Australasian Aid Conference

Speech

Speaker: Secretary of the Department of Foreign Affairs and Trade, Frances Adamson

Crawford School of Public Policy (ANU), Canberra

19 February 2019

Introduction and acknowledgements

Thank you for that kind introduction, Professor Calford.

I acknowledge the traditional owners of this land, the Ngunnawal people, and pay my respect to their elders past and present.

  • Dr Donald Kaberuka, Former President, African Development Bank and former Rwandan Minister of Finance
  • Masood Ahmed, President of the Centre for Global Development
  • David Arnold, President, The Asia Foundation
  • Professor Helen Sullivan, Director, Crawford School of Public Policy
  • Professor Stephen Howes, Director, Development Policy Centre
  • Dr Sharman Stone, Ambassador for Women and Girls
  • Members of the Diplomatic Corps

Ladies and gentlemen

I was genuinely delighted when Stephen invited me to speak at this increasingly important conference.

The Development Policy Centre and The Asia Foundation continue to do an outstanding job bringing together researchers - and a wide range of stakeholders - from across Australia, the Pacific, Asia and beyond.

I understand there are more than 500 participants this year, matching last year’s high-point, and that next year you will be searching for a bigger lecture theatre — quite remarkable.

Your insights, collaboration and research make a vital contribution to aid and international development policy in our region.

The task of driving forward our understanding of development issues and responses is as important as it is complex and cannot be done in isolation.

Half way through my term as Secretary of the Department of Foreign Affairs and Trade, I’d like to set out the 2019 context for Australia’s development partnerships, what we’re trying to achieve, and the way we’re going about it.

I look forward to the discussion we will have shortly, but let me first set out a framework for my remarks:

I will speak about some of the major contemporary challenges to development in our region and at home.

Then, I’d like to take a step back and consider the purpose of the development cooperation program; something that I think is especially important in such fast-changing times.

With that as the frame, I will share with you the areas on which I have been most focused.

And I will finish with some future directions.

Challenges

The context for Australia’s development cooperation, and indeed all our international relations, is one of multifaceted change.

Our world is being reshaped by technological change, climate change, globalisation and its discontents, and geopolitical transition.

These compounding changes profoundly affect development policy and programs.

In Australia we know we need to work harder to earn our place as a preferred partner for the region.

And we need to think hard about how we can do that over the long term.

We do so in the face of questions about our spending overseas as Australians battle flood, drought and fire at home.

Australians are also keenly aware of the changing balance of power in our region.

Today, some of our region’s largest economies are developing countries.

Naturally, then, development policy is more enmeshed in foreign policy than used to be the case.

As leaders’ speeches at APEC in Port Moresby last November laid open, the big strategic questions of our age have landed on our doorstep with a new intensity.

We have our work cut out for us, right now, close to home and globally, to hold our own in an increasingly contested international arena.

And of course, we want to do more than hold our own.

The Government’s 2017 Foreign Policy White Paper explained both why and how Australia should maximise our international influence, including by making our development cooperation as effective as we can.

Australians are right to expect from us a development cooperation program that makes the best possible use of their taxes, and responds adroitly to a fast-changing world.

They are right to expect a development cooperation program animated and organised by Australia’s national interests.

We deliver this by focusing our efforts on our own region, the Indo-Pacific and in particular the Pacific Island countries, where we have the most at stake and can bring the most influence to bear.

We do it by thinking carefully about the main game, achieving strategic clarity, and acting accordingly.

And I think we can all agree on the need - as a community - to work more closely with our regional partners to design programs together that deliver strong results, to hold ourselves to account for the results, and, where our results are sub-optimal, to correct course quickly.

Purpose

It is important, then, that we are clear about the purpose of Australia’s development cooperation.

It has a unique part to play in our national interests within our wider agenda.

Australia’s development cooperation makes our region more secure and stable, and that makes Australia more secure and stable.

Australian development cooperation boosts our region’s prosperity, and that benefits Australia’s economy and prospects.

