SENATOR THE HON PENNY WONG

LEADER OF THE OPPOSITION IN THE SENATE

SHADOW MINISTER FOR FOREIGN AFFAIRS

LABOR SENATOR FOR SOUTH AUSTRALIA

SPEECH

12 March 2019

REBUILDING AUSTRALIA’S INTERNATIONAL DEVELOPMENT PROGRAM FOR A TIME OF DISRUPTION

2019 ANNUAL LECTURE IN POLITICAL SCIENCE AND INTERNATIONAL STUDIES

UNIVERSITY OF QUEENSLAND

*** check against delivery ***

(Acknowledgments omitted)

It is a privilege to be here tonight to deliver the 2019 Annual Lecture in Political Science and International Studies.

Students and academics of the University of Queensland contribute to national debate in a range of areas.

In foreign policy, I point to the contribution of the Chancellor, Peter Varghese – a former secretary of the Department of Foreign Affairs and Trade – who recently led development of the India Economic Strategy 2035 – a strategy which charts a course for deeper and broader economic engagement between Australia and India.

Labor supports its recommendations, which align with the ambitions of our FutureAsia initiatives.

 

Introduction

Labor’s foreign policy is founded on the belief that we deal with the world as it is and we seek to change it for the better.

This means a foreign policy that is not just transactional, but is purposive.

Those purposes are defined by our values, interests and identity.

We know what we stand for: compassion, equality, fairness, democratic principles and the protection of rights.

We know what our interests are: the security of the nation and its people; the prosperity of the nation and its people; a stable, peaceful region anchored in the rule of law; and constructive internationalism.

And we know who we are – an inclusive, diverse nation which draws strength from the waves of immigrants who have come to our continent and our First Nations’ peoples.

Our foreign policy will speak to who we are, the confidence we have in ourselves, the values we believe in and to the region and world we want to live in.

Labor recognises that Australia’s international development program is a key element of our foreign policy – and that it reflects a key element of the Australian character – the generous nation of a fair go.

And so, together with Labor’s Shadow Minister for International Development and the Pacific, Senator Moore, I have also been working to develop and articulate Labor’s agenda for Australia’s international development program.

In 2017, Labor’s International Development Caucus Working Group undertook consultations with key aid and development stakeholders.

That work has been invaluable in contributing to Labor’s understanding of the sector’s concerns with the current aid program, and in shaping the objectives, strategies and actions for a Shorten Labor Government.

 

The problem

The current global context is one characterised by disruption.

Changes in the balance of economic and strategic power, economic and social inequality, rising nationalism and challenges to the liberal rules-based order are reshaping our world.

This disruption is compounded by a humanitarian crisis of an unprecedented scale.

Globally, over 65 million people are currently displaced, more than the number of people displaced as a result of World War Two.

In these circumstances, Australia’s international engagement – including our international development program – is of even greater importance.

At a time when our national interest compels us to strengthen our engagement, the Abbott-Turnbull-Morrison Government has not only neglected Australia’s international development program, but savagely attacked it.

Since its election in 2013, the aid budget has been on an ever-diminishing trajectory.

Over $11 billion has been slashed from Australia’s aid budget to date, including more than $140 million in the most recent budget.

Currently, Overseas Development Assistance sits at 0.22 per cent of Gross National Income.

This is set to fall to 0.19 per cent in 2021-22.

And forecasts indicate that by 2026-27 this figure will fall to just 0.16 per cent – the lowest on record. That’s 16 cents in every $100 of national income.

The Minister for Finance recently confirmed his government’s cuts to Australia’s international development program amount to $80 billion over the medium term to 2028-29.

These cuts have not only had a very real impact on the people who benefit from investments in areas like health and education, they have damaged Australia’s reputation as a reliable partner in the region, and lessened Australia’s influence precisely at the same time our national interest compels us to engage more deeply.

This government’s willingness to cut aid to this extent means that repairing Australia’s international development program is beyond our collective reach in the short term.

Labor has consistently called for a return to a bipartisan approach to Australia’s international development program – an approach that has broken down as a result of the Abbott-Turnbull-Morrison Government’s actions.

