Ben’s Blog

It looks like AusAID may well be making the most of the golden opportunity it’s been handed if this story is anything to go by.

From the title, Australian aid school deters poverty and inspires dreams, to the very last word, Australia’s program to support school building and management in parts of Indonesia is presented in an overwhelmingly positive light.

From the personal:

Parhin, who is in year 8, says she is ‘‘approximately 14’’ but has no birth certificate.

Her parents married young, quickly divorced and left her in the care of her grandmother. The two live in a one-room shack next to a cow pen, relying on the generosity of neighbours and Parhin’s odd jobs to get by.

This is not atypical. Just 10 of the junior high school’s 104 students live with their parents, says Zainuddin.

Parhin’s teachers say she is smart enough to do anything, given the opportunity. ‘‘My ambition is to be a doctor,’’ she says.

What if she had left after primary school? ‘‘I would probably be married, more than once,’’ she said. ‘‘But [marrying so young] is just wrong.’’

To the political:

Jacqui DeLacy, head of AusAID in Indonesia, says the program, introduced by the Howard government in 2005, has ‘‘transformed the lives of hundreds of thousands of Indonesian children’’.

‘‘Education is the best way to break the cycle of poverty. It gives people the possibility of a productive life. It increases incomes, makes people healthier, reduces early marriage,’’ said Ms DeLacy. ‘‘It’s been a great investment in the stability and prosperity of Indonesia and generated enormous goodwill between our two countries.’’

How often do international aid stories make headlines in the Australian media? AusAID should probably crack open a bottle and raise a quick toast to Tony Abbott if they haven’t already. And all because the Coalition blockheadedly decided to announce “cuts” it will never make – being in Opposition and all. And to an aid program initially begun under the Howard Government.

If reports are to be believed, Julie Bishop, Shadow Foreign Affairs Spokesperson, is not happy about how this has made the Coalition in general, and herself in particular, appear. I think she’s right to be annoyed.

The Coalition certainly won’t have won any friends in the aid and development sector by proposing the cuts. They appear to be pandering to a base selfishness that exists in the some parts of the Australian community. And they’ve done it all in the cause of trying to stop the Government raising a levy to help Queenslanders who’ve been hit by flood and cyclone.

Not a good look.

Tony Abbott has today announced what he would propose to cut in order to fund disaster relief and reconstruction in Queensland without using a levy. I’ll let others comment on the merits or otherwise of his suggested domestic cuts – a lot of money taken out of schools, a lot of spending “deferred” on water buybacks in the Murray-Darling basin, money withheld from the automotive industry, and so on…

The whole list of what the Coalition would like to axe (and what it costs) is here (pdf).

I’ll only comment on the proposed cuts to Australia’s overseas aid. Tony Abbott admits that cutting Australian aid to Africa was “vigorously discussed” – which I take to mean that he pushed hard to gut the program – but was not added to their list of savings. There’s a bit more detail about how, exactly, the Bishop camp prevailed on this matter here.

So that’s the good news on aid. The bad news is that if he were Prime Minister (and, of course, he’s not but his plans give some indication of what the Coalition’s priorities would be if they did form Government) Abbott would defer – “subject to review” – a 4-year program to build schools and provide training and support for teaching and school management in Indonesia. The annual cost of the program is roughly $110 million. You can find out more about the program at Ausaid’s website.

So, the answer to yesterday’s question about what he would cut is, “The building of schools to provide basic education for poor Indonesian children, and the training of teachers, principals and school management groups to improve the quality of education for those children.”

He offers the expected “charity begins at home” nonsense to justify this. Now, I don’t think that an Opposition leader, an alternative Prime Minister, should be equating disaster relief and reconstruction with “charity”. Surely It’s a fundamental obligation of government. This is not to say that budget cuts might not be necessary to fund the disaster response – but it is not a charitable act by Government to help out its own citizens when disasters strike.

He’s on stronger grounds suggesting that overseas aid as currently construed is more a charitable gesture. There is no way a government can be required to give aid. But here, too, I think we have fundamental human obligations of solidarity and support to help fulfill the legitimate rights, needs and aspirations of all people wherever they happen to live.

Recognising this, Australian Governments of every persuasion have repeatedly committed to giving 0.7% of our national income in aid to support poverty reduction and development in poor countries. (Though the bipartisan commitment is to reach 0.5% of GNI by 2015). It is poor form for the Shadow Cabinet to be even considering delaying the achievement of this bipartisan goal.

