Law Library Stacks

Back to Regulation of Foreign Aid

The Australian government recently released a report setting out the policy framework for its aid program in response to an independent review.  The review was aimed at ensuring the program’s effectiveness as its budget is increased to 0.5% of GNI over the next five years.  Features of the program include a lead government agency (AusAID); a geographic focus on East Asia and the Pacific; a commitment to the Millennium Development Goals; an emphasis on partnerships with recipient countries, other government agencies, and non-governmental organizations; a focus on core objectives, results, and value for money in aid allocation and in procurement and evaluation processes, with nearly all aid being untied; a separate annual appropriation for the program; and internal and external oversight and reporting mechanisms.  Australia also regulates the private donation system through an accreditation process and engages in different development assistance initiatives apart from direct aid to countries, such as providing scholarships and addressing issues in the remittance system.

I. Introduction

A.   Official Development Assistance Figures

The Australian government’s total Official Development Assistance (ODA) budget for the 2011-12 fiscal year is AU$4.84 billion (about US$5.14 billion).[1]  This is estimated to be equivalent to 0.35% of Australia’s Gross National Income (GNI).  This is an increase upon the previous year when the ODA expenditure was estimated to amount to 0.33% of GNI.[2] 

There is bipartisan agreement in Australia to raise the ODA budget to 0.5% of GNI by 2015-16.  To reach this target, the government has stated that it expects to increase the ODA budget to around 0.38% of GNI in 2012-13, 0.42% of GNI in 2013-14, and 0.46% of GNI in 2014-15.[3]  Beyond this, Australia has a longstanding “aspirational goal” of increasing expenditure to 0.7% of GNI (the target first agreed to by donor countries in 1970 and used as a reference point by the OECD[4]).[5]

B.  Private Contribution Figures

It is estimated that Australians contribute about AU$800 million (about US$856 million) per year to non-governmental organizations (NGOs) operating in the area of international aid.[6]  According to the Australian Council for International Development, this represents approximately 73% of total funds raised by agencies.  A further 14.5% of total funds managed by the sector consists of government funding received by NGOs through the government agency AusAID, while 12.6% is made up of grants from other Australian and multi-lateral donors.[7]  There are more than one hundred overseas development NGOs operating in Australia, including affiliates of international organizations as well as wholly local organizations.[8]

C.  Snapshot of Foreign Aid Activity

In 2011-12, Australia will provide bilateral aid to around 35 countries.  An additional 78 countries will receive assistance through regional and global initiatives.  The geographic focus of the program is currently East Asia (33%) and the Pacific (31%), with the top five recipients of Australian aid for the year expected to be Indonesia, Papua New Guinea, Solomon Islands, Afghanistan, and Vietnam.[9] 

In total, approximately 73% of AusAID’s administered funding (about AU$3 billion) will go toward country and regional programs.  Funding for global and multilateral initiatives, including humanitarian assistance and contributions to United Nations (U.N.) agencies, the World Bank, the Asian Development Bank, and non-governmental organization and volunteer programs, is estimated to constitute 27% of AusAID’s budget (about AU$1.1 billion).[10]

Half of the total aid expenditure “is expected to go towards projects in the areas of education, health, and economic growth.”[11]  Australia emphasizes that it is committed to the implementation of the Millennium Development Goals, which “underpin the Australian aid program.”[12]

Due to the established goal of increasing the ODA budget to 0.5% of GNI by 2015-16, in late 2010 the government sought an independent review of the effectiveness of Australia’s aid program, with the aim of ensuring that the increased funding is spent in the most effective manner.  The independent panel reported back to the government in April 2011, and its report, along with the government’s response, was released in early July 2011.[13]  The response sets the strategic direction for the aid program for the next four years and includes activities aimed at improving transparency and oversight, as well as making the program “more focused on results and on real, measurable value for money.”[14]

In terms of the specific actions arising from the Independent Review, the government has stated that it will:[15]

  • Develop a four-year, “whole of ODA” budget strategy, which will be considered as part of the 2012 Budget process, and ensure regular reviews of the program;[16]
  • Ensure value for money in designs, procurements, and grants, as well as greater selectivity and larger average program size;[17]
  • Improve risk management and performance oversight, including through stronger fraud control and enhanced evaluation programs;[18]
  • Develop a “Transparency Charter” with clearer and more accessible reporting of aid activities;[19]
  • Ensure that budget reporting is linked to results and that decisive action is taken on non-performing programs;[20]
  • Enhance the involvement of the Australian community, including through increased volunteer and NGO support and partnerships with business and academia.[21]

Several other reviews relating to Australia’s aid program have been conducted in recent years, including reviews of remuneration rates for contracted technical advisers, fraud control policies, grant guidelines, Annual Reviews of Development Effectiveness, as well as an OECD Development Assistance Committee peer review in 2008.[22]  A review of the procurement system is expected to be completed in 2011.[23]

Back to Top

II.  Legal Framework

A.  Regulation of ODAs

1.  Overview

Australia’s aid program is established through executive decision-making processes (i.e., Ministers and the Cabinet) as well as being subject to parliamentary approval and oversight in the context of the appropriations process and the reporting requirements that apply to all government agencies and Ministers.[24] 

As noted above, the policy framework and strategic direction for the aid program, including the criteria upon which decisions on the funding of various activities will be based, was recently set out in the government’s response to the Independent Review of Aid Effectiveness.  This states that decisions on aid allocation (i.e., to countries, regions, and sectors) will be based on sets of goals and objectives, as well as three broad “aid allocation criteria”: poverty-related need, effectiveness (or “capacity to make a real and measurable difference”), and Australia’s national interests.[25] 

As a result of the Independent Review, the government agreed to the following core purpose statement relating to Australia’s aid program:

