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New benchmarks for Australian aid

Bishop announces ODA cuts and reviews

As Australian Foreign Minister Julie Bishop joined members of the Pacific Islands Forum Ministerial Contact Group (MCG) in Suva last month, she highlighted Australia’s new policies for the region, including normalisation of relations with the Bainimarama regime. In recent years, Fiji has built new partnerships with China and other developing nations, but Bishop stated: “I want Australia to be the partner of choice in the Pacific and there is an opportunity with our new government to start afresh.” Australia’s partnership with the islands region, however, is being affected by significant changes to the Official Development Assistance (ODA) programme.

The Australian government, led by Prime Minister Tony Abbott, has announced major cuts to this year’s aid budget, with the islands region losing more than A$60 million in pledged aid in 2013-14. With a new emphasis on the Australian “national interest”, countries of strategic importance like Papua New Guinea, Fiji and Nauru are largely exempted from the cuts, while smaller islands states lose millions of dollars. In recent years, Australia’s aid programme has been growing, and growing fast. Before the September 2013 elections, both the Australian Labor Party (ALP) and the Liberal Party and the National Party coalition had pledged bipartisan support for an increase in Australian aid to 0.5 percent of Gross National Income by 2015 (some A$8 billion).

That objective started slipping under the previous Gillard government, with the target date set back to 2016-17. As well as reopening detention centres for asylum seekers on Manus and Nauru under the so-called “PNG Solution”, the ALP government reallocated A$375 million from the overseas aid budget towards the domestic costs of processing refugees in Australia. Since coming to power, the Abbott government has abandoned the objective of increasing the aid budget to 0.5 percent of GNI in coming years, pledging only to maintain the current level of funding.

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