Wednesday 25 Apr 2018 | 12:44 | SYDNEY
Wednesday 25 Apr 2018 | 12:44 | SYDNEY

What's the purpose of Australian foreign aid?

28 Nov 2012 16:42

2012 will be remembered as a year of sluggish international policy debate. Ken Henry recently said he couldn't remember a time in the last 25 years when the quality of public policy debate had been as bad as it is right now. In my opinion, Australia's aid debate is no exception.

Australia's public discussion on our role as an aid donor is patchy at best. The debate is sustained by ANU's Stephen Howes (who runs the Development Policy Centre) and the Lowy Institute's Annmaree O'Keeffe, while Hugh White keeps things interesting. News Limited's Steve Lewis writes a quarterly article for the Daily Telegraph exposing perceived aid waste.

Australian NGO heads do a good job of keeping the focus on poverty and humanitarian aid by getting out in the media during times of disaster and famine, or when it looks as though the aid budget might be cut. But few stay regularly engaged in public debate about Australia's aid strategy and the future of the aid program.

For some NGO figures, this is likely a deliberate strategy. Budget discussions are tense in Canberra. Few supporters (and recipients) of the aid program will want to continuously remind the Australian public, and the Treasury, of the $5.2 billion annual aid budget. As the Government continues to cut spending to achieve its promised budget surplus, foreign aid is an increasingly obvious target.

Last week, Australia's development community got a serious funding injection which has the potential to shake up and wake up the lethargic aid debate. The Harold Mitchell Foundation gave a $2.5 million grant to the Development Policy Centre, a university think tank which undertakes aid and development analysis. This grant, which will be matched by ANU, will give the Centre breathing space and independence from the very institution whose policies it will need to critically analyse and inform – those of AusAID. [fold]

The fact that this is such big news in Australia's small development community tells you a lot about the environment Australia's aid budget is operating in. Australia is not blessed with a collection of research institutes that provide Australia with informed analysis on international development issues, and hence inform and shape Australian aid policy. As a comparison, the UK aid agency DFID is surrounded by institutes which provide high quality research and engage in a dynamic public debate which helps inform the British public on the pros and cons of an international aid program.

Australia's weak aid debate is odd given the size and scope of Australia's aid program and considering the aid budget has more than doubled since 2006-07. Over this period, the Australian Government, civil society, and to a lesser extent the business community, have paid little attention to building Australia's capacity and knowledge on international development issues.

A frail and weak aid policy dialogue is bad news for those who support a sustainable and predictable aid program. A weak policy debate means there is one less obstacle to potentially diverting aid funds to other priorities. Sure, keeping a low profile and remaining disengaged from the public debate helps minimise the effort required to defend the aid program from criticism and keeps the Foreign Minister's office happy. But a weak aid debate also means that much of the policy and strategy surrounding Australia's aid program remains undiscussed, untested and misunderstood.

Too often in Australia, when the money stops the thinking starts. Earlier this year the Government slashed the defence budget by 10%. Subsequently, a vacuum of debate on defence policy has been filled with voices from both in and outside the ADF. A weak aid debate will prove detrimental to the sustainability of the Australian aid program. Does Australia have to wait until the aid program faces cuts before we can expect an informed and lively debate on Australia's role as an aid donor?

Photo by Flickr user sbluerock.


30 Nov 2012 15:33

Dr Jeni Whalan lectures in Development Studies at the University of New South Wales.

Danielle Cave this week called out the poor quality of Australia's public debate on aid. And she's right, of course.

When the Government announced at budget time that it would take an extra year to reach the aid target of 0.5% GNI (still 0.2% short of the target set globally back in the 1970s), we heard more public debate on aid in a single day than we have for the rest of the year.

Unfortunately, it was the usual horse-trading commentary for which the Australian debate has become renowned, a battle between aid advocates (usually representing organisations whose work benefits from a larger Australian aid budget), aid sceptics (who usually have little other engagement with development policy), and the Government's fiscal managers.

The more robust aid debate Danielle calls for needs to create a fourth pole in this otherwise familiar, politicised landscape.

To do so, it needs to establish a few initial parameters. For starters, aid is not benevolent charity, but neither is it an extravagance that Australia can't afford. More aid does not necessarily produce better development, but aid is neither dead (the case from the political right) nor a neo-colonial instrument of oppression (the case from the left). Development is rarely linear or equitable; instead, development is a highly political process that inevitably creates winners and losers. The purposes, design and evaluation of aid are also highly political.