The fundamental purpose of Australian aid is to help people overcome poverty. This also serves Australia’s national interests by promoting stability and prosperity both in our region and beyond. We focus our effort in areas where Australia can make a difference and where our resources can most effectively and efficiently be deployed.[26]

From this fundamental purpose, the government has articulated five “core strategic goals” for the overall aid program that will be taken into account in decision-making and evaluation processes: [27]

  • Saving lives;[28]
  • Promoting opportunities for all;[29]
  • Investing in food security, sustainable economic growth, and private sector development;[30]
  • Supporting security, improving the quality of governance, and strengthening civil society;[31] and
  • Preparing for and responding to disasters and humanitarian crises.[32]

Ten “individual development objectives” that give effect to these goals are also set out in the government’s response to the Independent Review.[33]  The response then lists five approaches that the government intends to use to deliver aid more efficiently and effectively.  These are reflected in the specific actions set out above. 

In addition to working within this policy framework, AusAID and entities with which it contracts must meet operating requirements that are set out in a number of statutes. They include the following areas of federal law: [34]

  • Anti-discrimination legislation;[35]
  • Legislation setting out employer obligations;[36]
  • Legislation that applies to the conduct and oversight of the public sector;[37]
  • Sector legislation;[38] and
  • Criminal legislation.[39]

Government agencies, contractors, and NGOs must also comply with regulations made under the Charter of the United Nations Act 1945 to implement sanctions imposed by the U.N. Security Council against member countries, as well as individuals and entities.  The guidance provided to AusAID contractors states that:

Under the Regulations, it is a criminal offence to deal in a specified range of goods or services with particular countries, or to use or deal with the assets of a number of specified individuals or entities, or to make assets available to a number of specified individuals or entities.  The offences created by the Regulations apply to conduct in Australia and to conduct by Australians anywhere in the world.  The Regulations are supported by parallel regulations and ordinances made under other legislation, for example the Customs (Prohibited Imports) Regulations and Customs (Prohibited Exports) Regulations.[40]

For example, the most recent regulations made under the Charter of the United Nations Act relate to the sanctions against Libya,[41] while others from 2010 relate to sanctions against specified entities in Iran[42] and the sanctions against Eritrea.[43]

The approach to delivering the aid program is also guided by various procedural instructions,[44] including the Commonwealth Grant Guidelines, Commonwealth Procurement Guidelines,[45] Commonwealth Fraud Control Guidelines,[46] Australian Government Investigations Standards,[47] Lobbying Code of Conduct,[48] and any relevant AusAID policy documents, such as “Family Planning and the Aid Program: Guiding Principles.”[49]

2.  Implementing Agencies

Of the 2011-12 ODA budget, AU$4.87 billion, or around 89%, will be administered by the Australian Agency for International Development, or “AusAID.”[50]  The remaining 11% of the budget will go toward programs run by a variety of government agencies, about a quarter of which is used for international programs operated by the Australian Federal Police.[51]

AusAID is an administratively autonomous agency under the Department of Foreign Affairs and Trade portfolio.[52]  It was established as a government agency in 1974 to bring together roles previously performed by different departments since an aid program to Papua New Guinea began in 1946.  In 1976, the agency was renamed and became part of the Department of Foreign Affairs portfolio.  Then, in July 2010, AusAID was established as an executive agency within the Foreign Affairs and Trade portfolio.   Its role involves advising the government on development policy, management of the implementation of Australia’s overseas development programs, and planning and coordination of Australia’s response to humanitarian disasters.[53]

There is an emphasis on whole-of-government engagement in the management of the aid program.  A Development Effectiveness Steering Committee, made up of senior representatives from central agencies, provides “a whole-of-government coordination mechanism” at the strategic level and oversees the effectiveness of the aid program.  AusAID also states that it takes a collaborative approach to working with other agencies, including in developing strategic priorities and delivering the aid program.[54]

3.  Restrictions

In discussing the strategic direction and policy framework of the aid program, Australia stresses that there are direct national security and national economic interests at stake within its immediate region.  For example, in terms of economic benefits, the government states that “by lifting people out of poverty, we also grow the global economy and that is good for Australian business.”[55]  In addition, the Australian government emphasizes that it has “broader interests and values in enhancing the stability and fairness of a global rules-based order.”[56]  This principle of “good international citizenship” seeks to promote a recognition that the government’s ODA policy “together with our foreign policy, security policy, and our international economic and environmental policies, all have an impact in supporting a stable and humane order that benefits all countries in the world.”[57] 

The linkages of the aid program to Australia’s national interests do not include requirements that suppliers be Australian entities.  In 2002, as part of an international initiative, AusAID began untying some aid components to Least Developed Countries, and by 2005 had untied the “vast majority” of its aid to these countries.[58]  Australia then untied the remainder of its aid expenditure in 2006, except for the Australia Indonesia Partnership for Reconstruction and Development.[59]  Instead, aid contracts are subject to a procurement process that involves preferred bidders being selected on the basis of value for money.  This is in line with the Commonwealth Procurement Guidelines, which also “prohibit discrimination based on foreign ownership, affiliation or location.”[60] 

AusAID states that its “procurement framework encourages competition and ensures that the agency uses its resources efficiently, effectively, and ethically, and makes decisions in a transparent and accountable manner.”[61]  A range of mandatory and recommended due diligence checks are made before AusAID enters into a contracting agreement with an entity.  These seek to “identify and manage key reputational and programmatic risks associated with implementing partners, such as fraud, misrepresentation, financial mismanagement and corruption.”[62]  For example, AusAID’s fraud control policy requires that any company or non-governmental organization on fraud blacklists are to be automatically excluded from bidding AusAID contracts.[63]

