Priorities for Australia's Development Assistance
The 2008‑09 Budget represents a major step in the implementation of the Government's development assistance policy priorities. Consistent with the Government's intention to increase the focus of the development assistance program on practical development outcomes, including faster progress towards the Millennium Development Goals, funding will be substantially increased for health, education, water supply and sanitation and basic infrastructure. Reflecting the Government's concern to ensure that more attention be given to the situation of the most vulnerable, funding will also be substantially increased for humanitarian, emergency and refugee programs and for people with disabilities. Environmental issues are a particular priority, with a major multiyear budget initiative to address adaptation to climate change. The 2008‑09 Budget also provides an opportunity to re‑invigorate our relationship with multilateral development institutions, through a major four year core funding partnership with effective UN agencies. Increased support will also be provided for countries in transition from conflict, in particular Afghanistan and Iraq, and in support of new Pacific Partnerships for Development.
Details of the Government's priorities for Australia's development assistance in 2008‑09 follow, including information on major 2008‑09 Budget initiatives.
Promoting Better Health
Context
Health is a cornerstone of development and poverty reduction. Improving health outcomes remains a critical development challenge in the Asia-Pacific region. Health outcomes are central to the Millennium Development Goals but many countries in the region are tracking poorly, particularly on goals 4 and 5 relating to reduced child mortality and reduced maternal mortality. In 2004, 10.5 million children died before their fifth birthday, with over a third of these deaths from the Asia‑Pacific region. More than half a million women in the region die annually of preventable and treatable complications in pregnancy and childbirth. Moreover, within the region and within individual countries, serious health disparities persist. In poor regions, the poorest 20 per cent are half as likely to have their children immunised and five times less likely to have professional assistance for childbirth, compared with the wealthiest 20 per cent.
Health system weaknesses are at the heart of the problem of poor and inequitable health outcomes. Women and children in particular suffer disproportionately from under-performing health systems. While overall resources remain inadequate, those available are often not used to greatest effect. Within government outlays there are major inefficiencies and misallocations of resources, with disproportionate support directed to urban and tertiary-level facilities. There are chronic shortages of human resources overall, imbalances in skill mix and distribution, and a largely unregulated private health sector.
High-burden diseases place a major strain on such weak health systems. Solomon Islands has one of the highest rates of malaria in the world, and multidrug‑resistant tuberculosis is found in at least five countries in the region. Halting and beginning to reverse the incidence of HIV, malaria and other major diseases is a major challenge. Five million people in the region are living with HIV, with 440,000 new infections in 2007. Papua New Guinea is now the fourth country in the region to experience a generalised epidemic, with more than one per cent of the adult population infected. Young women are particularly at risk. Indonesia is experiencing escalating HIV epidemics among injecting drug users, sex workers and their clients, and men who have sex with men, and a generalised epidemic in the provinces of Papua and West Papua. AIDS is the leading disease-related cause of death in the most productive age groups in Asia.
The circumstances of the most vulnerable require increased attention. There are clear links between poverty, blindness and disability in the developing world. In many poor communities people who are blind and living with a disability are among the poorest and least able to access services or other assistance. It is a major development challenge to give people with disabilities, including those who are vision impaired, the opportunity to engage more fully in social and economic activity.
Improving access to clean water and sanitation services is crucial to raising the health and living standards of people in the Asia‑Pacific region. The World Health Organisation (WHO) estimates 88 per cent of diarrhoeal disease is attributed to unsafe water supply, inadequate sanitation and hygiene.9 High incidences of vector-borne diseases, intestinal disease, trachoma, and arsenic poisoning in developing countries is strongly correlated to unsanitary practice and the absence of nearby sources of safe water. Better management of water resources and improved sanitation reduces the transmission of disease and leads to improved health outcomes for the poor.
Response
The Australian international development assistance program is significantly increasing its support to help improve the health and wellbeing of people in the Asia‑Pacific region, particularly the most vulnerable. Spending on health in 2008‑09 will increase to over $440 million in 2008‑09, or approximately 13 per cent of the development assistance program.
Australia is pursuing an integrated approach to development assistance in health and HIV by working closely with partner governments and communities as well as a broad range of international development partners such as UN agencies. In line with the Prime Minister's announcement,10 Australia has joined the International Health Partnership, demonstrating Australia's commitment to ensuring well coordinated collective efforts for achieving the health Millennium Development Goals.
A substantial scaling-up of health sector assistance is planned, with new funding of approximately $480 million scheduled over the next three years to support the strengthening of national health systems and address the priority health needs of women and children, contributing especially to MDGs 4 and 5.
Support to partner countries will address high‑burden health problems and aim to reduce regional vulnerability to HIV and emerging and re-emerging infectious diseases. For example, in addition to support through the Global Fund to Fight AIDS, Tuberculosis and Malaria (see page 14), Australia is providing $15 million to the Three Diseases Fund to combat HIV, tuberculosis and malaria in Burma.
Australia is committed to tackling malaria in the Pacific, where the burden of disease is high. The Prime Minister has committed Australia to work with the international donor community to provide mosquito bed nets to every mother and child in malaria‑affected areas by 2010. Up to $25 million is committed to combat malaria through prevention, disease management and health system strengthening, in partnership with WHO, regional governments and other stakeholders. Initially focussing on Solomon Islands and Vanuatu, this initiative will target those most at‑risk, such as children and pregnant women, and aim for the elimination of malaria in these areas.