Oh, and we know very little about what really works in development assistance.

To me, this is fertile ground for rigorous, sustained policy debate on aid. [fold]

So why isn't it happening? As Danielle notes, Australia lacks the well-developed research institutes devoted to development, though the ANU's newly endowed Development Policy Centre and of course the Lowy Institute can surely be expected to turn the tide.

But I think there are a few other things going on. The first is the insularity of Australian Government. Sure, Australia lacks the tradition of experts moving between government, think tanks and universities for which DC and (increasingly) London are known, and that probably won't change soon. But what could change quickly is a decision by AusAID to let its officials off the leash more often to engage in frank, open exchanges of ideas (a point I've made elsewhere about DFAT).

Second, there's a surprisingly small community of social scientists in Australia doing serious research on what works in aid and why. Australian development research is strong on anthropology and critical theory, but weak on the social scientific approaches that can best inform policy debate: large-n comparative work, for example, or explanatory political science, development economics and the kinds of randomised evaluations on which MIT's Poverty Action Lab is leading the way.

Finally, practice is simply ahead of analysis. The emergence of AusAID as a sizeable international donor is still fairly recent, the result not only of Labor's aid target but also of a highly valued Australian dollar and the effects of fiscal austerity in Europe. As Australia's aid budget continues to grow, albeit slightly less quickly than planned, a UN report released in September found that global aid flows declined in 2011 for the first time in years.

So what's to be done? Once we agree that we should be debating aid more seriously, where should we focus attention?:

  1. Development data: why is data on basic development indicators still so poor in the top recipients of Australian aid? Others have highlighted the problems of bad data in Africa, but in the Pacific it's often missing entirely, despite AusAID's commitment to monitoring and evaluation of its aid program.
  2. What role do aid contractors play in the delivery of Australian aid? How does this compare with other bilateral aid donors? What are the implications for accountability?
  3. Development policy beyond aid: as the Center for Global Development's Owen Barder argued this week, development is not synonymous with aid. Twenty-first century development policy will fail if it focuses simply on the transfer of resources from rich to poor; it must also address the full suite of global public goods, including trade policy and global financial regulation. I hope this is on the agenda of the Lowy Institute's new G20 Studies Centre.
  4. 'Fragility' in development: AusAID has embraced fragility as a priority for its aid program, in lock step with the World Bank and OECD-DAC. Australia is also a strong supporter of the g7- group of (self-nominated) fragile and conflict-affected states and the New Deal for Engagement in Fragile States agreed in Busan last year. But what will it really take for Australia to truly 'align' its development policies with recipient country priorities?

I for one would also love to hear what AusAID thinks is worth debating.

Photo by Flickr user Australian Civil-Military Centre.


3 Dec 2012 13:18

Jeni Whalan's post on the issues that should get more attention in Australia's aid debate is full of good ideas. But can I suggest we add another issue to her list of things that need to be debated: what is Australian aid trying to achieve?

The need for us to think about this question more deeply is clear enough from this passage in Jeni's post. She says participants in the aid debate need to...

...establish a few initial parameters. For starters, aid is not benevolent charity, but neither is it an extravagance that Australia can't afford. More aid does not necessarily produce better development, but aid is neither dead (the case from the political right) nor a neo-colonial instrument of oppression (the case from the left).

So, this tells us what aid is not. But what is it, then? What are the objectives of the aid program? In particular, if it is not charity, not something we altruistically do for others, then presumably we do it for ourselves. So we need to know as clearly as possible what it is supposed to be doing for us before we can begin any useful debate about whether it is working. [fold]

Now Jeni would probably file me away in the category of what she calls 'aid sceptics (who usually have little other engagement with development policy)'. I plead guilty to the second charge, but I'm not so sure about the first. I don't see myself as an aid sceptic. I can easily be persuaded that aid is good policy and worth spending money on. But first we have to know what it is for.

I am sceptical that we can rigorously debate how to spend the aid budget until we are clear about what aid is trying to achieve. And I am sceptical that we can rigorously debate the size of the aid budget against other government spending priorities until we can compare the cost-effectiveness of aid against other forms of spending in achieving overarching national objectives. Which of course means we need to know what the overarching objectives are that aid is supposed to support. Can I suggest that this question needs to go at the top of the list of issues to be debated?