An internal audit section reviews the fraud control mechanisms of partners, such as non-governmental organizations, contractor firms, and academic institutions.[64]  Partner government systems are also carefully assessed, and assistance is provided where needed; for example, to implement systems aimed at managing fraud and corruption.[65]

4.  Policy Considerations

In terms of the mechanisms available for implementing the aid program, in addition to non-governmental organizations, other government agencies, and contracted companies, AusAID includes “regional governments” in its list of partners, stating that “Australia increasingly looks to opportunities to use partner country processes and systems to deliver the aid program.”[66]  It refers to the 2005 Paris Declaration on Aid Effectiveness, which calls for “closer partnerships between aid agencies and partner countries through the delivery of aid via the partner country’s budget and the use of its procurement and financial management systems where possible.”[67]  In addition, Australia, along with New Zealand and other Pacific Islands Forum countries, signed the Cairns Compact on Strengthening Development Coordination in the Pacific in 2009.[68]  This agreement includes principles relating to mutual responsibilities and the involvement of the recipient countries in determining and achieving development priorities in Pacific Island countries.

The Australian government’s response to the Independent Review stated that it would continue to use a range of possible partnerships for delivering aid on a direct country-to-country basis.  This included national delivery through developing country government systems, which is stated as having the benefit of reducing the administrative burden on partner governments and enabling greater ownership, as well as leveraging national resources and facilitating “greater alignment with partner government priorities.”[69]  However, the response also states that, “to guard against the risk that aid funds will be poorly managed, we will only use partner government systems where we assess these as being robust.  Where they are not, we will work to strengthen these before any Australian funds are provided.”[70]

Direct partnerships with governments are seen by Australia as a better option in countries where it is the lead or major donor.  In such countries, the government says that it will “pursue results across a range of sectors,” including a partnership approach with the country’s government.[71]  However, in countries where Australia is a relatively small donor, or where aid is only a small proportion of the partner government resources, the focus “will be even more selective and our effort combined with that of other partners to achieve impact.”[72] 

Australia has now signed Pacific Partnerships for Development agreements with eleven Pacific Island countries, where it is a major (if not the primary) donor.[73]  These agreements are aimed at improving the focus of Australia’s aid on a defined number of mutually-agreed sectors.  The fundamental principles underlying the agreements are mutual respect and mutual responsibility:

Mutual respect:  the Partnerships take country ownership seriously and respect partner country leadership of their own national development plans. Australia and partners will also acknowledge accountability to our respective Parliaments for the impact and effective use of development assistance. 

Mutual responsibility:  the Partnerships will be explicitly based on mutual, long-term and measurable commitments for development results. Australia will commit to provide new and additional bilateral assistance over time in return for commitments by Pacific partners to improve governance, enhance private sector development, increase investment in economic infrastructure, achieve better outcomes in health and education and in other areas.  Jointly, we will assess progress towards development outcomes and hold each other accountable for the commitments we make in the Partnerships.  Australia will not engage in conditionality—all commitments made by Pacific partners will be jointly identified and agreed and draw from partners’ own national development plans.[74]

The agreement for which implementation has been most advanced is that with Papua New Guinea, which was signed in 2008.[75]  AusAID states that it is supporting the country’s own priorities by focusing on four key areas: health (including HIV), education, transport infrastructure, and law and justice.[76]  In 2011-12, AusAID expects to spend AU$436.5 million on projects in Papua New Guinea, while other agencies will also contribute AU$45.8 million.[77]

5.  Discretionary Aid

In addition to the funding allocated to specific ODA activities through the appropriations process, which is explained below, Australia provides funding on a discretionary basis to local projects in various countries through competitive grant programs.[78]  This includes two programs through which NGOs that have been established in developing countries can apply for funding: the Direct Aid Program (DAP) and the Small Activities Scheme (SAS).

The DAP is a “flexible, small grants program funded by the Australian Government through AusAID and managed by the Department of Foreign Affairs and Trade.”[79]  It involves the disbursement of funds at the discretion of the Australian Head of Mission in different countries.  Each post has a DAP strategic plan and a DAP Committee, which makes recommendations to the Head of Mission, who makes the final funding decision.[80]  Each overseas post may have slightly different processes and criteria, but will focus on ensuring that projects “have developmental outcomes, and are consistent with the international relations and public diplomacy objectives of the Post.”[81]  Furthermore, the emphasis is on projects that have a direct benefit to those most in need in the local community.

In 2010-11, the total DAP budget was AU$8.25 million.  The budgets of the individual posts range from AU$10,000 to AU$510,000.[82]  The Independent Review recommended that the budget for the DAP should at least double, with the highest increases made in countries with no country program.  The government agreed in principle with this recommendation, with the details to be determined through the 2012-13 budget process.[83]

The SAS is aimed at contributing to “the reduction of poverty and the achievement of sustainable development through small scale interventions.”[84]  It is normally administered by the resident AusAID officer in the Australian Embassy or High Commission within a country.  For example, in China, the scheme is managed by AusAID in consultation with the Chinese Ministry of Commerce.  It “provides grants for small-scale development cooperation activities in poorer, remote and minority group areas, especially in the national poverty counties.”[85]  The maximum funding available for each project is AU$100,000.[86]

In addition to these programs for developing country NGOs, there is a Human Rights Grants Scheme that provides funding to NGOs and human rights organizations based or operating in developing countries.  The scheme is overseen by an expert panel that makes recommendations to the Minister for Foreign Affairs.  Grants are awarded to projects that achieve one or more of the following objectives:

  • prevent or end gross human rights violations
  • promote positive change in policies or actions of government or relevant non-state actors in the area of human rights
  • monitor, seek redress for and/or report on human rights violations, including supporting victims of human rights abuses
  • educate and/or train human rights victims, workers or defenders
  • promote observance and implementation of international human rights standards
  • promote and strengthen national or regional human rights institutions or mechanisms.[87] 

