Australian Agency for International Development

CHAIR: Mr Baxter, do you have an opening statement?

Mr Baxter : Yes. I would like to begin by briefly highlighting some of the progress made by AusAID since the previous hearing and the implementation of the government's aid policy and effective aid program for Australia. We continue to strengthen the way we work with partners, both domestically and internationally. We launched a new civil society engagement framework in June 2012, and the framework sets out how we will work with civil society organisations to improve the effectiveness of our assistance, better manage risk, and enhance efficiency, accountability and value for money. The framework was developed in close consultation with the NGO community in Australia and overseas. It includes an agreed approach to linking AusAID funding to civil society organisations, with a focus on effectiveness, capacity and relevance to Australia's aid objectives. A steering committee has been established to oversee the implementation of the actions agreed to under the framework, which includes representatives of the NGO community.

Our first consultative forum with business was held in August 2012. The forum brought together over 120 business leaders and development professionals to discuss the role of the private sector in promoting development and to share examples of projects that have achieved both commercial and development outcomes. It included speeches from the managing director of Rio Tinto Australia, David Peever, and the International Finance Corporation's vice president for the Asia-Pacific, Karen Finkelston. Preparations for the forum were driven by a business engagement steering committee that includes representatives of the Australian Chamber of Commerce and Industry, the Business Council of Australia and the Australian Industry Group. At the forum the minister launched the private sector development strategy for the Australian aid program, which sets out how the program will support private sector growth in partner countries. To build on the momentum generated at the forum, we are convening a series of country-specific roundtables with bilateral business councils, focusing on Indonesia, Papua New Guinea, the Pacific and Africa.

The multilateral engagement strategy of the government was released in October 2012, and the strategy prioritises our engagement with multilateral organisations to ensure our aid dollars are invested in the most effective way possible. The strategy builds on the Australian multilateral assessment published in March 2012 which for the first time rated the performance of multilateral organisations based on their poverty orientation and impact, capacity to make a difference, value for money and relevance to Australia's development objectives.

Finally, I would like to mention briefly fraud in the aid program, as this has been an issue of great interest to the committee and an area where AusAID has made substantial investments to improve performance. In March of this year, a new risk management and fraud control branch was established. That is in addition to a separate audit branch, led by a chief auditor. Our audit committee has been substantially strengthened and we have doubled the number of fraud control officers based in Canberra and established four dedicated overseas positions in our highest risk posts.

In 2011-12 we more than doubled the number of staff from AusAID and our partner organisations receiving risk and fraud training. The result is that we have more than halved the rate of potential loss to fraud from .03 of a per cent of the total aid budget in 2010-11 to .012 per cent in 2011-12. During a recent visit to Papua New Guinea I signed a joint statement on zero tolerance of fraud in Australia's aid program with the new Minister for National Planning and Monitoring, The Hon. Charles Abel. The statement commits both sides to comprehensively investigating any suspected fraud in the program, with the perpetrators prosecuted to the full extent of PNG law.

CHAIR: Thank you very much, Mr Baxter, for your opening statement.

Senator KROGER: Thank you for your opening statement, Mr Baxter. I want to follow up your comments in relation to potential loss through fraud, which we have also covered in past estimates. What do you put the immediate reduction for after such a short amount of time down to? Can you provide a better breakdown of how that was identified? I am sure it was more than just training.

Mr Baxter : As I mentioned, we have had a multifaceted effort both in Australia and overseas to strengthen our capacity to prevent fraud, to detect fraud when it occurs and then to go after those people who perpetrate fraud. It really goes through our whole operation in Canberra and at our posts. We spend a lot of time making our staff aware of the fraud issue and giving them specific training that will help them design programs that are less prone to fraud. We have done a lot of analysis of which kinds of programs present the highest level of risk and of how we might be able to mitigate those risks better.

We do realise that there are not any no-risk options for us, given the kinds of countries where we spend the aid program—which is, of course, taxpayers money—so we are not complacent that the result means that we have finally cracked the code, if you like, on fraud. We have had a good year, but we know we have to keep at this. It is a constant priority for the agency and it is a constant priority for a program managers in Canberra and in the field. So I think that it is a combination of factors.

We have also spent a lot of time talking to our major partners about the problem of fraud. I mentioned the agreement I signed with the Papua New Guinea minister responsible for aid coordination only a couple of weeks ago. Papua New Guinea accounts for the largest number of fraud cases both by numbers and, I think, by volume of fraud in terms of dollar value, so it is important that we make gains in Papua New Guinea. We have had similar conversations in our other major partner countries: the Solomon Islands, Afghanistan, East Timor and Indonesia.

Senator KROGER: So it has been a tightening-up of the process and the structure in relation to the types of programs that make fraud more difficult rather than changing the nature of providers or being more stringent in the criteria and the approach and the due diligence undertaken on providers. How I write in that?

Mr Baxter : I think that it is a combination of that and the investment in a significant amount of new resources into our efforts. But, in terms of talking to providers, as an example I have met the CEOs of all of our major contractors specifically on this issue over the last six months. We had probably not done enough of this in the past—talking to out implementers, if you like, about what they are seeing in the field and about how we can take that knowledge and turn it into better-designed programs that at least increase the chances of our preventing fraud and detecting fraud, where fraud occurs.

Senator KROGER: I would like to put on record, because you have already mentioned what the percentage of the fraud is, that in the scheme of things it is relatively small as a percentage of the money that is directed by AusAID. I would like to note that. The issue is that, because of the size of the AusAID budget, it becomes significant.

We were talking about the deployment of taxpayers money in the most effective way. I turn to the perception that AusAID has been used as part of our bid process for the UN Security Council. Given the timing of estimates in relation to the announcement of that bid, I think it is quite relevant. I would like to draw your attention to an article that was printed by the News Limited network by Gemma Jones. I would like a table that article, Chair. Are you aware of that article, Mr Baxter?

Mr Baxter : I am, yes. It is from 2 October.

Senator KROGER: That is the one. It outlines and gives a breakdown of material was presented in both the budget ministerial statement and the portfolio budget statement. The information that she has done an analysis of shows a dramatic change in the focus of aid in regions. She was doing a comparative analysis from 2007-08 to the last financial year. I wonder whether you have any observations you would like to make on the back of that article?

Mr Baxter : The first thing that I would say is that the aid program is not tied to the UN Security Council bid—although, of course, the reputation of the country is an important factor in getting support for any international candidacy and Australia has a very strong reputation as being a high-quality deliverer of effective development assistance. If you look at the changes in our program over the period that you mentioned, you will see that there is not any evidence that the focus of our program has been changed dramatically as a result of the UN Security Council bid—with the exception, of course, of the fact that the government has committed to a major increase in our program, so the volumes have gone up over time. One area that is often quoted as alleged evidence of some distortion of the aid program's priorities is the government's decision to start a program in Latin America and the Caribbean. Our current funding for Latin America and the Caribbean combined is less than one per cent of the Australian aid program.

Senator KROGER: Having gone from a zero position where we had determined that we would not deploy any AusAID resources into that area.

Mr Baxter : That was not the position of the government. The Independent review of aid effectiveness made a recommendation to government that it not increase the program, and the program has stayed flatlined since the Independent review of aid effectiveness was accepted by government. So there is been no increase in our Latin America and Caribbean program since that time, but—

Senator KROGER: But they did question why we were putting paid into the area.

Mr Baxter : That may be the case, but the government accepted the recommendation to continue the program at current levels. If you look at an area such as North Africa and the Middle East, you will see that the percentage of the program go to North Africa and the Middle East in 2006-07 was three per cent, and in 2012-13 it was two per cent. So aid to Africa and the Middle East has actually fallen over the last six years despite the considerable resources that have been applied to the humanitarian problems in places such as Libya and, latterly, Syria.

In sub-Saharan Africa our aid program has gone, from 2006-07, from two per cent of total ODA to 7 per cent in the current financial year. So there has been an increase in Africa. Africa, as you know—particularly sub-Saharan Africa—is where the highest concentration of people on earth living in extreme poverty are located, so there are very good development reasons for us to increase our programs in Africa. But it is an increase off a low base to still well less than 10 per cent of the total Australian aid program, and it is still the case that the vast bulk of our resources are spent in the Asia-Pacific—something like 80 per cent of our bilateral and regional programming.

Senator KROGER: I will just pull out two or three of the projects that AusAID has supported and ask you how they serve to advance our interests. The first one—and I raised this earlier in the day—was the $150,000 that was put towards the building of the statue in the UN Plaza in New York to commemorate anti-slavery in the Caribbean. How does that serve to advance Australia's interests—or anybody's interests, for that matter?

Mr Baxter : That was not an AusAID funded program.

Senator KROGER: So it was funded how and where? What budget did it come out of?

Mr Baxter : You would have to direct that question of the Department of Foreign Affairs and Trade. It was not funded out of the AusAID budget.

Senator KROGER: That is very interesting, and they conveniently did not point that out at the time. So you are telling me that, for instance, the $150,000 that I was told was determined to recognise the government's anti-slavery, anti-trafficking position—not only historical but also current—has nothing to do with AusAID? It has come out of some other bucket?

Mr Baxter : That is right.

Senator KROGER: That is extraordinary. What about the $270,000 for reviewing agriculture and fisheries management in Eritrea? Has that come out of the AusAID budget?

Mr Baxter : That was a program which was implemented by the Department of Agriculture, Fisheries and Forestry. They had an agricultural cooperation program in Eritrea from 2004 to 2011. AusAID did provide $36,000 for a review of the DAFF activities and a scoping mission in Eritrea which was completed in June 2010. It was decided at that time not to proceed with additional agricultural support to Eritrea. The details of that program would will be with the Department of Agriculture, Fisheries and Forestry.

Senator KROGER: So $36,000 came out of AusAID to review that in addition to the $270,000 which you are telling me came out of the budget of another department?

Mr Baxter : It was certainly implemented over that period from 2004 to 2011 by the Department of Agriculture, Fisheries and Forestry. I am not aware of us providing funding to it. It could have been expenditure that was eligible to be counted as ODA under the guidelines of the OECD, but that does not necessarily mean that that it came from our budget; it may have been appropriated correctly to that department, as often happens.

Senator KROGER: I cannot tell you how disconcerting this is, Mr Baxter. When I have been questioning DFAT on some of these things today, they have not provided, for instance, information that the first one I raised was not an AusAID project, and you are telling me now that the second one I raised may well have been funded out of another department.

Senator Conroy: I am not sure that there is much Mr Baxter can do. You are berating him.

Senator KROGER: Minister, I have to say that I have sat here for many estimates and praised Mr Baxter for the Independent review of aid effectiveness, which was initiated under his watch when he was first the director-general. I thought that what we are all about here was making sure that money is deployed in the most effective way possible, and I think there is bipartisan agreement for that. But it really concerns me when there are projects which clearly have been funded to support our profile in the lead-up to the United Nations Security Council bid, and we are now seeing that they are all coming out of different buckets. When I hear that the budget for the United Nations Security Council bid was only $24 million and we go through things and they are all coming out of different departments, it begs the question: how much did this bid cost the government? It does not matter how much interrogation we do and how much we ask, we never seem to come up with a finite answer; and it is about time that Australians all were given the true facts.

I come to another one. There was a membership of the Convention on Biological Diversity in Kenya that is listed as $300,000. It was back in 2009. I am just wondering whether you are aware of that one—whether it has come out of an AusAID budget—and whether you can explain what membership of the Convention on Biological Diversity means and entails?

Mr Baxter : I understand that this payment relates to a payment of US$231,038 made by the department of the environment to the United Nations office at Nairobi, Kenya, under the Convention on Biological Diversity. The payment relates to Australia's assessed contribution under an international convention and does not relate to the aid program in Kenya as was implied in the article.

Senator KROGER: So that is another program that was funded not through AusAID but by the department of the environment?

Mr Baxter : Yes.

Senator KROGER: I will come to a fourth one then. This is funding for giant telescope project in Chile's Atacama Desert. It was a $65 million project.

Mr Baxter : Again this was not funded from the aid program; this was funded by the Department of Industry, Innovation, Science, Research and Tertiary Education, who provided $88.4 million of Commonwealth funding in 2010 to the ANU, which is a member of the consortium which is developing the telescope. Of the $88.4 million, up to $65 million will contribute towards the construction of the telescope in Chile.

Senator KROGER: So this is another one funded by another department?

Mr Baxter : That is correct.

Senator KROGER: It would be great if departments could actually talk and put together all these different grants so that we could get a full picture of what our largesse is.

Mr Baxter : My interest in Ms Jones's article was to check the accuracy of it, as she sought to contribute this expenditure to the aid program and clearly some of it was not.

Senator KROGER: As you know, Mr Baxter, I have been one of your strong defenders at this table; hence I am raising this. So you do not support the premise that there has been a strategy to change the direction of aid spending across the globe? My reading of it was that that there had been a 250 per cent increase in aid. I took Africa, South and Central Asia and the Middle East together, and it seemed to me that there was a drop in aid—I am talking in percentage terms here—in our immediate region: the Asia-Pacific region. That is not your interpretation of it?