When the scale and pace of change is so great, it is right that our program should change, and it has; but throughout, its purpose has remained steady.

We remain firmly focussed on ending poverty in our region.

Ending poverty is the starting point for the international community’s 2030 Agenda, and it is at the heart of Australia’s development program.

But our interests would not be well met by a region in which people have escaped poverty — but only just, or only temporarily.

It is strongly in Australia’s interests that the people of our region are able to realise the benefits of economic opportunity.

We want individuals and communities to live well, and raise children with hope, in a world of moderate politics and economic freedom.

Australian development cooperation works to that end in a region where the needs remain immensely high; where we are still relatively very well off; where we care about our neighbours, and recognise that in many ways our wellbeing is bound up with theirs.

Strikingly and happily, the proportion of people in East Asia and the Pacific living in extreme poverty has fallen from 60 per cent to 4 per cent over the past 30 years.

This is a monumental achievement, but there remain pockets of extreme poverty in some countries, high rates of poverty in several, and considerable state fragility.

Of the 15 countries that we partner with on development, ten are fragile or conflict-affected.

PNG, Solomon Islands, Timor Leste and Afghanistan are all still burdened with high rates of extreme poverty.

And across the Indo-Pacific, there are hundreds of millions of people whose economic situation remains precarious.

In Indonesia, for example, almost 60 per cent of the population lives on less than six US dollars a day.

Many countries in our region, and particularly in the Pacific, are acutely vulnerable to economic and other shocks.

In 2018 Cyclone Gita was estimated to have caused damage equal to approximately 30 per cent of Tonga’s GDP.

In the face of these needs, Australian development cooperation partnerships deliver resilience, growth and opportunity.

We support effective economic management, an enabling environment for businesses to grow, strong private sectors, open markets and trade.

We understand that gender inequality contributes to and often exacerbates a range of challenges, including poverty, weak governance — and conflict and violent extremism.

We empower women and girls.

We support countries to get the most out of the resources they spend on health and education.

We implement inclusive development programs, partnering with people with disability and indigenous peoples.

To help countries protect and advance their development gains, we invest in strong security partnerships.

This takes us into many complex policy areas, but throughout, reducing poverty and providing new opportunities remains at the heart of what we do.

Now, for many in this room, the rationale for this is self-evident: it accords with Australia’s values, and builds the kind of region we want — prosperous and stable.

Strategic effect

But it’s worth looking twice at the question of our national interest, especially given the strategic shifts underway in our region and neighbourhood.

I strongly believe that Australia’s national interest is best served through a well-resourced and effective, highly professional development assistance program that delivers on our long-term interests in our partners’ prosperity.

Our development program is a rolling investment in the kind of region we want.

It is important that development professionals play a leading role in what we might call deep policy formulation, alongside country experts, security specialists, economists and others.

The reason is simple: reducing poverty helps create the region we want, in the ways I have already mentioned, and it is a proven basis for exceptionally effective relations with partner countries.

Solomon Islands is in a much better state thanks to the success of RAMSI, and so is our bilateral relationship.

So much so, that former Solomon Islands Prime Minister Sogavare, once a staunch, nationalist critic of the Mission, himself warmly welcomed an agreement with Australia to facilitate a comparable intervention should it ever be needed.

Or consider our trade negotiations with Indonesia, which we completed in August last year.

The Economic Cooperation chapter of IA-CEPA shows how we can use development cooperation to help a close partner like Indonesia realise the full benefits of a trade agreement.

Mutual interests are the main business of foreign and trade policy.

Development cooperation can be at its most effective when it unlocks mutual interests, and harnesses self-interest on both sides.

Indeed, that is the natural end-state of development cooperation.

But, along the way, development cooperation has its own particular strengths by virtue of its focus on one party’s development needs.

The major achievements I have mentioned, and many others, demonstrate that Australian development cooperation focussed on the wellbeing of Solomon Islanders and Indonesians worked profoundly in Australia’s national interest.

