Is Australia's foreign aid really that generous? > Check the facts

Is Australia’s foreign aid really that generous? > Check the facts

Who: “It will be the highest aid budget in Australian history.” Bob Carr.

The Claims: The 2013-14 aid budget will be the highest in history.

The Facts: In absolute dollar figures the 2013-14 aid budget will be the highest in history. However, this does not take inflation into account. Relative to Australia’s Gross National Income (GNI) this year’s aid budget is not the highest.

Discussion of evidence:  The Australian government allocated $5.7 billion to foreign aid in the latest budget. This equated to 0.37 per cent of GNI. According to the OECD this is not the highest the aid budget has ever been. As shown in the graph below the aid budget used to be much higher than it is today.

Furthermore, since December 2012 $375 million of the aid budget has been diverted to pay the costs of asylum seekers arriving in Australia. This decision has made Australia the third biggest recipient of its own foreign aid, as shown in the table below.

Amount of foreign aid ($m) % of total aid
Indonesia 646.8 11
PNG 507.2 9
Australia 375.1 7
TOTAL AID 5666.4

This means that not only is the aid budget not at record high levels but a proportion of the budget is being diverted to pay for domestic policies.

Update: The recent announcement of Labor’s PNG policy involved changes to the foreign aid budget. The aid budget will be reduced by $879 million over four years and $420 million will be reallocated within the budget to provide additional assistance to PNG over four years. These changes make Australia’s foreign aid budget less generous than previously announced.

*originally posted on June 25

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