Australia’s 2021 aid budget focuses on past promises

For a second straight budget, Australia is playing down the value of its aid budget by separating new COVID-19 funding from the rest of the program to maintain the appearance of a $4 billion Australian dollars ($3.1 billion) official development assistance program it committed to maintaining in the 2019 aid budget.

Announced as part of the federal budget in Canberra on May 11, Australia’s development assistance program for the 2021-22 financial year includes an additional AU$335.3 million as “temporary” ODA, which is “targeted and supplementary measures to respond to COVID-19”.

This brings Australia’s total aid budget down to AU$4.3 billion from AU$4.5 billion in 2020-21 when additional funds allocated to the pandemic response are considered. The government’s commitment to maintaining an ODA budget that is affordable, targeted, and effective is its justification for maintaining this cap in the budget.

The Pacific, Timor-Leste, and Southeast Asia are the beneficiary regions of the “supplementary” budget. Support for vaccine access will receive AU$162 million, with the Department of Foreign Affairs and Trade aiming to deliver 10,000 Australian manufactured AstraZeneca vaccines to the Pacific and Timor-Leste each week over the coming year.

Economic support will be supported through an AU$100 million supplement, and India will also receive AU$16.7 million with support for its pandemic response, including the supply of medical and personal protective equipment.

In other areas of the aid budget, there has been little movement despite a pandemic that is resulting in an increasing number of confirmed cases and deaths in a region Australia says it is “stepping up” to support.

The humanitarian and COVID-19 response fund remains fixed at AU$200 million. Gender equality initiatives are fixed at AU$65 million, disability initiatives at AU$9.6 million, with a slight increase in money allocated to global NGO programs which will be AU$139.1 million for the 2021-22 financial year.

The winners

Through the supplementary COVID-19 funding, health and health security have been a winner in this budget. But it also received an additional AU$22.3 million increase through contributions to global health programs. Despite the humanitarian and COVID-19 response fund remaining steady, global humanitarian partnerships also saw an AU$13 million boost as a response to the pandemic.

Additional funds of AU$5 million will be directed to the International Committee of the Red Cross, taking the allocated budget to AU$25 million. The other AU$8 million will be directed to the World Food Programme, bringing the allocation to AU$38 million.

Climate partnerships is also a program area winner, doubling from AU$20 million to AU$40 million in response to a government commitment to increase its climate-related funding. The program aims to generate an AU$700 million portfolio of low emission and climate-resilient investment in the region. Infrastructure and rural development programs received an AU$1.1 million increase, with AU$27.1 million available for upcoming initiatives.

Regionally, the Pacific remains the focus receiving AU$1.4 billion in ODA for 2021-22 — excluding the supplementary budget. Papua New Guinea continues to receive the largest share: AU$479.2 million in country allocation for 2021-22. But this is a figure that is continuing to decline with the funds allocated instead to Pacific regional programs that will be able to have a wider impact.

In Bangladesh, direct country allocation will see AU$30.8 million directed in support, consistent with the previous year. Incorporating the allocation of funds to support the Rohingya population, the country is set to benefit from an AU$78.1 million increase for a total of AU$133.8 million.

New investments are being made in social protection systems to improve the resilience of the Indo-Pacific region to economic shocks — including the establishment of partnerships for social protection programs worth AU$18 million over the next five years. Investments in gender announced prior to the budget were among other new initiatives announced by DFAT.

The losers

In balancing the budget, education received the biggest cut. Contributions to global education partnerships dropped 90% — from AU$35 million to AU$3.5 million. Regional scholarships and education programs also declined from AU$66.6 million to AU$58.5 million. Health, water, and sanitation were a surprise cut considering their importance in fighting the COVID-19 pandemic. According to the budget papers, funding has decreased by AU$12.1 million to AU$156.1 million.

Overall contributions to international organizations also suffered at the hands of COVID-19 with an AU$8.6 million drop, and cash payments to multilaterals declined by AU$33.9 million.

A concerning outcome

The response from Australia’s NGO sector has been one of concern.

“We’re really worried,” Marc Purcell, CEO at the Australian Council for International Development, said to Devex. “The rates [of] COVID are through the roof in our region and there is no new money in this budget for responding. We’ve got 5,000 cases a day in Indonesia, we don’t even know how bad rates of infection are in PNG and the virus is mutating.”

Purcell said it appeared Australia’s aid program pivot to a COVID-19 focus was not being resourced to do the job needed, and was possibly being based on projections six months out of date.

“Announcements were made by the government last year in November, and since that time things have become much, much worse in the region. Last year there wasn’t COVID in PNG and India was on top of it. Now the situation is more dire and we’ve known that all year. It is shocking to me that there is no new resourcing to tackle the scale of need.”