced people and assist after humanitarian disasters. Working with non-government agencies, our aid contributes powerfully to removing the barriers that stop people from living healthy, productive lives, enabling them to contribute to the wellbeing of their communities and to stable civic environments. 

One story illustrates the expertise and effectiveness of our aid sector in Laos. Keo Chan, her husband and three children were only just getting by. With little money, they shared a small house with two other families. There was not enough rice to go around, and Keo and her husband had to travel to another village to work to feed their family. There was no extra income for daily expenses, like school fees or medicine. If emergencies came up, there was no safety net.

An integrated development project, working with the community, sparked changes. A village irrigation system has opened up new farmland, enabling Keo's family to have their own rice paddy, and improvements to the village's household water supply mean they can enlarge their vegetable garden, so they're able to grow enough food. Keo has learned how to read and write. She is part of a savings and loans group and was recently asked to be the group's bookkeeper. Keo has established her own small coffee plantation, a cash crop that she can sell to make a living. She now has her own home to live in, with space for her three children to grow. 

These latest cuts break faith with the many communities like Keo's which benefit from Australian aid. They break faith with global agencies and those agencies on the ground delivering these impressive results. They had every right to feel that these programs would be resourced for at least a few years. Short-term commitments bedevil the aid area. Most effective development takes years to bear fruit. The recent cuts remove predictability - a goal expressed strongly by Minister Bishop in an address only last February. She said, "But what I have done is stabilise the budget at $5 billion per annum. It will increase in line with inflation, so it will go up by CPI. This will provide certainty, predictability of funding for our partners, for the recipients, and will put the aid budget on sustainable financial footing." 

The massive cuts are also a breach of faith with Australian non-government agencies and will inevitably involve job losses and the cutting back of programs. The loss of expertise and professionalism from the sector will take many years to restore.

The successors to the Millennium Development Goals, the Sustainable Development Goals (SDGs) will be negotiated next year. How can Australia participate in their development while simultaneously drastically cutting back its own aid?

We stand at the cusp of a new year and look ahead with sorrow. Those most affected are the silent ones whose water and food supplies will remain precarious, whose babies will not be vaccinated and whose girls will not go to school. By 2017, Australia will drop from contributing 34¢ for every $100 of our national income, to 22¢. Our aid has never been so low. Other developed countries with higher debt levels than ours, have been holding their aid budgets to promised levels and some, like Britain, have even reached the UN agreed target of 70¢ per $100 of income.

I would like to see a little more faithfulness to communities that benefit from Australian aid and to the Australian people who care about these things. 

As the New Year dawns, it seems more than appropriate to spare a minute's silence for the state of Australian aid.

Barbara Deutschmann has worked in aid and development for more than three decades and currently works with TEAR Australia.


Robert Coles
February 5, 2015, 12:17PM
It is most unfortunate that Government overseas aid has been reduced and we all would hope that it will increase again soon. My wife and I have supported Christian overseas aid organisations for many years, but we don't borrow money to do this. Our government is borrowing overseas to send funds overseas again for aid projects.
Mr J. C. Penney, the founder of the famous J.C. Penney department store chain in USA, started his own charitable Foundation around 1926. He funded the charity by borrowing heavily against his equity in the business. The 1929 Wall Street crash wiped him out and he had to start over again at the age of 56.

Governments cannot do everything and cuts are inevitable in difficult times. I think many Australians would like to see more being done to alleviate the growing homeless problem in our large cities.

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