Mr Baxter : If you count South and West Asia as part of Asia, the figures are basically the same now as they were in 2006-07. There has been, in percentage terms, a slight drop in the level of aid that we are giving to the Pacific. You would understand, I am sure, that the absorptive capacity of small Pacific island countries is finite in terms of how much assistance we are able to provide.

The dollar figure for the amount going to the Pacific has gone up in that period by around half a billion dollars. The percentage in 2006-07 was 26; this year it is 23 per cent. For East Asia, it is the same as it was in 2006-07—26 per cent. For South and West Asia, the figure has gone up from 6 per cent to 10 per cent. That is largely accounted for by the increases for Afghanistan, Pakistan and Bangladesh.

Senator KROGER: Minister, perhaps you can help me. Can you tell me how much aid, the strategy of which has been to further advance our profile in nations or regions and the provision of which has coincided with the bid of the last four years, has been provided not through AusAID but through other departments?

Senator Conroy: I am certainly happy to take that on notice for you. I will see what Minister Carr and DFAT are doing. I am not sure that Minister Carr will necessarily be able to give you information about the programs of other departments if, as you suggested, some are from other departments. But I will see what information we are able to make available.

Senator KROGER: I appreciate that, Minister. I just cannot believe that there are a number of departments funding various projects and programs without some sort of DFAT oversight and without being integrated as part of an overall strategic approach. I cannot believe that these programs are all being randomly funded by different departments—ironically, all around the same period of time. There does seem to be an increased incidence of them. It would be appreciated if you indeed can assist, Minister, in relation to whether there are programs which have had a loose DFAT oversight but have not been funded through AusAID—that have been funded through other departments. That would be very helpful.

Senator Conroy: I am happy to take that on notice and see what information Minister Carr can make available.

Senator KROGER: It would also be very helpful to know what stage these projects are at—starting with the four I have just mentioned. I guess the statue is underway, so that probably should not be counted as part of it, but it will be very interesting to see whether these projects will continue to be funded at the same rate should the bid be unsuccessful tomorrow. It will be interesting to see whether there is a change in the direction of aid funding if there is a negative outcome for the government tomorrow.

CHAIR: I need a motion from a senator on the committee to accept this document tabled by Senator Kroger. Thank you, Senator Eggleston. It is so resolved.

Senator RHIANNON: To assist my understanding when I read your document—when you talk about ODA funding, does that include ODA eligible projects?

Mr Baxter : ODA eligibility is decided in accordance, as I think you know, with the guidelines of the Development Assistance Committee of the OECD. ODA funding means that whatever program is using that funding has been judged to meet the guidelines of the OECD.

Senator RHIANNON: I appreciate that, but last night I was speaking to Defence and they kept on correcting me, saying 'ODA eligible'. Therefore I was left with a sizeable amount of money. When I read your documents, I come across the term 'ODA funding'. Does that include ODA eligible funding which might come under Defence, AFP or any other department?

Mr Baxter : It does to the extent that, for the last two years now, we have included in what we call the blue book details of the aid funding, the ODA funding, that has been received by other departments and agencies apart from AusAID—the Federal Police, the Department of Immigration and Citizenship et cetera. That is in the back of that document. That funding has been given to those departments and agencies for activities that have been judged to be consistent with the guidelines of the OECD as legitimate uses of aid funding. Sometimes agencies and departments will undertake an activity only part of which can be funded through the aid program, because only part of it is eligible.

Senator RHIANNON: Thank you. I think in answer to Senator Kroger's question you said that the aid to Latin America stands at about one per cent.

Mr Baxter : Less—Latin America and the Caribbean combined.

Senator RHIANNON: Yes, it comes in at less than one per cent of ODA today. But can you confirm that the Latin American-Caribbean aid was nought per cent in 2006-07, 2007-08, 2008-09 and, since 2008-09— 2008 being the year the bid started for the United Nations Security Council—the total amount of aid given is just under $170 million?

Mr Baxter : Senator, the government made a four-year commitment of $60 million to the Caribbean and $100 million to Latin America.

Senator RHIANNON: Yes, so it is about that figure. I think that is important in the context of saying there is just one per cent. On Africa, in the year 2007-08, the figure I have seen is that aid to Africa was at $94 million and has steadily increased since that all-important year of 2008, standing at $354.6 million this year. Is that the case?

Mr Baxter : The first thing I would say before answering your question is that the overall aid program has increased markedly since 2006-07 because the government, as part of its election campaign, committed to increasing the overall size of the Australian aid budget to 0.5 per cent of Australia's gross national income. That, in effect, was a commitment to double the aid program over a period of several years. So there has been fast growth in every area of the Australian aid program over the period that you mention. In respect of the Africa program, we break down Africa into sub-Saharan Africa, and North Africa and the Middle East. Combined, those two regions were five per cent of the program in 2006-07 and then nine per cent of the program combined in 2012-13.

Senator RHIANNON: Thank you. In responding to Senator Kroger, did you say that, in terms of the future of aid to Latin America, it should level out?

Mr Baxter : Yes. There was a recommendation made in the independent review of aid effectiveness that our aid to Latin America and the Caribbean not increase, and it has not increased. It has stayed the same since the government made that commitment of $60 million over four years to the Caribbean and $100 million over four years to Latin America.

Senator RHIANNON: I actually saw it had recommended—and maybe again it is the delights of the English language and how one interprets it—a phasing out of programs. The independent review said that there was:

… little case for further country program aid to Latin America and the Caribbean. This is a relatively prosperous region, not of great strategic importance for Australia.

That is why I have understood that people have interpreted that as phasing out the programs.

Mr Baxter : The independent review made a number of recommendations around allocations to particular regions. Budget matters are matters ultimately for the government. The government took account of the recommendations of the review, but it is for government to decide how to allocate the budget.

Senator RHIANNON: What is AusAID's involvement with the Direct Aid Program?

Mr Baxter : We provide some advice to the Department of Foreign Affairs and Trade on the issue of ODA eligibility. So, if there are particular programs that they may have concerns about whether or not they are suitable to be funded using aid funds, then we can provide them with that advice. But the Department of Foreign Affairs and Trade develops its own guidelines around the expenditure of the Direct Aid Program.

Senator RHIANNON: Does that mean you therefore do play some role in making the final decision about what grants will be funded?

Mr Baxter : No, we play no role. It would only be if a particular project was referred by the Department of Foreign Affairs and Trade to AusAID for an opinion as to whether or not that project was eligible for aid funding under the OECD guidelines.

Senator RHIANNON: Does that often happen?

Mr Baxter : I cannot recall one in my three and a bit years in AusAID. Other colleagues may have other advice. But this is very much a longstanding program and there is a very good understanding within the Department of Foreign Affairs and Trade of what is in and what is out, if you like.

Senator RHIANNON: Right. What are AusAID's links with the Australia-Africa Mining Industry Group?

Mr Baxter : Beyond having the odd conversation with some of the members, we do not have any formal relationship with them.

Senator RHIANNON: So there is no working group with AAMIG?

Mr Baxter : No, there is not.

Senator RHIANNON: With regard to some of the projects under DA Program, because you have obviously signed off on them, confident that they qualify for ODA, how have you judged those projects that DAP has funded where they are in conjunction with mining companies, which often engage in projects in mining-impacted areas?

Mr Baxter : We do not get asked to pass judgement on them. They are decisions that are made, ultimately, by the heads of mission in the relevant embassy or high commission, and those decisions are entirely for DFAT. On AusAID's part—just to be very clear, on the record—we have not provided financial, in-kind or any other support to AAMIG.

Senator RHIANNON: I refer to one of the discussion papers that you have released this year with regard to partnerships between the mining sector, governments and civil society, which states: 'AusAID will not subsidise corporate social responsibility programs of miners or other work that would have occurred without AusAID's support.' So that is your policy position. You have said that your job with DAP is to ensure that these projects are ODA compliant. If DAP funding has gone into projects that support the corporate social responsibility initiatives of mining companies, as in a range of projects in local communities, wouldn't that be going against that policy position that came out this year?

Mr Baxter : The policy position that you are referring to governs the way in which we, AusAID, use our funding to help countries—and I emphasise we are about helping countries—develop their extractive industry sector. We do not provide funding to mining companies and we have no intention, under the Mining for Development Initiative, to do so. I understand that DFAT have agreed to fund a number of projects where mining companies have also contributed to those projects, but there is nothing in the OECD Development Assistance Committee's guidelines that would make that an illegitimate use of aid funding. That is a legitimate use of aid funding as long as the project itself is geared towards providing a benefit to the developing country that it is being implemented in.

Senator RHIANNON: But, considering it is widely recognised in Australia and internationally that mining companies have to carry out their own corporate social responsibility, and considering you have that clear policy, don't we have a grey area here that needs to at least be considered by AusAID to ensure that your funding is not compromised in any way?

Mr Baxter : This is funding that has been given to DFAT, and they are responsible for making decisions on its implementation in accordance with the OECD guidelines. But in no sense do AusAID police DFAT's expenditure. That is a matter for DFAT.

Senator RHIANNON: Thank you for that, because that appears to contradict what you said at the start of my questions about DAP, that AusAID's role was to ensure that it was ODA compliant. If I have misunderstood, I apologise, but that is what I understood you had said.

Mr Baxter : What I also said is that, if DFAT has made a decision to support a project that a mining company has also provided funding for, that is perfectly fine and in accordance with the rules of the OECD, as long as that project delivers a benefit to the people living in that developing country.

Senator RHIANNON: Do you not recognise that there may be some challenges there for AusAID in determining if it is ODA eligible because of this factor of corporate social responsibility being the responsibility of mining companies, not something that aid money should be spent on?

Mr Baxter : I have no visibility of the details of these particular projects that DFAT has provided funding to and that mining companies have also contributed to.

Senator RHIANNON: So DAP has funded a project that Paladin Energy Ltd has also contributed to, and Paladin have been implicated in serious labour and environmental abuses in Africa and are currently the subject of allegations of corruption in Malawi. If such information was presented to you—and you have acknowledged that AusAID has this responsibility with DAP—would that be something that you would investigate to ensure that you had not made a wrong decision?

Mr Baxter : No, we would not investigate, because we have no role in the decision making. This is funding that is DFAT's responsibility. It would be the responsibility of the Secretary of the Department of Foreign Affairs and Trade to look into any such matters. As I have said to you, our only role in this is whether or not it meets the OECD guidelines. Those guidelines do not go to the matters that you have raised—they are much more narrow than that. They are talking about demonstrating the benefit to the developing country of the investment of ODA funds.

Senator RHIANNON: Thanks, Mr Baxter. I did want to move on to private contractors and I certainly did want to welcome AusAID's recent policy statements and efforts of transparency and engagement with civil society. It is certainly regularly raised with me when I meet with aid organisations. Is AusAID planning on outsourcing the management of the Mekong programs and partnerships with an Australian non-profit civil society organisation to a private contracting company?

Mr Baxter : I will just asked my colleague Mr Brazier, but I am not familiar with this. I am certainly not aware of us outsourcing. Do you have any more details, Senator?

Senator RHIANNON: No, it has been raised with me that this could happen, so I took the opportunity while we were together to raise it.

Mr Brazier : I am not familiar with the activity that you refer to.

Senator RHIANNON: So there are no plans to outsource the management of any of your partnerships with Australian non-profit civil society organisations?

Mr Baxter : No. We have a partnership arrangement with the Australian Council for International Development, and now with eight of its larger members. These are multi-year agreements which have multi-year funding attached to them. We are in the process of finalising negotiations for our next four-year agreement with those organisations, and we do that directly.

Senator RHIANNON: And specifically on the AusAID-NGO Cooperation Program—you will continue to look after that?

Mr Baxter : Absolutely.

Senator RHIANNON: Chair, I just seek your advice. I have questions on the National Food Plan green paper. Should I ask them now?

CHAIR: I am not sure that that is relevant to AusAID, but you can try it now.

Senator RHIANNON: Was AusAID involved in the draft of the green paper as part of the National Food Plan?

Mr Baxter : Not that I am aware, no.

Senator RHIANNON: Does AusAID have a role in the formulation of Australia's national food strategy with respect to our role in ensuring global food security?

Mr Baxter : No, our focus is on food security in developing countries. My understanding is that the green paper is focused solely on domestic food security issues.

Senator RHIANNON: Will AusAID be ensuring that this strategy reflects the burgeoning recognition that empowering small-scale farming to be successful in low income countries is an essential ingredient to future food security? Would that sum up your approach?

Mr Baxter : We certainly believe that doing more to assess smallholder farmers is absolutely an essential part of building stronger food security in developing countries, yes.

Senator COLBECK: Senator Rhiannon just talked about working with small communities in developing countries around self-sufficiency in food. Are you aware of a program called Learn-Grow?

Mr Baxter : No, not personally.

Senator COLBECK: It is a program that is being developed and I understand there has been some contact with AusAID, looking for development of partnerships. It is about developing particularly Indigenous food plants within their countries, and developing local capacity to engage with those products. I can only recommend it to you; I was wondering whether the recommendations of the recent review might make a program like that, which is not of significant scale, more likely to be something that you could partner with.