Non-communicable diseases (NCDs) are the cause of an increasing majority of deaths in the Pacific. The Australian Government is supporting the Secretariat of the Pacific Community (SPC) and WHO to jointly implement a four year, $20 million program to tackle and control NCDs in all 22 Pacific island countries and territories. The program will focus on reducing the major NCD risk factors — tobacco and alcohol use, physical inactivity and unhealthy diets — in order to reduce the incidence of chronic diseases such as cardiovascular diseases, cancer, chronic respiratory diseases and diabetes.
Increased support will be provided for health-related development research and analysis. Four 'knowledge hubs' have been established with leading Australian institutions around our key health priorities. Approximately $24 million over the next three years will be provided through competitive grant research rounds and commissioned and multilateral research. Increased support will be provided to WHO to enable it to take a lead role in coordinating and taking forward health system strengthening work in the Asia‑Pacific region.
Clean Water and Sanitation
New funding of $300 million over three years (see Box 1) will address clean water and sanitation challenges that stand in the way of improved health outcomes.
| Box 1: Access to Clean Water and Sanitation |
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In line with pre-election commitments, the Government will invest $300 million over three years, with $8 million in 2008‑09, to address the critical challenge to health and wellbeing posed by inadequate access to clean water and sanitation. This initiative will improve access to clean water and effective sanitation in urban, peri-urban and rural areas, and improve water security by protecting freshwater sources. Program delivery will be through partnerships with developing country governments, private and non-government entities, and bilateral and multilateral development agencies. In recognition of the slower progress in achieving the sanitation Millennium Development Goal target, there will be a significant emphasis on sanitation service provision and hygiene behaviour change. An urban water and sanitation component will deliver efficient and sustainable water supply and sanitation infrastructure, especially for the poor in the rapidly growing urban and peri-urban areas of the Asia-Pacific region. It will also support policy reform, promote good practice water utility models, improve the capacity of the public and private sectors to plan and implement infrastructure, and promote improved hygiene behaviour. A rural water and sanitation component will develop improved rural water supply and sanitation infrastructure, including for small rural towns. Community based models and improved hygiene behaviour will be promoted to ensure sustainability and maximise the impacts of new water and sanitation services. Enhanced partnerships with multilateral agencies such as the United Nations Children's Fund (UNICEF) will support efforts to minimise risks to water quality from industrial and agricultural pollution and arsenic. A water security component will extend successful partnerships in Asia and the Pacific region to protect and better manage freshwater resources. Partnerships in the Pacific will strengthen water planning and management, enhance access to safe drinking water, increase water conservation and storage capacity, and enhance sanitation and solid and hazardous waste management to prevent contamination of water. This component will also continue partnerships with multilateral agencies, such as WHO, to develop safe water plans, and with CSIRO and other partners to develop innovative solutions for water security. The initiative will target partner countries in the Asia-Pacific region which experience serious deficits in access to safe drinking water and basic sanitation, or face critical challenges in protecting freshwater sources. The initiative will benefit the urban and rural poor through better access to safe water and sanitation and more predictable water supplies for economic activities. |
Blindness and Disability
A budget initiative, outlined in Box 2, will address avoidable blindness and establish a comprehensive strategy for addressing disability in partner developing countries.
| Box 2: Fighting Avoidable Blindness in the Region |
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In line with pre-election commitments, the Government will invest $45 million over two years on eliminating avoidable blindness in the region. A pilot eye and vision care program will address primary and secondary eye care needs in the Asia-Pacific region and inform the design of longer-term programs for addressing avoidable blindness. AusAID will partner with Australian non‑government organisations to provide support on blindness and vision impairment. Partnerships will also be built with regional and international agencies, to support work on blindness, vision impairment and other disabilities. This will include support to WHO, the Secretariat of the Pacific Community (SPC), and, on disability more broadly, with the Pacific Islands Forum Secretariat. The program will expand the number of eye heath workers through support to training centres, medical colleges and teaching hospitals. This will include support to the Pacific Eye Institute. Support will also be provided through existing scholarships and volunteer programs. People with disabilities are among the poorest and most vulnerable in developing countries. They are often systematically excluded from basic services and denied opportunities to escape from poverty through employment. A new Disability Strategy for the development assistance program will be developed through national and international consultation. The strategy will aim to improve the lives of people with disabilities by:
By putting in place an effective strategy, action to address disability issues will be mainstreamed throughout the development assistance program. |
HIV/AIDS
Estimated expenditure on programs to prevent the spread of HIV and mitigate its effects will increase to approximately $130 million in 2008‑09. Major programs to be funded include:
- Australia-Indonesia Partnership for HIV ($100 million, 2008-2015) supports Indonesia in preventing the spread of HIV, improving the quality of life for people living with HIV and alleviating its socio-economic impacts.
- Papua New Guinea-Australia HIV and AIDS Program ($178 million, 2007‑2012) is working through PNG Government systems, civil society and the private sector to prevent the spread of HIV and provide treatment and care.
- HIV/AIDS Asia Regional Program ($59 million, 2007-2015) supports harm reduction activities among injecting drug users in Burma, Vietnam, Cambodia, Laos, Philippines and southern China.
- Pacific Islands HIV and Sexually Transmitted Infection (STI) Response Fund ($30 million, 2009-2013) supports national planning, community based prevention, testing and treatment.
- Australian contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria ($135 million, 2008‑2010) will contribute to performance-based grants to support country-driven programs to reduce the burden and impact of three of the world's most devastating diseases - HIV, tuberculosis and malaria.
