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Joint Standing Committee on Foreign Affairs, Defence and Trade
Strategic effectiveness and outcomes of Australia's aid program in the Indo-Pacific

DIXON, Professor David, Chair, Diplomacy Training Program, University of New South Wales

FITZGERALD, Mr James, Board Member, Diplomacy Training Program, University of New South Wales

WILLETTS, Professor Juliet, Research Director, International Development, Institute of Sustainable Futures, University of Technology Sydney

CHAIR: We will now resume the Foreign Affairs and Aid Subcommittee's public hearing today on Australia's aid program. I welcome representatives from both the Institute of Sustainable Futures at UTS and the Diplomacy Training Program at UNSW. Thank you very much for coming today and for your submissions. I now invite each of you, or a combination, to make a brief opening statement or statements.

Prof. Willetts : Thank you for this opportunity to provide comments in this inquiry from UTS's perspective. Australia is a country that is surrounded by developing countries. More than half of the world's poor live in Asia and the Pacific, and that's a fact that needs to inform this whole inquiry. We see investment in aid as a critical complement to other investments in foreign affairs, and we hope that our inputs can help strengthen the strategic nature of aid and help address the Sustainable Development Goals in our region. In this opening statement, I want to speak to three brief points—one concerning gender equality, the second concerning private sector engagement and the third on innovation and multi-stakeholder partnerships.

On gender equality, our main message is that we've started working in this area, but there's a lot more to do. In our submission, we support continued investment in this area and recognise that women and girls are among the most marginalised, noting that the aid program didn't meet the 80 per cent target of investments that effectively address gender equality. And there's good reason for this: it's not an easy area to address, and our experience, in research in Indonesia and Cambodia, showed how, if you make crude assumptions about how to support women, it doesn't always work.

We were looking at female entrepreneurs and the extent to which those women were empowered by being supported to conduct entrepreneurial activity. What that research revealed was that we need to better understand the actual barriers they face and we need to engage much more with men and households and communities as a whole, not target only women. So to do this, greater gender expertise is needed in programming and it also needs to be resourced. The policy commitment also needs to be accompanied by increased resource allocation. If not, we know that, for instance, some women's economic empowerment programs can actually result in backlash and violence against women. Things that had been assumed to have positive outcomes actually might not.

Our second point is about the private sector. Our message for you today is that this is difficult terrain and we really need clear metrics to understand whether the investments are resulting in reduced inequalities. So the intent on engaging with private sector is sound. It's about leveraging a broader set of drivers for economic and social development and to be catalytic in creating change. However, as stated in the DFAT submission to the inquiry, it's difficult terrain. It's difficult to do well. It's difficult to do well in a way that actually does address inequality. The research we've done that looked at small-scale enterprise really shows you how you also need to engage with and fund investments in governance, regulation and the wider institutional system. Our research showed in Vietnam that poor households were being systematically excluded from piped water services and, similarly, supply chains for sanitation. In Indonesia, there were much higher costs in more remote areas.

If we only focus only on the private sector part of the picture, we won't actually address inequalities. We actually need to address the whole system and change some of the governance and regulatory settings within which the private sector operates if we want to make changes in poverty. So private sector engagement can't be a panacea; it has to be part of a bigger picture.

The final point is innovation. We really need to focus on partnerships and address the causes not the symptoms of the issues we see in the countries in our region. So in our submission, we've emphasized that effective aid is actually just about relationships. We all know that relationships are built on trust and confidence, and that they are undermined by uncertainty and by suspicion. So the drop in aid of 25 per cent since 2013 means that multiple programs that were in train have been cut and have had resultant effects on the relationships with the partner governments in countries where we work as those programs were suddenly halted. There also can be suspicion if it's likely Australia is overtly using aid for furthering just its own interests. People will see through that, basically.

In our view, multiple-sector partnerships and engagement are a critical source of innovation to help address the systemic challenges and to create trust. We think that the innovation exchange has expanded the breadth of ways in which aid is seen to be able to be delivered. But we also think that there is a lot of innovation within the existing programming, particularly where there's a wide set of actors including researchers, private sector and civil society involved. One network of Australian universities called the Research for Development Impact Network is bringing together those different actors and looking at how to use evidence to inform better programming and innovation.

