Comments

Thank you for the pointers set out above. it will be as you said, interesting to see if the above issues highlighted in your article have been included as they ought to be. i will be very interested to follow up on your views on the budget. Thank you, Johnny

I don't really understand the Aid Transparency Index scoring either Robin. What I do know is that in June 2014 DFAT commenced its quarterly reporting for all partner countries, prior to that I don't think they covered all countries and the updating was much less frequent. They also began identifying the sector for each activity. These three changes: coverage of all countries, quarterly updates of all new transactions and sector coding have now made this information much more useful. It will be even more so when regional, multilateral and other government department funding is included. I understand that DFAT hopes to have these added over the next 12 months. Now that the data is being regularly published hopefully it will also be available on the DFAT website in an easy to access form. There are certainly good models on other aid agency websites that could be used (eg the UK and Canadian government aid agencies). Given the lack of clear links to the IATI data on the DFAT and IATI websites it took me quite a while to find the IATI datastore query page. The people at IATI tell me that they are in the process of fixing their website.

Thanks Garth. Though the same type of information is available from the OECD Development Assistance Committee's <a href="http://stats.oecd.org/Index.aspx?datasetcode=CRS1#" rel="nofollow">Creditor Reporting System</a> (CRS), the IATI information on individual activities accessible via the link above has the considerable virtue of much greater timeliness. CRS data are run through quite the mill, and so far extend only as far as 2012 for Australian aid activities. However, I am unsure how it can be the case that (a) the quality, coverage and timeliness of Australia's activity data reporting has markedly improved in 2014, and (b) Australia's Aid Transparency Index score for transparency in the publication of activity-level information has actually fallen a bit in 2014. As noted above, the data collection period in both years was April to June. I assume there was not a sudden improvement from July 2014. Something needs explaining here: either the data were actually about as good in 2013 as they were in 2014, or the Aid Transparency Index was unfair to Australia. A further observation is that the pointer to activity-level data which you provide above is nowhere provided on DFAT's website. At present, with a little persistence, you can find your way to <a href="http://aid.dfat.gov.au/Publications/web/statistics-data-2012-13/Pages/aus-aid-data.aspx" rel="nofollow">this</a> page about aid statistics on which it is stated only that 'Australia reports annually its development assistance to the DAC ... This includes statistical information at the activity level, which can be accessed through the DAC’s website'. There follows a link, not to the CRS, but to the DAC's general website. <a href="http://aid.dfat.gov.au/aidpolicy/developmentpolicy/Pages/iati.aspx" rel="nofollow">Elsewhere</a> on the DFAT website you can read that Australia will 'fully participate' in IATI, and you get a link to the IATI website but not directly to the IATI Datastore -- and the link to the Datastore on the IATI website is, today at least, broken. Clearly DFAT's website should prominently display a direct link to it, or some similar portal which processes and displays IATI registry data.

Robin, I agree with you that Australia appears to have gone backwards generally in its transparency around aid. This seems to be a most unfortunate situation given the Government's intention to improve the accountability and effectiveness of the aid program. However in the last six months DFAT has improved the quality, coverage and timeliness of activity data reported to IATI. For the first time researchers can now obtain a fairly comprehensive and up-to-date summary of all DFAT funded activities that are allocated to a specific country. At this stage regional, multilateral and other government department funding is not included, but I am told by the ODA Statistics and Reporting Section of DFAT that this is in the works. Data is updated about 8-10 weeks after each quarter and is complete for that quarter with some data beyond that. The most recent data is complete to June 2014 and goes back two to three years. The easiest way to access this data is probably to go to http://datastore.iatistandard.org/query/index.php and select the option: one transaction per row - a transaction is a payment made for an activity. This contains all the data currently recorded for each activity with the exception of the total planned expenditure for the activity. This total expenditure can be obtained using the one activity per row option. I am happy to help anyone if they need a hand to get up to speed with this.

Thanks for this article, you make some excellent points. Worth clarifying however the following line - 'Infectious diseases, until now, have been our greatest health challenge.' with reference to data from the <a href="http://www.healthdata.org/results/country-profiles" rel="nofollow">Global Burden of Disease country reports</a> we can see that non communicable diseases have, at least in some parts of the Pacific, been the dominant cause of death and disability for several decades. In Tonga, for instance, at least as far back as 1990 heart disease and diabetes were already the top two causes of premature death, and stroke came in at number 5. A similar pattern can be sen in Fiji. Samoa is an interesting example - in 1990, lower respiratory infections were the #1 cause of premature death, but stroke, heart disease and diabetes were 2nd, 3rd and 4th. In 2010, diabetes was clearly out in front. In the Solomons, the trend you mention is more clear:in 1990, lower respiratory infections and diarrheal disease were #1 and #2, but by 2010 had been overtaken by diabetes and stroke. This trend was also evident in smaller nations like FSM. In Papua New Guinea, 7 of the top 8 causes of premature death are communicable, maternal and neonatal conditions, though diabetes has increased dramatically and is ranked #2, and we can see indications that in the longer term NCDs will continue to rise. One reason I think these details are important is that they show just how slow health ministries in some countries and donors have been to come to grips with the demographic transition and rise of NCDs, and the health systems responses that are needed. It's important that the DFATs and DFIDs of the world understand that NCDs aren't the 'Johnny come lately' of the global health scene, and that strategic, long term prevention and health systems responses are needed if they are to be effectively addressed.

