Foreign affairs overview

Budget Review 2015–16 Index

Dr Geoff Wade

The appropriation of $1,400 million to the Department of Foreign Affairs and Trade (DFAT) for 2015–16 represents a five per cent increase over the $1,324 million appropriated in 2014–15.[1] In terms of staffing, while some 500 positions were slated for removal last year, partly through the integration of aid agency AusAID into DFAT, this year DFAT will see average staffing levels increase slightly from 5,722 to 5,734.[2]  

Across the foreign affairs realm, changes to the aid budget have been of the largest magnitude and attracted the greatest attention.[3] By comparison, the other changes in DFAT’s budgeted operations are less dramatic, but some aspects are worthy of mention.

First, Australia’s regional positioning has been revised again. While the 2014–15 Budget was replete with   references to Australia’s location in the ‘Indian Ocean Asia Pacific’, this year’s Budget statement makes no reference at all to this term, with Australia now being located simply within the ‘Indo-Pacific region’.[4] The significance of this change is moot, but it does reflect a growing use of this new term.[5]

In areas of intense engagement overseas, over $110 million is being provided for continuing diplomatic activities in Iraq and Afghanistan in 2015–16, along with a further $15 million in capital costs. These figures represent marked increases over 2014–15, a trend that looks set to continue—departmental expenses will see $6 million growth in 2016–17.

Increases in the funding of the New Colombo Plan, which carries forward and expands the Rudd Government’s Australia Asia Awards, feature prominently in this year’s Budget.[6] Some 4,800 grants will be on offer in 2016 to assist Australians to study across the region.[7] The almost $28 million allocation in the current Budget more than doubles that provided in the 2014–15 Budget and the forward estimates suggest that in 2017–18 and 2018–19 the program will be funded at about $50 million annually. This funding will thereby far surpass the $100 million over five years to which the Coalition initially committed.[8]

In the sphere of trade promotion, two measures are notable.  The international and domestic promotion of the various Free Trade Agreements into which Australia has entered during the current government has been funded for $24.6 million.[9] In addition, five new offshore investment promotion positions have been created and a new office for investment promotion is to be established in Boston.[10]

The inaugural Australia Week held in Shanghai in April 2014, which was intended primarily to promote Australia as an investment and tourism destination, was obviously seen to have been worthwhile as the new Budget provides Austrade with $9.2 million over four years to fund further Australia Week events in China, India, the US and ASEAN countries.[11]

Tourism has lost the prominent position it enjoyed in the 2014–15 Budget. The $151 million appropriated this year for programs to promote Australia’s international tourism interests represents a reduction compared to the estimated actual expenditure in 2014–15. Industry bodies have indicated their disappointment.[12]

Worthy of further note is Austrade’s participation in the Global Leader in Tropical Health program, assisting the Department of Industry and Science in efforts to develop northern Australia into a centre of expertise in tropical health.[13] Austrade is being given $1.4 million (growing to more than $2 million annually over 4 years) to provide sectoral expertise and advice to what will be an $80 million undertaking.[14]

The Budget also provides for expanded Australian diplomatic representation, as outlined in the Library’s Budget Review article The Indo-Pacific focus of ‘Expanding Australia’s Diplomatic Footprint’.



[1].          Australian Government, Portfolio budget statements 2014–15: budget related paper no. 1.9: Foreign Affairs and Trade Portfolio, p. 21; The budget figures in this article have been taken from the following document unless otherwise sourced: Australian Government, Portfolio budget statements 2015–16: budget related paper no. 1.9: Foreign Affairs and Trade Portfolio, 2015.

[2].          Australian Government, Agency resourcing: budget paper no. 4: 2015–16, p. 136; ‘More than 2,500 jobs axed at ATO, Foreign Affairs Department’, ABC News online, 14 May 2014.

[3].          For information on changes to the aid budget, see the Library’s Budget Review article ‘The shrinking aid budget’.

[4].          Portfolio budget statements 2014–15: budget related paper no. 1.9: Foreign Affairs and Trade Portfolio, op. cit., pp. 3, 5, 15, 39; Portfolio budget statements 2015–16: budget related paper no. 1.9: Foreign Affairs and Trade Portfolio, op. cit., pp. 3, 4, 5, 15, 16, 18, 19, 27, 43, 44.

[5].          See, for example, C Hill, ‘Australia in the Indo-Pacific century: rewards, risks, relationships’, Parliamentary Library briefing book: key issues for the 44th parliament, Parliamentary Library, Canberra, 2013;  M Beeson, ‘The rise of the Indo-Pacific’, The Conversation weblog, 3 May 2014; B Thomas-Noone, ‘Indo-Pacific security links: nuclear weapons, Merkel in Japan, security cooperation in South China Sea and more’, Lowy Interpreter weblog, 12 March 2015.

[6].          K Rudd (Prime Minister), 'On the power of ideas: the establishment of the Australia Asia Awards—Address to the National University of Singapore’, transcript, 13 November 2009.

[7].          Department of Foreign Affairs and Trade (DFAT), ‘New Colombo Plan’, DFAT website.

[8].          Liberal Party of Australia, The Coalition’s Policy for a New Colombo Plan, 30 August 2013.

[9].          Australian Government, Budget measures: budget paper  no. 2, 2015–16, p. 97.

[10].       Ibid., p. 98.

[11].       A Robb (Minister for Trade and Investment), China-Australia Business Week, media release, 3 March 2014; Budget measures: budget paper no. 2, 2015–16, op. cit., p. 95.

[12].       Tourism and Transport Forum, Tax hit on tourism, media release, 12 May 2015.

[13].       A Robb (Minister for Trade and Investment), $15.4 million to support tropical research under Northern Australia growth plan, media release, 10 May 2015.

[14].       This initiative is part of a broader education and science undertaking aimed at tropical health and medicine research in northern Australia. See C Pyne (Minister for Education), $42 million for tropical health and medicine research in northern Australia, media release, 9 May 2014.

 

All online articles accessed May 2015. 

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