And it is just not necessary to cut this program. Australia has a $1 trillion a year economy. Annual government expenditure is around $350 billion. The total reconstruction costs for Queensland from the flooding and cyclone will be upwards of $5 billion. Cutting this program will provide an annual saving (“saving” for the Australian budget, but “loss” for Indonesian children) of only $110 million.

The flood figure of roughly $5 billion of direct costs for the Australian Government comes from early estimates, and is no doubt now on the low side because of the further impact of Cyclone Yasi. However, it gives you an idea of the size of this cost relative to Government expenditure.

So whether the disaster relief and reconstruction is funded by a levy, by deferring the return to budget surpluses (shock! horror!) for a year or two more, or by other budget savings… Australia can afford to fund the cost of disaster response without cutting or deferring any part of its overseas aid program.

Tony Abbott said that this “deferral” of spending on education support for Indonesia is “subject to review”, so now would be a good time to get in touch with your Parliamentary representative and tell them to leave the aid budget alone.

And don’t let the Government off the hook either. Though the PM rejected calls to cut the aid budget in the wake of the flooding, with Cyclone Yasi, further flooding and now fires in WA, the Labor Party, too, will be looking for budget savings to fund the disaster response.

Update
Others weigh in on the proposed aid budget cuts: morally bankrupt, alarming, and (politically) needlessly damaging.

The Opposition are considering cutting Australia’s aid to Africa in order to fund post-flood relief and reconstruction. Likely we won’t know the result of Shadow Cabinet’s deliberations until tomorrow’s Parliamentary session.

As unwelcome, unedifying and morally bankrupt as this call is, it should not be surprising. The Coalition was always going to oppose the Government’s proposed flood levy – having made political mileage from unrelenting opposition to almost any Government proposal, regardless of the accuracy, integrity, or policy outcome of its opposition. It can generally be relied upon to seek political advantage from any xenophobic sentiment in the voting public. (Do I really need to cite examples?) And it has waged a fairly constant – and consistently simplistic – campaign against increased aid to Africa for the last 3 years or so.

When the floods struck Queensland (and other parts of Australia) it was never going to be long before some people would call for Australia’s overseas aid to be cut. The first comment on this story is emblematic:

Cancell all overseas aid and use these funds to help aussie instead of a levy, stop our tax dollars going overseas until all Aussies that are affected by the Fires and floods in WA and floods in the east are back on their feet,why slug the Australian people again, we give so much to anyone in need, when are we going to get some in return???

Sadly, this viciously selfish parochialism is not limited to tabloid blog commenters, but also finds champions within Parliament House. Liberal MP Alby Schultz, too, thinks that overseas aid spending should be cut or frozen in order to pay for domestic disaster response.

Luckily this kind of parochialism is not reflected in international responses to Australia’s troubles – offers of aid have come to Australia from Papua New Guinea, Indonesia and elsewhere. And it almost certainly does not reflect mainstream public opinion. The Government promptly rejected such calls.

Quite apart from the morality of such calls, the economics are, of course, easily dispatched. Australia’s aid program amounts to roughly 1.5 % of government expenditure. We are not diverting huge amounts of money away from needy Australians to support needy foreigners. And – within that program – Australia’s aid commitment to Africa is small, only $163.9 million last year and $200.9 million in the current budget. There just aren’t big savings here to be made. And, of course, as one of the wealthiest nations on the planet we should – and can afford to – support Australians who have been affected by the recent climate-related disasters.

But this all feeds in to the Coalition’s use of the floods to continue, and amplify, its attacks on each and every program it had already decided to oppose. The National Broadband Network shouldn’t go ahead because of the floods. Schools that are still waiting for classrooms and other infrastructure that the Government has already committed should be kept waiting forever because of the floods.

Obviously, it’s an easy game to play: The Government should not spend money on thing x, or should stop spending money thing y because of the floods. (Where x and y were things we were always going to oppose anyway, literally come hell or high water.) And overseas aid, it seems, is no exception.

Since the 2007 election, the Opposition has opposed increases in aid to Africa and accused the Government of using this aid to bolster a bid to win a temporary seat on the UN Security Council. In this, they have been aided by various members of the conservative commentariat.