Grant programs operated by or on behalf of AusAID are subject to the standard Commonwealth Grant Guidelines.[88]

6.  Oversight

The aid program is subject to both internal and external oversight mechanisms that seek to ensure financial and program accountability and to identify possible improvements.  This includes annual performance reports within the internal quality assurance system that assess the performance of a country or regional program in terms of its progress against the country or region’s development goals, the contribution of Australian aid, and aid management.[89]  In addition to these reports, there are quality reports on individual aid activities as well as independent evaluations of significant activities commissioned at least once every four years.[90]  AusAID also commissions a number of “cross-program evaluations at the sectoral and country strategy level” each year.[91]  The Performance Review and Audit Section of AusAID is responsible for conducting particular internal reviews as well as for developing and overseeing AusAID’s fraud control framework.[92]

The Office of Development Effectiveness was established in 2006 as a separate unit within AusAID.[93]  The Office reports directly to the Director General of AusAID and is separate from the other parts of the agency that are responsible for managing the aid program.  It is guided by the Development Effectiveness Steering Committee, which is chaired by the Director General and comprises deputy secretaries from the Department of the Prime Minister and Cabinet, the Department of Foreign Affairs and Trade, the Treasury, and the Department of Finance and Deregulation.[94]  This committee advises the government on major aid policy and budget priorities and concerns.  The Office undertakes annual reviews of development effectiveness that are tabled in Parliament, as well as evaluations of particular matters.  These reports are available on the Office’s website.[95]  The Office also checks the robustness of the internal quality reporting system.

In terms of external oversight, the Australian National Audit Office’s annual work plan of performance audits includes audits of aspects of Australia’s aid program.[96]  AusAID must also develop an annual report that is tabled in Parliament in October each year, as required by the Financial Management and Accountability Act 1997.[97]

Australia’s aid program is also subject to peer reviews by other donor countries as part of the OECD Development Assistance Committee (DAC) arrangements.  The last peer review of Australia was conducted in 2008.[98]

B.  Regulation of Private Contributions

NGOs involved in overseas aid activities may be granted income tax exempt status, as well as being eligible for other tax concessions and exemptions relating to Goods and Services Tax and Fringe Benefit Tax, under Australia’s tax legislation as it applies to non-profit entities.[99]  Not-for-profit (NFP) or charitable organizations must also comply with the registration and other regulatory requirements under either the Corporations Act 2001 (Cth) or state legislation applicable to incorporated associations.[100]  As part of Budget 2011, the government announced that a new body, the Australian Charities and Not-for-profits Commission (ACNC), will be established and commence operations on July 1, 2012.[101]  This agency will “initially be responsible for determining charitable, public benevolent institution, and other NFP status for all Commonwealth purposes; providing education and support to the sector; implementing a  ‘report-once use-often’ general reporting framework for charities; and establishing a public information portal by 1 July 2013.”[102]

Donations collected by organizations for their overseas aid activities can be claimed as tax deductions by donors if the organization “has been admitted to the Overseas Aid Gift Deduction Scheme (OAGDS) and been endorsed by the Australian Taxation Office (ATO) as a deductible gift recipient (DGR) for the fund that it operates.”[103]  This process involves the Minister for Foreign Affairs declaring that an organization is an “approved organization” following an approval process that is run by AusAID.  The organization’s overseas aid fund must also be a “public fund” established “solely for the relief of people in a country declared by the Minister for Foreign Affairs to be a developing country,” and that the Treasurer has declared to be a “relief fund.”[104]  Various requirements must be met for an overseas aid fund to qualify as both a “public fund” and a “relief fund” for the purposes of the scheme, as well as for the organization to be endorsed by the ATO.[105]

Non-governmental aid organizations may also need to register under and comply with each Australian state’s fundraising legislation.[106]  Other legislation that must be complied with includes the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth), Spam Act 2003 (Cth), and Privacy Act 1988 (Cth).  Organizations must also comply with the regulations implementing U.N. sanctions, as noted above, and must not deal with listed terrorist organizations under the Criminal Code Act 1995 or the Charter of the United Nations (Terrorism and Dealing with Assets) Regulations 2002 (U.N. Charter Regulations).[107]

To receive any government funding, an NGO must be accredited by AusAID.[108]  Organizations must submit a range of evidence and are assessed against accreditation criteria.  They must also be signatories of the Australian Council for International Development Code of Conduct for Non-Government Organisations in order to receive accreditation.[109]  This is a self-regulatory code that sets out standards of governance, management, financial control, and reporting.  Organizations must submit an annual report to the Council that is used to assess compliance with the code.  Various other voluntary codes of practice can also be signed by NGOs, and adherence to these can provide assurances to donors regarding the practices and integrity of the organizations.[110]

A new draft accreditation guidance manual was released for comment in June 2011.[111]  In addition to the accreditation process, the risk management framework relating to the funding of NGOs includes accreditation reviews that are undertaken every five years, as well as audits, spot-checks, and cluster evaluations that assess the capacity of NGOs receiving funding.[112] 

Back to Top

III.  Foreign Aid Appropriations Process

The ODA budget is determined as part of the annual appropriations process that is primarily governed by the Financial Management and Accountability Act 1997 and associated regulations,[113] as well as the Australian Constitution.  Broadly, under the Constitution, “no money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law.”[114]  The mechanisms for this include annual appropriations bills that contain appropriations of specified amounts for government operations.  Additional appropriations bills can be introduced during the financial year “in order to meet requirements that have arisen since the last Budget.”[115]  Annual appropriations bills that form part of the Budget are accompanied by Portfolio Statements.  These are “the most comprehensive and inform Members of Parliament and the public of the proposed allocation of resources to government outcomes.”[116] 

The ODA budget, including for both bilateral and multilateral activities and expenditure by all government agencies involved in the delivery of the aid program, is a separate item within the annual Budget – it is not combined with the appropriations and portfolio statements relating to the Department of Foreign Affairs and Trade.  AusAID prepares its own advice and documentation required by the Financial Management and Accountability Act 1997 in accordance with its status as a “prescribed agency” under that legislation.[117]

Back to Top

IV.  Other Types of ‘Aid’

The following are examples of different types of development assistance provided by the Australian government that do not involve the provision of direct aid to countries for particular activities.