In considering causes versus symptoms, an example to think about is the narrowing of the aid program focus from health to health security. We just saw in the news last week a case of polio in PNG for the first time in almost 20 years. We can try and address that through very narrow measures or we can realise that actually it's a result of a failed public health system. And to address actual health systems, we need broader investments in health, not just in health security. I think that's a good example of this whole picture of thinking about how do we use aid strategically. If we're too narrow and we're too focused on exactly the things that might be a risk for Australia then we're going to actually miss the things that could create broader change in the region. If you contrast this with an investment in Indonesia through the DFAT infrastructure facility, they work with the ministry of finance on financing mechanisms between national and local government to incentivise local governments to deliver more basic services. Now that's a kind of change in a whole governance system that will have a long-term effect but it wasn't a narrow thing trying to address the symptom.

Zooming back out, to address gender equality, private sector engagement and innovation we need the right skills, and that includes within DFAT. That was critiqued recently in the Development Assistance Committee review. We need to make sure we have the right expertise in DFAT to manage the aid program, and we obviously also need to shift public support. The public, through Lowy's survey, have shown that they think we invest way more in aid than we actually do, and that's part of the issue that we're all facing in trying to demonstrate the value: we have a misperception about how much is actually invested. In our view, aid is a strategic investment. We need to use it carefully, and we need to use it to support genuine partnerships.

CHAIR: Thank you.

Prof. Dixon : Thank you for inviting us to meet you today, and thank you for inviting us to this really weird place. Maybe people from Canberra are used to this, but it's a very strange building.

CHAIR: At least you can see out!

Prof. Dixon : Yes. The Diplomacy Training Program is a very small independent NGO which is affiliated with UNSW. DTP is committed to advancing human rights and empowering civil society in our region through in-country training programs which build the skills and capacity of community advocates and human defenders in civil society. Despite our name, we're not actually about diplomacy in the traditional sense. DTP was established in the 1990s at our university by Jose Ramos-Horta when he was in exile from Timor-Leste. I should explain that James Fitzgerald and I are volunteers who work on DTP's board, as it were. It's a very small organisation with only three employees.

This is a significant time of change in our region. Australia's standing and influence are under threat as big countries flex their muscles and small Pacific nations band together. We've had experience in working in almost every nation across the Asia-Pacific. While others are building influence, Australia is seen as stepping back, as in the withdrawal of Radio Australia, a very unfortunate step. Development aid is crucial. We, of course, argue, like our colleague from UTS, that it should be increased significantly from its current low, but it should be used strategically, and it's that side that we want to focus on today.

For DTP, strategic use of aid means challenging the dichotomies between pragmatism and principle and between rights, security and national interest. Our specialisation is in training people to use principles of the rule of law and the tools of human rights to create capacity in civil societies in the region so that they are able to advocate for their own priorities rather than being simply the recipients of an externally determined charity or aid program. Such capacity makes the benefits of economic aid more effective and sustainable, in our experience. Our key focus is on those whom economic development alone can leave behind or harm: indigenous minorities, migrant workers in particular, women and people with disabilities. Our work furthers many of the Sustainable Development Goals—in particular goal 1, no poverty; goal 5, gender equality; goal 8, decent work and economic growth; goal 10, reduced inequalities; and particularly goal 16, peace, justice and strong institutions. However, we do not presume to make decisions about what is best for the peoples of our region. We work with our regional partners to identify how we can help them to achieve their own priorities and goals. I think independent NGOs have a particularly useful role in doing this.

Our work builds relationships of mutual trust and respect with our alumni. We have now more than 3,000 DTP alumni around the region, including Abel Guterres, the ambassador to Australia. These people are increasingly influential ambassadors for Australian values of legality and human rights, as expressed in Sustainable Development Goal 16 and indeed in the white paper on foreign policy published last year. We very much welcome the committee's interest, and we hope that we can continue to contribute to building Australia's development program.

CHAIR: Do you have any further comments to add, Mr Fitzgerald?

Mr Fitzgerald : No, only to second Professor Dixon's comments.