Half a century of bipartisanship has been cast aside.

At a time when nationalism and populism is again on the rise, parties of government need to come together to demonstrate investment in international development does not come at the expense of domestic prosperity. Rather, it contributes to it.

But those calls have gone ignored in a time of ultra-partisanship – when the legitimate concerns of Australians struggling with low wage growth and cuts to services can be irresponsibly exploited to undermine the importance of Australia’s international development program.

That this is undertaken by the same people who have delivered record low wage growth and cuts to schools and hospitals underlines their cynical use of nationalist rhetoric.

Of course, this is not a phenomenon unique to Australia – with trends towards nationalism and populism sweeping democracies around the world.

There are many factors which drive nationalism and populism.

One thing we do know is that inequality is a central factor.

Labor’s agenda of a fair go for all Australians is an expression of Labor’s values – but it is also necessary to protect the health of our democracy.

By working to address inequality at home, we can foster the public support necessary to rebuild Australia’s international development program so that it again reflects the generous spirit of the Australian people.

We must – the region we seek requires it. So too does our national interest.

 

Labor’s approach to international development assistance

Labor’s agenda of a Fair Go for All Australians reflects our values, as a party and a nation.

Labor believes Australia can show humanity, decency and compassion to ensure a fair go for all – at home, on our doorstep, and abroad.

Australians are generous – in 2018, Australia ranked second in the World Giving Index, behind only Indonesia – a reflection of the willingness of Australians to help a stranger, donate to charity and volunteer.

Our international development program should once again reflect the generous spirit of the Australian people.

It is something we should be proud of.

Development assistance must contribute to our national interests, and reflect our values.

It can – and should – serve development objectives and broader strategic goals.

Rather than seeing humanitarian and national interest goals as a binary, the starting point for our international development program should be the kind of region we want.

One which retains a system of institutions, rules and norms to guide behaviour, to enable collective action and to resolve disputes.

A region in which those seeking to make or shape the rules do so through negotiation not imposition.

A region with an open trading system and investment transparency to maximise opportunity.

A region where outcomes are not determined only by power.

A region where all people live in peace and prosperity.

We know poverty alleviation is a necessary although not sufficient foundation of stability and prosperity.

And democratic governance and human rights are critical to sustainable development and lasting peace.

A region with these characteristics reflects our national interests and our values.

Supporting and strengthening such a region will require better coordination of Australia’s engagement across government, NGOs, academia and the private sector.

Aid is a key enabler of development. But we must work to bring together other elements of Australian engagement – diplomacy, trade, labour mobility, and private sector investment.

Recognising this requires a change in mindset in both the Department of Foreign Affairs and Trade, and the development sector.

All those with a stake in international development must come together and align our engagement so that Australia’s contribution has maximum impact in disrupted times.

Better alignment and coordination will be a key imperative for an incoming Labor Government.

Under a Shorten Labor Government, the objective of Australia’s international development program will be to promote sustainable economic growth, poverty reduction and inclusive development in a way that reflects our values and supports our national interests.

This purpose cannot be achieved without addressing the declining trajectory of Australia’s aid budget.

We do not underestimate the task of rebuilding Australia’s international development assistance program.

At Labor’s National Conference in December, the party adopted an amendment to our Platform to commit to increasing Official Development Assistance as a percentage of Gross National Income every year that we are in office, starting with our first Budget.

The damage done by the Abbott-Turnbull-Morrison Government is substantial.

Rebuilding the program will not be achieved in one year, or in one term of government.

It is a fiscal challenge, a long-term challenge, but most of all it is a political challenge.

Pauline Hanson, for example, continues to call for the entire development assistance budget to be cut.

She says that Australia is:

“shamefully wasting billions on overseas handouts to corrupt governments and unaccountable NGOs”

It is a call sadly echoed by at least some members of the Liberal National Party.

All of us who believe in a strong, secure, prosperous and generous Australia must push back and articulate why Australia’s international development program matters:

  • To the lives of those in our region.
  • To our influence in our region.
  • To our own national interest.