Photo by Flickr user Bethan.


4 Dec 2012 14:23

Garth Luke is Lead, ODA and Emerging Issues at World Vision Australia.

I agree with Hugh White when he says that we need to be clear about what aid is trying to achieve if we are to spend the aid budget most effectively.

Most Australians believe that its purpose should be to help poor people in countries with low incomes. AusAID has commissioned four public opinion surveys since 1998 and all have shown that the greatest support is for things like saving people's lives, improving education, helping people in emergencies and reducing poverty. In the most recent survey in 2009, 63% disagreed with the statement: 'I agree with giving aid if we get something back in return. e.g. trade relationships'.

Poverty reduction is also the agreed purpose of aid in international agreements and almost all of the Australian Government's statements about the aid program.

Unfortunately many of the people who influence discussion about aid in Australia and many of those making decisions about the aid program do not have such purity of purpose. They want to also use aid to support the Australian economy or increase our military security, prestige or influence. Some even want to take from the aid program to boost defence or diplomats or reduce our very small deficit.


Aid is just 1.4% of the Commonwealth Budget and will grow to only 2% of the budget when we reach 0.5% of GNI.

Despite major reductions in poverty and its worst aspects (for example a 42% drop in global child deaths since 1990), there are still huge needs in the world that our aid can help meet – 7 million people needing AIDS treatment, 170 million children stunted by malnutrition, millions of children still dying for lack of a vaccine or a toilet, 60 million children who can't go to primary school.

The research is clear that aid has been effective in helping solve these problems – but it is not at all clear that it boosts economic growth or increases our security.

Can't we just focus this tiny part of the budget on the thing it is good at (helping the poor) and leave the diplomatic, military, trade and other self-interests to other areas of government?     



5 Dec 2012 11:37

Sam Byfield from the Nossal Institute for Global Health at the University of Melbourne writes:

The Lowy Institute's commitment to stimulating debate about aid is laudable, and hopefully successful in elevating (and adding complexity to) the aid debate.

On the issue of the AusAID's 'insularity', there seems to be a few factors at play. Firstly, and this should come as no surprise, is the nature of bureaucracy as opposed to politics. The scope for engagement by bureaucrats in the public discourse is inherently limited. It takes a particularly brave bureaucrat to stand up and criticise (constructively or not) their employer's strategy.

Relatedly, there often seems to be an 'organisational line' pushed by AusAID staff – in the area of health, for instance, there is a stock presentation often rolled out by AusAID staff at meetings or conferences which limits the capacity for genuine policy discussion. This sort of management and information control isn't unique, however, to AusAID or to bureaucracies.


Jeni Whalan notes correctly that development is not synonymous with aid. It is increasingly recognised that saving lives and reducing poverty requires genuinely multi-disciplinary approaches. This is an area deserving of more research and public debate. This is perhaps reflected by a recent phenomenon, as the aid budget has increased, whereby AusAID has recruited staff from elsewhere in the public sector, particularly at senior levels – getting in seasoned bureaucrats and experts from other sources, as opposed to 'aid professionals'. One potential benefit is that the organisation might increase its capacity to engage in areas that are beyond the strict traditional purview of 'aid' – like security or trade, for instance. The Australian Civil-Military Centre is a good example of this. It is crucial that development responses and the discourses these are framed in continues to shift in this direction – it is also foreseeable though that this might pose a threat to some of the traditional aid players, and that working cross-sectorally with those from outside aid's traditional boundaries will take some getting used to.

On the issue of limited research, including of the 'big n' variety, I'd argue that there is good research happening, but (perhaps by definition) it's often within the confines of universities. Part of the weakness in aid research and debate is that researchers aren't necessarily good at communicating their findings, and there's sometimes not a lot of awareness about broader issues of public policy (indeed, sometimes there's a suspicion). Parliamentarians certainly don't have time to read journal articles, and are reliant on academics and public servants to highlight salient points (and are generally appreciative of those who do it well). Public servants themselves are often in the same boat as parliamentarians.

There needs to be stronger engagement between researchers (especially those within universities), NGOs and policy makers. ACFID's Universities Linkages Conferences play an important role, and ACFID is beginning to understand the importance of closer engagement between NGOs and academics. AusAID's Australian Development Research Awards scheme, launched a few years ago, is another notable addition to Australia's development research capacity.