A.  Debt Relief

Australia contributes to international debt relief initiatives, including the Heavily Indebted Poor Countries Initiative (HIPC), the Multilateral Debt Relief Initiative (MDRI), and World Bank arrears clearance activities.[118]  In addition, Australia has entered into bilateral debt relief arrangements and “has provided 100% debt forgiveness to those HIPC qualified countries that owe money directly to Australia.”[119]

B.  Scholarships

The Australian government has established an “Australian Awards” program “to promote knowledge, education links and enduring ties between Australia, our neighbours and the global community.”[120]  One aspect of the program is Development Awards, which are administered by AusAID.  Such awards have been part of the overseas aid program since the 1950s.  The current Development Awards include:

  • Australian Development Scholarships (ADS), which “provide opportunities for people from developing countries to undertake full time undergraduate or postgraduate study at participating Australian universities and Technical and Further Education (TAFE) institutions”;[121]
  • Australian Leadership Award Scholarships (ALA Scholarships), which target “high achieving applicants” from developing countries wishing to undertake postgraduate study in Australia;[122]
  • Australian Regional Development Scholarships (ARDS), which provide opportunities to people from developing countries in the Pacific to study at selected education institutions outside Australia;[123]
  • Australian Leadership Awards Fellowships (ALA Fellowships), which “provide short term opportunities for study, research and professional attachment programs in Australia, delivered by Australian organisations, to nominated fellows from eligible countries”;[124]
  • Prime Minister’s Pacific-Australia Awards, which provide a combination of work placement and leadership training for recipients of development awards who “are leaders or potential leaders of their country”;[125] and
  • AusAID Short Course Awards, which “aim to reduce the impact on partner countries of long-term absences of key personnal [sic].”[126]

C.  Guest Worker Pilot Program

The Department of Education, Employment and Workplace Relations administers the Pacific Seasonal Worker Pilot Scheme.[127]   Under this program, workers from Kiribati, Papua New Guinea, Tonga, and Vanuatu who receive an employment offer from an approved employer may receive a special visa to work in Australia for four to six months.  The program started in 2008-09 to “place workers in regional Australia where there is unmet demand for low skilled workers for employment in horticultural positions.”[128]  As of May 2011, 468 visas had been issued to Pacific seasonal workers under the program.[129]

D.  Remittances

The Australian government is highly aware of the significance of remittances by workers in Australia to developing countries, particularly in the Pacific region.[130]  AusAID therefore undertakes various activities related to ensuring that the remittance system is fair, effective, and secure.

A key initiative, funded by AusAID in partnership with the New Zealand Aid Programme and developed and managed in conjunction with a private development consultancy, is a remittance database that aims to improve transparency and competition in the remittance system, thereby reducing costs in the long term.[131]  The resulting website,, provides information to people in the two countries about remittance methods, operators, and fees.[132] 

In addition, AusAID has a partnership with the Westpac Banking Corporation to provide financial literacy training to Pacific seasonal workers prior to their entry into Australia as part of the Pacific Seasonal Worker Pilot Scheme,[133] as well as to rural or vulnerable communities in some countries.  This latter program, the Pacific Financial Inclusion Program,[134] receives funding from AusAID along with international development agencies.[135] 

In terms of the efficiency and accessibility of payment systems, Australia and New Zealand have also partnered with the International Finance Corporation and the World Bank Group to develop the Pacific Payments, Remittances and Securities Settlement Initiative.[136]  AusAID is also a member of the Pacific Financial Inclusions Donors Group, which seeks to coordinate efforts and develop strategies to further their vision to “optimize collaboration amongst donor partners in the Pacific with a view to expanding access to financial services to an additional two million Pacific Islanders by 2012 in an effective, efficient and sustainable manner.”[137]

In October 2010, a joint Australian and New Zealand report on remittance costs to Pacific countries was presented to the Pacific Islands Forum Economic Ministers Meeting.  Following a discussion of the report, the Ministers agreed “to explore and prioritise support for domestic initiatives in both sending and receiving countries to promote lower remittance costs.”[138]

In seeking to ensure that the remittance system is protected from misuse for criminal or terrorism purposes, Australia regulates remittance service providers through the standard financial and regulatory system that applies to financial institutions such as banks, as well as placing restrictions on remittance dealers that operate outside that system.  In the latter situation, the government agency AUSTRAC (Australian Transaction Reports and Analysis Centre) operates the Register of Providers of Designated Remittance Services, and monitors and enforces mandatory reporting processes.[139]  It is an offense for a person to provide a “registrable designated remittance service” if the person’s name and other details are not entered on the register.[140]

E.  Trade Enabling Policies

The Australian government has identified that “the adoption of more open and freer trade and investment by developed countries would allow developing countries greater access to markets, knowledge and technologies” and therefore that “an open and predictable rules-based multilateral trading system is crucial.”[141]  It particularly highlights agricultural subsidies in developed countries as being a restrictive trade practice with harmful long-term effects, and advocates for their removal.  It states that countries with these subsidies “exacerbate the current food security problem by insulating their producers from world price changes, shifting the adjustment burden to farmers in developing countries, and taking market share away from them.”[142]

Back to Top

Prepared by Kelly Buchanan
Foreign Law Specialist
September 2011

[1] Australian Government, Summary of Australia’s Overseas Aid Programme 2011-12: Budget Highlights (May 10, 2011),

[2] Id.  The most recent OECD donor statistics available show that Australia’s total gross ODA disbursements in 2010 amounted to US$3.848 billion, which was estimated to be about 0.32% of GNI.  In terms of net disbursements, this figure included US$3.466 billion for bilateral ODA and US$0.32 billion for multilateral ODA.  OECD donor country statistics are available at ODA_DONOR (last visited Sept. 1, 2011).