Mr Baxter : There are certainly programs that are being funded within the portfolio looking at this issue of indigenous food sources. The Australian Centre for International Agricultural Research has a program at the moment trying to promote the growth and consumption of indigenous vegetables in Papua New Guinea and some other parts of the Pacific. Non-communicable diseases are a huge problem in PNG and the island Pacific. Obesity, high blood pressure and diabetes are basically lifestyle diseases and in part this has been caused by significant changes in diet. Trying to get people to value and cultivate and ultimately market indigenous vegetables is part of ACIAR's program.

Senator COLBECK: I have had this conversation with ACIAR at previous estimates, and I know there have been other conversations. In fact, the board of ACIAR were meeting with one of the principal proponents of Learn-Grow last night. I thought you were part of that group.

Mr Baxter : I am on the ACIAR commission but I had to do some homework for today.

Senator COLBECK: That is understandable! As I said, I can only recommend that program to you.

Mr Baxter : We will certainly look at it.

Senator COLBECK: Your program is not affected by the efficiency dividend, is it—except for perhaps the delay in the date of the 0.5 per cent?

Mr Baxter : Certainly the government announced in the May budget that the 0.5 per cent of GNI target would be delayed by one year, to 2016-17. I will ask Paul Wood, who is our chief financial officer, to answer your question about the efficiency dividend.

Senator COLBECK: While he is there leafing through his folder, the other that question I had in this area is: have any of your programs being frozen by the current funding freeze that the government has in place?

Mr Baxter : No.

Mr Wood : In relation to the efficiency dividend, AusAID's departmental appropriation funding is subject to the efficiency dividend, so the 2½ per cent and the four per cent efficiency dividend that you are familiar with is applied to AusAID's departmental funding. It is not applied to AusAID's administered budget. Just to reiterate the point regarding the freeze on grants, official development assistance is not classified as a grant under the FMA regulations, so we have not been subject to the freeze on grant expenditure.

Senator COLBECK: I want to go through some of the recommendations of the review and firstly look at recommendation 31, which was around workplace culture and staff turnover issues. I do not know whether you will have these numbers here with you, so you might have to take this on notice. What have the staff turnover levels been for the last four financial years? Can you give me any information on that?

Mr Baxter : Before answering your question, we certainly recognise that this was an issue within the organisation. In 2009 the Australian National Audit Office conducted an audit of AusAID and highlighted this issue, and it was again taken up in the independent review. Since that time we have implemented measures within the organisation to require officers, unless there is very good reason to do otherwise, to spend at least two years in the position that they are in in Canberra, and that has had an impact in driving the staff churn down. I will ask my colleague, Mr Exell, who is the head of our Corporate Enabling Division, to give a more thorough answer.

Senator COLBECK: You have partly answered my next question too, so thank you, Mr Baxter.

Mr Exell : In relation to the internal movement rate, which the Director-General has just referred to, in 2010-11 the rate was 8.8 per cent and in 2011-12 it was 8.2 per cent. So we have seen a fall in our movement rate as a result of those measures introduced.

Senator COLBECK: Is the requirement to spend two years in a particular position in Canberra the principal response that you have put in place to deal with that recommendation?

Mr Baxter : It is one of the principal responses. We did some research and looked at why people were moving, and one reason was that we did not have enough discipline around our own internal procedures and processes, and the so-called two-year rule was one response. The second thing we found that motivated people to move was unhappiness often with their supervisor, and so people voted with their feet without having a two-year rule in place. So we recognised that it was important for us to increase our investment in management and leadership training, and we have certainly done that over the last couple years.

Senator COLBECK: So how did those issues of unhappiness with their supervisor manifest? I was going to ask you about bullying and harassment; would they be classified in that context? How would you actually classify them and what measures have you put in place to deal with those?

Mr Baxter : What we have done consistently in AusAID over a period of years, and certainly before I commenced about 3½ years ago, is to regularly conduct staff surveys. These are formal confidential staff surveys where staff are asked a whole lot of questions by a professional research company—

Senator COLBECK: It is external?

Mr Baxter : It is an external thing. Those results are then analysed and provided to management but also to management at different levels within the organisation. They measure things like staff satisfaction with their supervisors, the workplace culture and all of those elements that you would expect. We did find that some of the responses were negative in terms of people's views of the general level of competence of supervisors and managers. As I said, we have invested significantly in leadership and management training as part of that.

In terms of the broader workplace culture, we have spent quite a bit of time, particularly this year, developing a document that we call Our Mission, Our Values. It is a document that really has been developed by staff to identify, if you like, the principles under which people want to work in AusAID. They look at things like integrity, accountability, performance and the like. We think it has been a very worthwhile exercise and we think that staff have a very strong ownership of the document which underpins the culture we want to foster within the organisation.

Senator COLBECK: What about things like managing poor performance?

Mr Baxter : I think we have become better at managing poor performance. As you know, it is a really difficult area, but we have a performance management system—like, I think, many other organisations in the Australian Public Service. Where people are found to have performed unsatisfactorily there are certain actions that are required to be followed: firstly, remedial action, and if that remedial action does not lead to improvement in performance then other measures can be taken.

Mr Exell : Can I add that in May 2011 the director-general launched the AusAID Workforce Plan—Phase One. That particularly focused on some of the issues that you have been looking at: recruitment, retention, performance management and learning and development. They were very much key elements of that first year of our workforce plan. In particular, with the new performance management system, we saw this year a completion rate of about 97 per cent of our performance agreements, which was the highest ever, so I think that was part of that commitment to look at the performance management framework.

Senator COLBECK: Are there any hot spots in that workplace culture or issues that came through?

Mr Baxter : One of the things that we have been trying to do—and it was picked up in the independent review—is to ensure that we have a better gender balance, particularly at the senior levels of the agency. If you were to go back a couple of years ago, you would find that about two-thirds of AusAID staff were female and you would find, below the senior executive service level, a majority female workforce. Above the SES level, the proportions were changed. So we have worked hard over the last couple of years to improve the representation of women in our senior leadership positions, and we have gone from being below the Australian Public Service average to being above the Australian Public Service average now, so we have been able to turn that around over the last couple of years. Getting the gender balance right has been an important focus for us.

We also have started but have a way to go in improving the rate of employment of people with Indigenous backgrounds in the agency. We are below the Public Service average, which I think is really quite depressing in some ways, given that AusAID should be seen, I think, as an employer of choice for people with Indigenous backgrounds in Australia, given our focus on development and some of the issues facing Indigenous Australia. So we have an Indigenous employee network and we are working with them to seek to attract more graduates in particular to join AusAID.

Senator COLBECK: You might have to take this on notice too, because I do not know that you will have these details. Are you covered by Comcare?

Mr Baxter : Yes.

Senator COLBECK: I would be interested to know what has happened with premiums from Comcare over the last, say, four years in terms of the premium in dollars and as a percentage of payroll budget.

Mr Baxter : We will take that one on notice.

Senator COLBECK: And I think there are some penalty and bonus figures that go alongside those premium numbers too, so if you could give us those as well I would appreciate that.

Mr Baxter : Okay.

Senator COLBECK: Thank you. Last Senate estimates, Senator Kroger asked some questions about TLO and the suggestion that their contract was cancelled because their report was pessimistic and needed to be rewritten in a more upbeat manner. Are there any other reports that AusAID has been uncomfortable with because they are either critical or pessimistic?

Mr Baxter : Firstly, I reject the suggestion that TLO's contract was cancelled because of unhappiness with a particular report. Their contract was cancelled by the Australian and the Dutch governments because of concerns over a long period of time about the performance of the organisation against its contractual obligations.

Senator COLBECK: Okay. Are there any other reports that AusAID is uncomfortable with because they are critical or pessimistic?

Mr Baxter : No, not that I am aware of. I would not describe any of the reports that TLO or anyone else has done for AusAID as necessarily pessimistic. We are quite frank and open in our own assessment of the situation in Afghanistan, and certainly any suggestion, as we saw in the media this morning, that AusAID is less than frank in the way in which we describe—

Senator COLBECK: Mr Baxter, I am not specifically targeting Afghanistan. I am looking more broadly at that. I am looking at a broader cultural issue within the organisation. That is what I am looking to get at.

Mr Baxter : Over the last couple of years, as you know, we have implemented or commissioned an independent review into the aid program, the first one in 15 years. We have also initiated reviews of some of our larger programs—for instance, Papua New Guinea. A review of our Papua New Guinea program was done, and the findings of that review were quite negative in terms of the performance of the Papua New Guinea program and recommended some quite sweeping changes to the way in which we manage it. We did not shy away from that. As we have with the independent review, with the review of our program in Papua New Guinea we made public the report and we implemented the recommendations.

Senator COLBECK: I am just going to recommendation 33 of the review, which talks about fostering a culture of risk management rather than risk aversion.

Mr Baxter : Yes.

Senator COLBECK: The government has agreed with that recommendation as part of the overview. Just in that context, I suppose I have a concern that there might be a problem with criticism in respect of risk aversion. Could you provide us with a list of all the independent reviews that have been taken in the last year and whether they are publicly available or not and, if they are not, when they might be made publicly available?

Mr Baxter : Certainly. I think it is fair to say that AusAID is subject to more independent evaluation than any agency in the public sector that I can think of. We established this year in June an independent evaluation committee which comprises three experts in evaluation in both aid and public policy from outside the organisation. They will now oversight the evaluations of AusAID programs, and all of those evaluations will be publicly available.

Senator COLBECK: If you could provide us with that list, that would be great.

Mr Baxter : I am happy to.

[20:32]

CHAIR: I remind senators that we still have a long way to go in the program. We have not started on the countries yet. Questions on outcome 1?

Senator FAWCETT: Mr Baxter, welcome.

Mr Baxter : Thanks, Senator.

Senator FAWCETT: I will just take you back to last estimates. We spoke about the delivery of aid programs. In particular, we talked about long-term benefits. We talked about the fact that when people sing the praises of the Colombo Plan it is not just about the delivery of the technical training; it is about the relationship that was built between Australia and the region. I queried at the time the practice of engaging, in the name of value for money, other nations, particularly in Europe, to deliver aid in our backyard as opposed to using Australian companies. At the time, you said to me that if I looked into it I would find that the majority of international companies employ Australians to do that work. You then agreed to take that question on notice. What came back was that less than 50 per cent—in fact, only about 40 per cent—of people working for overseas countries delivering our aid are actually Australians, so I would just like to explore that a little more deeply. Do you accept the premise that there is a long-term value in Australians delivering Australian aid because it builds relationships?

Mr Baxter : Under the previous government, a decision was made to 'untie'—as it is called—the Australian aid program, which is to open up the Australian aid program to international bids. Many governments have done that around the world. Some have not, but many governments have. When the current government were elected at the end of 2007, they continued the policy of untying Australian aid on the basis that that is how you get best value for money and the best people involved that are available internationally in delivering your program.

The majority of our contracts are won by Australian companies because they have worked with us for many years, but we do get bids from people from other countries. You will also find that Australian contractors are delivering a significant number of the aid programs in the United Kingdom, the United States and European countries. So our companies are benefiting from the untying of aid by other governments. This has been a longstanding policy and I do not believe it is going to change from the current settings.

Senator FAWCETT: I take your history lesson, but I challenge the previous government's and this government's assertion that in all circumstances value for money is necessarily the short-term who can do it most cheaply or who might have, by percentage, the best reputation versus the long term relational benefit. I take you to a Lowy paper that looks at the re-engagement of the United States in the Pacific region. A lot of its argument goes to that relationship-building aspect. When it then turns, having dealt with China and America, to Australia, it says that Australia should look to other ways to engage and to be seen to be engaging with Pacific island states. That 'to be seen to be' is an important part.

Mr Baxter : The United States spends $15 million a year in the Pacific; we spend $1.2 billion.

Senator FAWCETT: My question, though, is why we spend $6 million with a German company. I will defer to my translator here on how to pronounce the name.

Senator ABETZ: It is the Deutsche Gesellschaft fur Internationale Zusammenarbeit.

Senator FAWCETT: I could not have said that in a pink fit! This is a German company. When I go to their website, I find that they say:

As a federally owned enterprise, we support the German Government in achieving its objectives …

What are they doing in Cambodia, which is in our region? They are identifying poor households in Cambodia. We are providing them $6 million to do that.

Mr Baxter : Absolutely. They are a first-class outfit. We use them in a number of countries across the world—Afghanistan, Africa and Pakistan—where they have capability. What we are charged with in AusAID is producing the best development outcomes we can using the best expertise that we can afford within a value-for-money framework. You will find when those companies that are not from Australia are engaged they have gone through an international open tender process and have been selected on the basis of merit.

Senator FAWCETT: I have no qualms at all in acknowledging that this company, whose name I cannot pronounce, is probably world leading. But in this particular task of identifying poor households in Cambodia, when I search the internet further I find brochures that have been developed about this program. Whilst there is acknowledgement of AusAID if you dig deep enough into the job advertisements, in the brochures that hit the streets there is no mention of Australia at all. Yet $6 million has gone to that particular company. There is another German company that receives $897,000 for exactly the same job—identifying poor households in Cambodia. My contention is that long-term value for the Australian taxpayer is not just in the delivery of the aid project itself but in building the relationship, and that relationship will not develop if the recipients do not actually know that the money that is funding that program is not on behalf of the Federal Republic of Germany but is provided by the Australian taxpayer.

