Australia’s international development agencies are preparing for hard times ahead, predicting the nation’s already reduced foreign assistance budget could be further hit as aid again becomes a scapegoat in this year’s May budget announcement.
“While it would be catastrophic to the program for even more savings to be found from the Australian aid program it is nevertheless possible,” Andrew Johnson, political engagement manager at World Vision Australia, told Devex. He stressed that unless Prime Minister Tony Abbott assured the public that the budget for the aid program will be protected, “the aid community will continue to be concerned that further savings will be found and we believe this will do untold harm.”
Johnson fears further cuts to be more far-reaching, and may impact programs supporting the most vulnerable people, including health, education and WASH. Whole regions could see a loss of Australian funding and the political engagement managers is even expecting global programs to take a hit. New initiatives will likely be off the table as well.
Only the legally binding multilateral commitments will be safe.
“The scale of the cuts already announced … will touch every part of the aid program in some way or another,” Johnson said. “The program has already cut the ‘fat,’ it is now about amputating entire limbs.”
Given last year’s slim federal budget, Australia’s foreign aid envelope was cut by 11 billion Australian dollars ($8.6 billion) since September 2013 — comprising more than 20 percent of the total reductions in the budget.
“The government has stated that the reason for such large cuts is primarily to solve what it has termed as Australia’s ‘budget emergency,’” Tim O’Connor, communications director for UNICEF Australia, told Devex. But current estimates show Australian foreign aid will account for only 0.22 percent of gross national income by 2017-18, which according to Johnson is “the least generous level in recorded history.”
Aid cuts’ impact on development — and Australia’s leadership role
According to development agencies, this instability of aid funding is already leading to problems working with communities. Hard choices are being be made on where to invest and where to cut costs. Some cash-strapped nongovernmental organizations, for instance, are already mulling over whether they need to choose between investing in the health or education sector in a particular country.
See more stories on Australian aid:
● With cuts in the pipeline, Australian aid effectiveness in question
● Inside the takedowns of AusAID and CIDA
● Australia reveals additional cuts to foreign aid budget
● DFAT's James Gilling: 'We are trying to make ourselves more open'
● Doing business with DFAT: A procurement process guide
“These cuts directly undermine the predictability of our funding partnerships,” Paul O’Callaghan, CEO of Caritas Australia, shared with Devex. This unpredictability has been further shown to reduce aid effectiveness by as much as 20 percent. O’Callaghan, however, does not believe the situation will improve any time soon.
For development agencies, the benefits can be seen in the government’s own numbers: A report released by the country’s foreign affairs and trade department confirms the effectiveness of the Australian aid program. How effective the program will be given massive budget cuts remains to be seen.
Worryingly, reductions in the aid budget are also affecting Australia’s role as a leader in Asia and the Pacific and increasing instability in the region.
“The scale of these cuts,” the Caritas chief noted, “[has diminished] Australia's contribution to poverty reduction and improved security in our region.”
Australia’s development agencies, however, aren’t just calling on Abbott’s conservative coalition government to protect the aid budget. They are also urging the administration to reverse previously announced cuts and to act more “Australian.”
“Over 1 in 5 Australian households contribute to charities — we are a country of compassion and generosity,” O’Callaghan stressed. “The government’s actions to dramatically reverse 50 years of Australia’s global leadership work as a wealthy country should be realigned with Australian values.”
The message to the Australian government is clear: enough is enough.
Has your organization been affected by this instability of aid funding from the Australian government? What measures have you implemented to ensure the effectiveness of your aid programs? Let us know by leaving a comment below.
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