[3] Australian Government, Australia’s International Development Budget Statement 2011-12: Statement by Hon. Kevin Rudd MP [Ministerial Budget Statement] 3 (May 10, 2011), available at au/budget/2011-12/content/download/ms_ausaid.pdf?v=1.

[4] The 0.7% ODA/GNI Target – A History, OECD Development Co-operation Directorate (DCD-DAC),,3343,en_2649_34447_45539475_1_1_1_1,00.html (last visited July 27, 2011).

[5] Australian Government, An Effective Aid Program for Australia: Making a Real Difference—Delivering Real Results [Government Response] 1 (July 2011), available at

[6] Australian Government, Independent Review of Aid Effectiveness [Independent Review] 3 (Apr. 2011), available at

[7] Facts and Figures, Australian Council for International Development, http://www.acfid. (last visited Aug. 22, 2011).

[9] Ministerial Budget Statement, supra note 3, at 6.

[10] Id.

[11] Department of Foreign Affairs and Trade, Portfolio Budget Statements 2011-12: Australian Agency for International Development (AusAID) 106 (May 2011), available at 2012_pbs/2001-12-PBS-Foreign-Affairs-and-Trade-ausaid.pdf.

[12] The Millennium Development Goals: The Fight Against Global Poverty and Inequality, AusAID, (last visited Aug. 22, 2011).  See also Government Response, supra note 5, at 7.

[13] See generally Independent Review of Aid Effectiveness, (last visited Aug. 22, 2011).

[14] Government Response, supra note 5, at 1.

[15] See id. at 2.

[16] Id. at 19.

[17] Id. at 20.

[18] Id. at 21–23.

[19] Id. at 24.

[20] Id. at 23–24.

[21] Id. at 25–26.

[22] See DAC Peer Review of Australia – Main Recommendations and Findings (2008), OECD website,,3343,en_2649_34603_41877687_1_1_1_1,00.html (last visited Aug. 22, 2011).

[23] See Government Response, supra note 5, at 20.

[24] For information about the Australian government accountability frameworks, see generally Foundations of Government: Accountability, Australian Public Service Commission, foundations/accountability.htm (last visited Aug. 22, 2011).  For information about the structure and operations of Australia’s public service, see Foundations of Government: Introduction, Australian Public Service Commission, (last visited Aug. 22, 2011).

[25] Government Response, supra note 5, at 27.

[26] Id. at 1, 17.

[27] Id. at 2.

[28] Id. at 28–29.

[29] Id. at 30–32.

[30] Id. at 33–36.

[31] Id. at 36–38.

[32] Id. at 38–39.

[33] Id. at 2. 

[34] See AusAID, Lists of Laws and Guidelines for Contractors Undertaking Activities for AusAID (June 2010), available at

[35] Including the Age Discrimination Act 2004 (Cth), Equal Opportunity for Women in the Workplace Act 1999 (Cth), Sex Discrimination Act 1984 (Cth), Disability Discrimination Act 1992 (Cth), Racial Discrimination Act (Cth), and the Human Rights and Equal Opportunity Commission Act 1986 (Cth).  See Respecting the Diversity of the Australian Community in Providing Services, Australian Public Service Commission, (last visited Aug. 22, 2011).

[36] For example, the Occupational Health and Safety Act 1991(Cth) and Fair Work Act 2009 (Cth).

[37] Including the Public Services Act 1999 (Cth), Auditor-General Act 1997 (Cth), Ombudsman Act 1976 (Cth), Freedom of Information Act 1982 (Cth), Privacy Act 1988 (Cth), and Archives Act 1983 (Cth).  In addition, the Financial Management and Accountability Act 1997 (Cth) provides the framework for the proper management of public money and public property.

[38] For example, the Building and Construction Industry Improvement Act 2005 (Cth), Banking Act 1959 (Cth), and Corporations Act 2001 (Cth), as well as the Environment Protection and Biodiversity Conservation Act 1999 (Cth), which requires prior approval for actions that are likely to have a significant impact on the environment anywhere in the world if the action is undertaken by the Commonwealth.

[39] For example, the Criminal Code Act 1995 (Cth) and Crimes Act 1914 (Cth).

[40] Lists of Laws and Guidelines for Contractors, supra note 34, at 7.

[41] Charter of the United Nations (Sanctions – Libyan Arab Jamahiriya) Regulations 2011 (Cth), available at

[42] Charter of the United Nations (Sanctions – Iran) (Specified Entities) List 2010 (Cth), available at

[43] Charter of the United Nations (Sanctions – Eritrea) Regulations 2010 (Cth), available at

[44] See Lists of Laws and Guidelines for Contractors, supra note 34, at 7–8.

[45] Under the Financial Management and Accountability Regulations (Cth) ss 7 and 7A, available at, both the Commonwealth Procurement Guidelines and the Commonwealth Grant Guidelines must be applied by officials performing duties in relation to procurement or grants.

[46] Under the Financial Management and Accountability Regulations (Cth) s 16A, the Fraud Control Guidelines must be applied by officials performing duties in relation to the control and reporting of fraud.