When development partners invite us to make a contribution to their internal development challenges, they do so on the basis of one fundamental premise.

The focus has always been, and absolutely remains, that country’s development, through poverty reduction, prosperity and stability.

That’s a privilege we must continue to earn.

That’s how we build the development partnerships that yield opportunity, security and strength.

That’s what we are appropriated $4 billion a year through the Budget process to do.

Priorities

Obviously, this is a huge responsibility — financial and policy-wise — so strong governance and performance systems are vital.

We are continually seeking ways to improve.

The machinery of Government change that brought Australia’s development budget across to DFAT in 2014 was big and complex.

It changed the institutional setting for governance of our development cooperation, and it changed the program’s staffing profile.

In late 2016, I commissioned a review of the development program that assessed and redirected DFAT’s implementation of its new responsibilities.

We have built a strong foundation for what remains a work in progress.

The first priority I will highlight this morning is governance of the development program.

As many of you know, DFAT established the Aid Governance Board in late 2017, combining and building on the former Aid Investment Committee and Development Policy Committee.

The Aid Governance Board reassigned responsibilities to better align policy and implementation, manage risk effectively, and improve effectiveness and efficiency, including through improved development capability.

The Board is making a significant contribution, and I expect its impact to grow over the next couple of years.

I know everyone here today shares the strongest commitment to aid effectiveness.

Australia’s approach to aid effectiveness focuses on ensuring the following:

  • close relationships with partner governments
  • strong analysis of country needs through Aid Investment Plans
  • thorough design of individual aid investments
  • careful selection of implementing partners
  • and regular monitoring and evaluation of the performance of individual aid investments and implementing partners.

Strong safeguarding practices and culture within DFAT and our partners is an imperative.

We will be releasing a new policy on preventing sexual exploitation and harassment in the near future which will clearly outline our expectations.

All this is built into the programming cycle and is core work for all my colleagues who work on our aid program, as it is for me.

Across all DFAT’s operations, I have continued to emphasise the importance of a strong performance culture and systems, and of collecting evidence to build our knowledge of what works well and why.

In some respects our development cooperation program leads the way for the rest of the department.

Each year, DFAT completes over 350 reviews of individual aid investments.

And we assess progress with the implementation of 25 country and regional programs.

These annual processes ensure our managers critically assess the program’s performance and take action to achieve better results and to build on success.

The Office of Development Effectiveness within DFAT produces robust evaluations which contribute not only to the effectiveness of the Australian aid program but to global knowledge on a range of important development issues.

As an example, I was pleased to launch our evaluation on disability inclusion in the aid program in November last year, and am looking forward to the ODE’s evaluation on ending violence against women and girls being launched this year.

The department maintains a consistently strong track record of producing and publishing evaluations, with management responses, across the breadth of the aid program.

Transparency is vital, if at times painful.

In 2018 the department published 45 evaluations, a publication rate of 94 per cent, and an increase on the 41 publications of 2017.

Development is a difficult and high risk endeavour.

We work in complex environments where institutions may be weak and our counterparts may have limited exposure to best practice.

The reality is that investments and programs will not always go to plan.

DFAT’s report, “The Performance of Australian Aid”, is candid and transparent about areas where we must do better.

When we identify problems, we work with our partners to improve the situation.

This is an essential part of building trusting long-term relations with our international partners, and of getting our development partnerships right.

A second priority is related to the first: and that is the importance of expertise.

This is obvious and has been a consistent refrain during my term.

I am pleased to see an improvement reflected in the ANU’s Aid Stakeholder Survey, though there is clearly more to be done.

I want to reassure all of you that we are continuing to work to ensure DFAT has the expertise needed to deliver the aid program efficiently and effectively.

We have a dedicated Workforce Strategy for international development, and a stream of work to identify ways to build further on our existing capability.

This work is essential, because expertise is the key to coherence.

It is key to understanding the many trajectories of change that impact development work today.

