Budget freeze leaves aid sector the biggest loser

The Fred Hollows Foundation says it's disappointed at the Federal Government’s decision to cap aid spending at $5 billion annually for the next two financial years and abandon its commitment to CPI increases.

 “It’s a real cut that affects real people who would have had their sight and their dignity restored,” says Mr Doolan. 

The federal government expects to save $7.6 billion over 5 years as a result of the freeze and subsequent peg on Consumer Price Index payments from 2016/17.

Two billion dollars alone will come from abandoning bipartisan support to lift aid levels to 0.5% of the Gross National Income and tying rises to inflation instead.  

The cut to aid spending is the biggest single savings measure in the 2014 budget.    [Trachoma screening and surgery at Kuyu hospital in Oromia, Ethiopia.]

Mr Doolan said the money had been earmarked for work with some of the world’s most vulnerable people.

Mr Doolan is urging Canberra to channel more funds through NGOs.

“We have actually seen a minor increase in funding to NGOs despite the larger cuts to the aid budget," he said, "but funding to Australian NGOs is currently less than 3 per cent of the total Australian aid budget - it should be no less than 10 per cent.

"The Treasurer has failed to live up to his commitment to channel greater funding through Australian NGOs.”

The Foundation’s comments echo those of the Australian Council for International Development - the peak body for humanitarian and overseas development organisations. 

“When you’re talking about people living on $2 a day, every dollar counts and we’re incredibly disappointed to see the government fail to honour its election commitment,” said ACFID Executive Director, Marc Purcell.

However, Mr Purcell has welcomed an increase in humanitarian funding and the government’s ongoing partnership with Non-Government Organisations and volunteers.
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