Shadow Foreign Affairs spokesperson, Julie Bishop, puts it like this:

The Coalition has repeatedly raised concerns about the Rudd Government’s diversion of aid funding to countries outside our region in pursuit of the campaign for a temporary seat on the United Nations Security Council

as if any aid to Africa must be inherently suspect and driven by base political motives.

I’d agree with Joel Negin at the Lowy Institute, though, that Australia’s aid contribution in Africa is about long-term development, including water and sanitation, education, maternal health, and sustainable agriculture. Bob McMullan, former Parliamentary Secretary for Overseas Aid, also responded to those insinuations by saying:

Our increased assistance is about contributing more effectively to achieving the Millennium Development Goals and being a good international citizen in a world that is becoming ever smaller and more complex.

In a world of need, the people living in the starkest poverty live in sub-Saharan Africa. It’s entirely to expected that the Labor Government – with a renewed commitment to the Millennium Development Goals – would focus again, even if only in a fairly niche way, on Africa. This was ALP policy before the 2007 election (and before any Security Council bid) and it has been the consistent policy call of the Australian aid community who wanted to see some strategic re-engagement of Australia’s aid program with Africa.

The Opposition are considering cutting Australia’s aid to Africa (among other things) to fund rebuilding costs in the wake of the recent floods and Cyclone Yasi.

It’s worth asking which specific programs will be cut, and how a reduction – even a small one – in Australia’s aid spending squares with the Opposition’s putative commitment to lifting aid to 0.5% of GNI by 2015.

So will we be cutting delivery of food aid to Ethiopia, Kenya, Niger, Sudan or the Democratic Republic of Congo?

Or, possibly, educational support to children orphaned by HIV/AIDS in Malawi, Mozambique or Tanzania?

How about reducing the number of women who can receive free fistula surgery in Ethiopia?

Oh, I know, how about cutting back on improving access to safe drinking water and sanitation? Or agricultural extension and research to improve food security?

So, in the search of a cheap political victory, and a negligible $200 million of savings (the annual size of Australia’s entire aid program in Africa), the Coalition are proposing that one of the wealthiest nations on the planet should be slashing support for some of the world’s poorest people in order to fund entirely affordable domestic disaster relief and reconstruction.

TEAR Australia has laid out the case, and the contact details, for getting in touch with Opposition MPs and telling them not to call for African aid cuts. Go there now, and come back here later.

And I’ll have a quick and dirty look at the (dirty) politics of this.

To coincide with the UN General Assembly gathering to assess and (hopefully) accelerate progress on the Millennium Development Goals, the Guardian newspaper has created a new Global Development site, which is jam-packed with MDG discussion, dissection, analysis and argument. Including a very useful clearing-house of the most recent MDG reports.

The site is co-sponsored by the Bill & Melinda Gates Foundation – which seems to be finding good ways to voluntarily redistribute some of Bill’s wealth. Nice to see a billionaire’s cash being spent in a big way in the fight against poverty.

However, I suspect it means that you won’t read any articles on the site questioning whether major sector-specific donors and global funds (like the Gates Foundation) distort global poverty spending and development priorities or undermine national health systems and integrated whole-of-government approaches to tackling poverty.

ODI has a new site up as well – Development Progress. The site aims to document national success stories in development and poverty reduction, so I’ve bookmarked it to read when I need encouragement and inspiration.

Economists Milford Bateman and Ha-Joon Chang go all Dawkins on the religion of microfinance in The Microfinance Illusion (pdf)

Microfinance thus offers… a highly visible way of being seen to be addressing the issue of poverty, but in a way that offers no challenge whatsoever to the distorted structures of wealth and power that historically are mainly responsible for the creation and perpetuation of poverty.

Ouch.

Duncan Green has more.

So, it’s over, according to Bill Easterly, writing at his aidwatch blog. The Millennium Development Goals (still 6 years away from their 2015 target date) will not and can not be achieved. The source for his prophecy? The 2009 Millennium Development Goal progress report, which is available here (5mb pdf).

Sure enough, the report makes sobering reading for campaigners who have been calling on governments to “spare no effort” to achieve these 8 anti-poverty goals – as they promised to do. Very few of the goals are on track to be achieved at the global level, though there is progress on several – for example, increasing primary education (88% children of children worldwide enrolled in 2007, up from 83% in 2000), reducing child mortality, and halving the proportion of people without access to safe drinking water (which the world is on track to achieve).