Mr Baxter : I think the last part of your statement is a reasonable position to take—that the recipients of Australian aid should know that the aid comes from Australia. We are working very hard to ensure our branding is much better than it has been in the past. But the issue of ensuring that we provide value for money for the taxpayer by getting the best available expertise at the best available price is one that successive governments have demanded of AusAID. We still operate on that basis. If the government wants to change the basis and say, 'We should not have open tender processes; we should restrict them to Australian companies only in certain countries in certain activities,' that would be a dramatic change from the last decade of policy under successive governments—and governments have not been saying that to AusAID.

Senator FAWCETT: There are probably a few things that have happened over the last decade that both sides of politics, perhaps, could improve. That is our role on this side of the bench, and I understand that. Could you just explain to me what is in Australia's national interest in paying a German company nearly a quarter of a million dollars to encourage youth in Egypt to find employment?

Mr Baxter : Unemployment, firstly, was one of the major sparks to some of the unrest that has occurred in Egypt. The government had made a commitment to provide some assistance to Egypt through its transition period. You are asking me about a $250,000 program from a $5 billion budget, so you will understand that I do not have that all in my head. I will get you some details on it, but I know broadly what we have been trying to do in Egypt, which is to help the government with a massive problem it has with youth unemployment.

Senator FAWCETT: I guess I am trying to put myself in the shoes of the reasonable man in the street as a taxpayer saying, 'What's happening to our money?' but also looking historically at where we have been recognised as adding significant value with our foreign aid, and it is through things like the Colombo Plan, and largely that is about relationship building. But I will leave it there.

Mr Baxter : Just on the Colombo Plan—a little plug—we have the new Colombo Plan, the Australia Awards, which this year is seeing 4,200 people being brought to Australia to do long- and short-course study.

CHAIR: Very good. Senator Kroger.

Senator KROGER: Mr Baxter, can I just go back and clarify a couple of observations you made earlier on. I want to go back to the percentage of the budget in ODA that is given to the regions. I am looking at the comparative analysis of 2007-08 and the projected ratio for 2012-13. In the Pacific region, including PNG, I have that down as a drop in percentage of ODA budget, from 27.2 per cent in 2007-08 down to 22.7 per cent in 2012-13. Is that correct?

Mr Baxter : My numbers are from 2006-07 to this current financial year, but they are roughly comparable. The Pacific was 26 per cent of the program in 2006-07 and it is 23 per cent of the program today.

Senator KROGER: So it has dropped again slightly from that. Likewise, for East Asia, including Indonesia, there is a drop, even though we are working on different years. On the time comparative I am making, I have got 30.6 to 25.6. Are you looking at a similar kind of difference for those years that you have got?

Mr Baxter : No. It stays the same, at 26 per cent in both years, from 2006-07 to 2012-13. Of course, in the case of both the Pacific and East Asia there has been a very significant dollar figure increase.

Senator KROGER: Yes, and there has been a considerable increase in the aid budget, hasn't there, which we will come to.

Mr Baxter : That is right, yes.

Senator KROGER: We talked about the increase in Africa, South and Central Asia and the Middle East and Latin America, where we have gone from a zero base to 47.7, I think the actual amount is. But you have indicated the strategy is not to direct any aid to that region again.

Mr Baxter : Not to increase it.

Senator KROGER: Given that we have got a decline in the percentage of ODA going into the Pacific region, is that something that we are going to see a continued trend of or is that something that is really indicative of only the next year or two? If that is the case, it will have been a change in our strategic approach.

Mr Baxter : I mentioned earlier there are issues of absorptive capacity in some of the Pacific island countries. For instance, Tuvalu has 10,000 people, so there is obviously a limit of absorptive capacity for development assistance in a country that small.

You cannot forever keep increasing your development assistance to Tuvalu; there is only a finite amount you can spend on that number of people sensibly. So there is an element that, given the small size of some Pacific Island countries, you may not see rapid increases over the next five years. It is different in the larger countries. As you know, aid to the Solomon Islands has gone up dramatically under the whole RAMSI mission, where we are now providing $250 million of ODA funding for 500,000 people. Papua New Guinea has increased, Vanuatu has increased—the countries closest to Australia that are most populous. But the absorptive capacity issues are ones that were highlighted in the independent review. The panellists raised questions about future growth in the Pacific, and specifically this absorptive capacity issue.

Senator KROGER: Is the government still committed to its revised timetable for achieving a 0.5 per cent of GNI spend on foreign aid?

Senator Conroy: We would have to take that on notice and get a response.

Senator KROGER: And can you tell me the year. It does involve $1 billion a year in increased spend, is that right?

Mr Baxter : It depends where GNI is, but that is roughly correct.

Senator KROGER: It does beg the question how that is going to be achieved, given that it is a substantial increase and it is something that has not been done before, which is why I think the strategic approach is critical and the way in which that is going to be delivered.

Mr Baxter : Earlier this year, in May, the government issued what is known as the Comprehensive Aid Policy Framework. In this document the government sets out the projected growth in the aid program by region over the next four years. There is a clear strategy that the government has issued. It is publicly available; it was released on budget night this year. As I said, it aligns the growth that we expect to see in the aid program between now and 2016-17 by region and also looks at how the funding will be applied to our five strategic goals that are set out in the government's aid policy.

Senator EGGLESTON: An article in the Australian reported that AusAID had 38 communications, media and public relations staff, and it said that this funding on public relations staff comes amid cutbacks to promised foreign aid spending by Labor. How many communications, media and PR staff does AusAID have?

Mr G Dunn : We currently have 36 communications and media officers.

Senator EGGLESTON: When was the last time AusAID reviewed its staff allocations?

Mr G Dunn : We look at our staff allocations on an ongoing basis. But, in this particular area, we have people who do a range of activities. We have a range of people who look at media inquiries as they come through, but a lot of our staff in this area are looking after our website—to ensure that our public information is available to all—our publications and our internal communications.

Senator EGGLESTON: You have one website or several?

Mr G Dunn : One website.

Senator EGGLESTON: What is the total staff budget for media and communications, which would include the development of your website?

Mr G Dunn : In the vicinity of, for the last financial year, $7 million.

Senator EGGLESTON: That is quite a lot for media and communications.

Mr G Dunn : That was for our staff, our publications and the programs we run through all our media processes.

Senator EGGLESTON: So it is all-inclusive. How many separate publications do you have?

Mr G Dunn : I am not sure on that one.

Mr Baxter : We have a lot. We will have to take that on notice because we produce a lot of material in the countries where we are delivering the programs, as well as in Australia.

Senator EGGLESTON: And, I presume, you produce material in different languages.

Mr Baxter : Yes.

Senator EGGLESTON: What is your budgeted expenditure on media and communications for 2012-13?

Mr G Dunn : It is in the same vicinity as last year's expenditure.

Senator EGGLESTON: Have you had any cutbacks to your budget for media and communications? From your last response, I presume the answer is no.

Mr G Dunn : We think, given the work we need to do in this area, that we run a pretty lean team.

Senator EGGLESTON: So you are efficient. Have you cut back on staff at all?

Mr G Dunn : In general?

Senator EGGLESTON: Yes, in general.

Mr G Dunn : No, because of the increased funding to the aid budget over the last several years, we have had commensurate staff increases. But I think we are at the peak at this point in time.

Senator EGGLESTON: I have another question on outcome 1 and it is about aid abuse—not a very happy subject. There was a report in the Australian on 19 June claiming that aid program workers were caught abusing children. The article was written by Sean Pernell. Are you familiar with that article?

Mr Baxter : I know of it. I do not know it in detail but I know of it.

Senator EGGLESTON: Were you aware of the claims prior to the article?

Mr Baxter : Yes, but they are not all accurate.

Senator EGGLESTON: That was the other part of my question—were the claims founded? You are saying 'only partially'. Is that what your answer is, in effect?

Mr Baxter : Australia was the first international donor government and AusAID was the first agency in the Commonwealth government to implement a policy to protect children from abuse. We are very proud of that record.

AusAID introduced its comprehensive child protection policy in 2008 and it requires all staff in AusAID, all consultants, contractors and volunteers and non-government organisations that receive AusAID funding to comply with the policy. The policy is mandatory in terms of the compliance standards. We announced at the time the policy was implemented that it would be subject to a formal review every three years, and that story was written based on the findings of that formal review. The 2011 independent child protection policy review team found that we had an impressive commitment to child protection, and the work that we had done to develop, implement, support and resource the policy was also impressive.

The review and our management response is on our website. We have done this in a very public way. There were 23 substantive recommendations from the review. We have agreed with all of them. We have implemented four already and the rest are underway. The policy has been the overarching mechanism through which we have received notifications or accusations of child abuse or other problems relating to child protection within the aid program. I think we have had 32 child protection notifications since March 2008. Ten were substantiated, eight resulted in dismissal, two resulted in resignation, seven were unsubstantiated, six are under investigation and nine were outside the scope of the policy—that is, they did not relate to the Australian aid program. None of the reports have been against AusAID staff.

Senator KROGER: Mr Baxter, was there an incidence of that happening in any particular country over another?

Mr Baxter : No. I do not have the countries in front of me, but my recollection over the last three years has been spread largely in the Asia-Pacific region where we have our bigger programs, as you would expect.

Senator KROGER: Is that policy available on the website?

Mr Baxter : Absolutely.

Senator KROGER: Does it include, for instance, similar sorts of security checks to those that we have here in Australia if you are dealing with kids?

Mr Baxter : Absolutely.

Senator KROGER: So a similar sort of basis?

Mr Baxter : Yes, and other government departments—for example, FaHCSIA—are now looking at our policy as a benchmark against which they can implement their own.

Senator EGGLESTON: Under the portfolio overview, the government has announced a cut to Australian Public Service spending of $550 million over the forward estimates on top of the four per cent efficiency dividend that has already been imposed. According to the government, savings will be achieved from eliminating wasteful spending and inefficiencies. How much of the $550 million in savings are expected to come from AusAID?

Mr Wood : I understand that savings are applied at portfolio level and they will be announced in the Mid-Year Economic and Fiscal Outlook.

Senator EGGLESTON: But, in general, what areas of wasteful spending and inefficiencies will AusAID be targeting for savings?

Mr Wood : In relation to the finance minister's media release from late September, the areas targeted are travel, relating to a specific class of travel, for example; printing, moving to online; and reductions in consultants and contractors. Once the MYEFO is issued, we will apply the savings in accordance with those categories.

Senator EGGLESTON: How much funding is currently allocated to those kinds of areas—what percentage of your total budget, if you can give that.

Mr Wood : We could probably do that after the break.

Pr oceedings suspended from 20:59 to 21:15

CHAIR: We will get started. Could I have a motion from a senator that we accept the opening statement as a tabled document?

Senator EGGLESTON: So moved.

CHAIR: Thank you, Senator Eggleston. I understand we have concluded our questioning an outcome 1, so we will move on to program 1.1, which is PNG and the Pacific. Senator Eggleston.

Senator EGGLESTON: Thank you. I would like to ask you some questions about tuberculosis in Papua New Guinea. I asked some in May this year.

Senator Conroy: We had quite a discussion with someone else recently on this. I cannot remember where.

Senator EGGLESTON: You are not suggesting we are repeating it, are you?

Senator Conroy: I am possibly suggesting that. Was it today?

Senator EGGLESTON: I do not think so.

Senator Conroy: I am just trying to think which other committee I was on.

Senator EGGLESTON: Did you have photographs? Because there are photographs for this.

Senator Conroy: There were no photographs last time.

CHAIR: Perhaps it is deja vu!

Senator EGGLESTON: Okay. How much of the total aid budget invested through AusAID to improve PNG based health services is dedicated to tackling TB in that country?

Mr Baxter : I will ask my colleague Mr Batley to answer that.

Mr Batley : And I might ask my colleague Mr Tranter!

Mr Tranter : Thank you, colleagues! The allocation under the Australian aid program to Papua New Guinea in the health sector this year is $104 million. In terms of our allocations for addressing tuberculosis, we have committed around $5.3 million in Western Province this year and a further $500,000 to support the appointment of a senior medical adviser to the National Department of Health. So it is approximately $6 million out of the total allocation of $104 million.

Senator EGGLESTON: All right. So it is $6 million or thereabouts. Where did the senior medical adviser come from?

Mr Tranter : It was an appointment made by the World Health Organization, drawing on funding provided by AusAID. The senior medical adviser is on contract to the WHO and is working within the National Department of Health in Port Moresby.

Senator EGGLESTON: Okay. So he or she was a World Health Organization appointment—

Mr Tranter : That is correct.

Senator EGGLESTON: but funded by AusAID—and, presumably, has a good record in dealing with TB. On 31 May this year, in response to a question from me, AusAID provided a breakdown of the $8 million allocated to addressing TB in Papua New Guinea. The answer provided by AusAID details expenditure of approximately $3 million. Can you provide me with an update as to the continued application of these moneys and can you break that down into programs?

Mr Tranter : Certainly.

Senator EGGLESTON: Do you need to take that on notice?

Mr Tranter : I am able to do that now. In terms of the total commitment from AusAID to address tuberculosis in Western Province, we have now expanded that to $11 million over four years, 2011-12 to 2014-15. In 2011-12, we expended $3.4 million.