[47] All Australian government agencies that must apply the Commonwealth Fraud Control Guidelines “must also comply with the minimum standards for investigations set out in the Australian Government Investigations Standards.”  Investigation Standards, Australian Federal Police, fraud/investigation-standards.aspx (last visited Aug. 22, 2011).

[48] In 2008, the Australian government introduced the Lobbying Code of Conduct and established a Register of Lobbyists “to ensure that contact between lobbyists and Commonwealth Government representatives is conducted in accordance with public expectations of transparency, integrity and honesty.”  About the Register, Department of the Prime Minister and Cabinet, (last visited Aug. 22, 2011).

[49] This is stated as being “a comprehensive reference document for AusAID staff, partner organisations and contractors who are preparing, designing, implementing or monitoring any AusAID funded aid program or activity involving reproductive health and family planning.”  It clarifies the government’s approach to supporting family planning activities in the aid program, which is “to support a comprehensive approach to family planning and reproductive health” and is in line with the 1994 Cairo International Conference on Population and Development (ICPD) Programme of Action. AusAID, Family Planning and the Aid Program: Guiding Principles (Aug. 2009), available at

[50] Ministerial Budget Statement, supra note 3, at 6.

[51] Id. at 114–18.  The International Deployment Group of the Australian Federal Police (AFP) provides officers for the Australian government’s “domestic and international stability and security operations” and seeks to contribute to “the development, maintenance or restoration of the rule of law in countries that seek Australia’s support, as well as to United Nations and domestic initiatives.”  International Deployment Group, Australian Federal Police, (last visited Aug. 22, 2011).

[52] See Organisation Structure, AUSAID, (last visited Aug. 22, 2011).

[53] AusAID, Annual Report 2009-10: Agency Overview (2010), available at anrep/rep10/agencyoverview.html.

[54] Id.

[55] Government Response, supra note 5, at 6.

[56] Id. at 7.

[57] Id.

[58] Australian Government, Australian Aid: Promoting Growth and Stability (A White Paper on the Australian Government’s Overseas Aid Program) 22 (2006), available at publications/pdf/whitepaper.pdf.

[59] Untied Aid Opportunities, AusAID, (last visited Aug. 22, 2011); see also Eligibility Criteria for AusAID Contracts, AusAID, eligibility.cfm (last visited Aug. 22, 2011).

[60] Id.  The Commonwealth Procurement Guidelines (2008) are available at procurement/procurement-policy-and-guidance/CPG/index.html.

[61] AusAID, Annual Report 2009-10: Management and Accountability – Purchasing and Assets (2010), available at (last visited Aug. 22, 2011).

[62] Id.

[63] Government Response, supra note 5, at 22.

[64] Id.

[65] Id.

[66] Regional Governments, AusAID, (last visited Aug. 22, 2011).

[67] Id.

[68] Pacific Islands Forum, Cairns Compact on Strengthening Development Coordination in the Pacific (2009), available at Compact%202009.pdf.

[69] Government Response, supra note 5, at 54.

[70] Id.

[71] Id. at 27.

[72] Id.

[73] See Pacific Partnerships for Development, AusAID, (last visited Aug. 22, 2011).

[74] Id.

[75] The Partnership for Development Between the Government of Australia and the Government of Papua New Guinea (2008), available at also Papua New Guinea–Australia Partnership for Development, AusAID, partnership/png.cfm (last visited Aug. 22, 2011).

[76] Papua New Guinea, AusAID, (last visited Aug. 22, 2011).

[77] Id.

[78] See Annual Plan 2010-2011 for Competitive Grant Programs, AusAID, business/grants-annualplan.cfm (last visited Aug. 22, 2011).

[79] Direct Aid Program (DAP), Department of Foreign Affairs and Trade, au/direct_aid_program/index.html (last visited Aug. 22, 2011).

[80] Direct Aid Program (DAP) General Guidelines, Department of Foreign Affairs and Trade, (last visited Aug. 22, 2011).

[81] Id.

[82] Direct Aid Program (DAP), supra note 79.

[83] Government Response, supra note 5, at 60.

[84] Funding to Developing Country NGOs, AusAID, (last visited Aug. 22, 2011).

[85] China: NGO Funding Schemes, AusAID, (last visited Aug. 22, 2011).

[86] Id.

[87] Human Rights Grants Scheme, AusAID, rights_scheme.cfm (last visited Aug. 22, 2011).

[88] Grant Funding Arrangements, AusAID, (last visited Aug. 22, 2011).  The Commonwealth Grant Guidelines are available at au/publications/fmg-series/23-commonwealth-grant-guidelines.html (last visited Aug. 22, 2011).

[89] Government Response, supra note 5, at 22.

[90] Id. at 23.

[91] Id.

[92] See AusAID, Annual Report 2009-10: Management and AccountabilityInternal Audit (2010), available at (last visited Aug. 22, 2011).

[93] About ODE, AusAID Office of Development Effectiveness, (last visited Aug. 22, 2011).

[94] Id.

[95] Annual Review of Development Effectiveness, AusAID Office of Development Effectiveness, (last visited Aug. 22, 2011).

[96] Government Response, supra note 5, at 23.  See, e.g., Australian National Audit Office, AusAID’s Management of the Expanding Australian Aid Program (Nov. 2009), available at Publications/Audit-Reports/2009-2010/AusAIDs-Management-of-the-Expanding-Australian-Aid-Program.

[97] See Accountability: Annual Reporting, Australian Public Service Commission, au/foundations/accountability.htm#annualreporting (last visited Aug. 22, 2011).  AusAID’s Annual Reports for the past ten years are available at 1205&CFID=3328295&CFTOKEN=90652321 (last visited Sept. 1, 2011).

[98] DAC Peer Review of Australia, supra note 22.

[99] See generally Income Tax Guide for Non-profit Organisations, Australian Taxation Office (ATO), (last visited Aug. 22, 2011).