Dishearteningly, the global financial crisis and food price rises already are reversing, or threaten to reverse, progress against the targets of Goal 1, to reduce extreme poverty and hunger.

Now Easterly makes some good points about accountability and the need for a clearly defined theory and strategy for change in policy advocacy and campaigning. All of this needs to be taken seriously. Refreshingly, he also makes his critique in a way that isn’t entirely negative. For example, he writes some nice things (albeit, in “silver lining” mode) about the global plan, and advocacy campaign, for large-scale poverty reduction…

The inspirational enthusiasm and increased efforts surrounding the MDGs probably did contribute to progress on specific efforts and some partial success stories (mainly in health and education), as pointed out in the UN MDG 2009 report. That can give some hope for the future and some solace to the hard-working and deeply committed participants.

But overall, his contention is that we should give up on the MDGs and focus on something else that may bring some good – he describes the (sure, still 6 years away but, to his mind, inevitable) failure of the MDGs as a “tragedy” for all who contributed to campaigns for the achievement, and a greater tragedy for the world’s poor.

I take issue with his analysis. First, there’s the principle of giving up on a project half-way through (doing a Palin?) because it appears likely that not all of the goals will be achieved in full. Clearly, on current progress, many of the goals won’t be achieved in full, though I don’t see that Easterly really makes a strong case that they can’t be. For example, his assertion that “the MDGs’ attainment depended all along on global and national economic growth” (and supporting assertion that this is beyond any government’s control) seems pretty bald. All of the goals were dependent entirely on global and national economic growth? In every region?

Second, his call for focused and strategic advocacy that identifies who is responsible for an injustice, why it is a problem that needs to be addressed, and what they should do about it, is a good one, but I don’t actually see it as a criticism of the Millennium Development Goals themselves. I certainly don’t see it as a criticism of the civil society campaigns that have developed around them.

Campaigns like Make Poverty History in Australia, and scores of other national campaigns around the world, have taken the shared vision and inspiration of the MDGs, they’ve used analysis and information from MDG efforts and they’ve heaved mightly on the strategic lever of a widely-publicised international commitment to seriously tackle global poverty. That is to say, MDG campaigners haven’t, as far as I can tell, remained vague and unfocused about who can deliver change, why they should and what they should do to deliver the change. In each national context, they’ve developed focused advocacy campaigns and asked their governments to act on things that were in their power. They broke the goals down, they got specific, they adapted their policy asks to their national contexts, and they applied pressure to get what they were asking for. These campaigns have, I would say, genuinely influenced discussion and action for pro-poor development at the international level and at the national level – in countries both rich and poor.

Third, there are more positives from the campaign than Easterly makes space to credit in his post. One story that he doesn’t mention is the unprecedented commitment (and investment) to increase aid among the world’s donor nations. Where aid flows from OECD countries had declined in the 1990s, last year they reached their highest ever level of USD 119.8 billion.

And as for debt, sure, there is still plenty of unfinished business to deal with the debt burden of the world’s poorest countries, but by the end of 2008, 35 countries had received USD 102.6 billion (400 kb pdf) of debt relief, and poverty-reducing expenditure was increasing among these countries as a group. I think it’s likely that these  commitments, along with the new levels of public interest in and support for aid and debt cancellation, have been driven to a very large extent by campaigning around the Millennium Development Goals.

Finally, some of his reasonable points about accountability and the likelihood of being able to hold all governments accountable for the achievement (or not) of the MDGs, seem to build on the assumption that it is better for nations to wear their indifference to poverty on their sleeve rather than hypocritically hide it behind an international agreement they have no intention of honouring. It’s a fair point in a way, I guess…

But… what if 189 countries did sign up to an agreement to “spare no effort” to free a billion men, women and children from abject and dehumanising poverty… What if millions of people from across the world joined together in a global campaign to demand that those countries keep their promises…

Andrew Bolt’s taking his hard-earned dollars away from World Vision because (he says) it is blowing cash on the pagan cult of global warming. Which is a fine and principled move, since Bolt knows for a fact that climate change isn’t happening and/or isn’t caused by humans and/or won’t be a problem anyway. And it’s good to stick by your principles even if a few malnourished sponsor kiddies have to go hungry because of it.

