Australia cuts 3 billion more in foreign aid

Transcript

Australia's government has announced that it will cut more than three billion dollars from its foreign aid budget, in addition to cuts made earlier this year.

The Tony Abbott-led government says the cuts will be made over the next three to four years coming on top of the 7.4 billion US dollars cut from budgeted foreign aid spending outlined in May's federal budget.

Jenny Meyer looked at reaction to the aid cuts.

Australia's Treasurer, Joe Hockey, released his mid year economic and fiscal outlook in Canberra, saying over the past 12 months the Australian economy has continued to strengthen despite significant offshore headwinds and the government has made a good start on budget repair. As part of his speech Joe Hockey said:

JOE HOCKEY: Where the Government has made new spending decisions we have more than offset the costs with new savings.  In particular, Defence and national security commitments totalling $1.3 billion are more than offset by savings in our foreign aid Budget of $3.7 billion. Where we have made savings we have worked hard to ensure that there will be no negative impact on the Australian economy.

The head of World Vision Australia says the aid cuts are absolutely historic in their devastation, and leave organisations like World Vision in tatters. Tim Costello says development progress in regions like the Pacific depends on the predictability of aid and arbitrary cuts mean programmes are likely to be pulled costing lives and causing human suffering. He says the government is using the aid budget like an automatic teller machine to try and balance the books and because the cuts are so massive they are likely to be across the board.

TIM COSTELLO:  They have not been specific. And these cuts, you know 7.5 billion and 3.7 (billion) are over the next three years. So I guess in their minds they figure we've made the announcement now we'll work out where we'll cut. So at every level I and so many of the other agencies believe this is immoral.

Tim Costello says vaccination, water and sanitation programmes in the region all now have a huge question mark hanging over them. The Greens' spokesperson for aid, Senator Lee Rhiannon, says her party is troubled and very opposed to further cuts to the overseas aid programme. She says the cuts are diverting money away from the world's poor and Australia is effectively robbing its neighbours. She says the climate change pressures Pacific countries are under is caused by massive greenhouse emissions from developed countries like Australia which should be pulling its weight with traditional aid funding as well as extra climate change assistance. She says Australia's aid programme accounts for 1.4 per cent of the Federal budget but is carrying the burden of 20 per cent of the cuts.

LEE RHIANNON: It's insulting at any time when one should be working to reduce the gap between rich and poor. And when you consider the challenge of natural disasters that many of these people face and now the problems of climate change Australia is not being a good neighbour in the Indo-Pacific and Asia region.

Australia National University's Director of the Development Policy Centre says the cuts are a massive game changer and are the largest ever made to Australian aid with the reduction being a third of the total budget over the next four years. Professor Stephen Howes says because cuts have never been so big it's difficult to predict how they will fall but he thinks aid to regions furthest away will be most vulnerable. He thinks only Nauru and Papua New Guinea of the Pacific nations will be immune because they host detention centers. Professor Howes says the Pacific has seen aid double over the past decade and it is a very aid dependent region. He says public opinion and governments have supported foreign aid programmes over that time but this now appears to have changed.

STEPHEN HOWES: We've never been less generous. At the moment there's not a big public reaction to this. There wasn't to the earlier cuts. And you've got to think that emboldened  the government to think 'alright we'll cut it again' and by this huge amount. And there has been very little outcry. It's hard to predict what's going to happen. The need for aid is never going to go away.

Professor Howes says programmes need to respond to global issues such as climate change and aid may pick up again when the economic times improve but at the moment the outlook is very bleak.