Australia’s international development program has been undermined by cuts to its budget, and also by a reduction in the capacity of our public service to deliver it.

The loss of leadership and technical expertise affects our ability to maximise the impact of our aid spend.

As a result, there has been a growth in the use of managing contractors under the Abbott-Turnbull-Morrison Government – with just ten companies now managing 20 per cent of the aid budget.

Greater outsourcing of our international development program gives rise to the legitimate concern that these arrangements are driven more by lack of capacity or risk aversion, rather than a focus on improved development outcomes.

In 2013, the Abbott Government abolished AusAID.

But as I said in my speech to the Australian Council for International Development National Conference in November 2017 – you cannot unscramble an egg.

Instead, a Shorten Labor Government will focus on working with the Department of Foreign Affairs and Trade to build development capability and ensure it is prioritised and valued.

Greater recognition of, and demand for, this capability will not only be good for the Department, it will be good for the countries we partner with, and good for Australians – increasing confidence that taxpayers’ dollars are achieving the intended outcomes and supporting our national interests.

We will examine the way aid is structured and governed within the Department to ensure it is managed appropriately and effectively.

We want to rebuild and reward aid and development skills within the Department, encouraging and attracting people with development skills – those who have expertise in specific sectors or thematic areas – and who understand what works in low- and middle-income countries.

We would expect graduates to be trained in the basics of aid design and management just as they are trained in the basics of the Department’s other areas of work.

We would expect senior officers to engage with and draw upon external expertise in designing and implementing development programs just as we would expect those with aid and development skills to be adept at policy development, diplomacy and strategic thinking.

There should be flexibility within the Department and across the public service to draw upon specific skills and expertise when needed.

I have spoken elsewhere of the economic dimension to the strategic shifts we are witnessing.

This gives rise to two key imperatives:

  • a greater capacity within the Department to integrate economic analysis and diplomacy as a core function; and
  • stronger capacity to harness the various aspects of Australian economic engagement – government and private sector – towards our strategic objectives.

To this end, a Shorten Labor Government will invest in the Department’s geo-economic capacity and expect that the new counsellor positions we have announced will play a key role in-country to ensure our development, trade, investment and diplomatic policies are integrated.

Good diplomacy has never been an abstract art. In today’s world, the deployment of the full gamut of Australian engagement has become even more critical.

Our development assistance programs across the region will be visible to and coordinated with the various Australian enterprises operating there.

Labor will encourage and reward officers who undertake postings in Asia and in the Pacific. Such postings should be highly valued in career progression.

Further, the skills, experience and expertise of Locally Engaged Staff are an asset and must be valued, utilised and built upon.

Labor will improve communication and transparency in Australia’s aid program by ensuring transparency standards are sufficient and represent a level playing field for all delivery partners, and by providing project-level information for all projects and programs above $1 million.

Achieving the best value for taxpayer funds must be an overriding objective in the delivery of Australia’s international development program.

We will also better communicate results of Australia’s investment in international development to the Australian public, so Australians can see the impact of their tax dollars and have confidence they are being spent wisely.

 

Labor’s priorities for development assistance

Australia’s international development program should be focused and targeted where Australia can have the most impact and influence – our own region.

This reflects our national interests, and our relative capabilities and strengths.

The Leader of the Opposition, Bill Shorten, has made clear the Pacific will be a priority for Labor.

Labor sees the region as, in the words of the Pacific leaders, ‘one Blue Pacific continent’, Australia’s front yard.

We believe in a deep and comprehensive partnership with Pacific nations in which Australia is a responsible and constructive partner.

Australia can be the natural partner of choice for Pacific nations, but we cannot take this for granted.

In Papua New Guinea, one of our closest and most important neighbours, Australia invests over $550 million in aid annually.

We should all be concerned that despitethis, Papua New Guinea still has some of the poorest social and development indicators in the world.

This apparent lack of return on investment is what leads some to advocate scaling back Australia’s aid budget even further.

Yet we cannot turn our back on the real needs of some of our closest friends and neighbours.

It is clear that a fresh approach is needed.

A Shorten Labor Government will work in partnership with the Government of Papua New Guinea to examine whether our aid dollar is having the best impact possible.