And so Andrew goes off in search of a new sponsor-child who doesn’t have the misfortune of being supported by an agency that thinks climate change is real, and likely to affect the poorest people earliest and worst. Which is going to be hard. Very hard. Because it’s not just World Vision, but TEAR Australia, Oxfam, Childfund, Caritas, Care Australia, and who knows how many others who are also “blowing cash on this pagan cult”…

It’s almost like they think that the world’s poorest people might actually be vulnerable to climate change, what with being overwhelmingly dependent on small-scale rain-fed agriculture, having little by way of savings or insurance to avoid or recover from drought or flood, and living in countries and communities with little capacity to adapt to large-scale climate change impacts like sea-level rise, glacial melting and so on.

But that’s not the point. The point, as Andrew so cogently notes, is:

why is (World Vision CEO, Tim) Costello offering himself as a global warming expert?

Yes. I mean News Limited bloggers – and coincidentally Andrew Bolt himself is one of those –  are acknowledged global warming experts. What they say is not at all stupid and multiply disproven.

The people who are not global warming experts would obviously include everyone that World Vision (and others) might rely on for insight into climate change and its impacts on the poor, like – I don’t know – actual climate scientists, or even poor people themselves and the people who work with them.

Here’s the big picture of the volume trend in Australian aid:

____ = Budgets to present
_ _ _ = Forward estimates to 2012/13 (loosely planned expenditures for those years)
_ _ _ = Implied trajectory to reach Rudd Government commitment to 0.5% GNI by 2015
____ = Path to reach 0.7% GNI by 2015

As you can see, aid has now hit 0.34% of Australia’s Gross National Income (which, by the way, is a level of aid spending as a proportion of our national income that we haven’t reached since 1992/93). Aid spending slumped in the latter years of the Hawke/Keating Government, and then was gutted a couple of times under Howard before he really began to increase it in the lead up to the World Summit in 2005. Rudd has maintained that increase and put a definite goal (0.5% by 2015) to aid spending.

Though, note that the “slow and steady” increases to the aid budget under Rudd so far mean that more substantial increases need to be delivered after the three-year forward estimates period, well after the next election. This is problematic for a few reasons:

It increases the likelihood that the goal will not be met either because its delivery will be the responsibility of a different government (we have at least 2 elections between us and Kevin’s 2015 target date) or because a slower time-frame means more time for “unforeseen circumstances” to throw a spanner in the works.

“Backloading” aid (ie. postponing or delaying the major aid increases) limits the contribution it can make to the achievement of Millennium Development Goals and limits the support and resources available to poor countries to weather the storm their are facing right now. Instructively, European donors are frontloading much of their aid (spending more of the committed budget in earlier years) so it does the most good to those who need it under the current circumstances:

The Commission is frontloading €3 billion, or 72% of its foreseen budget support to African, Pacific and Caribbean nations thereby ensuring that social spending is not forsaken when most needed… Overall, frontloading by the European Commission should bring forward €4.3 billion resources to 2009.

Sure, frontloading implies a tailing-off of aid in later years, just as backloading implies a scaling-up of aid in later years. But if investments are made now that address the current shocks, and build resilience and capacity in poor countries and communities, this needn’t be a huge problem.

Despite the dire global economic circumstances Australia can still afford to lift its aid to the internationally-agreed target of 0.7% GNI. Our aid budget is still small as part of the Government’s overall revenue and expenditure (just over 1% of total expenditures) and you can, in some respects, think of it in the same light as the domestic stimulus package (worth tens of billions) put forward in the same budget. If we are seriously committed to limiting “the scale of the human impacts” of the global recession, and tackling the tragedy of global poverty, then it’s a reasonable proxy indicator of that commitment. (The green line on the graph above shows the straight-line trajectory our aid budgets would need to follow to reach 0.7% by 2015. It’s ambitious, but achievable.)

I’ve discussed this 0.7% target a little bit before. I understand that the political and economic circumstances don’t seem good for setting a timetable to reach this target. (However, circumstances were also apparently never quite right during 16 years of uninterrupted economic growth and a dozen or so massive budget surpluses either…) I think it’s high time the Australian Government made a timetabled commitment to increase its aid to 0.7% of Gross National Income (that’s 70 cents for every $100 of our national earnings) by 2015. C’mon Kevin 0.7!

