Department of Foreign Affairs and Trade—overview

Budget Review 2013–14 Index

Dr Cameron Hill and Nina Markovic

At a time when the Government is promoting its ‘Australia in the Asian Century’ White Paper and has been urged by a Parliamentary Committee to expand Australia’s overseas diplomatic presence, it seems counter-intuitive that the 2013–14 Budget subjects the Department of Foreign Affairs and Trade (DFAT) to significant efficiency measures, including temporary staffing reductions, and that an overseas mission is being closed and plans for new ones suspended. Current estimates (see graph) show that expenditure on DFAT is at historically low levels (0.3 per cent).

DFAT proportion of total govt expenditure

Source: Parliamentary Library (note: figures for 2012–13 and 2013–14 are estimates only)

Although the Government has yet to formally respond to the 2012 report of the Joint Standing Committee on Foreign Affairs, Defence and Trade’s inquiry into Australia’s overseas representation, the Budget might have been the opportunity to address the Committee’s recommendation that DFAT’s ‘funding be increased in the long term to a set percentage of gross domestic product sufficient for the creation of a diplomatic network appropriate to Australia’s standing in the G–20 and the [Organisation for Economic Cooperation and Development] OECD’.[1] The report also recommended that the increased demand for DFAT’s consular services be funded through ‘a combination of increased passport fees and a small hypothecated and indexed travel levy’.

Budget savings

DFAT’s contributions to the Government’s fiscal consolidation over the forward estimates include: public service ($5.3 million), departmental ($8.5 million), and capital ($60.1 million) efficiencies.[2]  Further savings of $11.7 million in 2017–18 and $7.7 million in 2018–19 have been flagged.[3] Australia will also close its embassy in Hungary and will reportedly put plans to open an embassy in Senegal, announced in the 2012–13 Budget, on hold.[4] 

Staffing reductions?

It was reported on the day before the Budget that the Foreign Minister had stated that DFAT would not be forced to reduce staff as a result of the Budget. He also denied that DFAT’s budget was in a ‘parlous position’.[5] While DFAT’s budget might not be ‘parlous’, it is confusing. The 2013–14 Budget states that part of DFAT’s savings will come ‘from a temporary reduction in Canberra-based positions in 2013–14’.[6] It is unclear where the ‘temporary reductions’ will come from, particularly when staffing across DFAT’s three Outcomes is projected to increase by a total of 58 in 2013–14.[7] It may be that these increases will be offset by decreases in non-permanent and/or contracted staff.

Wither the ‘Asian Century’?

There is no provision in the Budget for a new full embassy in Mongolia and/or new consulates in Thailand (Phuket), China (Shenyang) or eastern Indonesia, despite these being identified as priorities in the Asian Century White Paper.[8] 

New funding measures

New measures involving DFAT include: $215.9 million over seven years to upgrade the Government’s classified communications network; $52.6 million over three years to upgrade the security of accommodation in Kabul; $50.6 million over seven years for a new High Commission in Kenya; $14.1 million over four years for DFAT’s continued coordination of the Regional Assistance Mission to Solomon Islands (RAMSI); and $4.3 million over one year to continue DFAT’s role in helping prevent people smuggling.[9] Mining and other trade links have been cited by the Government as being at the heart of the diplomatic investment in Africa.[10] As stated in the 2012–13 Additional Estimates and included in this year’s Budget, DFAT’s United Nations Security Council team has received $27.5 million over three years (out of a total of $30.7 million across three agencies) to secure additional representation at the UN headquarters in New York, as well as in Africa.[11]

 


[1].      Joint Standing Committee on Foreign Affairs, Defence and Trade, Australia’s overseas representation: Australia’s overseas representation: Punching below our weight?, The Joint Standing Committee, 29 October 2012, accessed 15 May.

[2].       Australian Government, Portfolio budget statements 2013–14: Foreign Affairs and Trade Portfolio, 14 May 2013, pp. 19–20, accessed 15 May 2013.

[3].       Australian Government, Budget measures: budget paper no. 2: 2013–14, accessed 15 May 2013.

[4].       Ibid., J Kelly, ‘Carr says the budget hit to foreign aid was inevitable, but aid groups are disappointed’, The Australian, 13 May 2013, accessed 17 May 2013.

[5].       AAP, ‘DFAT set to be spared job cuts’, The Canberra Times, 14 May 2013, accessed 15 May 2013.

[6].       Budget measures: budget paper no. 2: 2013–14, op. cit.

[7].       Portfolio budget statements 2013–14: Foreign Affairs and Trade Portfolio, op. cit., pp. 23, 31, 37.

[8].       Australian Government, ‘Australia in the Asian Century’ White Paper, accessed 15 May 2013.

[9].       Portfolio budget statements 2013–14: Foreign Affairs and Trade Portfolio, op. cit.; B Carr (Minister for Foreign Affairs), Protecting Australia’s interests abroad, media release, 14 May 2013, accessed 15 May 2013.

[10].     Ibid.

[11].     Australian Government, Additional estimates 2012–13: Department of Foreign Affairs and Trade, accessed 17 May 2013; Budget measures: budget paper no. 2: 2013–14, op. cit., accessed 15 May 2013.

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