CHAIR: Firstly, thank you for your very extensive submission, Professor Willetts. It's a very good one that addresses all the criteria there. I'm interested in what you said about retaining the focus on infrastructure development when it's focused on the needs of the poor and the marginalised. One example is from when I went to the Solomon Islands in January of this year. There are a number of programs working in communities around gender and assisting women and girls, but a lot of the needs of the community often didn't necessarily align with what those programs were doing. A lot of communities, for example, raised the need for infrastructure investment in water and sanitation, and the influence that would provide in terms of helping women and girls to not have to walk long distances to use facilities, gather water and so forth. I'm interested in hearing more about your views around that infrastructure investment and where we should be investing our development assistance more effectively.

Prof. Willetts : Water and sanitation is my core area, so I am happy to speak to that. The current level in the aid program is 3.4 per cent of the aid budget. I think to be in line with other OECD donors it could easily go up to five per cent, and it would be more comparable to other donors. It's because of the issue you just raised. It is an absolute basic human necessity day in, day out, particularly for women and girls, including for issues such as menstrual hygiene, which has now become an issue which is way more discussed and talked about in terms of, for instance, girls going to school. If schools don't have toilets then the girls are more likely not to go to school, and we now have research based evidence that proves that. So we know it's an area that needs to be addressed. In terms of ensuring infrastructure programs focus on the infrastructure people need, which is the point you just referred to, is what's being provided meeting needs? To me that's about the engagement processes that lead up to the provision of infrastructure. Programs need to have adequate engagement with local governments and with communities themselves, including women, to be ensuring that needs are articulated.

In terms of reaching the poor, to build on the example I gave earlier of the financing mechanism in Indonesia from the national to local level, what was clever about that financing mechanism was that it was contingent on the numbers of new household connections to low-income households. So you were basically incentivising local governments to invest in their water utilities to do something that reaches the poor. The money only flowed when you verified that those household connections to the poor had actually been provided and the service had been running for some time. It's that kind of thinking—what's the outcome we're looking for?—and making sure financing is provided on that outcome basis rather than as an input and asking whether the input is to build something, in which case maybe it won't get built to quality and maybe it won't reach the outcomes we hoped for. But if we're giving the money on the basis of the outcome that everyone agrees is important then that's a way to ensure that aid is more effective.

CHAIR: Professor Dixon, talking about strategic investment in our aid program to assist strategic and/or defence outcomes, how can we better target our aid and development assistance programs to achieve strategic and defence outcomes, and how can we garner public and, indeed, parliamentary confidence—or directions—in strategic or defence related aid, if that makes sense?

Prof. Dixon : I think the particular approach that we take is about working with the communities that we seek to connect with, to go out and see what they want from us and to have our priorities dependent on what they do, because the major issue, it seems to me, at the moment is about influence, soft power and spreading Australian values. If we're simply doing this in a way which is seen as being crudely propagandist it's obviously not going to work. But if we're able to help the people in the communities that we're serving to develop their own capacities to develop the policies, interests and so on that they work for, that's the best approach. I don't know if James may want to add to that.

CHAIR: Being more direct, do you think we can garner further investment in aid by utilising our strategic and defence outcomes as a reason for investing in that aid?

Mr Fitzgerald : I'm not sure I can respond directly to your question, but allow me to say the following. It's axiomatic to say that we're living in a time of flux and change in the Pacific. There is a need to abandon old assumptions. Institutions that have served all parties well, or not, for years are receding. There are new actors. The message we're receiving from our colleagues in the region is that, in broad terms, we have a situation where a lot of the smaller island nation states who essentially used to subcontract out their international diplomacy to Australia or New Zealand are now picking up their own agendas. There are a number of reasons for that, but some of them are mentioned to us. For instance, there is, obviously, the arrival of new, significant actors in the region: China, Indonesia, Malaysia, Taiwan and others. But, at the same time, we are told that, while these smaller nations are determining their own agenda and priorities, they are in some way seeing Australia and its interests as not necessarily being consistent with their own priorities. A good example is the direct effect on these small nations of climate change and Australia's abundant coal industry. So we're seeing a divergence of interests and, I suppose, an enlightenment, to a certain extent, in these small nations about what is in their interest. It is for that reason that we believe that the best approach—at least for our organisations; I cannot speak for the Australian government, obviously—is to engage with those in civil society who seek change and give them the tools to make their efforts more effective. In our case, that is teaching human rights frameworks and remedies—those sorts of things. As David mentioned before, this organisation was first established by Nobel Prize winner Jose Ramos Horta. The concept was to convey the lessons he had learned advocating on behalf of an independent Timor to others in the region, which are that there are these systems in place internationally, such as United Nations conventions, principles and committees, that people can plug into to be more effective advocates—that's what we do—and, in the course of that, build up substantial alliances, networks and friendships in the region. So, in relation to defence, from our perspective, we would say defence starts not with patrol boats and missiles but with the hearts and minds of people and their decisions about who they're going to partner with in the future.