In 2012-13, as I said before, we have committed $5.3 million. We expect to spend all of that. In terms of the breakdown for this financial year, we expect to disburse $132,000 in supporting extension for laboratory services, including assisting PNG to meet the costs of diagnostics through the Queensland Mycobacterium Reference Laboratory, and a further $800,000 to support the Health and HIV Implementation Services Provider, which is a managing contractor that we use to support the PNG health service, including in Western Province, including with support for health materials and pharmaceuticals. We will commit a further $1 million in support for the Stop TB in Western Province program, which is implemented by World Vision. The major part of our expenditure this year is $3.3 million to support the construction of a new TB ward at Daru hospital, bringing our total commitment to $5.3 million this year.

Senator EGGLESTON: This question is really about the Daru hospital, because one of our colleagues, Warren Entsch, who is the member for Leichhardt, a seat based on Cairns, I believe, went up to Papua New Guinea and had a look at the Daru hospital and took a series of photographs which show that it is in pretty poor condition. I might table these photographs for the record, if that is possible.

CHAIR: I think they were tabled at the last estimates, but if you want to do it again feel free.

Senator EGGLESTON: I was not aware of that, but I will table them again. We are advised that the photographs are slightly different.

Senator Conroy: Slightly different!

CHAIR: Mr Entsch is in them.

Senator Conroy: Oh, my God.

Senator EGGLESTON: Mr Entsch is in them.

Senator Conroy: Oh, please! Hansard don't deserve it.

Senator EGGLESTON: Hansard probably have to put up with a lot of things, Senator Conroy. I am sure they will be able to cope with photographs of Mr Entsch.

Senator Conroy: You're a cruel man.

Senator EGGLESTON: He was obviously deeply concerned by the state of that hospital, which was pretty appalling when you see the photographs. I suppose it must be conceded that, if you have allocated this money, $3.3 million, to the building of a new hospital, the parlous state of the Daru hospital has been recognised and in fact is in the process of being rectified. Is that a fair comment?

Mr Batley : There is no doubt that Daru hospital is not of the standard of hospital that we expect in Australia, but just to put things into perspective: in Australia, the average spend per head of population on health is about $3,300; in Papua New Guinea it is $40. That goes a long way to explain the different levels of service that can be expected. That having been said, we have been working with the health authorities in Western Province in Papua New Guinea, and with the central authorities in Port Moresby, to consider the whole suite of health and medical services in Western Province, and that includes the hospital. We have helped them undertake a review of redevelopment options for the hospital. It certainly highlighted the fact that, apart from the physical state of the hospital, there is insufficient floor space for current bed numbers and there is a need for new buildings. We have put offers to the National Department of Health on a number of occasions over the last few months to support refurbishments. The position that the PNG authorities have taken is that they really want to sequence this properly. They would like to develop a master plan for the hospital, rather than engaging in ad hoc repairs.

We have agreed to help fund that master plan as the first step in improving the overall situation. That master plan will cost about $450,000. That will occur by early next year, and that will give us, but more pertinently PNG authorities, a firm basis on which to plan and sequence work to upgrade the hospital.

Senator EGGLESTON: There seems to be a very high incidence of tuberculosis in PNG, according to the material I have been given. It says that the incidence of tuberculosis has increased by 42 per cent in the last decade. Can you confirm that?

Mr Baxter : The incidence of TB in PNG is increasing and it is a significant problem. It is probably on similar levels to countries like Cambodia, which also has a significant TB problem. There are also significant issues with TB infections in East Timor. There are a number of countries in our region where TB is a big issue. We, in addition to our bilateral programs, are major supporters of the Global Fund, and the Global Fund provides assistance to countries to deal with the issues of TB, malaria and HIV and AIDS. Just in the last few weeks in replacing our former ambassador for AIDS, Mr Murray Proctor, the government has appointed James Gilling as the new ambassador not only for HIV and AIDS but also for TB and malaria in recognition of the seriousness of these issues.

Senator McLucas, the Parliamentary Secretary for Disabilities and Carers, visited Daru a couple of weeks ago to inspect the progress that the Australian aid program had made in helping PNG to treat tuberculosis, and she reported positively on her visit. She had visited Daru previously and reported on what was going on in terms of the treatment of patients that had been transferred from the Torres Strait clinics back to PNG, and she made the judgement that addressing the problem of TB in Western Province was the right focus for Australia and that we were doing so in a targeted and cost-effective way. She was able to see the AusAID funded sea ambulance which is now conducting outreach visits along the South Fly Coast on a monthly basis and also doing medical evacuations. She was also able to see in operation the new x-ray machine and the gene expert machine, the latter of which can diagnose multi-drug resistant TB within two hours, and she made the judgement that these have substantially improved the diagnostic services at Daru General Hospital. The combination of the redevelopment that is planned, as Mr Batley mentioned, and the work that we have already done we think has made a significant difference to the capacity of PNG authorities, although we recognise that this is an issue that will be with us over the long term.

Senator EGGLESTON: I am interested in the issue of the spread of multi-drug resistant tuberculosis. Does AusAID have any data on the number of reported cases of multi-drug resistant tuberculosis since 2007?

Mr Baxter : We do have data but to go back that five years we would have to take it on notice. Certainly the data is available but we would have to find it.

Senator EGGLESTON: Could you give us the reported cases of extensively drug resistant tuberculosis for the same period.

Mr Baxter : We are happy to do that. I point out that with multi-drug resistant TB and extensively drug resistant TB, one of the ways in which that is generated is by patients and not taking their full course of drugs right through to the end, as you find with and antibiotics. That is why treating people in their own communities is seen by authorities such as the World Health Organisation as the most effective way to tackle the problem within Papua New Guinea.

Senator EGGLESTON: That is interesting advice, because in the past I suppose they were put into sanatoriums and had their medication supervised by nursing staff, but that would obviously be very hard in a country like Papua New Guinea.

Mr Baxter : But our work with World Vision is specifically aimed at training community health workers and volunteers to supervise TB patients so that they do take their full course of drugs. Over the past year, 92 patients have been transferred from Queensland Health clinics to PNG health services. Of those 92, 65 of the patients have now completed their full course of drugs and 27 continue to be treated.

Senator EGGLESTON: Of course, the full course can be for a very long time.

Mr Baxter : Particularly for the multidrug-resistant strains, that is right. It can be two years or more.

Senator EGGLESTON: I can see the logic of what you are saying about home care. One of the problems, from what I am advised, in managing tuberculosis in PNG is that there is only 0.6 of a health worker per thousand people in Papua New Guinea, so I suppose the question arises about whether or not there is any program to address the need to train more health workers to enable medications to be provided to these people with drug-resistant tuberculosis. Is there any plan to do that?

Mr Baxter : There is. The first point to make is that PNG health services are the responsibility of the PNG government.

Senator EGGLESTON: I accept that.

Mr Baxter : We obviously assist them, but 90 per cent of PNG's budget comes from PNG's own revenue sources—

Senator EGGLESTON: We do accept that. That is a very important point, I think.

Mr Baxter : yes—and less than 10 per cent is Australian aid. That comprises their budget. You are right that Papua New Guinea has one of the lowest ratios of health workers to population of any developing country. I think it was three weeks ago that Senator Carr announced a new program where we will train another 1,400 health workers over the next couple of years. We also have a program looking at those institutions that train health workers, and we are carrying out an assessment as to what would be required to double their output. So we recognise that this is a problem.

As you know, there has been a change of government in Papua New Guinea following the general election in the middle of this year. The new government is determined to improve the provision of basic services to its population, so we are encouraged by that. I visited Papua New Guinea only three weeks ago and met with the health minister. There is a determination to do more. We are willing to assist that within the budget that we have allocated.

Senator EGGLESTON: What is the population of Papua New Guinea?

Mr Baxter : It is about seven to eight million.

Senator EGGLESTON: That is quite a significantly large population in a fairly small land area. That is a little bit bigger than New South Wales, in fact, in population.

Mr Baxter : And a relatively fast-growing population as well.

Senator EGGLESTON: The training of health workers is carried out in New Guinea itself—or perhaps in Queensland?

Mr Baxter : No, these community based health workers and midwives are trained in Papua New Guinea. We do, through our scholarship program, bring Papua New Guinean students to Australia to study in related disciplines at Australian universities as well and have done for many years.

Senator EGGLESTON: How many graduates are there a year?

Mr Baxter : I would have to take that on notice—

Senator EGGLESTON: If you would.

Mr Baxter : but we certainly give a few hundred scholarships a year.

Mr Tranter : There are at least 200 new awards each year for study in Australia.

Mr Batley : But not all in the health area.

Mr Tranter : That is right.

Senator EGGLESTON: So how many in the health field would there be?

Mr Tranter : I will have to take that on notice.

Senator EGGLESTON: Please do.

Mr Baxter : We have also started working with one of the resource companies in Papua New Guinea, a company called Oil Search, on a jointly-funded program to train midwives. That program has only started this year, but we are very pleased that we have been able to partner with one of the commercial enterprises in Papua New Guinea on a program which is really aimed at lowering the maternal mortality rate through training of midwives.

Senator EGGLESTON: Yes, that is very good. Having someone with some training at births cuts down the mortality rate significantly, and it is one of the UN Millennium Development Goals, of course, to do that. Coming back to multidrug resistant tuberculosis: is it possible to identify the source of that infection? Is it possible to identify it as having occurred in Papua New Guinea or having been brought in from another location?

Mr Baxter : I am venturing into the world of medicine here, and in layman's terms my understanding is that multi drug resistant TB can be generated by not taking the full course of drugs. Once it takes root, it can then be spread in the same way as normal TB—that is, through coughing and other personal contact. That emphasis on making sure people receive the right medication, that it is genuine medication and that they take the medication through its full course is critical to the control of the spread of multi drug resistant TB. Then, when you have multidrug resistant TB within a community, all of the same protocols that apply around so-called normal TB apply to multi drug resistant TB in terms of covering your mouth when you are coughing and lack of physical contact and the like

Mr Batley : It is also important that, when people are in the infectious stage, they are able to be isolated. That is one of the reasons that we have focused on refurbishing an interim isolation ward and that we are building a brand-new isolation ward at Daru hospital. The interim isolation ward is fully functioning now, and it is one of the best TB facilities in Papua New Guinea already at this stage.

Senator EGGLESTON: Given the size and the urgency of this TB epidemic in Papua New Guinea, are there any plans to have a bigger and broader public health program to deal with it under this new government?

Mr Baxter : The Papua New Guinea government, with our assistance, has commissioned an independent analysis of what might be the most appropriate next steps to implement in order to control the spread of TB, particularly the more drug-resistant forms of TB. That study was conducted by an eminent medical professional from the Victorian government. It was an independent study. I have received a letter from the Papua New Guinea permanent secretary of health giving us the executive summary of that report. We probably have the full report, but I have read the executive summary, and there are a number of recommendations in that report that PNG is considering.

Senator EGGLESTON: Is one of them to fund the program from the Pacific Women Shaping Pacific Development initiative announced by the Prime Minister on 29 August?

Mr Baxter : Not necessarily. That is broader than just health; it is looking at women in terms of economic empowerment, violence against women and women in leadership positions.

Senator EGGLESTON: Thank you very much. You obviously have a huge problem there and are working very hard to overcome it.

Senator RHIANNON: Thank you. The foreign minister, in response to a question I asked him in the Senate about the use of foreign aid to manage people seeking asylum in this country, stated:

It could well be that there are areas of support for asylum seekers where, according to the international tests, that is considered appropriate and other areas where it would not be appropriate.

Can you confirm that no aid money will go to building, staffing or maintaining detention centres on Nauru or Manus Island?

Mr Baxter : The financial implications of implementing the recommendations of the Houston panel report, including the impact on the ODA budget, are still being considered by government. But, as Senator Bob Carr said, there may well be legitimate costs associated with the response that are ODA eligible.

Senator RHIANNON: So, considering what is ODA eligible and considering you always give emphasis to the rules in terms of how this money is used, I ask again: can you confirm that no aid money will go to building, staffing or maintaining detention centres on Nauru or Manus Island? Or can you confirm what aspects of the detention centres in those locations will not receive any aid money?

Mr Baxter : Okay. At those offshore facilities, upgrades to infrastructure that may benefit the local population, or where a portion of them may benefit the local population, are eligible to be funded with ODA—

Senator RHIANNON: Are you referring to buildings that would be used for the detention centre?

Mr Baxter : No, I am referring to the public infrastructure. So it is things—

Senator RHIANNON: That are separate from the detention centre.

Mr Baxter : like you have to build a bigger water supply because the population on the island is larger: the local community gets a benefit because they get a better water supply than was there previously. You can work out what proportion of that cost can be attributed to the benefit to the local community and you can have some of that expenditure classified as being eligible for ODA funding. But the general principle is that those are costs that confer a benefit on the populations of the island is concerned. That is probably the broadest way of looking at it. So the buildings that house the detainees themselves would not be ODA eligible. But, if there was a big hospital that had to be built that benefited the local community, a proportion of that hospital could be booked as ODA.

Senator RHIANNON: Okay. Thank you. Could you take on notice to provide the committee with a breakdown of the funding committed to Nauru for the last four years and to Manus Island for the last four years—what the programs were and the amounts? Could you take that on notice, please.