- A new United Nations Partnership for the Millennium Development Goals (see Box 9 on page 57) will increase Australian core funding to the Joint United Nations Programme on HIV/AIDS (UNAIDS), the lead agency in coordinating the global response to HIV including scaling up towards universal access on treatment, care and support.
A major review of Australia's HIV strategy will be undertaken in 2008‑09. The review will result in a new International HIV Strategy that will aim to strengthen Australia's regional leadership role in HIV, guiding AusAID programming decisions and strategic partnerships. The review will identify how the Australian international development assistance program can in future best add value to the global HIV response in the light of new knowledge about the epidemic's trends and impacts particularly in the Asia‑Pacific.
Diagram 3: Health: estimated ODA by sub-sector 2008‑09
Promoting Better Education
Context
Education is one of the highest impact development investments. Basic education provides the skills for full participation in society, increases access to employment and other sources of income and opens up opportunities for further education. Women who are educated have smaller families, and healthier, better educated children. A person who has attended primary school is more likely to vote and to participate in community development activities. Education also makes communities more resilient to emerging threats such as infectious diseases and conflict.
Six Education For All goals11 were agreed in 2000 at the World Education Forum to complement and expand on the broader education MDGs (2 and 3). Both the MDGs and Education For All targets stress the importance of ensuring that all children, boys and girls alike, complete a full course of primary schooling. This necessitates investment in the expansion of education facilities and a greater focus on educational quality and relevance. Training teachers, reforming school curricula, building infrastructure and improving school management all make immediate improvements to the delivery of education services. However, to achieve long-term sustainable impacts requires improvements in education systems — ensuring that teachers are effectively deployed, curriculum materials are made available to all students every year, infrastructure is maintained, and schools have the authority to respond to changing local needs.
Much of the Asia-Pacific region is making significant progress towards attaining the education MDGs. Net primary enrolment rates are comparatively high at over 90 per cent. The region is also well on its way to achieving gender parity (MDG3) at the primary level but there are still wide gender gaps at the secondary and tertiary levels. However, in spite of this progress, there remain an estimated 26 million children out of school in the region. Reaching these out of school children is a significant challenge because many of these children are disadvantaged by disability, being in minority ethnic and language groups, or extreme poverty. Ensuring such disadvantaged children enrol in and attend school will require a sustained effort.
Response
Australia's approach to education supports achievement of the MDGs and Education for All goals. The Prime Minister announced12 that Australia will strengthen its development assistance activities to focus on enabling children not in school in East Asia and the Pacific to access a primary education. Spending on education will increase to over $540 million in 2008‑09, or approximately 15 per cent of the development assistance program. A substantial scaling-up of education assistance is planned, with new funding of approximately $500 million scheduled over the next three years to strengthen national education systems, to help put more children in school and improve the quality of education provided.
Australia will continue to work with partner governments, non-state providers of education, non-government organisations, other donors, and global partnerships such as the Education for All - Fast Track Initiative to develop and fund programs that both contribute to service delivery inputs and build the capacity of partner governments to make policy decisions, improve resource allocation and enhance efficiency to make best use of scare resources. Assistance will include:
- support for teacher training, thereby improving education quality in the key areas of English, mathematics and science. Targeting women and ethnic minority teachers will continue to be an important component of in-service teacher training programs
- support for curriculum reform and the production of related materials, since good textbooks based on a rigorous school curriculum also contribute to improving the quality of education
- improving school operations through training for school heads and district supervisors that gives them the skills to implement their school plans within allocated resources
- enhancing essential school infrastructure, including building and refurbishing classrooms, thereby increasing participation in education, and
- the promotion of gender equality through teacher training programs that improve the gender balance in teaching workforces, curriculum reforms that redress gender stereotypes in learning materials; and infrastructure programs (for example provision of separate toilet facilities) that have helped to encourage more girls into school. Women will continue to be empowered to play a greater role in the management of education, particularly as members of school boards.
New assistance is being provided to the education sectors in East Timor, Burma and South Asia. Major existing programs will be strengthened and expanded in Indonesia, the Philippines, Papua New Guinea and the Pacific. Assistance will be provided to address specific education needs such as indigenous peoples' education in the Philippines, quality secular education in the Islamic schooling sector in Indonesia and the Philippines and the development of English language skills in East Timor. Australia will also help countries improve vocational and technical education systems to build skills and enhance employment and productivity among young people.
The Australia-Pacific Technical College, with campuses in Fiji, Samoa, Papua New Guinea and Vanuatu, will continue to provide skills development and qualifications that will enhance the opportunity for Pacific Islanders to access national and regional labour markets.
Scholarships
Scholarships are an important component of Australia's education sector assistance. They provide individuals with the opportunity to develop skills needed to strengthen the performance of key institutions in developing countries.
The largest of AusAID's scholarship programs is the Australian Development Scholarships, of which approximately 1,000 are awarded annually for tertiary and higher education, managed through AusAID's country programs. Fields of study are targeted to address agreed priority human resource and development needs of partner countries, in line with Australia's bilateral development assistance programs.
Scholarships are also awarded under the Australian Leadership Awards (ALA) program which aims to foster leadership and build partnerships in the region. Approximately 2,500 Australian Leadership Awards will be offered between 2008 and 2011 to current and emerging leaders through scholarships and fellowship placements with Australian host organisations. In addition to their academic award, recipients of ALA scholarships also participate in a Leadership Development Program.