CHAIR: Thank you. I've got many other questions, but I'll pass to the Deputy Chair and others.

Senator GALLACHER: Professor Willetts, I think I opened a project in Surabaya a couple of governments ago where 100,000 houses were reticulated and metered, and Australia paid 50 per cent of the cost after completion. You referred to that model. Is that model going to be applicable in the Pacific? This was a highly urbanised area.

Prof. Willetts : Not necessarily, in its current form. In the case in Indonesia, the local governments and the utilities were taking on the pre-financing, so it depends on their ability to prefinance. I think the idea that aid leverages, that we don't pay for everything and that there's co-investment definitely still stands, and the aspect of that payment being ideally done to the extent possible on the basis of the outcome that you're trying to reach still stands also. The details would differ, I think, depending on the context.

Senator GALLACHER: Even on notice, is there an example of a project in the Pacific where the authorities completed the project and we supplied 50 per cent or 70 per cent or whatever?

Prof. Willetts : Quite possibly and very likely. I don't have details that I would be able to give on that.

Senator GALLACHER: When I was in Canberra the other night, the Timorese ambassador that you mentioned—is he the dean of the college?—

Senator MOORE: Yes, he is the dean of the college.

Senator GALLACHER: was addressing a gathering of all the ambassadors and diplomatic heads of mission in Canberra. The thing I don't see, though, is where that translates into effectiveness. If the Timorese birth rate is at risk and there is stunted growth and cognitive deficiency and Timor has revenue from its increased share of the Timor gas fields, how do we join the dots in that respect to get the outcome on the ground? How does Australia facilitate that?

Senator MOORE: It's just a simple question, Professor!

Senator GALLACHER: After a couple of decades.

Prof. Dixon : Talking specifically about Timor-Leste, it's about—

Senator GALLACHER: Sorry. I'll put it this way. We've seen it happen in New Guinea. They're in a second economic boom. The first one sort of disappeared without any discernible increase in the WHO outcomes. I just throw that out there.

Prof. Dixon : Again, I will use Timor-Leste as an example. The way in which the resources, which have come from oil and gas, have been used is obviously a matter of concern to friends of Timor outside. One of the outcomes that we would hope from our work specifically in Timor-Leste is to increase the governance capacity within Timor-Leste—obviously, I'm trying to pick my words politely here—so that the resources are used effectively and fairly and lead to appropriate outcomes. That kind of thing depends to a significant extent upon the appropriate principles of legality being used in the managing of economic resources. I hope that answers your question.

Senator GALLACHER: Do we do anything in governance, though? Do we train people in governance and due diligence in a diplomatic way? Do they send people here for that level of training? I've actually met the Auditor-General of Kenya on a plane. We do get people together, don't we?

Prof. Dixon : Absolutely. As a very small NGO, our focus is on increasing the capacity for civil society to hold governments accountable and to assist in those processes.

Prof. Willetts : Could I just add a little on Timor. It is related to programming. Amongst DFAT's programming, there is governance for a development program which focuses on the good use of economic resources. I know that within the water and sanitation sector there has been a basic program over the long term that has been working on ensuring resources go into building rural water supply systems and rural sanitation. The Asia Foundation is also working on social accountability and building the capacity of the tiny, tiny—there are many—NGOs, as David said, to hold government to account. I think it's intervening on all those sides. You can't just intervene in one place in the system; you need to come at it from multiple directions. I think that is part of what is being done through the aid program.

Ms CLAYDON: Thank you all for your evidence this morning. I want to pick up on two things from you, Professor Willetts. One was around your observations that some of that investment into women's empowerment and participation in entrepreneurship in the private sector hasn't always had the intended outcomes and that there might be ways in which we could better ensure the application of those 'do no harm' principles. Could you just explore that a little further for the committee and also the role that you see academics or NGOs on the ground playing in that. I would be interested just to hear a little bit more about that and any examples that you've got.

