1301.0 - Year Book Australia, 2001  
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 25/01/2001   
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The Australian aid program has undergone considerable changes over the past fifty years. Change has occurred in the administration of the program, its focus, the major countries receiving Australian aid and the type of aid provided.

Australia’s aid activities began before World War II when grants, generally below $100,000, were made to Papua New Guinea. In 1950 Commonwealth Foreign Ministers met in Colombo and launched the Colombo Plan, which was concerned with aid to South and South-East Asia. Under the Plan, Australia provided a diverse range of activities such as education scholarships, technical cooperation, training and staffing assistance to countries of the region.

In 1952 joint activities in other countries began, with aid targeted at low income member countries of the British Commonwealth. Papua New Guinea, which was being administered by Australia at the time, was the major recipient of Australian aid, along with India.

After the mid 1950s, aid decisions continued to be strongly influenced by political considerations, but as more countries became fully independent, and with changing international perceptions, the motives underlying the Australian aid program began to change. Due to Australia’s historical links to Papua New Guinea, aid to this country remained at two-thirds of the total aid program. In the 1960s South-East Asia gradually gained more importance than South Asia, with Indonesia overtaking India as the second largest recipient of aid. Progressively Australian aid became no longer tied to countries that were members of the British Commonwealth.

Today Papua New Guinea, the South Pacific and East Asia (in particular Indonesia, Viet Nam and the Philippines) feature prominently in Australia’s aid program, as shown in table 3.5.

Initially Australian aid was composed predominantly of bilateral assistance. In the 1960s cooperation between donor countries became established as a range of development agencies were formed, including the OECD’s Development Assistance Committee (DAC), a number of new United Nations agencies and the Asian Development Bank (ADB). In the early 1970s about 7% of Australian aid was provided to multilateral organisations, whereas now over a quarter of Australian aid is allocated to them.

Originally the aid program was administered by several government departments, including the Department of External Territories, the Department of Foreign Affairs and the Departments of Education and Treasury, reflecting the ad hoc nature of the program. In the early 1970s, in recognition of the need for stronger policy direction and coordination, along with Papua New Guinea achieving independence, a single government agency was set up to administer the aid program. First known as the Australian Development Assistance Agency (ADAA) then the Australian Development Assistance Bureau and later as the Australian International Development Assistance Bureau, it has evolved into the Australian Agency for International Development (AusAID).

Over the past twenty years, several reviews of the Australian aid program have been undertaken. In 1984 the Minister for Foreign Affairs commissioned the Jackson Review. The Review led to a stronger focus on partnerships with recipient countries through a country program approach. Instead of selecting individual projects, country programs were developed which considered the development priorities of recipient governments and Australia’s capacity to assist. Cooperative relationships were established, with both recipient and donor governments involved in the planning and implementation of country programs. The three agreed principal objectives for aid stemming from the Jackson Review were humanitarian assistance, support for Australia’s strategic interests and promotion of Australia’s commercial position. In addition the then Government decided on a geographic focus on Papua New Guinea, the South Pacific and South-East Asia, as well as a new sectoral focus including agriculture, infrastructure development, health, population planning and urban development.

In 1996 the Simons Review was commissioned by the Minister of Foreign Affairs. This led to the adoption of a single clear objective for the aid program: to advance Australia’s national interest by assisting developing countries to reduce poverty and achieve sustainable development. The Government decided that Papua New Guinea, the Pacific and East Asia would continue to be high priorities for Australian assistance. It was also decided that health, education, rural development and governance would be the priority sectors, in addition to two issues that cut across the development process: the promotion of gender equity and the maximisation of environmental sustainability. The Government’s response to the Simons Review strengthened the partnership approach emphasised in the Jackson Review, noting that effective partnerships with developing countries formed the core of Australia’s aid program.

Apart from understanding the need for a better-targeted and focused aid program there was also a significant emphasis, in the Government’s response to the Simons Review, on improving the quality of the program. This included support for a more vigorous focus on defining strategic and program objectives as well as on allowing better performance measurement and reporting on aid quality.