Treasurer Joe Hockey Treasurer Joe Hockey
Treasurer Joe Hockey
Treasurer Joe Hockey
Global scrooge: Treasurer Joe Hockey’s budget has slashed foreign aid by $3.7 billion. Photo: Andrew Meares
World Vision chief: Tim Costello says the aid cuts are “immoral”. Photo: Alex Ellinghausen
Australia has transformed into the global Scrooge just in time for Christmas, with spending on foreign aid set to plunge compared to other wealthy industrial countries.
An analysis of Treasurer Joe Hockey’s $3.7 billion cut to the aid budget announced on Monday – on top of the $7.6 billion cut in May – reveals that Australia’s generosity towards the world’s poor will fall to an all-time low.
Australia will soon devote a paltry 22¢ cents in every $100 of national income to foreign aid – less than half the amount spent by the Coalition government more than 40 years ago.
The scale of the aid cut has been largely overshadowed by the siege in Sydney in recent days but has nonetheless generated alarm in charity circles.
Aid groups have decided to rush forward a planned online campaign sponsored by the charity foundation of Microsoft billionaire Bill Gates in the hope of shaming the government into reversing its decision.
World Vision chief Tim Costello has branded the government’s aid cuts “immoral” and warned Australians must question their values as a nation.
An analysis of Mr Hockey’s mini-budget by former AusAID chief economist Stephen Howes reveals the cuts to aid are the largest ever, reducing the budget by 33 per cent over four years.
“Cut any other government program by a third and there would be a huge outcry,” Professor Howes told Fairfax Media on Wednesday.
“Especially if it was something that affected the poor, there would be protests about fairness.”
But the aid cuts in May caused barely a ripple in terms of public anger.
Polls suggested slashing foreign aid was the most widely supported measure of a generally unpopular budget – even among Greens voters.
But aid groups hope to turn this attitude around, with a website and social media campaign under the hashtag #SaveAustralianAid to estimate the cost of the cuts vaccinations, education and maternal health in the region.
The government has defended the cuts as necessary to balance the budget and offset spending on defence and national security measures.
Foreign Minister Julie Bishop directed blame toward Labor, saying the reduction in aid spending was a “direct consequence” of blocked budget measures in the Senate
But Professor Howes said a debate was needed about why the government had broken a promise to maintain aid spending, and why helping the poor now seems expendable.
In figures published on the DevPolicy commentary website Professor Howes has charted Australia’s spending on aid as a percentage of national income over the past four decades.
This measure is generally regarded as a more accurate reflection of a nation’s generosity and allows for comparisons with other countries.
The figures show under the McMahon conservative government in 1972 Australia spent 45¢ out of every $100 on aid, rising briefly to 47¢ under the Whitlam government before a mostly steady decline.
Aid spending reached a low point in 2000 before the Howard government began to ramp up the program in its final years in office – an expansion that dramatically increased under the Rudd/Gillard governments.
Both sides of politics had committed to a 50¢ out of every $100 target for aid spending until 2012 when Labor cut back on aid in a bid to achieve an overall budget surplus.
The aid program also came under heavy criticism for growing too quickly, contributing to multilateral funds such as the World Bank rather than programs in the immediate neighbourhood, and paying expensive consultants.
But the funds devoted to aid have fallen off a cliff since the Coalition took office and abolished the former stand-alone agency AusAID as one its first acts in office, merging the staff with the Foreign Affairs department.
Professor Howes said Australia will drop from 13th to 19th in the generosity stakes compared to other industrial nations.
But Ms Bishop said Australia will remain the 10th largest donor in the Organisation for Economic Cooperation and Development in 2015-16 and deliver a program to reduce poverty and enhance stability in the region.
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