The other one I want to pick up with you is around becoming a trusted partner, which involves some long-term investment, not just financially. Are you aware of any existing tenure programs that have enabled us to better establish ourselves as trusted partners in that space, or is that sort of new terrain for us to explore? What would be required to secure those long-term aims? I'll hand over to you.

Prof. Willetts : Thanks, Sharon. In terms of women's empowerment and that we don't always reach the intended outcomes, a current example is a new fund for civil society organisations called the Water for Women Fund. It's an $110 million investment in the Asia-Pacific. It is to address water and sanitation in the context of also addressing gender equality and inclusion, so all different types of inclusion—disability, minorities and many other angles. It's in its establishment phase, but I think what's interesting about it is that as well as civil society organisations there is a managing contractor private sector organisation involved and there are research grants attached, so it's got many different actors working towards a common goal. At the moment there's work developing a gender and inclusion strategy with sets of principles along the lines of what we're talking about in terms of do no harm. That's about being able to monitor what the effects are. We can't just assume that the effects are positive for women; we actually need to ask them, and we need systems in place to do that.

One of the principles, for instance, in that gender and inclusion strategy is to expect backlash. When you change gender dynamics there will be resistance and may be negative consequences. We need to expect that, be aware of that and build in ways of mitigating that and ways to deal with it when it actually happens. For instance, it's making sure that in this case the civil society organisations and in-country partners are prepared enough, have the skills to deal with these situations and are going in with eyes open rather than closed.

On the trusted partner long-term investments—

Ms CLAYDON: Just before we move there, sorry, is that work that's being done still in its infancy or are there examples you can point to where there has been good preparation for that backlash coming forward?

Prof. Willetts : I think organisations like the International Women's Development Agency have already done a lot of work in this area. In the previous work on women's economic empowerment in the Pacific it was revealed that, without good care, you do create increased violence against women. These can be proactively addressed early on in programming to avoid the extent.

Ms CLAYDON: Sorry, I've got a lot of supplementary stuff. Is that built in? Would that be a general principle now when we're going to fund programs somewhere and we have an aim to deliver gender equity and safety and security for women in a region? Are we proactive in our approaches to ensure that we're adequately prepared? Do we now ensure that those NGOs or on-the-ground people are well-equipped to deal with any backlash that might come? Equally, is there always a component to monitor and evaluate those outcomes? Is that part of our normal practice now?

Prof. Willetts : It's part of emerging practice. I wouldn't say that we've already got there. There are definite examples of it in terms of leading organisations et cetera, but I wouldn't say it's absolute that everyone is past that bar.

Ms CLAYDON: Would it be your recommendation that that is somehow built into—

Prof. Willetts : Yes, I think that definitely could be made more explicit.

Ms CLAYDON: the kinds of funding agreements that we enter into?

Prof. Willetts : Yes, I think it could be.

Ms CLAYDON: Sorry for all the interruptions.

Prof. Willetts : That's okay. So trusted partners, and long-term investment—I'd say it's sort of similar. There are definitely examples of it in the aid program. The Indonesia Infrastructure facility that I mentioned earlier has already been going for six to eight years and has now been funded for another 10-year phase. It's now called KIAT. The acronym is using the Indonesian words, which is also a nice change, rather than using English. In Timor, a lot of the programming also has been quite long term. So definitely there are examples of long term investment, and it has demonstrated that it's possible to do, even with changing budgets year to year, to make those longer term commitments. I think we need to expand how much of the aid program that refers to so that we have less of the shorter one-, two- or three-year cycles of funding. We core fund with good monitoring and trusted partners to do good work.

Ms CLAYDON: What's the percentage of funding at the moment that will go into those longer term programs?

Prof. Willetts : No—

Ms CLAYDON: No? Okay, that's a question I'll ask the—

Prof. Willetts : It would be a very grey area how you define exactly what that meant, but it would be worth looking at. It's a good question.

Senator MOORE: Professor, I've just been looking at your website, which is very useful—I should have done it earlier—and the Diplomacy Training Program. I'm looking at the focus on human rights in the SDGs. In an advertisement to both organisations, I hope you're providing submissions to the Senate committee on the SDGs. Just a little plug there. You're taking note? Thank you, Mr Fitzgerald. Are both organisations involved in this shadow community response to Australia's voluntary response to the SDGs next month?

Mr Fitzgerald : We are aware of it.