Diagram 4: Education: estimated ODA by sub-sector 2008‑09
Addressing Environmental and Climate Change Challenges
Context
While rapid economic growth in the developing world is essential for poverty reduction some economic growth can also place pressure on natural systems. The health of these systems is particularly important to the rural poor as their wellbeing and livelihoods are heavily dependent on access to productive soil and fresh water. Without protecting natural systems, there is a risk that livelihood gains made through economic growth and development will not be sustainable over the long term.
Water management provides a clear example of these contrasting pressures: increasing demands for water mean that by 2025, more than three billion people could be living in water-stressed countries. Balancing the provision of water supplies across agricultural, domestic and commercial users in growing communities requires careful management of surface and groundwater extraction to ensure sustainability of water supply assets and protection of aquatic ecosystems.
The pressures on natural systems are also predicted to intensify with climate change. Climate change will potentially impact on all major development sectors, through increased vulnerability of communities to disasters, increased spread of disease, lowered agricultural productivity, and increased costs of infrastructure provision. The most vulnerable countries (for example small island states, those with high proportions of their populations at risk from extreme weather events) require particular support in managing environmental and climate change impacts.
Response
Addressing environmental and climate change challenges is central to the poverty reduction efforts of the development assistance program. Expenditure on environment and climate change programs in 2008‑09 is estimated to increase to over $130 million, approximately 4 per cent of the development assistance program.
A major new funding commitment (outlined in Box 3) will help address climate change adaptation challenges and lead to significant growth in this sector in future years.
| Box 3: Adaptation to Climate Change |
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In line with pre-election commitments, the Government will invest $150 million over three years, with $35 million in 2008‑09, to meet high priority climate adaptation needs in vulnerable countries in our region. The primary geographic emphasis of the program will be Australia's neighbouring island countries, but targeted policy and technical assistance will also be available for other countries in the region. The objectives of the program are to:
The program consists of four principal components: The first component will improve scientific information on, and understanding of, climate change impacts by generating improved climate change impact information to assist decision-makers. This component will engage with, and build the capacity of, scientific communities in partner countries, including through cooperative research partnerships. The second strategic planning and vulnerability assessment component will increase the level of understanding of key climate vulnerabilities at the regional, national and sector levels, and ensure that decision-makers have access to the right information and tools to support adaptation planning and action. The third component will finance the implementation of priority adaptation measures. It will also assist in developing national capacity to cope with climate change impacts in the longer term. Activities implemented under the climate adaptation initiative will be well coordinated with the adaptation activities of other donors and multilateral agencies in partner countries, particularly in the Pacific. The fourth component of contributions to major multilateral adaptation funds will increase significantly Australia's contribution to multilateral financial mechanisms for climate change adaptation. |
Communities in developing countries will also be assisted to improve access to clean water and sanitation (see Box 1 on page 12). Better management of freshwater sources to withstand climate change impacts will help ensure that water supply and sanitation systems are more sustainable.
Assisting countries with policies and programs that support sustainable development, particularly through initiatives that reduce the carbon footprint associated with the growth of their economies, is an increasingly important area of work for the development assistance program.
Australia will support Indonesia in the development of its national framework for avoided deforestation and the implementation of the Kalimantan Forests and Climate Partnership. The Partnership aims to prevent the deforestation of up to 70,000 hectares of Kalimantan's peat land forests, rehabilitate 200,000 hectares of degraded peat land and plant up to 100 million new trees on rehabilitated peat land.
Through the PNG-Australia Forest Carbon Partnership, Australia will assist Papua New Guinea to develop its avoided deforestation policies, forest carbon measurement system and demonstration activities to enable Papua New Guinea's participation in future international forest carbon markets. Credible accounting of changes in forested areas is essential for such participation, so Australia will support Papua New Guinea in the development of a rigorous forest carbon measurement and accounting system.
Australia's contribution to the World Bank's Forest Carbon Partnership Facility will assist developing countries to establish credible estimates of their national forest carbon stocks, identify sources of forest-related emissions, determine the opportunity costs of avoided deforestation interventions and design appropriate response strategies.
Broad-Based Growth
Context
Sustained reductions in poverty have been achieved in countries where the benefits of economic development have been shared widely across the community. Broad-based economic growth provides increased opportunities for employment and increased government revenue to fund delivery of services to the poor and disadvantaged.
In spite of impressive growth in some economies, a large number of extreme poor continue to be found in the Asia‑Pacific region. For example, despite national level growth, lagging areas such as southern Philippines and eastern Indonesia have not progressed rapidly in per capita income or human development terms. In such areas, and across economies where people depend on slower growing sectors such as agriculture, appropriate policy settings and public investment can help ensure the benefits of growth are shared. In the Pacific, despite a recent lift in growth rates in a number of economies, per capita incomes have mostly remained stagnant or retreated since the mid-1990s. Volatile, commodity-dependent earnings complicate economic management and the task of continuing to generate employment opportunities for a young and expanding population.
Extending access to basic infrastructure services, including transport, electricity, water and telecommunication, is a fundamental instrument of poverty reduction in rural and urban areas. Growing populations need increasing and reliable levels of infrastructure investment to improve their social and economic conditions. More than half the population of East Asia already live in cities and towns and this proportion will continue to increase. Meanwhile many countries are decentralising, devolving functions and responsibilities to sub‑national level, where support is needed to ensure capacity to deliver services, including in rural areas. It is also important to ensure that the gains from economic growth are translated into greater access to health and education services.
