The Australian Government’s new development policy Australian aid: promoting prosperity, reducing poverty, enhancing stability and new performance framework Making Performance Count: enhancing the accountability and effectiveness of Australian aid introduce key shifts in our aid program.
Australia's new development policy and performance framework are available in PDF and Word formats.
The need for change
The world has changed—and our aid program must change too. Today, many developing countries are growing rapidly, with aid representing an increasingly small proportion of development finance. To be effective in this new context, our aid needs to be more innovative and catalytic, leveraging other drivers for development, such as private sector investment and domestic finance. We need to recast our aid program in light of this new development paradigm.
Changing where we work
The Australian aid program will focus on our Indo-Pacific region. We will have a sharper focus on our immediate neighbourhood—this is where we can make the most difference.
Changing what we do: re-shaping the aid program
The purpose of the aid program is to promote Australia’s national interests by contributing to sustainable economic growth and poverty reduction. We will pursue this purpose by focusing on two development outcomes: supporting private sector development and strengthening human development.
A new strategic framework will guide the re-shaping of Australia’s aid program over coming years.
Figure 1: A new strategic framework for the aid program: promoting prosperity, reducing poverty, enhancing stability
More details on the priority areas:
2014/15 estimated allocation by sector
||2014/15 Budget Estimate
|Infrastructure, trade facilitation and international competitiveness
||13 per cent
|Agriculture, fisheries and water
||7 per cent
|Effective governance: policies, institutions and functioning economies
||18 per cent
||23 per cent
||16 per cent
|Building resilience: humanitarian assistance, disaster risk reduction and
||14 per cent
|General development support
||9 per cent
Gender equality and women’s and girls' empowerment will be addressed across the aid program. Aid for trade will be increased to 20 per cent of official development assistance (ODA) by 2020 and will include investments in economic infrastructure, agriculture, fisheries and other productive capacity.1
Changing how we deliver aid
Four tests will guide strategic choices across the aid program, translating this new strategic framework into practice. They will ensure that Australian aid:
- pursues our national interest and extends Australia’s influence
- impacts on promoting growth and reducing poverty
- reflects Australia’s value-add and leverage
- makes performance count.
There will be significant improvements in the way we deliver aid, through:
- greater innovation
- strengthening our private sector focus
- enhancing aid for trade
- disability-inclusive development
- economic diplomacy
- working with the most effective partners
- consolidating the aid program
- responsibly engaging with risk and applying safeguards
- actively managing fraud and anti-corruption
- following value for money principles
Making performance count
To reinforce efforts to re-shape the aid program, a new performance framework, Making Performance Count: enhancing the accountability and effectiveness of Australian aid, will operate at all levels of the aid program, with ten high level targets to assess the aid program against key goals. This new performance framework will ensure that funding is linked to performance at all levels of the aid program. This will ensure that taxpayers’ money spent through Australia’s aid program is achieving the greatest possible development impact.
1. Estimated aid for trade expenditure is based on the World Trade Organization (WTO) definition. Aid for trade largely overlaps with the investment priorities of infrastructure, trade facilitation and agriculture, fisheries and water from DFAT’s new development policy. A small proportion of Australia’s effective governance expenditure is also covered. However, these priorities are broader in scope, noting urban development, large water supply infrastructure, rural development and law and justice investments are not covered in the WTO definition.