Prof. Willetts : We've had some involvement in terms of making inputs towards the voluntary national review, through events held by the Research for Development Impact Network here in Sydney. The one way our institute is looking at it just now is via the high-level political forum, which is on this week. We've been working with IWDA, who are there in person. They have two people there, with their own social media et cetera. We've passed on evidence, key messages and ideas for them to put forward in the context of that high-level political forum.

Senator MOORE: And what about the diplomacy training?

Prof. Dixon : We're aware of it. Unfortunately, our director Patrick Earle is currently running a program in Indonesia. Perhaps I could give you more information via him?

Senator MOORE: I'll put that on notice.

Mr Fitzgerald : It is on his radar though.

Senator MOORE: In terms of your area at UNSW, how much funding do you get from DFAT?

Mr Fitzgerald : I think it's in the order of $250,000 a year.

Senator MOORE: Over how many years? From the start?

Mr Fitzgerald : No, it's not from the start, but—

Senator MOORE: You can take that on notice as well.

Mr Fitzgerald : We'll take it on notice. Look, it's a relatively small budget and a very high output, but part of our business is simply fundraising among the public and concerned individuals to supplement that money to allow this.

Senator MOORE: I was unaware, until this inquiry, of your work. Is there any similarity between the way you operate within UNSW and the Crawford School of Public Policy in ANU? So in the way you operate within a wider area, you have a particular focus. Is that similar, or not?

Prof. Dixon : Not really. I think the key difference is that the DTP isn't a part of the university.

Senator MOORE: It's not at all?

Prof. Dixon : No.

Senator MOORE: It's not considered part of it?

Prof. Dixon : It's based at the university, and the university supports DTP by providing it with facilities, rooms and some basic support—printing and hardware and that kind of thing—but it's actually an independent organisation.

Senator MOORE: So it's not formally part of the university? Okay. It's just that one of the goals of the white paper is this increased work with the universities. So it's not within that process; it's something separate. They acknowledge the work you're doing, but it's not through UNSW.

Prof. Dixon : That's right. It's not formally part of the university. I'm a professor in the law school, and DTP is based in the law school. Part of my role is to develop the relationship mutually between the university and DTP. The university is in the process of establishing an Institute for Global Development which will be the university's version of what we do at a higher scale.

Senator MOORE: So that's being developed currently for UNSW?

Prof. Dixon : Yes. It's been set up, and a director will be starting work later this year. It's focusing on Myanmar, the South Pacific and Uganda as three key areas.

Senator MOORE: Interesting. Is that going to get DFAT funding?

Prof. Dixon : Not currently—that is, as far as I know.

Senator MOORE: I'm sorry, but I'm just trying to look at the funding element and how it goes in, because that's the core part.

Prof. Dixon : I'm not directly involved in IGD, but as far as I know it doesn't have—

Senator MOORE: It's something we should ask about.

Prof. Dixon : It doesn't have DFAT funding; it's funded from the universities and philanthropy so far.

Senator MOORE: But in a true SDG agenda everyone should be partnering up, shouldn't they—working and pulling it together? I picked up from the website the focus on law and the rule of law. So that's where the law school is involved. Good.

Professor Willetts, thank you so much. I really enjoyed reading your submission. I have two particular questions—and there are many more. One was about your answer to Mr Crewther about the WASH funding. You have so much focus in there, which is also real. You talked about the level of funding. Is the current level of funding up or down on previous funding from Australia to the WASH program? You said it's about $3.4 million now and it should be more. Has it been more in the past, or is this about the same? I'm trying to get an idea because WASH has been on our agenda for a very long time because of the expertise that we have in Australia and also because of the clearly evident linkage between water and sanitation and poverty and empowerment.

Prof. Dixon : Yes.

Senator MOORE: So what's been our level of funding from your experience before?

Prof. Willetts : I need to get the exact figures.

Senator MOORE: You can take that on notice so you don't have to worry about getting it right.

Prof. Willetts : Okay. When we first started working with the NGOs to advocate for more focus, that was in 2007. It was very low then—I think from memory around 2 to 3 per cent of the aid budget. But I'll go back and check figures. Then it did definitely - increase.

Senator MOORE: Bob McMullan had a particular thing about it.

