Home World News Tony Abbott´s Slash to Australian Foreign Aid

Tony Abbott´s Slash to Australian Foreign Aid

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“It will force the approach of our aid bureaucracy to be re-examined and lead to more efficiencies – I am definitely in favor of that.”

A short time after gaining the Australian Prime Ministership the newly elected Tony Abbott made a decision that was described by the former AusAID Deputy Director-General Annemaree O’Keeffe as “ground trembling”. Following in the shadow of other newly elected right wing governments around the world he announced that AusAid (the body responsible for managing Australian overseas aid) would cease to be an executive agency, and would be integrated into the Department of Foreign Affairs and Trade. The reason for such a large change to the Australian foreign aid bureaucracy was to make diplomacy and aid delivery “more closely aligned”.

It has been claimed by many such as the former director general of AusAid Peter MaCawley that this course may effect Australia’s “standing in the Asian region” as well as be interpreted as a winding down of diplomacy in the region. Nevertheless the Australian government has moved ahead and issued a deadline of July 1st 2014 for this integration. But the process has been controversial. A leaked employee survey from the department of foreign affairs and trade (DFAT) showed only a minority of former AusAid staff felt part of the team and that private statements referring to the whole processes as more of a “hostile takeover”.

This comes in the wake of a national budget that has slashed overall foreign aid provided by Australia to the tune of AUD $7.6  billion dollars over the next five years. This alone represents the biggest overall cut in the new governments first budget. Cuts that have in general attracted a domestic backlash that has sent the new coalition governments poll ratings to a four year low of 36% according to latest data.

Criticism of the cuts and a the new policy of utilizing foreign aid as a tool to support foreign policy objectives is abundant in the development community in both Australia and internationally. But is there a flip side? We spoke to a former Australian aid official “Gary Andrews”, now a business development director at a Malaysian firm located in Kuala Lumpur.

Are you in favor of the cuts?

“I am not but by proxy it will force the approach of our aid bureaucracy to be re-examined and lead to more efficiencies – I am definitely in favor of that. 

Are you saying that AusAid has been inefficient?

“What I am saying in effect is that there must be resource efficiencies to be gained by adopting an aid management approach that doesn’t allow for micro-management of project implementation. Significant taxpayers money is being spent on the engagement of managing contractors to manage the process so why should AusAID waste their resources by duplicating it? Their focus should be on the monitoring and evaluation of these programs and there are already mechanisms in place to do that. Now, had AusAID realized this, and taken management steps to do so, then they probably wouldn’t have needed as many staff as they had.”

So there will be positive outcomes from the cuts?

“Without supporting the Abbot government changes I am saying that (probably unintentionally) they will lead to these sort of efficiencies being realized. The Aid Bureaucracy will have to compromise what it does overall and sensibly one would think that they will withdraw from micro-management rather than sacrificing the other things that they are more legitimately required to do.”

Australia has consistantly ranked highly over the years in terms of the quantity of foreign aid provided, both overall and in per capita terms. However, the latest round of budget cuts and reorganisation of the very purpose behind Australian foreign aid clearly risks denting the standing of a country of blessed opulence. The best case scenario is that efficiencies that potentially can be gained through intergration and budget cuts can offset the all but certain slide in international foreign aid rankings and the inevitable scepticism resulting from hard nosed “aid for trade” type diplomacy the coming years will bring.

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