And unlike the Coalition, our increased focus on the Pacific will not come at the expense of our key partners in South and Southeast Asia.

It is irresponsible, and counter to our national interest, to raid programs in one group of partner nations to fund others.

Supporting and building the Pacific region to the detriment of other nations will not serve our relationships, our influence, and our long-term prosperity and security.

Some dismiss the need to continue giving aid to middle-income countries.

I disagree.

The World Bank explains that middle-income countries are a diverse group by size, population and income level, and are home to five billion of the world’s seven billion people.

They represent about one-third of global gross domestic product and are major engines of global growth, yet they are also home to 73 per cent of those living in poverty in today’s world.

I speak of countries including Malaysia, Indonesia and the Philippines.

Across Southeast Asia, extreme poverty has fallen.
There are now 36 million people living on US$1.90 per day.

But there is more to be done.

Those living on incomes between US$1.90 and US$10 a day still comprise a significant percentage of the populations of many of our neighbours.

They are highly vulnerable to economic setbacks.

And gains that have been made have not necessarily led to a reduction in inequality.

This is compounded by myriad challenges, including:

  • Conflict and violence compounded by inadequate justice systems;
  • Urbanisation and lack of access to natural resources;
  • Natural disasters; and
  • The closing space for civil society

In addition, countries face economic imbalances, structural weaknesses, and complicated development pathways that may halt or reverse economic development gains.

Aid and technical assistance can play an important role in supporting our neighbours’ efforts to achieve their development objectives.

It can also help ensure ‘no one gets left behind’ – the pledge at the heart of the Sustainable Development Goals and 2030 Agenda for Sustainable Development.

Australia’s national interest is not served by lessening engagement with those countries in our region who have achieved some economic development.

Development challenges change but they do not disappear.

That is why we recognise the importance of aid to middle income countries.

In Labor’s views, our development assistance should leverage our strengths, be tailored to each country, recognising different circumstances and needs, and our different role and relationships.

In some countries, for some objectives, traditional grant aid may be best way to achieve an outcome.

In others, a combination of grants, government-backed development financing, public-private partnerships, and private sector engagement will be most effective.

And in other cases, Australian technical assistance or expert advice may best achieve our goals.

We will work in partnership with our neighbours.

And we will work in close coordination with likeminded partners, leveraging our respective expertise, funding and presence to enable an effective division of labour.

Just as I made the case for leveraging Australia’s comparative advantage in our trading relationships as Shadow Trade Minister, we must also look to how Australia’s strengths, experience and expertise can be drawn on to maximise the benefit of our international development program.

Health, education, climate change, infrastructure, and gender equality and inclusion will be central themes for Australia’s international development program under Labor.

Health outcomes in our region continue to be unacceptable.

The recent outbreaks of polio in Papua New Guinea are evidence of this.

The maternal mortality rate in Australia in 2016 was 8.5 deaths per 100,000 women giving birth.

In Papua New Guinea, that number is 215.

Ninety-nine per cent of all maternal deaths occur in developing countries.

Investment in health care and family planning improves individual wellbeing and contributes to prosperity and stability in communities and countries.

Aid can and does make a difference.

For example, the infant mortality rate in Timor-Leste is 41 per 1,000 live births. That’s still far too high – it compares to 3.1 deaths per 1,000 live births in Australia. But it is down from 131 in 1990.

That is a lot of lives saved.

A recent study by PWC for the Fred Hollows Foundation found that every $1 invested in vision contributes $4 to the local developing economy.

It’s why in 2008, the Rudd Labor Government deployed a consortium approach to deliver the Avoidable Blindness Initiative.

However, the Abbott-Turnbull-Morrison Government has reduced annual aid expenditure on eye health by approximately 41 per cent over the last four years.

As a part of our focus on health, I announce today that a Shorten Labor Government will invest $32 million in a Pacific Avoidable Blindness and Vision Loss Fund.

This investment will clear the backlog of cataract blindness across the Pacific.

It will enable treatment of over 19,000 people with the most severe cases of visual impairment.