Prof. Willetts : Exactly, and we met with him et cetera. So then there was a budget measure of $300 million in 2008 and then a follow-on to that, and I think the percentage did go above what it is now. But again we'd need to check. It's never gone up to the five per cent that various of the civil society organisations have said would be appropriate.

Senator MOORE: People have been agitating for it for a while, yes.

Prof. Willetts : Yes.

Senator MOORE: Okay. Thank you for talking about ACIAR as much as you did. ACIAR and what it can do is one of my pet things. In the middle of your submission you say:

For broader ACIAR research projects, it is also important that the mechanisms to select and fund initiatives and partnerships … are strategic, open and transparent. ACIAR's transparent reporting of funded projects through its website is an important element of communicating how ACIAR's funds deliver research outputs.

Certainly I understand transparency. Are you concerned it's not transparent enough at the moment? There has been an ongoing issue about people feeling as though, despite all the reports that are done and all the data you can find, it's still very hard to find exactly where the money's going. Are you concerned that at the moment it's not as easy to find how the process of funding is done through ACIAR?

Prof. Willetts : Yes.

Senator MOORE: Has that been an ongoing issue?

Prof. Willetts : Yes. At various times we've looked into what that process is and how our work might relate to ACIAR's work, and it hasn't been clear exactly. It's not as if there's a competitive round et cetera. That is fine, and it's not to say everything should be procured competitively, but it hasn't yet been so clear exactly what those mechanisms are. That may well be because of longstanding partnerships, which, as I said earlier, are a good thing. I don't think they're a bad thing.

Senator GALLACHER: So what can be done to give that clarity? We've had ACIAR at a number of inquiries, and they've always been very up-front. From your perspective, what could be done to give that clarity?

Prof. Willetts : It is probably making sure that the priorities in terms of areas of research that are part of their strategic direction are clear and communicated well to a broad set of stakeholders who might be interested in partnering with them.

Senator GALLACHER: So, if I were interested in what they're doing in I think it is Malawi in the Philippines, which is a critically important investment from a foreign aid perspective, would I be able to see what you're looking for?

Prof. Willetts : I think you can find information—and that's, I guess, what's meant here by 'transparent reporting'—about what things are happening now. It's less clear how you would start to engage in and be part of something that's in the future.

Senator GALLACHER: Sorry, Senator Moore.

Senator MOORE: No, no, that's how we get it all out. The other thing is evaluation, because both your organisations talk about evaluation. It's through your submission, Professor Willetts, and, from a squiz on the website, the words 'transparency' and 'evaluation' pop up in a lot of the reviews. Do either of you have any comments on the evaluation processes for the aid program?

Prof. Willetts : Yes, two comments. One is around the Office for Development Effectiveness—the ODE. I think there is appreciation and respect for the work that they're doing, that strategic level of evaluation, not just project by project. We all agree that's really important—that we shouldn't just be looking at the micro level. ODE have, over time, really tried to change and improve the ways that they engage with DFAT staff on those evaluations, to help ensure that the findings are taken up and used.

In terms of the normal systems for performance quality management, I would say I've seen a reduction in the focus on evaluation in recent years, and in the valuing of evaluations themselves and of the skills it takes to evaluate—to do that well. I think that's a shame, because we do need that. And we need more than simple numbers, because, if we just count things, that's going to focus on short-term wins and measures which ultimately aren't going to tell us whether we're getting there in the long term. The changes in governance and changes in hard-to-measure dimensions are really, really important. If we narrow our monitoring systems to countable things, then we have a problem, and I think that we won't be keeping our eye on the long game. So we do need those evaluations that go and ask the 'why' and the 'how' questions: In what context did this work? When did this work? How did this work? We need to answer those questions. So I would say a strength in and focus on the evaluations themselves in the aid program would be beneficial.

CHAIR: I have a further question, Professor Willetts. In your submission you talk about the need for longer term investment, five to 10 years, in our aid program. I had that personal experience, working in Kosovo, where a lot of the management, a lot of the time, were focusing on the need to ensure continued donor support for the organisation, which distracted from what the organisation actually did. Is that your main concern with that area, and where and how can we improve, specifically in garnering longer term assistance for aid?

Prof. Willetts : Hang on—is this about garnering it or doing it?

CHAIR: How can we garner support for longer term assistance, and then can you outline the benefits a bit more.

