[Australia] Labor $1bn battle plan on poverty

from The Age

By Tim Colebatch, Canberra

LABOR has pledged to set up a $1 billion trust fund to help Pacific Islanders develop their own small businesses as part of a major overhaul of Australia's foreign aid program to focus it squarely on reducing poverty.

Labor's spokesman on overseas aid and Pacific island affairs, Bob Sercombe, said the Howard Government had limited the effectiveness of Australia's $2.5 billion-a-year aid program by spending too much of it on Australian consultants and using it for other purposes such as locking up asylum seekers.

Mr Sercombe said Labor in government would focus the aid program on working in partnership with developing countries to reduce poverty, using the United Nations' eight Millennium Development Goals as the benchmarks for outcomes.

Labor would establish an independent think tank on development issues, modelled on the Government's Australian Strategic Policy Institute, and consider making AusAID a separate department to encourage more effective debate within government and in the community on development issues.

"It's time for Australia to help make poverty history," Mr Sercombe said. "Third World poverty is the greatest challenge of our times, and Labor is joining the fight. We can't stand back when we could save 40,000 children in the Asia Pacific each year. This is a moral imperative."

Mr Sercombe said a recent OECD review of Australia's aid program found almost half of it was provided in the form of technical assistance, mostly by Australians. The Howard Government, he said, had also used the aid program to pay $100 million to set up and run detention centres for asylum seekers in Nauru and Papua New Guinea, and $83 million in inflated prices for Australian wheat sales to Iraq.

A Labor policy paper issued yesterday, Our Generation's Challenge, says Labor would increase Australia's aid budget from 0.36 per cent of national income in 2010 to 0.5 per cent "as quickly as budgetary circumstances permit". But it failed to commit to a specific timetable, as most other Western countries have done.

Instead, the paper focuses on improving the goals and structure of Australia's aid program, which the Howard Government plans to increase to $4 billion a year by 2010. The paper was welcomed yesterday by PNG Foreign Minister Sir Rabbie Namaliu, who praised the proposed Pacific Development Trust as "a welcome departure from existing aid arrangements that are based on government-to-government assistance".

Vanuatu Prime Minister Ham Lini said his people also would welcome the planned trust. "There is a real need in Vanuatu for this type of financial facility," he said.

Mr Sercombe said this generation of Australians faced a unique challenge to fight global poverty.

"More than 8 million people around the world die each year because they are too poor to stay alive," he said. "Our generation can choose to end that extreme poverty by 2025."