OK, so the aid budget has increased since last year’s budget (by 5.6% in real terms). And  it seems like there are quite a handful of small things, as well as a few medium-sized ones, to be happy with in this moderately expanded budget.

First off, the budget statement is framed with a very welcome recognition of the way in which the global economic downturn will affect poorer countries (who have largely been ignored in media coverage about the issue – I mean they’re always poor, right? A global recession can’t make any difference to them…)

The global recession will generate enormous difficulties for developing country governments. While needing to help newly vulnerable populations, they will have less tax and other revenue to fund crisis responses and to maintain basic services such as health and education. This place a special responsibility on donor government to support developing country counterparts to generate employment and help limit the scale of the human impacts.

To this end, there are very welcome increases in investment in basic services, such as:

• basic education (increased roughly 46% on last year)
• water and sanitation (up 278% on last year)
• rural development (up 77% on last year)
• health (increased around 38% on last year)

The increase for maternal and child health (according to the estimates of the inestimable Garth Luke, now a senior researcher at World Vision) is very substantial, and will rise to $370 million from last year’s budgeted $260 million. Campaigners active in the MakePovertyHistory and Micah Challenge campaigns should be pleased, because maternal and child health in our region was one of the key issues they focused on.

There’s also some new $$ for economic infrastructure development – particularly rural electrification, roads and labour-intensive public works to help tackle unemployment. After long periods of neglect by all donors, not just Australia, rural development and agriculture is also starting to get renewed attention, particularly in light of the crisis in staple food prices of the last two years. For its part Australia puts up around $230 million for rural development (up 77% from around $170 million last year) focusing on agricultural productivity, the strengthening of markets, and support for poor farmers and communities.

A quick sample of the sectoral breakdown of aid budgets over the last decade shows a hopeful trend, I think.

As you can see, from around 2002/03 Australian aid (under Howard and Downer) went on a bit of a governance binge. Law and order programs, placement of Australians in senior positions in Pacific Island bureaucracies, capacity building of government institutions, were the flavour of the day (actually, of most of the decade). These programs have their place, but in 2005/06 these programs accounted for more than one-third of Australian aid. More Australian aid money was being spent on governance programs than on health and education combined. So it’s good to see that health and education now seem to be getting some sustained attention.

However, greater investments are going to be needed if Australia is to make a substantial contribution to stemming the wave of poverty and hunger that is likely to hit the poor over the next few years. The budget statement itself acknowledges that, according to a World Bank study, up to 90 million extra people worldwide (including 62 million people in our neighbourhood) will live in extreme income poverty this year because of the global recession.

A small aside on the right to food, and the livelihoods of poor, small-scale farmers – it’s worth checking out this statement made to the UN General Assembly by Olivier de Schutter, the Special Rapportuer on the Right to Food.

He notes that,

Since hunger is not the result of too little food being produced, but rather of marginalization and disempowerment of the poorest, who lack the purchasing power they need to procure the food that is available, guaranteeing such a protection should be a top priority.

He argues that prioritising the hungry and those vulnerable to food shortages should be the highest priority for policy makers. The priorities he outlines in this short speech are well worth keeping in mind as Australia’s aid program begins to scale up (though maybe slowly) its investment in rural development and agriculture.

The last observation I have is another small encouragement. When Rudd first announced his policy of lifting aid to 0.5% GNI by 2015 in a speech to the Lowy Institute he was very careful, as I noted at the time, to rule out budget support as a way of delivering aid through Pacific Partnerships, preferring instead Australian-directed and delivered projects. However, this budget statement seems to point in the opposite direction:

Working in partnerships means that increasingly Australia will work through, rather than alongside, different countries’ own systems of government and service delivery.

This is a good thing.

The last thing we need is the Australian Government behaving like an NGO, setting up and running an ever-increasing multitude of projects*. Working through countries’ own health, education and general budget processes and systems is much more efficient than a Government trying to micro-manage too many projects, it ensures better coordination of donor and recipient country development goals, and can lead to greater effectiveness and development of recipient country’s own systems. See here for an exploration of this kind of budget support.

*I’m not saying that Governments can’t run projects, and I’m certainly not saying that NGOs shouldn’t. Just that they have different capacities, functions and niches and they should make the most of those.