News National Labor warns more aid cuts on the agenda

Labor warns more aid cuts on the agenda

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Australia’s aid budget faces an overhaul and Labor fears that will mean more cuts to overseas assistance for the world’s poorest people.

The federal government has vowed to enforce accountability in the aid budget and is developing performance benchmarks to ensure successful programs are first in line for funding.

Foreign Minister Julie Bishop will release this new framework linking performance with funding shortly after the budget, but won’t discuss details until then.

However, she has made it clear the government wants to help the private sector drive economic growth in developing nations, believing this “aid for trade” approach is the best way to reduce poverty.

Labor is sceptical and warns jargon cannot hide the fact that cuts to programs in health and education will hurt vulnerable people.

“Abbott government slogans like ‘new paradigm’ and ‘economic diplomacy’ are designed to obscure the government’s cuts to the aid program,” opposition foreign affairs spokeswoman Tanya Plibersek said in a statement.

The government announced before the election it would pare back the aid budget by $4.5 billion over four years, calling Labor’s spending on overseas aid reckless and unsustainable.

It then set the aid expenditure for this financial year at just more than $5 billion, down nearly $110 million from the last budget.

Ms Bishop defended the decision to “stabilise” the aid budget, saying it provided certainty to those countries that received assistance and the organisations running programs.

She also said applying performance benchmarks to the aid program would become the global norm as countries tried to ensure they did not waste money during tough fiscal times.

“Our new development program will not be charity; rather, an investment in the future of our region and as investors, we must see a return,” she said in Melbourne this week.

She said the performance benchmarks would be signed off by the World Bank, which haf been helping the government develop its policy.