Mr Baxter : Certainly.

Senator RHIANNON: Just to expand on your description of where money can be used to interact with asylum seekers, will any of the existing funding be used for migration management?

Mr Baxter : Senator, what do you define as 'migration management'?

Senator RHIANNON: I acknowledge it is a broad term, and that is why I am trying to understand. We have two islands here, and people will be moving around the islands. So, again, can aid money be used to facilitate the movement or relocation of asylum seekers in any way on those islands?

Mr Baxter : I am not trying to be unhelpful but it is difficult to know without more precision around your question, because there are issues of interpretation that are related to specific elements of expenditure. But if your question is, for instance, 'Can the staffing of the processing centres be claimed as ODA,' the answer to that is no. Can the physical infrastructure be classified as ODA? The answer to that is no if it does not confer a benefit directly on the local population.

Senator RHIANNON: So can you confirm whether money will be spent—and, if so, how much—either directly on or in relation to the government's regional processing plan for refugees, or on any other measures suggested by the Houston report?

Mr Baxter : No, Senator, because those decisions are before the government at the moment. AusAID is not the lead agency on this; as you would imagine, the Department of Immigration and Citizenship is.

Senator RHIANNON: Thank you. I turn to Solomon Islands. Considering the high levels of deforestation in Solomon Islands, is AusAID looking to the Mining for Development Initiative or other support to develop mining as a viable industry after logging, as something you judge would assist the islands?

Mr Baxter : Senator, your comment on the rate of deforestation is of course correct. It is a significant problem for Solomon Islands in the years ahead, in that that renewable resource will be gone and the revenue for government from it will be gone. There is, as I think you are aware, a goldmine on Guadalcanal which was closed during the period of detentions, which is, as I understand it, being reopened. There has been some activity by some mining companies looking at deposits in other parts of Solomon Islands, although I am not aware of any active development. The Solomon Islands government, to my knowledge, has not come to us and requested assistance with developing their mining sector; and, as I said earlier, we respond to requests from governments that want to develop their natural resources. I do not know if Mr Tranter has any other information that is different from that—

Mr Tranter : No. That is correct.

Mr Baxter : but they have not come to us and asked us, so it is not a part of our partnership for development.

Senator RHIANNON: Do you need to take that on notice, to check?

Mr Baxter : No. The four people who deal with Solomons are all at the table.

Senator RHIANNON: What is AusAID's involvement with communities that are impacted by logging? I am particularly interested in whether you are providing any assistance to combat the worrying trend of the commercial sexual exploitation of children in areas that have been logged.

Mr Baxter : I will ask Mr Tranter if he knows anything about that. I am sure we do provide assistance to communities that have been affected by logging, but the second part of your question, about the exploitation of children, is something Mr Batley or Mr Tranter might have an answer for.

Mr Batley : Senator, the question of sexual exploitation of children is one that has come to the attention of the police authorities in Solomons over a number of years, and I am aware that it is an issue that has been pursued by the police. So it is not something that AusAID specifically has been involved in. But I think, under the RAMSI program, it is something that has been the subject of discussion between the participating police force sent by Pacific island countries, including Australia, and the Solomon Islands police.

Senator RHIANNON: There is a report out, by Tania Herbert, that identifies it as a recent problem in Solomon Islands. Understandably, it says that, if one can stop this in the early stages, one has a much greater chance of eliminating it. So it sounds like you are aware of it, but is it something that AusAID, in terms of the aid that you are delivering to that country, would be giving attention to in terms of (1) ensuring that terrible trade stops and (2) looking at ways to assist locals to manage their forests in a sustainable way so they do not get caught up with these overseas loggers, who are the main perpetrators of these crimes?

Mr Baxter : To the extent that you are referring to criminal activity such as sexual exploitation, that is a matter for the law and order authorities in Solomon Islands. On the broader question of Solomon Islands' natural resources, natural endowment, I think the focus of our work, including through the regional assistance mission, has been to strengthen the capacity of the central agencies in Solomon Islands, such as the finance ministry, to manage and set priorities for Solomon Islands. But forestry specifically has not been a sector in which we have been involved in recent years.

Senator RHIANNON: Is there any reason that you make that judgement, considering it dominates the economy so considerably and as it has been so clear that the industry is winding down and so much of the government's revenue will start to dry up? Why did AusAID choose not to work on that industry?

Mr Batley : Because we have been so closely involved in the central agencies, particularly in the finance ministry, we have certainly been deeply involved in the work of looking at the impact of that industry on national finances and looking at the projections of future government revenue and therefore drawing to the attention of government the need to consider their future financial situation in light of the gradual decline of that industry. The sector itself is not one that the government has sought our assistance in.

Senator RHIANNON: So where do you see the future going? It sounds like you are giving advice about the development of the economy of the Solomon Islands—does a point not come where you are actually advising them on what their future industries are? Is that your role?

Mr Batley : The advice that external advisers put to the government is information about the options and choices that Solomon Islanders, as policymakers, are going to have to make.

Senator RHIANNON: What are those options that you have put to them?

Mr Batley : I cannot give you an answer on that question but what I am saying is that the advice is that over the course of perhaps the next decade government revenue from logging will decline.

Senator RHIANNON: So why can you not tell us what the options are?

Mr Batley : I simply am not enough across the detail of that work.

Senator RHIANNON: Can you take that on notice, please.

Mr Batley : Certainly.

CHAIR: You mentioned the recent Papua New Guinea elections. I understand three women were elected to the PNG parliament and also there were a significant number of women candidates. How did Australian government funding assist women to get elected to the PNG parliament?

Mr Baxter : I know some of the candidates were recipients of Australian training assistance, both the programs that we support through the United Nations Development Program and more directly, and I know from my recent visit that at least one of the three candidates attributed a significant element of her success to that leadership and electoral training. We were delighted to see three women elected. As you said, there were probably at least another three who came second in their contests, so we could have had up to six—and that was going from one before—when there was a concern that perhaps we would not see any women elected. One of those three women elected has been made the minister responsible for community development and youth, and I know Senator McLucas met all three of the successful women candidates when she was in Papua New Guinea earlier this month. We hope that that is the start of a trend. I know the Prime Minister of Papua New Guinea, the Hon. Peter O'Neil, is also very pleased to see that and he has, as I say, appointed one of the women as a minister in his government.

As you know, the Prime Minister announced a major new initiative on gender in the Pacific region at the Pacific Islands Forum leaders meeting in Rarotonga not too long ago. It is a $320 million initiative over 10 years. One of the key components of that initiative is to work in the individual countries in the Pacific to have more women elected to positions of leadership at both the community level and hopefully the national level.

We have committed to developing country-specific programs for each of the Pacific Island countries because the context will differ as to what will work. Papua New Guinea, Solomon Islands and Cook Islands are the first three countries we are prioritising, and we will have their country strategies in place by the end of this year and we will have all country strategies in place by the next Pacific Islands Forum, which will be held in the Marshall Islands next year. One of the things that we are going to do is set up a mentoring program between Australian female politicians and their counterparts in the Pacific Islands. That kind of direct mentoring can be very effective.

Senator KROGER: Has the $320 million that you just mentioned come out of the existing budget or is that out of future funds?

Mr Baxter : It is based on our projected growth in the aid budget. Obviously it is unusual to have a 10-year program, but the government did that very deliberately because we know it is going to take at least that long particularly on issues like attitudinal change. We have the forward estimates and the Comprehensive Aid Policy Framework which cover the next four years. It will be within that budget envelope and the growth—

Senator KROGER: I am hoping you can assure me that it is not including existing programs that we are rebadging and putting under a broader title.

Mr Baxter : No, this is all going to be new funding.

Senator EGGLESTON: I have a question about what was called the climate change voyage. According to media reports, AusAID funded a canoe voyage from Manus Island in Papua New Guinea through the Pacific region, and the two-month voyage had the objective of raising awareness of climate change and inspiring community-based adaptation action. Do you know about this?

Mr Baxter : No, we do not. We will take that on notice—none of us are aware of it.

Senator EGGLESTON: The questions are: did Australia provide funds for this voyage and if so how much; how will AusAID assess the outcome of the voyage; what steps are in place to verify whether it has delivered what it said it would; and are there any KPIs to assess whether this use of taxpayer money has been worthwhile, and if so can they be provided in detail.

Mr Baxter : We will certainly do that.

[21:58]

CHAIR: We are done with PNG and the Pacific, and will move onto program 1.2, East Asia.

Senator RHIANNON: Considering reports that nearly two million acres of farmland in Burma has been seized by authorities from farmers and redistributed to over 200 companies and that this has left thousands of farmers with no land or livelihood, what steps is Australia taking to ensure Australian investment in Burma is not compounding poverty in that country?

Mr Baxter : That is a question that is best directed to the Department of Foreign Affairs and Trade. AusAID does not get involved in investment policy.

Senator RHIANNON: Could you outline any of the AusAID programs in Burma that address human rights issues in that country.

Mr Baxter : I will ask my colleague Mr Brazier to do that.

Mr Brazier : The three key pillars of our program in Myanmar are education, health and rural development. We do, however, have an interest in promoting democracy and are looking into support for Myanmar's parliament and associated activities in the area of good governance. I am not aware of activities beyond the good governance area specifically addressing human rights issues at this time.

Senator RHIANNON: Could you take it on notice if there are other government departments that would have ODA eligible funding that may be covering such programs?

Mr Baxter : We are happy to take that on notice. We do of course provide humanitarian relief and we have been doing so for some years, including in those areas that have been affected by conflict in Rakhine, including the Rohingya people who have been impacted by that conflict.

Senator RHIANNON: Thank you. Could I move on to Cambodia. I would like to start with the AusAID country strategy. It states:

Land management processes in Cambodia, which impinge on many facets of development, need significant strengthening. The pre-conditions are not present for us to directly re-engage in this arena and be effective.

Could you explain what that last sentence means, please.

Mr Brazier : Do you mean in the area of land reform?

Senator RHIANNON: I am not sure. It comes from the Australia-Cambodia Joint Aid Program Strategy 2010-2015, on page 10. I was just trying to understand what you meant.

Mr Brazier : I am sorry; I do not have that document in front of me, but I can confirm that land issues in Cambodia are, and have been for some time, a very difficult problem, and many donors and international NGOs have tried in the past to work on that subject and encountered difficulties.

Senator RHIANNON: Because there is this ongoing issue about land disputes, a number of other countries and their aid agencies are urging respect for human rights. They are taking that up quite strongly and calling for respect for the rule of law. Has AusAID considered adding its voice to theirs in its engagement with the Cambodian government?

Mr Brazier : I think that is a policy handled by the Department of Foreign Affairs and Trade.

Senator Conroy: That is probably more of a policy question. I am happy to take it on notice and see if Mr Carr has anything he would like to add.

Senator RHIANNON: I would appreciate your taking it on notice. I did want to add that aid agencies from some European countries have been raising this directly, but I appreciate your point and if you could take that on notice it would be useful. Is AusAID reconsidering its engagement with the Cambodian government in light of the escalation of human rights abuses?

Mr Baxter : No. We have an ongoing program in Cambodia. As the minister has said, we are concerned about human rights, and our embassy and our ambassador in Cambodia raise issues as they arise and express the views of the Australian government on those issues, but we are continuing to implement our programs, because our programs are aimed at bringing benefit to the people in Cambodia living in poverty rather than aimed at supporting the government.

Senator RHIANNON: That actually provides an interesting lead-in to my next question. Earlier this month, it was reported that families resettled by the AusAID funded Cambodia Railway Rehabilitation Project have filed a complaint with the Australian Human Rights Commission. The complaint alleges that they have suffered serious violations of their human rights as a result of resettlement under this project. I understand the allegations include that the Australian government failed to uphold its international human rights obligations in that it provided significant funding to the project without taking sufficient measures to safeguard against breaches of human rights. Will AusAID defend itself against these allegations?

Mr Baxter : Based on advice we have received from the Australian Government Solicitor, in the circumstances and out of deference to the Australian Human Rights Commission and the important function it carries out, we do not consider to it appropriate to comment on this matter in any detail beyond stating that the government does not accept the correctness of a number of the factual assertions made in the complaint and that it is firmly of the view that the decision to fund the project did not involve, or amount to, an act or practice which is inconsistent with, or contrary to, human rights.

Senator RHIANNON: Will you defend the case?

Mr Baxter : There is no decision yet made, as far as I am aware, by the Australian Human Rights Commission as to whether or not the complaint falls within their jurisdiction. My understanding is that that would be the first step.

Senator RHIANNON: My understanding is that, when they take their first step in responding to this complaint, AusAID will have the right to put in a submission. Is that how the process works?

Mr Baxter : As I understand it, there are a couple of options available to the Human Rights Commission. For instance, they might make a decision based around a call for mediation. I think that, depending on what their judgement is, there are a number of steps they can take. We do not want to pay any disrespect to that process. But I would say this generally about the program—it is one we keep under constant and close supervision.

Senator RHIANNON: You are referring to the railways project in Cambodia?

Mr Baxter : Yes. The resettlement of people for infrastructure projects is difficult wherever you do it. It is particularly difficult in the context which applies in Cambodia. We have gone to considerable lengths to try and address issues relating to the resettlement of people who have been affected by the railway development.

