Despite high-profile Government promises on overseas aid, agencies are suffering from significant cuts in their budgets. How will this undermine their work, and our reputation on aid?
ON THE eve of budget day last October, RTÉ conducted a vox pop on the streets of Dublin asking passers-by their views on what the Government should cut or keep. The first person interviewed was a young man, most likely in his 20s. His answer was swift and unequivocal – cut overseas aid. Those watching from the development sector winced. The following day the Government announced a reduction of some €15 million to the overseas development assistance (ODA) budget. Aid agencies protested, but many privately admitted the damage could have been much worse given the circumstances.
Fast forward to the first week of February. Taoiseach Brian Cowen informs the Dáil that the ODA budget will shrink by a further €95 million. The dozens of agencies and organisations that make up Ireland’s development sector are aghast, not least because the Government’s rhetoric on its ODA commitments had up to then been robust.
Only the previous month Brian Cowen, in his response to Pope Benedict’s New Year message, spoke of the obligations of the developed world to assist those in greater need at a time of global financial upheaval. While acknowledging Ireland’s serious economic difficulties, the Taoiseach stressed the importance of ensuring that “progress already made is safeguarded and . . . commitments made in fulfilment of the Millennium Development Goals do not falter.”
Aid agencies say those words rang hollow in the wake of the February cut and will ring hollower still if ODA funding is targeted again in Tuesday’s emergency budget. Trepidation within the sector as to what might be in store next week has in recent days turned into anxious whisperings that cuts of between €100 million and €200 million are under consideration – huge sums that many believe would rip the heart out of Ireland’s internationally renowned overseas aid programme and scupper the Government’s much vaunted aim of meeting the UN target of allocating 0.7 per cent of GNP to ODA by 2012.
Aid agencies frame it starkly as a matter of life and death. “The aid budget cannot simply be seen as a ‘soft target’. We must remember that Ireland’s aid saves lives – and that lives are at risk if we do not meet our commitments,” says Trócaire director Justin Kilcullen.
“We cannot allow ourselves to get caught up in our own troubles to the extent that we forget the world’s poorest, who are suffering the most as a result of the financial crisis, a crisis which they played no part in creating.”
It all looked so different last September when Brian Cowen and Minister for Foreign Affairs Micheál Martin sat in the Ecosoc chamber at UN headquarters in New York for the launch of the Government’s Hunger Taskforce report. UN secretary general Ban Ki-moon and Bono were among those present to cheer the report’s bold recommendation that Ireland draw on its historical experience of famine to make tackling global hunger a cornerstone of its aid programme.
On the same trip the Taoiseach again reaffirmed Ireland’s commitment to overseas development targets. Since then, figures including Kofi Annan and, most recently, US secretary of state Hillary Clinton have lauded the Government’s role in international development and its position as a major donor.
Yet, as Hans Zomer, director of Dóchas, an umbrella group representing almost 40 Irish aid organisations, told the Oireachtas Sub-Committee on Overseas Development this week, in the past 10 months Ireland’s aid budget has been cut three times – the equivalent of 17 per cent of the original programme for 2009.
Because Ireland sets its ODA target as a percentage of national income, the aid budget decreases automatically as the economy contracts. Aid agencies argue, however, that the recent cuts constitute a disproportionate blow to the ODA budget, one that exceeds the adjustment that occurs naturally as national income drops.
“We find ourselves in a situation where we have to remind Government Ministers of their own promises. Promises that were made at the highest possible level and at the most public of public fora; promises that have brought Ireland great gains in terms of international influence and respect,” Zomer told the Oireachtas committee on Thursday. “Promises that have raised the hopes of millions of poor people around the world that this time it was not going to be business as usual, that rich countries like Ireland – and yes, despite all the gloom and doom, we are still a rich country – would do their best to change the enormous injustice that is global poverty.”
THE ISSUE OF extreme poverty has taken on a fresh urgency in recent months as the magnitude, complexity and global dimensions of the economic crisis become more evident. With aftershocks from the credit crunch now passing through the developing world – still reeling from the impact of the food and energy price crisis not so long ago – the picture painted by institutions such as the World Bank is a bleak and deeply worrying one.
It predicts the number of people living below the poverty line will rise by 46 million worldwide, just as credit for developing countries becomes more difficult to secure, global trade shrivels, and remittances – the money sent home by migrant workers – dry up. While developing nations may be more protected from downturns in production, analysts point out that they are the most vulnerable in a prolonged global slowdown.