[100] See Registering Non-for-profit or Charitable Organisations, Australian Securities & Investments Commission (ASIC), organisations?openDocument (last visited Aug. 22, 2011).

[101] Press Release, Hon. Tanya Plibersek MP & Hon. Bill Shorten MP, Making it Easier for Charities to Help Those Who Need It (May 10, 2011), releases/2011/077.htm&pageID=003&min=brs&Year=&DocType=0.

[102] Id.

[103] Overseas Aid Funds: Introduction, ATO, content/30677.htm&pc=001/004/006/008/002&mnu=44782&mfp=001/004&st=&cy (last visited Aug. 22, 2011).  For information on the treatment of deductible donations, see Making Tax Deductible Donations, ATO,
(last visited Aug. 22, 2011).

[105] Overseas Aid Funds: DGR Endorsement, ATO, menuid=44782&doc=/content/30677.htm&page=3&H3 (last visited Aug. 22, 2011).

[106] See State and Territory Government Requirements – Fundraising, ATO, http://www.ato. (last visited Aug. 22, 2011).

[107] See Terrorist Organisations, Attorney-General’s Department, au/www/agd/agd.nsf/Page/Nationalsecurity_Terroristorganisations (last visited Aug. 22, 2011).

[108] See List of Accredited NGOs, AusAID, (last visited Aug. 22, 2011).

[109] Code of Conduct, Australian Council for International Development, http://www.acfid. (last visited Aug. 22, 2011).  See also Code of Conduct FAQs, Australian Council for International Development, (last visited Aug. 22, 2011). 

[110] See, e.g., Codes of Conduct and Standards, Oxfam Australia, (last visited Aug. 22, 2011).

[111] AusAID, NGO Accreditation Guidance Manual (Draft) (June 2011), available at http://www.

[112] Accreditation Risk Management, AusAID, (last visited Aug. 22, 2011).

[113] Financial Management and Accountability Act 1997 (Cth), available at http://www.comlaw.; Financial Management and Accountability Regulations 1997 (Cth), available at

[114] Commonwealth of Australia Constitution Act s 83, available at au/Details/C2004C00469.

[115] The Commonwealth’s Appropriation Framework – An Introduction, Department of Finance and Deregulation, (last visited Aug. 22, 2011).

[116] Id.

[117] See Financial Management and Accountability Regulations 1997 (Cth) sch 1.  “Prescribed agencies” do not handle any money other than public money.

[118] See Budget 2011-12: Part 2 – Expense Measures, Australian Government, (last visited Sept. 1, 2011).

[119] The Values and Virtues of Debt Relief, AusAID, (last visited Sept. 1, 2011).

[120] Australian Awards, AusAID, (last visited Aug. 22, 2011).

[121] Australian Development Scholarships, AusAID, (last visited Aug. 22, 2011).

[122] Australian Leadership Award Scholarships, AusAID, (last visited Aug. 22, 2011).

[123] Australian Regional Development Scholarships, AusAID, scholar/studyout.cfm (last visited Aug. 22, 2011).

[124] Australian Leadership Awards Fellowships, AusAID, (last visited Aug. 22, 2011).

[125] Prime Minister's Pacific-Australia Awards, AusAID, (last visited Aug. 22, 2011).

[126] AusAID Short Course Awards, AusAID, (last visited Aug. 22, 2011).

[127] Pacific Seasonal Worker Scheme, Department of Immigration and Citizenship, (last visited Aug. 22, 2011).  See also Pacific Seasonal Worker Pilot Scheme Home, Department of Education, Employment and Workplace Relations, (last visited Aug. 22, 2011).

[128] See Press Release, Chris Bowen MP, Visa for Pacific Island Seasonal Worker Scheme (Sept. 23, 2008),  

[129] Department of Immigration and Citizenship, Pacific Seasonal Worker Visa Grants as at May 2011 (May 2011), available at

[130] See Australian Government and New Zealand Government, Trends in Remittance Fees and Charges (Oct. 2010), available at

[131] See Press Release, Amanda Rishworth MP, Remittance Website to Help Pacific Islanders (Mar. 27, 2009),

[132] See Press Release, Hon. David Bradbury MP, Pacific Remittance Costs Come Down (July 26, 2011),

[133] Trends in Remittance Fees and Charges, supra note 130, at 15.  See also Pacific Seasonal Employer Scheme: Obligations, Department of Immigration and Citizenship, (last visited Aug. 22, 2011).

[134] Pacific Financial Inclusion Programme, (last visited Aug. 22, 2011).

[135] See Donors, Pacific Financial Inclusion Programme, (last visited Aug. 22, 2011); see also Press Release, Bob McMullan MP, More Pacific Islanders to Benefit from Australian Support for Microfinance (Jan. 29, 2010),
?BC=Media& ID=7156_6955_7097_6889_9860

[136] Trends in Remittance Fees and Charges, supra note 130, at 15.

[137] Partners, Pacific Financial Inclusion Programme, (last visited Aug. 22, 2011).

[138] Report Highlights Need for Remittance Reform, AusAID, topic.cfm?ID=3970_7856_8433_988_4666 (last visited Aug. 22, 2011).

[139] See Australian Transaction Reports and Analysis Centre, AUSTRAC Guidance Note: Register of Providers of Designated Remittance Services (July 2007), available at reg_pro_rem.pdfSee also Reporting Policy, Australian Transaction Reports and Analysis Centre (AUSTRAC), (last visited Aug. 22, 2011).

[140] Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) s 74(2).  See Removal from Register of Providers of Designated Remittance Services, AUSTRAC, (last visited Aug. 22, 2011).

[141] Government Response, supra note 5, at 14.

[142] Id.

Back to Top



Last Updated: 06/09/2015