Quick Post: How accurate is @TheAusInstitute’s ‘Oz is 3rd largest recipient of its foreign aid’ claim?

The Australia Institute is one of Australia’s far too many ‘think tanks’.  Like its right wing counterparts, it receives tax concessions — a bugbear about which I’ve written before.

In an ideal world, think tanks would be one of the mechanisms by which research and analysis were translated into policy options.  Instead, we have an environment where think tanks undertake the role of advocates.  Thus, in order for ideas to be advanced in the agora, you have to shout down the professional trolls like the IPA, the CIS, and the Australia Institute first.

An example of this was distributed recently by the Australia Institute.  On their website and Tumblr page, they posted the following picture:

The image was distrubuted with the text:

Quick quiz: Do you know which countries are the top three recipients of Australian foreign aid?

Answer: 1. Indonesia 2. PNG 3. AUSTRALIA ……. But hang on, you said foreign aid, right?

Yep – Australia is the third biggest recipient of its own foreign aid! And look what we’re spending it on …..

That’s poor policy for such a rich country.

Down the bottom, you can see where they’ve sourced the information.  The idea is that Lefties would get outraged, note briefly the source of the information to see if it’s reputable, and then distribute it to their friends.  There have been a few of these ‘argument by image’ things circulating the place recently, and all of them suffer the same problem: they’re deceptive.

If you’re familiar with how Australia’s foreign aid budget works, you’d think this is an odd way of accounting for the funds.  Quite a lot of funding is made on a regional basis for capacity building, for example.  Sure enough, if you dive through the APH website for Hansard, you find the conversation to which the image refers, starting on page 114.

Senator RHIANNON: How was the decision made to reallocate up to $375 million of Australia’s aid budget towards domestic refugee support costs, without clearly identifying which programs would be affected by this decision, consistent with our commitments under the Paris Declaration on Aid Effectiveness, and reaffirmed and strengthened in Accra and Busan to provide:

… reliable indicative commitments of aid over a multi-year framework and disburse aid in a timely and predictable fashion according to agreed schedules …

Senator Bob Carr: As I said in the Senate, I think in answer to a question from Senator Rhiannon, everything we do in our ODA budget is within the OECD guidelines.

We prioritised $375.1 million of official development assistance in 2012-13 towards funding some of the costs of supporting refugees in Australia. That represents seven per cent of Australia’s total ODA budget of around $5.2 billion 2012-13. The Papua New Guinea and Nauru country programs and payments already made were excluded from the reprioritisation. Other important exclusions included loans, promissory notes and assessed contributions to which Australia is subject.

We are minimising the impact of this reprioritisation by ensuring that, wherever possible, commitments are delayed rather than reduced and that the reprioritisation is distributed broadly, equally across regions. The bottom line is that one cannot spend money one has not got. It is inconceivable that we would borrow money for ODA. With a contraction in government revenues it has been necessary to reprioritise, but our aid budget has grown and it represents one of the most generous aid programs in the world. All Australians can be very proud that that $5.2 billion is being spent with maximum effect.

So about seven per cent of $5.2 billion is being spent with Australia as the ‘recipient’, an allocation which is consistent with OECD guidelines.  None of that information makes it into the graphic and yet it is important for the audience if they’re to understand the broader picture.

More information is provided on page 117:

Senator Bob Carr: […] I am just looking at Australia’s total ODA by partner country and region, and the increase in aid from 2006-07 to 2012-13 is altogether striking. When you ask about the attitudes of our partners, both nations and NGOs, they are very aware that Australia’s credibility is derived from the steep increase in aid that this government has delivered. I can quote three examples and I am happy to quote more: Papua New Guinea, in 2006-07 received $345 million; the current revised estimate puts aid to Papua New Guinea at $493 million. It has gone from 345 to 493. Another example—South and West Asia—it has gone from $143.6 million in 2006-07 to the current revised estimate of $475 million this year. In East Asia, the increase has been from $787 million to $1.207 billion. This is a steep trajectory—a big increase—and we are entitled, given the contraction of revenues, to say some projects in the context of this overall increase will be postponed and some reduced.

So there are two parts to consider.  Even if Australia really is the third largest recipient of its own aid (which, as we now know, it isn’t), we know that the amount of money going to all countries is increasing substantially (should it increase this much is another more difficult conversation).  So an informed person would look at the graphic and say: ‘Yes, if you ignore relevant details, Australia is the third largest recipient of its own foreign aid, but the amount of aid is increasing overall (even if you exclude the amount that goes to Australia).  If you ignore the allocation to Australia, things still look great.  Do I really care?’

The second part is that East Asia had $1.207 billion dollars allocated to it.  Why on Earth are we crying over $375.1 million?

Next, we might wonder what if other countries do the same thing.  The same source tells all:

Senator Bob Carr: […] The practice—that is, of finding money from an ODA budget to sustain refugee costs on our soil—is practised by the United States, with $895 million; France, $435 million; Sweden, $397 million; the Netherlands, $339 million: Norway, $335 million; and Canada, $284 million. These are all countries doing what we are doing: consistent with OECD practice, sustaining refugees on their soil as a matter of ODA as much as sustaining them in refugee camps offshore.

So… we’re only talking about 7 per cent of the ODA budget, we’re describing a small fraction of what goes to other regions, and other countries do the same thing?  Why would we be outraged by this practice?  Oh, because we don’t know much about it and The Australia Institute has fed us misleading ‘information’.

Let’s look at one final bit.  The arrow from our budget going to the right says that the money is spent on ‘domestic refugee policies’.

What is it being spent on (according to Peter Baxter, Director-General of AusAID on page 121):

Mr Baxter: That document is the OECD guidelines. It sets out that items such as food, shelter and training can be claimed as a legitimate ODA expenditure under the guidelines, as many other governments do around the world.

In the Universe next door, the Australia Institute might have run the following (but with better graphics):

TAI foreign aid revised


Ideally, this guff from the Australia Institute might make us all a bit more cautious about circulating these memes.

For the record, I don’t care much for the ALP; I’m historically an LNP voter.  But I also care about having an informed and reasonable discussion about these issues.  Think tanks like the Australia Institute are not contributing to an informed debate when they circulate these images.


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