We need development professionals who can try new approaches to longstanding challenges without fragmenting the aid program.

  • development professionals who are valued as highly in DFAT as our trade, foreign policy and corporate professionals and who are confident about their long-term career paths.
  • and, indeed, DFAT officers fluent in these streams and their integration.

We need experts both within DFAT and among our partners who can build the long-term partnerships for poverty reduction, while also maximising the benefits for Australia’s integrated international agenda along the way.

Ensuring we continue to recruit, develop and maintain this workforce is a key priority for me.

Within DFAT, I want to draw particular attention to our locally engaged staff who do so much to advance our development objectives across the Indo-Pacific.

They bring invaluable local knowledge and contacts, are a crucial part of our Posts’ corporate memory and contribute mightily to our effectiveness.

Locally engaged staff have been a particular focus of my own and other senior DFAT colleagues’ efforts to recognise and reward expertise.

I am very aware of course, in this room, that the Government has no monopoly on expertise.

The Government looks to you all to work with us, and to challenge us.

One notable critique was delivered yesterday, by Richard Moore, looking ahead five years after DFAT-AusAID integration.

I agree with Richard that perspectives from development cooperation can help us think differently and better about wider transformations in our world, and international relations in particular.

I welcome Richard’s focus on expertise — a major priority for me, as I have mentioned.

I must take issue, however, with a distinction Richard draws between diplomacy, which he casts as largely short-term, and development cooperation, which requires long term thinking and programming.

I can assure you, after decades in the service, that foreign policy is not a short-term game.

The drivers of our foreign policy are complex, varied and emphatically long term.

We are circumspect about our ability to predict decades into the future, but we work constantly to prepare Australia for an international landscape we can and must glimpse, but cannot know.

That is why our Foreign Policy White Paper, which looks ten years out, remains such an important document.

Another of my priorities is structured, analytical forward thinking, and I have established a new team in DFAT specialising in this work.

Certainly, we can do better at fusing the long term perspectives that inform development, economic and other aspects of our foreign policy.

Noone ever said integration was easy, or complete!

Richard’s work will provide an important stimulus for our ongoing effort.

So please, as a development community, keep telling us what you think - though I’m sure you need no encouragement!

Future directions

I turn now to the aid program’s future directions, and to our neighbourhood.

Already this year, the Prime Minister and Minister for Foreign Affairs have visited several Pacific Island countries, in addition to regular visits by the Assistant Minister for International Development and the Pacific, demonstrating that in order to step up in the Pacific, the Government will continue to show up — at the highest levels.

The pillars of the step up are economic, security and community links.

A major reform is the creation of the new Australian Infrastructure Financing Facility for the Pacific.

This $2 billion infrastructure initiative will significantly boost Australia’s support for infrastructure development in Pacific countries and Timor Leste.

It will use grant funding combined with long term loans to invest in essential infrastructure such as telecommunications, energy, transport and water.

This will assist Pacific countries to contribute to global and regional trade and build their economic resilience.

We will seek to avoid unsustainable debt burdens.

We will ensure that appropriate social, environmental and work health and safety standards apply to all projects funded by the Facility.

Another central economic measure is the very significant expansion in labour mobility.

The new Pacific Labour Scheme facilitates access for Pacific workers beyond seasonal work to now include low and semi-skilled work in new sectors such as aged and disability care, tourism, hospitality and non-seasonal agriculture.

To help overcome the costs of islands’ remoteness, we will grant visas of up to three years.

The Scheme is uncapped, and will grow with Australian employer demand.

We know from our experience of the long-running Seasonal Worker Programme that savings and remittances, an average of $8,850 per six-month work placement, have a real economic impact.

The Pacific Labour Scheme is much broader, so it introduces new opportunities, and new complexity.

Research partnerships have helped government to conceptualise and build our Pacific labour mobility initiatives.

They will remain important as we maximise the economic and social benefits.

In the security space, the Pacific Fusion Centre and the Australia Pacific Security College will help deliver on Pacific Leaders’ commitments in the Boe Declaration.