Richard, excellent comments. On the first point, you are right, the tendency to underspend the development budget does keep the deficit down. It happened last year, and I'm sure it will happen this year again. As you say, the budget is simply too optimistic about the government's spending capacity. On the other hand, however, revenue projections also fell short last year, and will fall short again this year. (Treasury's Mid-Year Economic and Fiscal Outlook confirms this.) So, even with a shortfall in development spending, this year's deficit will still be high: somewhere around 6-7 per cent of GDP. On the second point, the LNG project will give a huge boost to GDP through its commencement of exports, but most of the revenue associated with the LNG exports will go to pay off debt (the cost of all the infrastructure built). So, most of it will flow off-shore. Taxes won't be paid for a few years. The PNG Government will get some dividends from its ownership share, but there are two problems. One, mineral revenues have been declining in recent years as commodity prices have fallen, Ok Tedi has done poorly, and oil production has fallen. So the LNG dividends will in part make up for these other declines. And, two, the LNG dividends have now been committed to repay the Oil Search loan, so they won't be available to fund budget spending.

$100K seems a little low if including all the direct costs? Sad to say in my own quite extensive experience in PNG, most recipients return and then request further study opportunities. There is also a big problem in selection with those in the know accessing the opportunities not always on merit - esp. within the public service recommendations. Appropriateness of education & training is also an issue with dentists etc. trained with equipment and methods they do not have access to in their own context. Another cost is to the department they leave behind. I have worked in three key departments where the one leading light in each in terms of a very skilled, upwardly mobile professional "doer" ... doing great things, was whisked away to study, never to be seen in the department again. Effectively kneecapping the initiatives in train by taking away one of the very few effective people. Talking to many scholarship awardees after they return to PNG, they generally describe feelings of depression and stress after being home for a while. Perhaps blessed with more technical skills and knowledge but back in the same environment where they began - i.e. no power, no medicine, poor management and leadership. You would think in these days of technology, if scholarships are to continue many courses (especially Masters) could at least be partly completed in an external mode with more bang for buck, less disruption to families and workplaces and more skin in the game for the participant who would have to demonstrate their capacity and desire to learn.

One thing that always confuses me about PNG budgets - and you highlight it in your article - the development spending seems hopelessly optimistic considering the public service's capacity to implement projects. Buying vehicles and "donations" to various causes seems to be the only way they can spend these funds sometimes. Given that view, will the budgeted deficit be such a problem? Perhaps the actual development spending will only be a fraction of what was planned/budgeted for. Or do these funds just get spent, somehow, or spirited away into trust accounts? And, if little income from LNG is expected in 2015, where is the forecast 20%+ growth for PNG coming from??

This report fails to seriously analyse the experience of past privatisations in the Pacific, such as UNELCO in Vanuatu or Shoreline in Tonga. Both cases clearly disprove the ideological assertion that privatization “results in more efficient public service provision than state ownership.” A decade ago, the provision of electricity by the private company Shoreline Power Ltd was a major scandal in Tonga. The investment by the King in Shoreline was a matter of public debate for some time, until the re-purchase of key assets from the company by the government in 2008. The period of Shoreline Power Ltd’s monopoly over the production of electricity saw significant increases in the cost of power, until the government decided to re-purchase the electricity generation and distribution systems owned by Shoreline. Referring to Tonga, the report diplomatically notes “The government appears reluctant to hold directors accountable for performance, which may be explained by family connections and the closeness of Tongan society.” Does the ADB mean Royal family connections? There is a danger that privatisation simply means a shift from public monopoly to private monopoly, but with many Pacific states lacking the accountability institutions that are needed to hold private companies to account..

While Julie Bishop seems certain about no game change for the aid budget, the Minister for Finance seems less committal. This was Mathias Cormann on Sky this weekend (<a href="http://www.financeminister.gov.au/transcripts/2014/1005-australian-agenda.html" rel="nofollow">transcript here</a>). "PAUL KELLY: Okay if we look at the foreign aid budget, to what extent do you think there’s capacity for more savings in foreign aid? MATHIAS CORMANN: Between now and the release of the Mid-Year Economic and Fiscal Outlook we will be looking right across Government for opportunities for additional savings in order to make up for the additional expenditure or the cost of the delayed savings. Our commitment is not to add to the deficit, not to add to debt and as such to the extent that there is new spending or lower savings then we will have to find ways across Government, across the whole of the Government, to make up that ground."

From my view, IDA is just an excuse for the PM to use as a money transferring passage for selfish politicians. Look at other SOE's such as NHEL and NHC; these two organizations operate separately and all takings from NHEL from the sale of Government properties are not known by NHC. All land titles as well as Tenant Agreement Documents from NHC have gone missing. NHEL calls itself as the business arm of NHC but there's a very big corruption taking effect within NHEL. In our case, we have the Department of Works, The Department of Transport, National Roads Authority, upcoming Road Traffic Authority and most profoundly the new IDA (Infrastructure Development Authority). What's the use of creating more SOE's when we have DOW and NRA already in place? Is it for the benefit of all Papua New Guineans or for some individuals? We have enough organizations and SOE's for road infrastructures Developments already. All we need to do is make funding available through these organisations such as NRA and DOW and come up with good policies and techniques of how to limit expenditure costs for road maintenance and bring tangible solutions as to how we should build quality long-lasting infrastructure. The government should try introducing railway construction and send more engineers abroad instead of creating IDA. There’s no need for IDA. We have DOW and NRA already.

Great article Ben, I was reading <a href="http://www.nytimes.com/2014/10/02/opinion/nicholas-kristof-what-isis-could-teach-the-west.html?_r=2" rel="nofollow">this article</a> the other day which highlights the need for education as a crucial part of any 'arsenal'. I think our governments need to seriously consider the central role of aid in this area. Books are cheaper than bombs and tend to have better effect. I for one pray and hope they realise that aid is not even just strategically important but central important as part of our responsibility globally.