The formulation of a Parliamentary Committee on Aid (or at least a separate sub-committee) would help generate more discussion around aid and development. Parliament's committee system makes an important (though sometimes downplayed) contribution to public policy. This takes several forms: firstly, it provides a forum for engagement between parliamentarians and both academics and advocates. Secondly, reports from inquiries end up on the desks of people who make decisions. And thirdly, particularly important or newsworthy inquiries (like the recent inquiry into workplace bullying) generate media coverage and public discussion. Yet, as has been noted before, there is no parliamentary committee or sub-committee focusing solely on development and aid. Rather, it is rolled into Foreign Affairs (particularly Human Rights). This is an ongoing oversight, though one the Coalition at least has said it will remedy if and when it forms government.

Overall, an essential element needed to expand public debate about aid and development of enhancing this process is to ensure that research is clearly and succinctly articulated in written and verbal form. In this area, researchers could learn a few lessons from the advocates Jeni cites as one pillar contributing to the debate.


7 Dec 2012 12:12

Below, a comment on our aid debate from Anna Kent. But first, Thomas O'Connor, Senior Programs Manager at the Centre for Australian Progress, writes:

An important distinction to make in the aid debate is between relief aid, which is about providing a stop-gap social safety net in developing countries, and development aid, which is about creating the conditions where sustainable economic development can occur. AusAID and Australian NGOs do a reasonable job at the first type of aid (with our limited resources), and a bloody terrible job at the second type.

I'll talk more about development aid in a minute, but it's first important to recognise that relief aid is an important and valuable function of our aid program. Where developing country governments fail to provide the basic social services that make human life bearable, developed countries like Australia have a duty to assist. In Papua New Guinea for example, this has meant that Australia has played a crucial role in slowing the growth of the HIV/AIDS pandemic, and in helping expand access to primary education.

Aid sceptics ignore this when they make their most common arguments about the 'failure of aid'. They point to the fact that, after decades of effort and hundreds of billions of dollars spent, little has changed in the poorest countries. This is intellectually dishonest.


What needs to be looked at is the counterfactual — ie. what would have happened if we hadn't provided assistance? When discussing the supposed failure of Australian aid in PNG, Alexander Downer says that he disagrees with the sceptics because PNG living standards would have been so much worse without Australia's involvement. The reality is that people in desperately impoverished communities need assistance to meet their basic human needs, and this is a legitimate role for Australian aid.

The second type of aid, development aid, is where I believe the most fruitful debate can take place. The question here is, how best can the Australian Government and Australian NGOs & businesses create the conditions for economic growth in poor countries? I would argue that very little Australian aid achieves anything in this area at the moment, in large part because this is such a difficult question.

Three areas of opportunity that I can see. First, labour mobility. It's extremely unfortunate that the Australian guest worker scheme, established in 2008, has been such a dismal failure; a similar scheme in New Zealand has proved to be highly effective at achieving lasting development outcomes for a number of Polynesian communities. An independent evaluation of the NZ scheme found the program benefited social cohesion, in that unemployed young Polynesians were given job opportunities, it benefited Polynesian families back home as workers remitted much of their income, and it had a long-term benefit for the Polynesian economy in that returning works brought increased skills with them.

The second opportunity is in trade. Pacific countries, the focus of Australia's aid program, must find ways to achieve faster export-driven growth, and in areas other than resource extraction. Agriculture seems to the the natural choice, however there are a number of factors holding Pacific countries back from growing agricultural exports. Infrastructure is a big one, and an area where Australian aid can play a significant role. There could be opportunities for Australia to leverage China's growing role in the Pacific, considering that Chinese aid has been particularly beneficial in building large infrastructure in some African countries. Another barrier to Pacific agricultural exports is Australia's very high quarantine standards. These standards are obviously important to maintaining Australian food safety and public health, however we must be careful that quarantine does not become a non-tariff barrier to trade, utilised by Australian farmers to stop their PNG counterparts making a living. Also, more can be done to help Pacific countries meet Australian quarantine requirements. Within two decades, we should aim to be importing most of our bananas, coffee and some other primary foodstuffs from the Pacific.