The World Bank's 2008 World Development Report13 highlights that 'agriculture contributes to development as an economic activity, as a livelihood, and as a provider of environmental services, making the sector a unique instrument for development.' Issues affecting agricultural production and global food security include international trade barriers, climate change and the growing demand for biofuels. Efforts to boost agricultural productivity are also particularly important in a situation of rising global food prices — where addressing hunger and malnutrition will remain key to achieving MDG 1.
Response
Development assistance alone cannot address all impediments to growth. Sound macroeconomic and public investment policies, openness to trade and investment, microeconomic reforms that increase competition and reduce costs will be the primary driver of economic growth. However, used effectively, development assistance can be an important facilitator of broad-based growth and help countries more equitably share the benefits of growth. Particular areas of focus for 2008‑09 include infrastructure development, rural enterprise development and related governance reforms.
A substantial scaling-up of infrastructure assistance is planned, with new funding of approximately $420 million scheduled over the next three years. These new resources for economic infrastructure are financing investments and improved government policies in transport, energy, water supply and sanitation and communication sectors in Southeast Asia and the Pacific. For example, the development assistance program is supporting policy and regulation for water supply in Indonesia and the Philippines, infrastructure planning and management in East Timor, power sector regulation in Samoa, and transport infrastructure programs in Papua New Guinea and the Mekong region.
Australia is partnering with the World Bank on infrastructure programs in East Asia and the Pacific and in South Asia by co-financing major investment programs as well as supporting policy work in public-private partnerships, output based development assistance, energy and road safety. Infrastructure partnerships with the Asian Development Bank include work on water and clean energy.
In the Pacific, 80 per cent of the population live in rural areas, and need improved access to social services and markets. A new Pacific Regional Infrastructure Facility (see Box 6 on page 28) will address this challenge by providing effective performance‑linked support to infrastructure for Pacific island countries.
Diagram 5: Infrastructure: estimated ODA by sub-sector 2008‑09
Direct spending on rural development in 2008‑09 will comprise approximately 5 per cent of the development assistance program, comprising support for agriculture, fisheries and forestry.
Rural enterprise development programs will continue to expand as a feature in many country programs through 2008‑09, including in the Pacific, Papua New Guinea, East Timor, Philippines, Indonesia, Cambodia, Vietnam and Laos. Preparatory analysis to expand market-based approaches to rural enterprise and service development, including access to financial services and community driven development, will also be undertaken in 2008‑09. Options to be explored include market development programs in partnership with the United Kingdom's Department for International Development (DFID) and other bilateral donors, and targeted support to the International Finance Corporation, Asian Development Bank, and the Consultative Group for Assistance to the Poor to improve business environments and particularly access to financial services.
An Enterprise Challenge Fund will expand as an innovative means of sharing risk with business to achieve pro-poor growth. Through open competition, grants are awarded to business projects that achieve direct pro-poor outcomes including the direct creation of jobs, income-earning opportunities and increased access to goods and services by poor people and small businesses.
A comprehensive response to growing concerns about global food security requires both immediate action to support food availability for the most vulnerable, and longer term action to address the root cases of food insecurity (see Box 4).
| Box 4: Strengthening Global Food Security |
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To respond to the urgent threat posed by rapidly rising food prices, Australia will provide $30 million to support the work of the World Food Programme (WFP). Australia will also develop a comprehensive plan to guide future action on addressing the root causes of food insecurity in partner developing countries, and continue to advocate for trade reforms to enable world agricultural markets to operate more efficiently in support of food security. The first Millennium Development Goal targets halving poverty and hunger by 2015. World food prices have risen dramatically over the past year, due to a range of influences, including rising demand, falling investment, land use changes, rising energy and other input costs, some poor recent harvests, and trade restrictions. The World Bank14 estimates that 100 million people are at risk of being pushed deeper into poverty, potentially reversing development gains of the past seven years. The impacts of food price rises will be greatest for the poor and vulnerable, who spend up to 90 per cent of their income on food. To attempt to cope, the poorest are often forced to cut back on basic health and education services, and food and nutritional intake. An immediate humanitarian contribution of $30 million will be made to the WFP Emergency Appeal. This will support emergency assistance to poor countries affected by steep rises in the prices of essential food supplies and address critical gaps in WFP's food aid operations resulting from rising food and fuel prices. A comprehensive action plan will be developed to guide Australia's engagement in international efforts to address the root causes of food insecurity in vulnerable developing countries. Despite clear evidence that achieving growth in the agriculture sector is one of the most effective ways to reduce poverty, insufficient global resources and attention have been directed to agriculture and rural development.15 Australian support for improved agricultural productivity, market development and social protection will be strengthened. Dismantling barriers to trade in agricultural products must also be part of the international effort to improve food security. The Australian Government will continue its strong advocacy for agricultural trade liberalisation in multilateral trade policy fora and in bilateral and regional trade policy dialogue. |
Pacific Partnerships for Development
Context
The economic performance of several Pacific countries is improving, but to reach their potential significant reforms are required. The Pacific region's combined Gross Domestic Product (GDP) is projected to grow by 4.5 per cent in 2008, up from an average of 2.8 per cent between 2005 and 2007. The international commodities boom and increased tourism are producing higher growth rates in countries such as Papua New Guinea, Vanuatu and Samoa. However, while economic growth is occurring, Pacific states still have high levels of poverty and none are on track to fully meet the Millennium Development Goals. Substantial development challenges remain. Prominent among these are the difficulty in obtaining secure access to land, weak public sector capacity and difficulty in ensuring reliable infrastructure, especially for transportation.