Prof. Willetts : I'd say the garnering of support should follow from being able to demonstrate the benefits. To me, the demonstration of benefits is not just so that development partners feel secure and do not worry, like you say, about proving themselves every day. Instead, you want them to be focused on the long-term relationships. The longer timeframes are needed because relationships in-country with partner governments and with partner civil society organisations take time to mature and to deliver. If we try to do that in short time frames, it is less effective. So I think what can garner support is people understanding that it takes time to develop those relationships and that those relationships are critical to effective aid.

CHAIR: Do you have anything further to add to that, Professor Dixon or Mr Fitzgerald?

Mr Fitzgerald : I'd like to second Professor Willetts' comments, but also say that it's axiomatic: we are talking about Australia's near neighbours; therefore, the relationship aspect needs to be front and centre. Metrics are notoriously difficult when you're doing the sort of work that, for instance, the Diplomacy Training Program does in training people providing the training to use international rights frameworks and remedies. Measuring the outcome of that is extremely difficult, but we know that civil society is getting results in the migrant work context, et cetera. Proving the causation between the training that was provided in year X and the outcome of better working conditions for Filipinos in Qatar five years later is extremely difficult, but it's greatly appreciated by the beneficiaries. I think a simply metric approach will not reveal the full value of the work being done.

CHAIR: Just one final question: do you think there's too much of a metric approach or budget type of approach to our aid program at the moment, encouraging or incentivising partners within the funding that they receive to not utilise, for example, local procurements, local publishers for children's books or mosquito nets from a local manufacturer, but to actually bring it in from outside, which then can have a longer-term impact in terms of distorting the local economy? Do you think we have a metric based approach that is potentially causing that? Is there a way that we can better harness local procurement?

Mr Fitzgerald : My own experience is limited, for the most part, to the informants that we speak to—our partners in the region. But I think all of us are a little concerned about the rise of the metrics. We can go back to all sorts of anecdotes in history, including Stalin's Russia, about the dangers of just relying on tonnes of output or simplistic measures of performance. Particularly in something as important as Australia's relationship with its near neighbours, a much more sophisticated and nuanced approach is necessary.

CHAIR: Thank you.

Ms CLAYDON: I have one question I should have asked earlier on. To pick up on your recommendation that went towards ensuring that our infrastructure development and investments into trade are tested against an outcome of seeing reduced inequalities in the partnered countries rather than, perhaps unwittingly, increased inequalities that might exist. That is very much one our terms of reference, and it'd be great to have some evidence around what you thought might be ways we could best consider or ensure that those trade and competitive investments are actually going to deliver good outcomes in terms of reducing inequalities in their respective countries.

Prof. Willetts : I think it just means ensuring that they're subjected to the kinds of evaluations I mentioned earlier—not ones that avoid being overly simplistic in measuring what the gains are but ones that really look into the backstory of what the effects are for those involved and for those who are not involved, because it might even be those who were not involved that are more important in the equation. I just think that they should be subject to scrutiny in the same way that all development programs are.

Ms CLAYDON: Would that involve some qualitative and quantitative research?

Prof. Willetts : Absolutely. I guess that's what I meant by evaluation processes. It gives you the chance to ask those questions about why and how, and for those you do need qualitative methods.

Ms CLAYDON: Are you aware of any other jurisdictions or other nations that are actually doing a good job in terms of ensuring that their trade agreements or investment into private sector competitive arrangements are seen through that prism of, 'The outcome we're seeking to get here is a reduction of inequalities in this country, so let's ensure that our programs are appropriately aimed'?

Prof. Willetts : That's a very good question. The only thing I could hazard is possibly DFID, but I'd want to go back and have a look at their evaluations again and see if I definitely agree. They've done some in this space, but I'd want to have another look.

Ms CLAYDON: I'm aware that Canada is doing some considerable work around reduction of gendered inequality. That might be relatively new in the mix in terms of their trade agreements, specifically, and ensuring that they examine the potential implications for different outcomes.

Prof. Willetts : Canada would also be a great one to look at.

CHAIR: Thank you, Professor Willets, Professor Dixon and Ms Fitzgerald for your evidence today. You will be sent a copy of the transcript of your evidence for review. And thank you once again for your time and also for your efforts in the Asian development sector and indeed diplomacy more generally.

Prof. Dixon : Thank you for your work in such an important area.