Aid & development, explained.
The idea that defence can be funded by cutting aid is a false economy (Getty Images)
Canberra should take advantage of a rare alignment forming on Australia’s global role.
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Australians ahead of the game in aid debate, MPs should followAustralians ahead of the game in aid debate, MPs should follow
The international order is fracturing, and Australians sense it. Across every domain – territorial integrity, trade, human rights, the environment, and war – the rules are being torn up. Yet while the United States dismantles key aid institutions and parts of Europe slash their budgets to re-arm, Australians are holding firm.
This year’s Lowy Institute Poll shows the strongest support for development cooperation in eight years. Two-thirds of Australians say the aid budget is about right (49%) or too low (17%). The ANU’s 2024 Development Policy Centre survey echoes this sentiment, with over half saying Australia gives the right amount of aid (29%) or too little (22%).
To capitalise on this moment, narrow and defensive debates need retiring.
These polls challenge a long-held belief in Canberra that the public does not support aid. Skittish MPs and senior officials should take note: they may have more political space than they realise.
But to capitalise on this moment, narrow and defensive debates need retiring. Questions like: “is aid important?’ or “should we cut it to fund defence?” miss the point. They also miss the moment. The real challenge is assessing how development cooperation can best build peace, drive prosperity, uphold rights, and accelerate environmental protection.
As the government and Australia’s development ecosystem prepare to mark two years since the launch of Australia’s International Development Policy, three strategic truths demand urgent attention. Ignoring them will come at a cost.
The Indo-Pacific is no longer just a development theatre. It’s the frontline of Australian foreign policy. As US leadership grows more erratic and Europe falters, our region matters more than ever. Countries such as Indonesia, Vietnam, and Papua New Guinea are becoming more relevant to Australia as partners, markets, diplomatic swing states, and nodes of influence.
Meanwhile, Australia’s development program is evolving – moving beyond the outdated “aid recipient” paradigm to become one of the most sophisticated tools we have to maintain trusted relationships, demonstrate utility, and sustain presence in the region.
Lower-and middle-income country development trajectories will shape the regional context Australia operates in. By 2050, five ASEAN countries could rank among the world’s top 25 economies. Australia won’t. If we want enduring partnerships based on trust and shared progress, development cooperation is one of the few tools that delivers real outcomes with minimal coercive baggage.
It also delivers enduring value for Australia: from stabilising fragile regions to opening trade and investment opportunities.
Inequality, poverty, subnational conflict, and economic stagnation are not just humanitarian issues. They’re structural risks. Left unaddressed, they increase the chance of crisis in our near neighbourhood.
The prospect of another INTERFET or RAMSI is potentially underrated. Violence in Papua New Guinea’s Highlands, transnational organised crime and shrinking civic space in the Mekong, or Bougainville’s independence push all demand serious attention.
At a time when Australia is preparing for possible conflict in the South China Sea, Taiwan and beyond, we cannot afford to be blindsided by preventable disruptions closer to home.
Development is prevention. It builds resilience in institutions, economies, and governance. It buys time, creates options, and reduces the likelihood of evacuating citizens, deploying troops, or scrambling for influence after the fact. It must be central to Australia’s Indo-Pacific strategy, not an afterthought.
As global risks rise, Australia’s international spending has stalled. In 1999, international portfolios made up nine per cent of the federal budget. A quarter-century later, that share is unchanged. But beneath the surface, development assistance has fared the worst.
It has grown almost five times less than intelligence, half as much as policing, and even lags behind the erratic funding of the Department of Foreign Affairs and Trade itself.
Debating defence spending is necessary when the world feels dangerous. But if we fixate only on the defence dollar, we leave the rest of the international affairs portfolio vulnerable. And that leaves Australia vulnerable.
Australia must shift from a scarcity mindset dominated by annual cost-cutting to strategic decision-making driven by the scale of our interests and the risks we face. The challenges to Australia’s international relations are growing. So are the demands to respond.
That’s a big and expensive shift. Arguing otherwise is gaslighting the public. Arguing that only an increase to defence spending is required is narrow. Cutting aid to fund defence is a false economy. It undermines Australia’s broader strategic posture. Downplaying this reality misleads the public.
The world has changed. The public gets it. It’s time for international affairs leaders across government, academia and civil society to stop justifying aid and start grappling with the next set of strategic questions:
The Lowy Institute’s data shows Ministers have permission to act. The circumstances demand it. And the public appears ready to support a bigger role for Australia – not just in defence, but in diplomacy, development and broader international cooperation.
This is a rare alignment between public sentiment, strategic need, and policy opportunity. Government and Opposition alike should seize it, and act.
About the author
Bridi Rice
Bridi Rice is CEO of the Development Intelligence Lab and co-founder of the Asia Pacific Development, Diplomacy and Defence Dialogue.
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