The third opportunity is more obtuse and more difficult to achieve. This is doing the long term work of building institutions that facilitate a development-friendly culture. There has been really interesting research done by AusAID's Developmental Leadership Program that examines the influence of developmental elites and predatory elites. Researchers looked at recent development success stories such as Mauritius and Botswana, and asked why these countries were on the path to development while their counterparts in sub-Saharan African were mired in a cycle of poverty & conflict. What they found was that the success stories had a group of post-independence leaders ('elites') who stretched across government, business and civil society, who were largely committed to transparent and ethical leadership in service to their country. This led to a series of good public policy decisions, and the construction over time of social & economic institutions that are friendly to entrepreneurship and which exercise good stewardship over public resources. If and how these 'development elites' might be replicated in other countries is another question, however this provides a good starting point for looking at what conditions are needed to enable long-term development.

The debate about development aid needs to be had. We need to face facts that AusAID and our NGOs are failing miserably in this area. However, let's also remember that developing countries need relief aid too; surely we aren't so blind to human suffering as to deny them that?

Anna Kent:

I have been reading with interest the recent debate in the Interpreter regarding the true purpose of aid. I recently completed a Masters thesis looking at an element of our aid program that is promoted as development, but probably fits better as diplomacy: Australian Development Scholarships.  While these scholarships are now part of the Australia Awards family, they are offered to prospective students from a variety of developing nations for study at Australian TAFEs and universities. 

The links between aid, development and diplomacy are easy to see in the ADS, just a little below the surface (and the shiny PR). My thesis argued that the scholarships are actually a much better tool of diplomacy than development. And one could now argue that Australia's seat on the UN Security Council has been 'bought' by hundreds of these scholarships, particularly in Africa and the Caribbean. But the ongoing, long term diplomatic impact of thousands of students educated in Australia returning home to their lives thankful of the opportunities given to them by the Australian Government will also be a significant diplomatic 'win'. 

But, these awards are funded by AusAID, considered Overseas Development Assistance, and one of our largest education sector programs. They are also 'aid' spent for the most part in Australia on university and TAFE fees, living allowances and other costs. And development outcomes from the scholarships are hard to track, attribute and demonstrate.

If we're looking for a good case study to start a debate about Australia's confused aid/development/diplomacy conundrum with, Development Scholarships could be a good place to start.



11 Dec 2012 09:49

Judging from the tone of the current Interpreter debate on aid and development, it seems that the notion of a country's aid program doing double duty by meeting both humanitarian and national interest goals is an impossibility for some. 

Hugh White wants clarity about what Australia's aid program is trying to achieve. Garth Luke wants the program to focus on what it's good at: helping the poor, leaving self-interest to other parts of government.

But the reality, Hugh and Garth, is that achieving the national interest isn't all about military might and diplomatic negotiations. It's achieved through a range of means, including soft power. And one of the most potent and better resourced soft power tools Australia has is its aid program.

Let me try to give Hugh some clarity. To delete the national interest element from the aid program's current objective would drive it underground but it would still exist. Australia's geography has dictated since the 1950s that aid is not only a good thing for Australia to do, it is also in our geostrategic and commercial interest. The objective has been refined since that time but thankfully, the unusually honest acknowledgment that the aid program can walk and chew gum at the same time is still there. [fold]

What do you think the much lauded Colombo Plan was all about? Or tell me that the $250 million in aid that goes to Solomon Islands isn't in our mutual interest. Or that the presence of Australian aid supporting the Vietnamese Government in the early days of Doi Moi wasn't in our mutual interest. Or that the extensive development cooperation we have with Indonesia (our largest recipient) isn't in our mutual interest. And then tell me that none of that has been successful on both humanitarian and national interest grounds.

As for Garth's desire for other parts of government to deal with the self-interest, does this mean they should cease supporting the humanitarian goals of the aid program? Perhaps the ADF should stay at home next time there's a humanitarian crisis in the neighbourhood. Or perhaps Foreign Affairs officials shouldn't be involved in development cooperation negotiations or international humanitarian law discussions.

AusAID isn't an NGO; it's an arm of government and sits within the Foreign Affairs portfolio. Its status as an official development agency means that it is going to be called upon to use its development expertise to support broader government objectives.

There are times when this goes too far – last week's announcement about support to Manus Island is arguably a good example of that – but there is no impenetrable boundary which quarantines the government's aid program from the broader suite of Australia's international engagement.

Indeed, if AusAID did attempt to create such a barrier, its days would be numbered on one hand.

Photo courtesy of the Defence Department.