Indian Village:

"You Promised" Campaign - Background Information

What should the Australian Government do to keep its promise?

1. Give more

   Globally, current aid levels are around US$56 billion per year. The UN and World Bank estimate (conservatively) that this level will need to be doubled if the MDGs are to be met. In response to this, 19 out of 22 OECD (Organisation for Economic Cooperation and Development) donor countries have made commitments to increase aid (many of these give a bigger proportion of their wealth than Australia to begin with). Australia has not.

   During the last thirty years, wealth has doubled in Australia, our economic performance is now at the top of the OECD, and the budget is in significant surplus. While we have become richer as a nation, overseas aid has declined considerably as a proportion of our annual national income. In 1984 it was 0.47% - it is now 0.26% ($2.13 billion). In order to contribute our fair share towards achieving the MDGs, ACFID (Australian Council for International Development) estimates that we will need to double the amount of aid we are currently giving - up to a level of at least 0.5% GNI (Gross National Income). This increase could be accommodated easily within the natural increase in government revenue and would not require any additional taxes. A genuine commitment to the MDGs requires that Australia double its aid budget.

2. Give more effectively

   Increasing the amount of aid given, alone, will not see global poverty halved. The MDGs represent and require a clear focus of aid on the world's poorest people. Much of Australia's current aid budget is directed toward 'middle income' countries in our region. If the MDGs are to be achieved, a greater proportion of our aid needs to be directed towards the least developed countries (LDCs), many of which are located in Africa.

   A greater proportion of our aid must also be directed toward meeting the most basic human needs of the poor, including health, education, adequate housing, clean water and sanitation - the kinds of things your kids are learning about in this package! According to the OECD, in 2003 the Australian Government spent only 1.29% of its bilateral aid on basic education, 3.19% on basic health and 0.65% on water and sanitation. We need to target our aid differently if we are to make a real difference to world poverty.

3. Cancel the debts owed to us by poor countries

   Many poor countries are hindered from achieving the MDGs by their debt burdens to rich countries. The Australian Government has made progress in this area - it has cancelled 100% of the debt owed to it by Ethiopia and Nicaragua, and contributed a total of $77 million towards the multilateral Heavily Indebted Poor Countries (HIPC) initiative. Australia is well placed to take this response further by taking a lead, and working together with other debtors to cancel the debts owed by other countries such as Indonesia and Iraq.

For more information on the Jubilee 'Drop the Debt' campaign go to: www.jubileeaustralia.org

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