Australia's climate investments: What does the data say?

CANBERRA — According to the latest climate statistics published by the Organisation for Economic Co-operation and Development, Australia provided $313 million in climate-related bilateral finance for 2018 — but just $42 million was considered a “principal” investment. OECD data, which is provided in 2018 dollars, shows that Australia’s peak investment occurred in 2011. The following year saw Australia’s principal investment account for 38% of climate-related finance, steadily decreasing to 13% in 2018. Australian action on climate change has drawn a range of criticism. Calls from the Pacific for more action on climate change, including for Australia to reduce its carbon emissions at home, have been met simply with a redirection of aid to projects considered more climate-friendly. And inaction led to Indigenous Australians making a complaint to the United Nations last year. Diving deeper into International Aid Transparency Initiative data, published by Australia’s Department of Foreign Affairs and Trade, provides further insight into the sectors that the country’s aid program is targeting climate action through. But this also raises questions about the classification of programs under the climate banner and how transparent DFAT is in this space. Changing climate support Using policy markers that identify Australian aid disbursements as targeting objectives of climate change adaptation and mitigation, the IATI data produces headline results similar to what is published by OECD. This data shows that disbursements supporting climate change adaptation and mitigation did not make a large impact until 2010, when $86.5 million Australian dollars was disbursed. Only 16.8% of this was a principal investment. A AU$4.2 million disbursement to the Clean Technology Fund was the largest principal investment in climate change for the year. For programs with a “significant” investment in climate mitigation and adaptation, the largest investments for the year occurred through the Australian NGO Cooperation Program, or ANCP. Effective governance, disaster relief and preparedness, water and sanitation, agriculture, and education were leading sectors of investment. Geographically, global or regional programs were the focus, followed by the Solomon Islands, Papua New Guinea, Samoa, and Haiti. 2017 saw a shift in climate funding to focus on transport, in addition to effective governance. Papua New Guinea led in disbursements by far, accounting for 29% of the AU$176.9 million for climate-related initiatives. Global and regional projects followed, with Indonesia, the Solomon Islands, Vanuatu, and Fiji also priority regions. The largest principal investment supporting climate change adaptation and mitigation in this year was phase two of the PNG-Australia Transport Sector Support Program, receiving AU$23 million. But ANCP remained the largest overall area of investment through its continued significant support of climate-related programming, according to DFAT’s data. The data for 2020, as of July, shows that the sectoral focus remains on effective governance — now accounting for 15.5% of disbursements — and transport. Education, public policy, and management follow with contributions to a range of funds and multilateral bodies supporting work in this space. This has led to an increase in support for global and regional programs rather than country-specific initiatives. Where countries are specified, Papua New Guinea remains the main focus. Searching the data for “climate change” within program titles and descriptions produces different results — with many years seeing an increase in disbursements that could be classified as climate-related. Disbursements noting climate change totaled AU$124.6 million in 2010, AU$117.6 million in 2017, and AU$237 million in 2018. In 2020, disbursement drops to AU$99.3 million using this method. Questioning investment classifications IATI defines a principal investment in climate adaptation and mitigation as a program where the primary policy objectives “are those which can be identified as being fundamental in the design and impact of the activity and which are an explicit objective of the activity.” In determining a principal investment, IATI recommends donors ask the question “Would the activity have been undertaken without this objective?” But there are principal investments in climate change identified by DFAT that do not meet these criteria. Since 2014, disbursements as part of phase two of the PNG-Australia Transport Sector Support Program have been identified as a principal investment in adaptation and mitigation. The program makes no link between the project and a climate objective in its description, which lists the sector split as “Transport and Storage 100%.” According to the sector information, just 1% of the budget is for “environmental policy and administrative management.” Documentation on phase two of this project links to climate change but not as a principal objective. The climate links are to crosscutting policies that also incorporate HIV/AIDS, gender equality, and disability. Across the 170 pages detailing the design and implementation framework for this program, just nine references are made to climate. As an extension of phase one, which also had no clear links to climate objectives, it is likely that this program would have proceeded regardless of a climate objective. The exclusion of this program as a principal investment greatly impacts DFAT’s reported numbers. The program accounted for 75% of principal climate disbursements in 2018, increasing to 86% in 2019. Of combined principal and significant disbursements, this program accounts for 9.4% of total investment in 2019, with $AU24.8 million invested in 2020 to date. Excluding this program, DFAT’s climate funding for 2020 would drop to AU$155.1 million. While the IATI data provides a similar result to totals published by OECD on climate finance, the PNG-Australia Transport Sector Support Program cannot be clearly identified in OECD data. Program names are different, and OECD has additional categories including identifying climate as “not significant.” This shows that if IATI is the basis of DFAT’s reporting, further modifications to the data is required before it is provided to OECD. But as this data is part of DFAT’s transparency initiative, the classification of programs should not be significantly different.