As Ban Ki-moon put it recently, the current financial turmoil could be “the final blow that many of the poorest of the world’s poor simply cannot survive.” What humanitarian and development agencies fear is that the donor countries they depend on, including stalwarts such as Ireland, which is still ranked the world’s sixth most generous in per capita terms, may now turn inward as a result of pressures on domestic spending, and commitments made in more prosperous times will slip away.
Such a scenario would constitute a betrayal of the principles that underpin Ireland’s overseas development programme and its wider foreign policy, say aid agencies.
“Our overseas aid is not ‘charity’ to be turned on when Ireland is feeling ‘generous’ and then turned off when we are feeling the pinch,” Dóchas argues in a statement circulated to members of the Oireachtas this week. “Rather our aid is a practical expression of a deep and lasting commitment that we have as a nation, to fight injustice, oppression and poverty wherever it exists – in times of crisis more than ever.”
Apart from Ireland, two other EU member states have slashed their ODA budgets in recent months: Italy by more than 50 per cent and Latvia by 100 per cent. But neither was considered a leading player in overseas development to begin with – unlike Ireland.
Interestingly, several other European countries have stood firm and reiterated their commitments despite sliding national revenues. “Whilst there may be others who are tempted to shy away from their responsibilities, we in Britain will meet them – and we will keep our promises on aid,” Gordon Brown told a conference on development last month. A number of Scandinavian countries have vowed to retain or even increase aid spending levels.
The extent to which overseas development assistance remains a priority outside NGO circles in recessionary Ireland is open to debate. “In Government circles I believe there is a feeling that there won’t be a public outcry if the aid budget is cut,” says Fine Gael TD John Deasy, who chairs the Oireachtas Sub-Committee on Overseas Development. At a recent briefing, Fianna Fail TD Chris Andrews bemoaned what he called the “No votes in overseas aid” mentality of some politicians. On web forums, mutterings that “charity begins at home” have crept into discussions on Ireland’s overseas aid programme.
AID AGENCIES ARGUE, however, that the level of public donations is proof that while political will may be ebbing, a large swathe of the population remains committed to helping the world’s poorest despite their own newly straitened financial circumstances.
“The vast majority of our donors continue to maintain their support at previous levels, being mindful that they are supporting communities who are in far worse circumstances – lacking clean water, food security, basic healthcare and educational facilities, and having limited opportunity to create sustainable livelihoods,” says Brian Hanratty of Gorta.
Noel Wardick of the Irish Red Cross argues that while the aid budget might be seen by some as a “soft touch”, the consequences of further cuts will be far-reaching and devastating for those most exposed to the crosswinds of the global economic crisis. “I genuinely feel if the impact is explained to the Irish people, the vast majority will concur with us,” he says. “We are urging the government to stand over its very well-deserved reputation as a leader in the fight against poverty . . . Morally it will have some difficulty justifying itself if it doesn’t.”
Concern chief executive Tom Arnold agrees. “This is a basic issue of compassion,” he told TDs and Senators this week, explaining that in addition to immediate “safety net” aid being hit, long-term development strategies were in danger of being reversed in the world’s poorest countries.
“These are not just statistics,” said Jim Clarken of Oxfam Ireland, after he outlined how funding shortfalls had affected one Oxfam water purification project in the Democratic Republic of Congo. “If we stop funding these programmes, people will die.”
The crisis in numbers
The crisis resulting from spiralling food and fuel prices last year has pushed 130 to 150 million people below the $1.25 a day poverty line, according to the World Bank.
The World Bankestimates that an additional 46 million people will fall below the poverty line as a direct result of the current global financial turmoil.
Economic output fromthe countries of Sub-Saharan Africa is set to fall by €40 billion, and the figure for all developing countries together is €600 billion. Private capital flows to the world's emerging markets are expected to drop from €732 billion in 2007 to €130 billion in 2009.
Unesco estimatesthat the downturn will cost the 390 million people in Sub-Saharan Africa 20 per cent of their income.
The World Bankestimates 200,000 to 400,000 extra children are expected to die each year as a consequence of the global economic upheaval.
Up to 30 million jobscould be lost between 2007 and the end of 2009, according to the International Labour Organisation. This figure excludes unemployment in the informal sector – the largest source of work in the poorest countries. The number of working poor (people earning less than $2 or €1.60 a day) is expected to rise by up to 1.4 billion.
Many familiesin developing countries are dependent on money sent home by relatives working abroad. Such remittances are estimated to be worth €235 billion, or nearly three times as much as developing countries receive in foreign aid. As unemployment rises across the globe, levels of remittances have plummeted.