Response
The Prime Minister's March 2008 Port Moresby Declaration16 announced a new era of cooperation with the island nations of the Pacific, including Australia's proposal to pursue Pacific Partnerships for Development with Pacific island neighbours. Pacific Partnerships for Development will provide a new framework for Australia and the Pacific island nations to commit jointly to achieving shared goals including the Millennium Development Goals. Under these partnerships, Australia will be prepared to provide increased development assistance over time, reflecting Pacific island countries' own commitment to achieving improved development outcomes.
A package of Pacific-focused initiatives through this Budget will be drawn on in establishing Pacific Partnerships for Development. A Pacific Land Program will help reduce conflict over land, and make land more readily available for development. A Pacific Regional Infrastructure Facility will support better maintained and more reliable basic infrastructure in Pacific island countries, greater local employment opportunities for youth, and associated improvements in rural service delivery and business costs. A Pacific Public Sector Capacity initiative will support a better-trained, more effective public sector to plan and implement new development policies in the Pacific, with stronger linkages between Australian and Pacific counterpart institutions.
Pacific Land Program
In both urban and rural areas of the Pacific the difficulty in gaining secure access to land is a significant obstacle to economic and social development. Moreover, lack of clarity over boundaries and usage rights is a major source of disputes and potential conflict. Social and economic change is introducing new pressures for which the combination of customary land arrangements and existing land administration systems is ill-equipped. Clarity over land ownership and property rights provides the certainty essential for investments and thus economic growth to occur.
Access to land is essential for sustainable economic growth and for infrastructure development necessary to support delivery of basic services such as sanitation, energy, transport and health services. Strengthened administration and tenure systems will provide concrete economic and social benefits for landholders and the broader community while reducing the potential for disputes and protecting customary rights.
Responding to Pacific nation's own reform initiatives, a Pacific Land Program, outlined in Box 5, will support efforts to address land reform challenges.
| Box 5: Pacific Land Program |
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A new Pacific Land Program will invest $54 million over four years, with $6.5 million in 2008‑09, to protect customary land rights, promote economic and social development, and reduce the potential for instability from land-related conflict. The program responds to Pacific governments' own initiatives and is based on substantial prior consultation and planning. The program will contribute to Pacific development and security through: strengthened customary land rights and increased availability of customary and unused alienated land; faster resolution of disputes by traditional processes, courts and other methods including mediation; and improved urban planning and tenure security. Bilateral programs, initially in Papua New Guinea, Vanuatu, Solomon Islands and East Timor, will support partner government efforts to strengthen land departments and related agencies including dispute resolution arms through improved administrative systems and business processes. Support will be provided to build and maintain technical and managerial skills in both the government and non‑government sectors. The program will support reforms for new legislation and regulations to strengthen tenure security, provide mechanisms for informed consent of customary owners in negotiations with investors and developers and provide better leasehold mechanisms to increase the potential for raising finance. Programs will also support community and civil society efforts to achieve greater transparency in land administration. A regional program will assist Pacific countries in urban planning in response to growing problems associated with urbanisation including squatter settlements, poverty, growing youth unemployment and rising crime. It will partner with multilateral agencies, regional organisations, Australian agencies and professional associations to strengthen urban planning, infrastructure and service delivery, urban land tenure security and skills for planning officials and professionals. A second component of the regional program will provide education, training and professional development for professionals and semi-professionals in land-related areas such as surveying, valuing, real estate and the law. |
Pacific Infrastructure
The poor quality, reliability and high cost of basic infrastructure services in the Pacific island states are a major constraint to broad-based economic growth, poverty reduction and development. Because of their small size, many Pacific island countries experience difficulty generating sufficient internal revenue to finance the infrastructure construction and maintenance required to support the delivery of basic services and underpin sustainable economic growth and the development of the private sector.
Inadequate and unreliable infrastructure undermines service delivery and contributes to regional disparities, both social and economic. High cost and poor quality infrastructure services suppress innovation and private sector growth. In the Pacific, weaknesses in infrastructure services exacerbate rural decline, urban drift, poor education standards and health outcomes, unemployment and crime.
A Pacific Regional Infrastructure Facility (outlined in Box 6) will improve basic infrastructure services in the Pacific by lifting the quality and reliability of basic infrastructure; strengthening partner governments' use of their own resources for infrastructure maintenance and development; and by combining with infrastructure support from the multilateral development banks.
| Box 6: Pacific Regional Infrastructure Facility |
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A new Pacific Regional Infrastructure Facility will invest $127 million over four years, with $5.5 million in 2008‑09, to improve basic infrastructure services in the Pacific. The Facility will provide performance-linked support for basic infrastructure services in Pacific island countries in combination with multilateral development banks and, potentially, other donor partners. The Facility will support consistent, reliable and long-term infrastructure financing, cross country benchmarking of management performance and service standards and support cross regional learning about what works. It will also provide a transparent framework linking performance and resources across the region. The initiative will strengthen donor coordination and provide a potential mechanism for contributions from a range of donors. The Facility will be managed under a governance arrangement involving all contributors. Support will be country specific, targeted to address local constraints to growth and challenges to nation building and stability. As appropriate, support will be directed to improving policy, planning and regulation, as well as maintenance, rehabilitation and upgrading of infrastructure, and strengthening the role of the private sector in service delivery. Support will be provided across a range of infrastructure sectors in both rural and urban areas including transport, water, sanitation, waste management, energy and communications. Analytical work will underpin funding allocations, with the establishment of transparent performance criteria, for example on public expenditure management. |
Pacific Public Sector Capacity
Effective public service organisations have a central role to play in achieving poverty reduction and sustainable development. Yet the effectiveness of public sector workforces in the Pacific is often constrained by weak capacity in core areas such as literacy, numeracy and recordkeeping, together with skills shortages in areas such as public financial management, policy making and policy implementation. Poor organisational management, size and structure are further factors that affect public service efficiency. Salaries form a major part of public sector budgets, with very little left for recurrent service delivery costs. Pacific governments' investment in human resource development is low. Public expenditure remains concentrated in urban areas and resources allocated to regional areas often remain unspent due to limited implementation capacity. Without a more effective public sector workforce many Pacific nations will continue to face difficulties in implementing sound policies and programs to enable economic growth and improve basic service delivery.