Senator RHIANNON: When do you expect to hear from the Human Rights Commission about your options with respect to this complaint?

Mr Baxter : The answer is that we do not know. The complaint was lodged a short period of time ago. We will obviously stand by for advice from the Human Rights Commission.

CHAIR: That concludes questions on program 1.2.

[22:08]

CHAIR: We will move on now to program 1.3—'Africa, South and Central Asia, Middle East and Other'.

Senator ABETZ: On 23 August, a question was asked of Minister Bob Carr in the Senate about the purported registration or renewal of the Union of Agricultural Work Committees. It asked who had provided this registration to government, whether it was accompanied by a translation and, if so, by whom it was translated. In the Senate, one can ask a principal question and then two supplementary questions. In answer to the second supplementary question, Senator Carr promised:

I will not only do that; I will also go further—I will have the Arabic material and the translation tabled in the chamber.

Has that occurred?

Mr Baxter : Certainly we have looked into this issue in some detail—

Senator ABETZ: No, has there been a tabling of the translation in the chamber?

Mr Baxter : No, there has not.

Senator ABETZ: Can we have an explanation? In the Senate, if questions or issues are taken on notice, there is a 30-day rule—23 August, 23 September; we are now nearly double the time. I am wondering if some explanation could be given for the delay. I was looking at the certificate—and I have it in front of me, albeit in the unreadable version for myself—but, with a maximum of 300 words, it could not be too big a project to have translated, I would have thought, especially when expedition was asked for and Senator Carr said, 'I will not only do that, but I will go further and table it.' Here we are, two months later, and it is not tabled. Any explanation?

Senator Conroy: I am happy to take that on notice and see if the minister has any further information—

Senator ABETZ: All right, but the department might have some explanation.

Senator Conroy: No, I said I will take it on notice.

Senator ABETZ: Cut it out!

Senator Conroy: It is not how Senate estimates work. I can ask that any questions be taken on notice—

Senator ABETZ: Are there officials at the table who are able to provide an explanation?

Senator Conroy: You are asking for an answer as to why the minister has not done something, and I have taken it on notice for the minister to answer.

Senator ABETZ: I am assuming that the minister did not personally seek a translation but asked the department to undertake that for him. Is that correct, Mr Baxter?

Mr Baxter : We have undertaken some work around the registration issue that you have referred to.

Senator ABETZ: You have undertaken some work in relation to the translation request?

Mr Baxter : That is right.

Senator ABETZ: Has that document been translated?

Mr Baxter : Yes, there has been a translation.

Senator ABETZ: What date was that translation received?

Mr Baxter : I do not have the date with me, but it has been done in the last few weeks.

Senator ABETZ: In the last few weeks?

Mr Baxter : Yes—maybe the last couple of weeks.

Senator ABETZ: We now know it exists, but it has not been tabled, and that aspect—

Senator Conroy: As I said, we have taken it on notice.

Senator ABETZ: We have established it has been translated but the minister has not tabled the translation. We have established that, so thank you for that. As a result of that translation, have any subsequent or further inquiries been made about this organisation?

Mr Baxter : Subsequent to the earlier work that we have done to look at allegations that have been raised?

Senator ABETZ: No, subsequent to the translation being received of that certificate—has that excited any further investigations?

Mr Baxter : No, it has not excited any further investigations.

Senator ABETZ: What about the question that was asked on 23 August—did that excite or engineer or begin any new investigations?

Mr Baxter : Could you refresh my memory on the question on 23 August?

Senator ABETZ: It was in the chamber on 23 August. It is in the Senate Hansard, at page 6,267 of 23 August 2012, surprisingly.

Mr Baxter : Sorry, Senator, can I just backtrack a little bit?

Senator ABETZ: Yes, of course.

Mr Baxter : I think I am able to table the translation this evening, if that is acceptable to the chair.

Senator ABETZ: Of course it is, and the minister at the table might like to explain why he tried to stop all this from happening this evening by his intervention. But take that on notice, because you will have to think about it very carefully, I would have thought, Minister. I would be much obliged if a translation could be tabled.

Mr Baxter : We will provide that to the relevant officials. It was my fault for not being on the ball at quarter past 10 to know that I had a copy here with one of my colleagues to be able to table it for you.

Senator ABETZ: Has the translation been provided to the minister's office?

Mr Baxter : Yes.

Senator ABETZ: Can you tell us when that translation was provided to the minister's office?

Mr Baxter : I would have to check on that, but it would have been in the last week or so—maybe the last couple of weeks. I would have to check to give you the exact time.

Senator ABETZ: All right, if you can take that on notice, please.

Mr Baxter : Certainly.

Senator ABETZ: Were any subsequent inquiries after 23 August made? I think I asked that before, but I am not sure what the answer was anymore after we discovered we had a translation.

Mr Baxter : No. There were no investigations after that period of time.

Senator ABETZ: What do we mean by 'investigations'?

Mr Baxter : There has not been any material that has been brought to our attention that was different from material that we had seen before the date that you mentioned.

Senator ABETZ: But were any further letters written, investigations made or documents inspected to ascertain whether or not something may have been missed in the past?

Mr Baxter : There has been no direct correspondence that I am aware of between AusAID and other parties that have raised this matter with us in the past.

Senator ABETZ: I will need to ask the minister—and it is a pity that Minister Carr is not here—to take on notice whether the minister's office, one would assume therefore without AusAID's knowledge, has written to various authorities, such as, for example, the Israeli government or the Israeli ambassador in Australia, to get more information.

Senator Conroy: I am happy to take that on notice.

Senator ABETZ: Thank you very much. If we can be provided with copies, I will try to understand how this translation works later on.

Mr Dawson : I can talk you through the documents that you have.

Senator ABETZ: That is very kind, but time is short. I will have to have a look at this document as we are going through. Are you aware of the discussions between the organisation known as Shurat HaDin and World Vision about this matter?

Mr Baxter : Yes.

Senator ABETZ: And you are aware of the media release of the Executive Council of Australian Jewry of 15 October 2012?

Mr Baxter : Yes.

Senator ABETZ: Has that occasioned AusAID to reconsider its position?

Mr Baxter : No.

Senator ABETZ: So you are willing to dismiss all the matters raised by Shurat HaDin in its correspondence of 7 October 2012?

Mr Baxter : Nothing contained in the dossier or in Shurat HaDin's 7 October letter to World Vision alters the conclusion of AusAID's previous examination of Shurat HaDin's allegations—namely, that there is no evidence to support a claim that funding of UAWC is in violation of the UN charter act.

Senator ABETZ: Are you saying that in this quite lengthy document there are no fresh matters raised?

Mr Baxter : That is right; that is what I am saying.

Senator ABETZ: There are no fresh matters raised at all—that is your testimony here?

Mr Baxter : That is my understanding.

Mr Dawson : There was an extensive dossier of material which was attached to that letter. That was material which had already been passed to AusAID by Shurat HaDin and which was thoroughly examined in April and May.

Senator ABETZ: In this translation, Mr Dawson, I was given a stapled dossier of a number of pages. On page 2 of that document there are a number of categories. If I am reading this correctly, 'name of corporation in English' is blank. Is that correct?

Mr Dawson : That is correct, because it has no English name; it has an Arabic name transliterated into Hebrew.

Senator ABETZ: So how do we know what the English name of this organisation is from this document?

Senator Conroy: I think he said there wasn't an English translation.

Senator ABETZ: Yes, so how do we know that we are talking about the UAWC or indeed the Red Cross or the Labor Party or the Liberal Party—or AusAID, for that matter?

Mr Dawson : Because we know the Arabic translation of the words.

Senator ABETZ: You can tell us the Arabic, the Hebrew, and on the basis of that you have to understand what the English translation is.

Mr Baxter : No, from the Arabic we can translate the English.

Senator ABETZ: So where is that on the document?

Mr Dawson : It is not on the document.

Senator ABETZ: So this document, which is proof positive that we are talking about the Union of Agricultural Work Committees, is not on this translation of a document that Senator Bob Carr was telling us was the proof that it was the Union of Agricultural Work Committees?

Mr Dawson : The name of the organisation translates to 'committee of agricultural work'. The Committee Of Agricultural Work is the Jerusalem based office of the Union of Agricultural Work Committees. Amongst the documents which we have provided is a sworn affidavit from a gentleman by the name of Khalid Hidmi, who is both the Chairman of the Committee of Agricultural Work and the General Director of the Union of Agricultural Work Committees. They are one and the same organisation. The Committee of Agricultural Work is the Jerusalem based office of the Union of Agricultural Work Committees.

Mr Baxter : And that office has been registered by the Israeli government as a non-for-profit organisation since 1996.

Senator ABETZ: Why does the name 'Khalid Hidmi' ring a bell to me? I am sure somebody can assist. He has got some form, hasn't he, in relation to matters between the State of Israel and Palestine and the Palestinian authority?

Mr Baxter : Khalid Hidmi has been the Chairman of the Committee of Agricultural Work since its foundation and also the general director of the UAWC since 1991.

Senator ABETZ: Yes, but does he have any form to the knowledge of AusAID in relation to whether he may have been convicted? I might have the wrong person—

Mr Baxter : No, we do not have that information. Since this matter has been in the public arena we have received no representations and no expressions of concern from the Israeli government either in Tel Aviv or through their embassy here in Canberra. The government of Israel does not consider UAWC to be a terrorist entity and, as I said earlier, has registered its Jerusalem based office as a non-for-profit organisation since 1996.

Senator Conroy: So Bibi gave him a clean bill of health.

Mr Dawson : Senator, if I may help you with the name Khalid Hidmi, it is referred to in a letter from the Chief Executive Officer of World Vision—

Senator ABETZ: Yes, I have just discovered—

Mr Dawson : to Shurat HaDin on 27 September.

Senator ABETZ: Yes, pages 2 and 3. He is not listed as a member of the UAWC's board of directors.

Mr Dawson : That is correct. He is the general director.

Senator ABETZ: As I understand it, one of the issues is that it is that the directors that are checked out in relation to whether bodies are incorporated or registered—is that correct?

Mr Baxter : None of the individuals who are referred to in the correspondence that we have received directly or that we have seen between Shurat HaDin and World Vision refers to individuals or board members of UAWC that are proscribed.

Mr Dawson : We know that World Vision undertakes vetting of both directors and senior staff against lists of terrorists.

Senator ABETZ: Can you just assist me again. The translation into English of the name of this organisation is in fact not the Union of Agricultural Work Committees but—

Mr Dawson : The Committee of Agricultural Work, which is the name which the Israeli authorities suggested be used when the Union of Agricultural Work Committees attempted to register itself in that name—the Union of Agricultural Work Committees. They were not permitted to do so by the Israeli authorities, who asked that another name be nominated. That information is in the sworn affidavit from the general director of UAWC.

Senator ABETZ: Have you then inquired of this Mr Khalid Hidmi—and I am just reading his affidavit—as to how he made clear to the Israeli authorities at the time of registration that the committee was UAWC's office in Jerusalem?

Mr Dawson : Is your question, 'How did he make that clear?'

Senator ABETZ: He asserts this in the affidavit.

Mr Dawson : He swore it in the affidavit.

Senator ABETZ: Have you sought to verify that that is in fact correct?

Mr Dawson : Our officers in the region have spoken with him, yes.

Senator ABETZ: Yes, with him, but people have been known to falsely swear in affidavits from time to time and make false statements. So have you sought to independently verify that to which he deposed to in his affidavit with the appropriate authority in Jerusalem?

Mr Dawson : There is also a file of material which is the registration file from the Corporations Authority of the Ministry of Justice. In some of the material that they provided, Shurat HaDin provided a summary of the documents in that file. The summary of those documents fundamentally bears out the information which is provided in Mr Hidmi's affidavit.

Senator ABETZ: If you believe that to be the case, you will be able to tell the committee how Mr Hidmi made it clear to the Israeli authorities at the time of registration that the committee was UAWC's office in Jerusalem.

Mr Dawson : I assume he told them, because that is what was—

Senator ABETZ: How can you have documentation assuming that something was told to an authority? Is there a diary note from the authority in Israel saying, 'Mr Hidmi came in and at that time he told us this, and we are willing to believe his word'?

Mr Baxter : The affidavit has been sworn to under Israeli law.

Senator ABETZ: We know that. We know it is an affidavit, but I think we also know—

Mr Baxter : As Mr Dawson said, we have also seen the relevant file material which bears out his comments in the affidavit.

Senator ABETZ: Then where is the material? We were just told by Mr Dawson that he assumed. Where is the material that confirms—

Mr Baxter : We are happy to take the question on notice. We do not have that documentation with us, but we are happy to take on notice your question as to how Mr Hidmi made clear to the Israeli authorities at the time of registration that the committee was the UAWC's office in Jerusalem.

Mr Dawson : I can read from this summary of this file from the Israeli corporations authority. As I said, we have this summary courtesy of Shurat HaDin, who provided an English language summary of the material on the file. That shows us that in 1994 there was an official application to register the organisation. It listed UAWC as the first preference of the name of the organisation and CAW as the second preference. UAWC was then crossed out. It also listed the founding members of the organisation. There was then detail of a long exchange of correspondence between lawyers representing UAWC and the corporations authority, a request from UAWC for a response to their inquiries, and then a letter from the attorney, presumably of UAWC, to the corporations authority that says:

In accordance with our conversation from earlier today, I hereby inform you that my client does not object to registering the above named organisation, UAWC, under the name 'Committee of Agricultural Workers'.

