Federal Budget fails on fairness

Campaigns and Advocacy, Foreign aid, Media Releases article written on the 09 May 2017

After desperately gouging the aid budget to bring it to its lowest ever level in previous years, the Government has dealt aid another blow by reneging on its promise to keep spending in line with inflation, Oxfam Australia said tonight.

“The Government has refused to lift aid funding out of historically low levels, while at the same time pushing ahead with corporate tax cuts for the top end of town,” Oxfam Australia Chief Executive Helen Szoke said.

“Repeated cuts to aid funding that is crucial to tackling poverty have been used to balance the books – and this Budget has done nothing to rectify this unconscionable failing of our responsibility as a wealthy nation.”

Dr Szoke said tonight’s Budget had pegged next year’s aid funding at $3.9 billion, which was slightly more than the growth in the consumer price index, but completely out of step with global need and Australia’s international commitments. She said over the next four years of the forward estimates, the aid budget would be cut by $303 million.

“Aid spending now equates to about just 22 cents in every $100 of gross national income, a new historic low,” Dr Szoke said.

“Long-term aid programs have already had to be scaled back, most significantly across sub-Saharan Africa. These programs make communities resilient and able to cope when disasters strike. Aid is an essential part of Australia’s contribution to a more peaceful, stable and sustainable world – both for our own citizens and our neighbours.

Dr Szoke said tonight’s disappointing Budget could not come at a worse time as the world grappled with multiple humanitarian crises. About 30 million people in four countries – South Sudan, Somalia, Nigeria and Yemen –are experiencing alarming hunger. An unprecedented 65 million people have been forced to flee their homes because of conflict and persecution.

“The $20 million increase in the Humanitarian Emergency Fund is a small step in the right direction, but is simply not enough,” she said. “The Government needs to at least double its spending on the emergency fund to $260 million to meet urgent need and save more lives.

“At a time when our neighbours are grappling with the escalating realities of climate change, the Budget also shows no increase in Australia’s $200 million a year contribution to international climate finance, which is drawn from the general aid budget.”

Dr Szoke said tonight’s tax integrity measures, including new tightening up on tax avoidance by multinationals, were another move in the right direction.  However, it was concerning that there were no revenue estimates attached to the new measures.

She said that with one in three companies reported on by the Australian Tax Office paying zero corporate tax in 2015, more needed to be done. Oxfam estimates Australia loses up to $6 billion a year – and developing countries miss out on $3 billion annually – because of corporate tax dodging by the use of tax havens.

“In a world where just eight men have the same amount of wealth as the 3.6 billion poorest people, and the richest 1 per cent of Australians own more wealth than the poorest 70 per cent combined, the Budget has been a squandered chance to act on soaring inequality at home and abroad.

For interviews or more information, please contact Amanda Banks on 0411 449 653 or amandab@oxfam.org.au