A Pacific Public Sector Capacity initiative (outlined in Box 7) will support public sector training and workforce development and assist essential public sector reform.
| Box 7: Investing in Pacific Public Sector Capacity | |
|---|---|
A new $107 million four-year initiative Investing in Pacific Public Sector Capacity, ($6 million in 2008‑09) will strengthen public sector administration in the Pacific. This will address a key impediment to poverty reduction, by helping to improve service delivery and enable growth. Improving public sector performance requires a long-term, co-ordinated response which tackles the institutional causes of poor performance, while also providing immediate assistance to improve individual and institutional capacity in priority areas. Working alongside partner governments, the initiative will: Establish strong and enduring partnerships between Australia and the region, particularly between governments and tertiary institutions. These partnerships will strengthen the capacity of local and regional institutions to undertake public sector workforce performance improvement. Regional tertiary institutions that produce graduates, undertake policy research and provide training will also be strengthened. Partnerships between Australian and Pacific Government organisations and tertiary institutions will use twinning, mentoring and similar arrangements that foster strong people-to-people and organisational linkages capable of supporting long-term improvements in institutional performance. Systematically address public workforce development needs across the region. This component will provide workforce development assistance to address priority organisational and individual capacity needs, especially in leadership and core skills such as administrative competencies, planning, budgeting and financial management. Training will benefit all levels of the public service, from junior public servants to executive officers. Programs will be tailored to individual country needs, but may include increased opportunities for Pacific public servants to undertake both formal and on-the-job training and work attachments in Australia and within the region. Provide support for the planning and implementation of public sector reforms crucial to economic growth and delivery of basic services. This component will identify opportunities to support locally-led reform efforts in areas such as public financial management, human resource management and microeconomic reform. Reform efforts will be underpinned by improved region-wide analysis of public sector performance. | |
Improving Governance
Context
Improving governance, including through strengthening government performance and accountability, is a critical factor in achieving the Millennium Development Goals. Good governance allows citizens and communities to share the benefits of economic growth, stability and development. Good governance also supports the delivery of basic services such as health and education by focusing the resources and capabilities of the state on meeting the needs of its citizens. Governance has a broader scope than simply government and the institutions of state — it involves a strong and representative civil society and media, and an active and informed citizenry.
Oversight and accountability systems within government (such as parliamentary committees and statutory officers such as auditors, ombudsmen and public service commissioners), public financial management systems, the media, civil society and law and justice systems all play important roles in holding governments accountable for effective management of state resources and delivery of basic services. However, disempowered communities, particularly the poor or marginalised, with limited engagement in government decision‑making or means of advocacy frequently experience poor state responses to their needs and interests.
Australia commits close to half of its country program development assistance (more than any other bilateral donor) to weakly performing states where governance is weak and the risk of conflict or political instability is high. These are states where governments consistently have difficulty delivering core functions and services to the majority of citizens. Weak government performance has a direct negative impact on the poor. Though an especially difficult task in these circumstances, improving governance is central to delivering effective development assistance and making more lasting progress on poverty reduction.
Response
Australia will continue in 2008‑09 to work at all levels of society in partner countries to contribute to improvements in government capability, responsiveness and accountability. Spending on governance in 2008‑09 will be approximately 22 per cent of the development assistance program.
Australia's approach to governance focuses on strengthening state capability, accountability and responsiveness to citizens. This includes strengthening the institutions and processes that provide checks and balances on the way that the powers of the state are exercised. Transparency of government decision-making is important in keeping the state responsive and accountable to its citizens, as well as reducing the opportunities for corrupt practices.
Elements of this work include strengthening economic management, building public sector capacity at national and sub-national levels, strengthening law and justice systems, supporting democratic elections, and supporting national integrity systems. Growing emphasis is being given to encouraging effective leadership, building demand for better governance, increasing performance-linked development assistance, and tackling corruption. Within the law and justice sector new areas of work include security sector reform and local level initiatives to improve access to justice and ensure that justice serves the poor. Political governance activities include electoral support, civic education, parliamentary strengthening, peace building and work to increase the participation of women in government and to strengthen local-level governance systems.
A wide range of stakeholders including civil society, youth groups, women's societies, private sector organisations and faith-based groups are included in Australia's approach. Ensuring local ownership of activities is essential for sustainability and legitimacy, and work in 2008‑09 to build demand for better governance will continue to be locally driven and guided. A panel of eminent Pacific leaders will advise on Pacific leadership and governance issues. Local communities and faith-based organisations will be assisted to strengthen their capacity to plan, implement and evaluate local development initiatives, improve and expand on service delivery, and increase participation in policy development.