And it will train up to 600 additional health workers across the region to deliver programs on the ground.

This initiative is underpinned by a consortium approach with potential organisations including: Fred Hollows Foundation, Vision 2020 Australia and the Royal Australian and New Zealand College of Ophthalmologists.

Quality infrastructure is key to economic development and future prosperity.

Many of our neighbours have substantial unmet need.

In response, more innovative financing mechanisms are required to enable Australia to work in partnership with nations to provide them with the ability to meet their development aspirations.

In October, Bill Shorten made it clear that Labor intends to establish a government-supported infrastructure financing facility.

The Morrison Government subsequently announced similar intentions.

I know there are some concerns in the sector about the model outlined by the Government.

A Labor Government will work with the aid and development sector to ensure the implementation of a model that is fit for purpose and contributes effectively to our development goals in line with our values and national interest.

While this work continues, we would seek to utilise the mechanisms established by the current Government as a starting point.

Beyond funding, Labor’s support for infrastructure would also offer:

  • Capacity building.
  • Job opportunities and training.
  • Support for governance and project management.
  • Technical assistance to help achieve appropriate design and financing arrangements, including for climate resilience.

While much of the infrastructure financing will be focused on the Pacific, under a Shorten Labor Government there will be opportunities to finance and assist with infrastructure in Southeast Asia too.

As a disaster prone region, we can support climate-resilient infrastructure and systems.

Labor will help our neighbours ensure their infrastructure is sustainable and resilient.

This will be a part of Labor’s work to restore Australia’s credibility and reputation as a creative, collaborative and energetic member of the community of nations committed to addressing climate change.

Because we recognise the reality of climate change. And we understand that it is a lived experience, particularly for many of our friends and neighbours.

Supporting personal and financial security for women is critical to gender equality.

Ultimately, the full participation of women in the economy and in government, will only be achieved when women are confident and secure in their most fundamental rights.

Labor is concerned by the Morrison Government’s refusal to sign the UN International Women’s Day Statement – particularly by reports that Australia withheld support for the statement because of its support for access to safe abortion.

Labor believes reproductive choice and access to basic health care are integral to gender equality.

A strong civil society is vital to democracy, inclusion, transparency and openness, accountability, and the protection of minorities and marginalised groups.

A Shorten Labor Government will engage with civil society, not just as partners in the delivery of projects, but to support and strengthen the work they do and the role they play in their own countries.

Our engagement with civil society will include non-government organisations, business and professional associations, unions, local women’s organisations, media, and religious institutions.

Ensuring their viability is even more pressing in the face of rising authoritarianism, the shrinking space for civil society, and increasing attacks on freedom of the press across much of the region.

Labor will significantly increase the annual base grant for fully accredited NGOs in the Australian NGO Cooperation Program at a cost of $32 million over the forward estimates.

This increase reflects Labor’s commitment to working with non-government organisations to strengthen Australia’s aid delivery and also reflects our recognition that non-government organisations play a vital role in engaging with civil society.

To advance and protect disability, LGBTIQ, ethnic and religious minority and other human rights, Labor will appoint a Global Human Rights Ambassador.

We will also build the capacity of trade unions abroad to ensure people have access to fair and decent work and rights at work are better protected.

Our support for civil society also recognises the role and responsibility Australian businesses have both in enabling development and in ensuring human rights are protected overseas.

Labor will develop a National Action Plan on Business and Human Rights and strengthen the National Contact Point – the body that works to address human rights abuses by Australian businesses – and examine ways to provide better guidance to Australian companies on managing their requirements and obligations.

 

Conclusion

We are living in a time of disruption – in which the magnitude and nature of change shapes Australia’s strategic, economic and foreign policy interests.

Accompanied by a humanitarian crisis of unprecedented scale, it is essential that Australia’s international development program meets the challenges of these times.

Labor will rebuild Australia’s international development program – reversing the declining trajectory of the budget, rebuilding capability, and restoring consensus.

Labor’s international development program will speak to who we are, the confidence we have in ourselves, the values we believe in and to the region and world we want to live in.

Authorised by Noah Carroll, ALP, Canberra.