Australia is cutting its foreign aid but will boost its counter-terrorism spending in measures outlined in its annual budget. Federal Treasurer Joe Hockey said Tuesday his financial blueprint would make the country “stronger, safer and more prosperous.” Australia’s budget deficit has soared to $28 billion as tax revenues and mining royalties fall.
The Australian government is cutting its foreign aid budget by 40 percent as it tries to balance its accounts at home. Indonesia, which has been the largest overseas recipient of Australian assistance, will see a $175 million reduction in aid.
Matt Tinkler, a spokesman for Save the Children Australia, said the poorest will suffer the most.
“Who that hits in particular is Indonesia’s vulnerable. What it means is less children get vaccinated, less girls go to school, less women get empowered through work and a job, so it really is the poor people of Indonesia, and our region, that are going to bear the brunt of this budget’s cuts,” said Tinkler.
Charities have also condemned Australia's decision to slash aid to Africa by 70 percent. Oxfam has said that in sub-Saharan Africa, the poorest region in the world, Australian assistance “is now next to nothing.”
Critics say it damages Australia’s international standing.
Officials in Canberra have said the decisions were taken after considering which of its aid recipients were also relief donors to other countries. Economic growth and the capacity of foreign governments to address issues of poverty and need were also considered. Ministers insist cutting assistance to Indonesia was not related to the recent execution of two Australian drug smugglers, which has caused diplomatic friction.
Australia’s budget deficit has doubled as the economy falters under slumping commodity prices, most notably iron ore, its biggest export.
Millions more will be spent on national security, and Treasurer Hockey said there will be extra funds for the fight against extremism.
“The threat of terrorism is rising and ever-evolving and our response must be swift and uncompromising. We must have the best counter-terrorism capabilities available. Tonight the Government is committing an extra 450 million for our intelligence capabilities to ensure that we have the very best equipment and skills necessary to keep our community safe,” said Hockey.
Hockey said this was a budget that unleashes Australia’s potential. There will also be tax breaks for small businesses and financial help to families, but critics have said not enough has been done to create new jobs.