Much of the work on economic governance through Australia's development assistance program is directed at improving government fiscal and financial management through the provision of technical assistance. This assistance can include training, deployment of advisers, and links with agencies in Australia. Major investments in technical assistance to improve economic governance are focused on Papua New Guinea, Solomon Islands and Indonesia. Other significant economic governance support is provided in the Philippines, East Timor, Vanuatu and elsewhere in the Pacific.
The use of performance-linked development assistance will expand significantly in 2008‑09, with close to $100 million allocated to such arrangements. As agreed performance criteria are met, Australia provides additional budgetary assistance to address agreed development priorities. In 2008‑09, Australia will provide performance‑linked assistance in up to ten countries, targeting reforms in a variety of sectors and levels of government.
Australia is now a major contributor to the World Bank managed Global Partnership on Output Based Aid (GPOBA), which is trialling innovative, private sector-based approaches to providing water, sanitation, transport and health services to the poor in developing countries. Consistent with other performance-linked assistance, GPOBA funds are released only on delivery of agreed outputs.
Improving Transparency and Accountability in Government
Work will continue to improve transparency and accountability in government in partner countries. Support will be provided to implement country specific Anti‑Corruption Action Plans and further regional and global anti-corruption partnerships and programs. Action plans will prioritise efforts to build constituencies for action by highlighting the costs of corruption, particularly its negative impact on the poor through distorting the efficient allocation of resources to basic service delivery. Assistance will also be provided to reduce opportunities for corruption, for example through better procurement practices, and change incentives for corrupt behaviour, for example through assistance with prosecutions.
To build constituencies for reform, assistance will support: education and information dissemination on corruption costs; building grassroots momentum and demand through increased awareness; partnerships with civil society groups, non-government and professional organisations to promote ethical conduct and transparency; fostering integrity and accountability in leaders; supporting greater community participation to improve transparency of local level service delivery; and independent tracking of government integrity, including through the Extractive Industries Transparency Initiative and Transparency International.
To reduce opportunities for corrupt behaviour, assistance in selected countries will strengthen regulatory and accountability frameworks, key oversight and accountability institutions and legal and administrative frameworks for financial controls and scrutiny.
To change incentives for corrupt behaviour, assistance in selected countries will strengthen technical capacity to prosecute cases involving corruption and assist partners to ratify and implement the UN Convention Against Corruption.
A new Governance and Anti‑Corruption Experts Group will provide access to enhanced expertise in anti-corruption issues.
Diagram 6: Governance: estimated ODA by sub-sector 2008‑09
Promoting Gender Equality
Context
Gender equality is essential to efforts to eradicate poverty, enhance economic growth and democratic governance, and achieve sustainable development. Gender gaps are most visible in the low access of women and girls to education and health services, to economic opportunities and to political participation. Female primary school enrolment is as much as 26 per cent lower than that of males in areas within South Asia. The Pacific has the lowest rate of female membership of parliaments in the world. Rates of maternal and girl child mortality are also of significant concern in the region. In Papua New Guinea 61 in every 1,000 female infants die before reaching the age of one, and in East Timor just over one in ten girls die before reaching the age of five. In the Pacific region one in 62 women die during pregnancy or delivery. High rates of violence against women is a significant problem in many countries in the region: the United Nations Development Fund for Women (UNIFEM)17 estimates that the incidence of violence against women by an intimate partner varies from 10 per cent in the Philippines to 67 per cent in Papua New Guinea.
Gender discrimination has clear economic and social costs. According to one recent estimate, by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP),18 the Asia-Pacific region is estimated to be losing $42‑$47 billion per year because of restrictions on women's access to employment opportunities. A further $16‑$30 billion per year is estimated to be lost because of gender gaps in education. Investments in gender equality, particularly in health and education, yield some of the highest returns of all development investments. Maternal mortality rates decline. Children are healthier and better educated. Household incomes improve. When attention is paid to gender equality, women's participation in the life of the community and in politics is higher, and economic growth is stronger.
Response
Progress on gender equality is an integral part of achieving the MDGs. Australia is working to implement international best practice in the area of gender equality, focusing on areas where least progress has been made in narrowing the gender gap such as improving women's economic status, expanding their participation in decision making, and strengthening their leadership. Sectoral programs which support equal access to health and education are also fundamental to achieving gender equality. Efforts to eliminate violence against women are an important new area of assistance.
A range of specific development assistance initiatives promote gender equality and empower women:
- An evaluation on violence against women, due to be completed in 2008, will guide scaling up initiatives in areas such as women's access to justice; support for women and girls living with violence; and actions to prevent gender based violence.
- A leadership program 'Advancing Gender Equality in Pacific Governance: Stronger Women Citizens and Leaders' will be implemented as part of Australia's Pacific Leadership Program. This will improve women's political literacy and civics education at the grassroots level.
- The women entrepreneurs program is working closely with the World Bank and International Finance Corporation on reforms that improve business opportunities for women in the Pacific. This program includes research on constraints to doing business, entrepreneurial case studies and database on legal frameworks.
- The community empowerment program, Local Governance and Infrastructure for Communities in Aceh (LOGICA), is widely regarded as a best practice model for engaging women to drive development change in villages. LOGICA has helped to develop the confidence and leadership skills of over 2,300 village representatives, of whom more than half are women. As a result, more women are moving into leadership positions in local government.
- Increased support will be directed to the UNIFEM, an important partner for Australia in achieving gender equitable development opportunities and outcomes.
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