The Fusion centre will bring together the best security insights in the region, enabling a big picture view on the challenges we face together.

This includes traditional security challenges, like transnational crime and maritime domain awareness.

But it goes much further than that — into the domains of cyber security, health challenges, humanitarian preparedness and response, and environmental security — including climate change, a huge issue for our partners.

The Australian Pacific Security College will bring together officials from Pacific countries for training and professional development opportunities.

The College will deliver training across the Pacific, utilising existing facilities and responding to countries’ needs.

No less important is the suite of programs designed to bring Australian and Pacific Islanders together through education, religion, sport and culture.

Throughout, we will integrate our overarching interest in making Australian strengths more available to the Pacific, with our development-cooperation focus on reducing poverty and promoting opportunity.

A second future direction for Australian development cooperation is on partnerships to respond to climate change.

Australia and Pacific Island countries have formally stated in the Boe Declaration that climate change remains the single greatest threat to the wellbeing of the peoples of the Pacific.

We are already mainstreaming climate and disaster resilience into our aid investments, especially in the Pacific, but we need to do more to support our neighbours and partners to reach sustainable development goals.

I thank stakeholders, many of whom are here today, for their contribution to this work.

Thirdly, on future directions, in Southeast Asia, we will work with development partners to build stability, prosperity and resilience.

Our partners in Southeast Asia are embarked on complex economic, social and structural reforms to consolidate their gains in recent decades, and sustain further economic growth.

Our development cooperation facilitates influential relationships and expert partnerships that have proved pivotal in reform to date, and will continue to do so.

As many of you know, Overseas Development Assistance comprises a small and declining proportion of the overall sources of development finance for these countries.

Accordingly, we will complete a shift from service delivery to focus on economic governance and policy reform to develop the skills and human capital that Southeast Asian countries want.

In Southeast Asia, as in the Pacific, our long-standing education programs are high priorities.

Our work in the health sector is complemented by the path-breaking work of the Indo-Pacific Centre for Health Security.

We help to mitigate the effects of conflict and build peace, especially in Myanmar and the Philippines.

Our development relationships in Southeast Asia are points of influence in the trajectory of change in these countries.

We occupy these positions by virtue of the quality and integrity of our development cooperation — a major national asset.

The final future direction I wish to highlight is the deepening integration of development cooperation as a core part of our joined-up foreign policy.

This is not just about the incorporation of development into DFAT.

A bigger driver is the region we want to engage with us — as partners.

The era of donor / recipient relations is passing away, as it was always meant to do.

Development assistance no longer defines our relations with any other country.

DFAT’s new holistic country strategies capture that.

As did Prime Minister Morrison, in the way he talked about our vuvale or family relations in the Pacific.

The entire Pacific step up is a demonstration of how development cooperation programs can set the scene, and set a tone, and support a wider international agenda — as development cooperation helps us ensure that our Indo-Pacific region evolves peacefully, trades freely, and co-operates to build security.

Conclusion

Let me conclude by observing that international development cooperation is both a challenging and a rewarding endeavour.  You all know that.

Of the many who contribute, I want to acknowledge particularly the volunteers.

For more than 60 years, successive Australian governments have supported Australian volunteers in almost 50 countries.

The Australian Volunteers Program, takes a more structured approach to long-term capacity building, to build lasting connections between Australians and their overseas partners.

Copies of the new Global Program Strategy for the Australian Volunteers Program are available in the foyer.  I commend the strategy to you.

We are all highly motivated by the opportunity and obligation to reduce poverty and build opportunity as effectively as we can.

And I think we all understand that to get the long-term settings right, and to build Australia’s development cooperation program over time, we have to forge a practical consensus on Australia’s national interests in development in the Indo-Pacific.

I thank you all for your contribution, and look forward to even more productive collaboration as we work to strengthen our partnerships in our own region and beyond to the benefit of those in greatest need.


Last Updated: 19 February 2019