Senator ABETZ: If that is the case, that sort of sounds good on the face of it, but one wonders why the Israel Law Center would then go to such trouble and continue to pursue that. Clearly, they have indicated to you that there are further difficulties with that documentation and it should—

Mr Dawson : No; they have not indicated anything of the sort.

Senator Conroy: Do you think they have indicated it to the Israeli government at any stage?

Senator ABETZ: I do not want to go there. As I indicated to you at another estimates, all you have to do is visit the Governor-General if you want to change roles.

Mr Baxter : We are aware that Shurat HaDin have a relatively extensive portfolio of issues that they are pursuing around the world. I am aware that they are suing the former President of the United States Jimmy Carter. They are pursuing legal action against the Warwick Hotel, which recently hosted the stay by the President of Iran, President Ahmadinejad, and there are a number of other commercial entities that they are pursuing through legal action. They have a very extensive program, looking at particular issues.

Senator Conroy: Excellent volunteers, I hear.

Mr Baxter : So you would have to ask them why they are pursuing particular issues. We are satisfied with the investigation that we have carried out into World Vision's due diligence of UAWC. We have carried out due diligence of UAWC ourselves. I say again that at no time have any representations been made to us by the Israeli government expressing any concern about the funding that we are providing to World Vision and World Vision is using to support agricultural work for poor communities in Palestine through the UAWC.

Senator Conroy: Has Bibi gone soft? Good grief.

CHAIR: Have you finished questioning on this item, Senator Abetz? I am conscious that your colleagues might have questions about something else.

Senator ABETZ: There is a Mr Bashir mentioned in these documents. I must say that it is singularly unhelpful to have this translation, which was held by the department for numerous days, dropped during the committee hearing, which does not allow us to study it.

Senator Conroy: Thanks for your opinion, Senator Abetz.

Senator ABETZ: I think most fair-minded people would question why that which was promised to be expedited sat in a file for so long and why a minister at the table sought to ensure no further questioning, only for it to be revealed that there was a translation available and it gets dumped now and then we cannot go through it and fully research it.

Senator Conroy: I am not going to start a fight with you now about your trying to verbal me at 10.30 at night, but I reject your assertion.

Senator ABETZ: Regrettably all I will note is the board chairman of UAWC, Bashir Al Khairy, was tried and convicted of the bombing of the Supersol grocery store in West Jerusalem on 21 February 1969 and he was sent to 15 years jail, and that is the sort of person we are dealing with in this organisation. That is why it should not be taken flippantly that the Jewish community is genuinely concerned about this organisation.

Mr Baxter : Nor have we taken it flippantly. We have investigated thoroughly all claims that have been raised and referred them all to the competent authorities in the Australian government.

Senator ABETZ: I will leave it at that, but undoubtedly there will be other questions.

CHAIR: I will ask a senator to move that the document tabled be accepted.

Senator KROGER: So moved.

CHAIR: Thank you. We are still in program 1.3.

Senator RHIANNON: A question on notice, question No. 2128, concerns some questions I asked about demolition orders on possible aid projects in Palestine. The foreign minister stated: 'The Australian government is aware of reports that demolition orders were issued in June 2012 against approximately 50 structures in Susya village, south Hebron. Two of these structures are tents funded by AusAID through a $2,500 grant to ActionAid Australia under the AusAID NGO Cooperation Program in 2012. One tent houses the local preschool for 35 children and the other tent houses a local health clinic which provides 60 medical consultations per week for women and the elderly.' The foreign minister goes on: 'Australia has expressed concern to the Israeli authorities about the proposed demolitions and is committed to working with the Israeli authorities to find a solution which avoids demolition of these structures.' Could you outline what work was undertaken with the Israeli authorities and if it was successful in finding a solution to avoid demolition?

Mr Baxter : You are very up to date on this issue and, as you say, we have expressed our concern to the Israeli authorities about the proposed demolition. Australia's Ambassador to Israel raised the matter with the Israeli foreign ministry on 2 July. I am not aware of this issue actually being resolved, but I will ask Mr Dawson if he has any further information.

Mr Dawson : I think it was raised with the Israeli authorities on 2 July, again on 4 July and again on 30 July. So that is three times altogether. As far as we are aware, no action has been taken on the demolition of the structures, but there is an issue in front of the courts in Israel brought by a settler organisation at the moment. The tenor of the representations which have been made to the government of Israel has been about the significant humanitarian implications of the demolitions. We are aware as well that some other donors have been advocating the introduction of some kind of building master plan for communities in the area that may provide some possible way forward, but at the moment it is basically the status quo. The structures remain but they are said to be illegal structures and the registration process for them has proven very difficult for the communities.

Senator RHIANNON: What does the Australian government see as its next move? You said that they have contacted the Israeli authorities on three occasions. Could you first share with us what the response of the Israeli government was in those discussions, and what is the next step that the Australian government proposes to take considering these aid projects appear to still be under a threat of demolition?

Mr Dawson : This is part of a much larger picture of structures in the area, with representations being made to the Israeli authorities from a number of other donors. I think it is going to be best if Australia continues to work with other donors in bringing the issues to the attention of the Israeli authorities.

Senator RHIANNON: Who are the other donors we are working with, please?

Mr Dawson : I cannot give you a list of that at the moment. We can take that on notice. But certainly the European donors have been quite heavily involved in this issue.

Senator RHIANNON: Thank you, if you could take that on notice. What was the response of the Israeli government when you spoke to them or when representatives spoke to them?

Mr Dawson : It was a conversation where they understood the issues that were being put but were also obligated to respond that they viewed the structures as illegal structures.

Senator RHIANNON: They viewed the aid projects as illegal structures?

Mr Dawson : The structures, yes.

Senator RHIANNON: Moving on to Afghanistan, I understand that AusAID recognises that the need to support the electoral process in Afghanistan is very important. What portion of the aid budget for Afghanistan is being spent on support for the electoral process?

Mr Baxter : We have in preparation a major new program to support the 2014 presidential elections and the subsequent parliamentary elections. We expect to contribute to a broader multidonor effort to strengthen the institutional capacity of the Afghanistan Independent Election Commission. We are currently looking at something like $30 million over four years.

Senator RHIANNON: Does your work in this area take into account recommendation 15 of the International Crisis Group report Talking about talks: toward a political settlement in Afghanistan, which sets out the need to:

Condition aid for future Afghan elections on the repeal of the February 2010 presidential decree on the electoral law, rationalisation of the electoral calendar and an overhaul of the voter registry, to include a redrawing of electoral constituencies to make them more responsive to present-day demographics and geographic divisions.

That is a quote from that publication. Is your work in the context of that recommendation?

Mr Baxter : No, it is not. It is part of our ongoing discussion with our partner donors and the Afghan government. There is broad recognition, certainly within the international community and within the Afghanistan government, that credible, inclusive and transparent elections are an important platform for improved governance and human rights in Afghanistan and that the credible, inclusive and transparent elections in 2014 will be fundamental for stability in Afghanistan moving forward. At a major international conference in Tokyo that was held in July this year and attended by the Foreign Minister, the government of Afghanistan committed to detailing the timetable for elections by early next year, including the arrangements under which those elections would be held, including the security arrangements under which those elections will be held. It is one of the fundamental elements of what is called the Tokyo Mutual Accountability Framework, which was agreed at that conference. Donors pledged support for Afghanistan through to 2014 and beyond on the basis that Afghanistan agreed to meet certain commitments, and credible, inclusive and transparent elections are part of that commitment.

Senator RHIANNON: In terms of that recommendation, which appears to set out the need for redrawing of electoral boundaries, issues to do with the actual rolls, is it that you disagree with that recommendation?

Mr Baxter : No, not at all.

Senator RHIANNON: It is more that it is just not part of your work?

Mr Baxter : Yes. Everything we are doing is actually consistent with that recommendation; it has just come from a process of intergovernmental discussions.

Senator RHIANNON: I am just trying to understand how it all works. Given your commitment to continue the support for the electoral process, does AusAID recognise the need to ensure adequate security for voting centres? I gather that was a fairly key priority.

Mr Baxter : Yes.

Senator RHIANNON: Is it something that our money is going into, or are you just making sure that it happens?

Mr Baxter : No, that would not be funded from aid funding. The government, along with other governments that are part of the international coalition in Afghanistan, have made commitments to support and sustain the Afghan National Security Forces, and so security would obviously be provided by the Afghan National Army and the Afghan National Police. They would be funded from those funds. Our work is to work on the machinery of the election itself.

Senator RHIANNON: In the May estimates I asked you how much of the money allocated for ADF related projects will be spent directly on projects and how much will be absorbed into new net additional costs of ADF personnel support and associated costs. You stated that none of it is aimed at meeting any of the costs of ADF personnel who have been deployed. In the same estimates, in question on notice No. 41, ADF gave a very useful table on provincial reconstruction teams. The table is called 'Summary of ODA eligible individual project costings undertaken by Defence for period 2006 to 2011'. The costs are broken up, so you can see the breakdown. We have a column for direct project costings, a column for defence employee costs and a column for defence employee support costs. Taking those latter two columns, where considerable money is spent—in most years more than 90 per cent of the money for individual projects goes on employee costs or support costs—does that not contradict the comment that you made that none of the money goes on costs of ADF personnel?

Mr Baxter : None of the ODA funding spent by AusAID in Afghanistan goes towards covering the costs of ADF personnel.

Senator RHIANNON: I acknowledge that they call it ODA eligible—

Mr Baxter : That table goes back to a date prior to AusAID working in Uruzgan province. We stepped up our representation on the ground and the expansion of our programs starting from August 2010. There was a period up until the end of 2009 when the proportion of development assistance from Australia delivered by the defence forces was high. That has fallen significantly following the increased civilian presence in Afghanistan. We do not pay AusAID funds to the ADF to protect us; that is covered within the ADF's budget.

Senator RHIANNON: But it is still called ODA eligible, and it goes beyond 2009-10. There is a breakdown here for 2010-11 and the money is said to be detailed for 2011-12, and we have those two columns. Can you take that on notice. There might be a clear explanation but it is down there that ODA eligible money is going to defence employee costs and defence employee support costs right up to the present time.

Mr Baxter : I am happy to take that on notice but I will again say it is not funding that is coming out of the AusAID budget.

Senator RHIANNON: Even if you can take on notice how you explain that ODA eligible money is being spent on defence costs.

Mr Baxter : I obviously do not have that table in front of me so I am happy to look at it.

Senator RHIANNON: It is question No. 41 from the May estimates.

Senator KROGER: Before I begin my questions, Senator Rhiannon might like to look at a submission by the ADF to the inquiry on aid into Afghanistan. It gives a clear understanding of what the Defence Force does in support of aid. It is worthwhile looking at. Mr Baxter, I return to the liaison office. It was touched on earlier, very briefly, and we discussed it and I tabled the report at the last estimates. I understand that you have an FOI request from the member for Mayo, Mr Jamie Briggs, in relation to documents?

Mr Baxter : That is my understanding. I add that AusAID has offered Mr Briggs and Ms Gambaro a briefing on our relationship with The Liaison Office as well.

Senator KROGER: I will come to that. I have the FOI request here and I am happy to table it, but I do not want to take up the time of the committee at the moment. The FOI request from Mr Briggs was lodged on 3 August. Very briefly—and I really am cutting to the chase here—I understand that AusAID have indicated that they are going to make a decision on the FOI matter on 17 November. Is that correct?

Mr Baxter : That sounds right.

Senator KROGER: Are you able to give us an indication today whether you are going to be able to release all the documents covered by that FOI request?

Mr Baxter : I do not have that information with me. I would have to check it out.

Senator KROGER: You just referred to the offer to Mr Briggs and Ms Gambaro in relation to a private briefing. I understand you offered a private briefing to the shadow foreign minister, Julie Bishop. Is that correct?

Mr Baxter : We did provide a briefing to her.

Senator KROGER: You took a document with you?

Mr Baxter : My colleague did. Mr Dawson was part of that briefing exercise.

Senator KROGER: Who attended the briefing?

Mr Baxter : Mr Dawson.

Senator KROGER: Mr Dawson, you took a document with you to that briefing?

Mr Dawson : From memory, we showed the shadow minister the actual text of the comments on one particular part of the draft annual report from the liaison office, a part which had been the subject of some comment.

Senator KROGER: I am somewhat puzzled that AusAID has changed what they offered in relation to this FOI request. I understand there was initially a request for costs of some $10,000 for the release of the documents. That was then changed to $5,000 and now, I understand, all charges have been waived—although the matter is still being considered and is to be resolved on 17 November. Is that correct?

Mr Dawson : The short history is that there was a very broad request submitted under the FOI Act. We did an assessment of how much effort would be required to fulfil that request. It was a substantial amount of effort. We costed that effort. I think we offered to waive half that amount. Then, in subsequent conversations with Mr Briggs or his office, we identified that it might be easier if the request were narrowed and we suggested how that might be done. A more limited request was submitted and we are now actioning that request. We have waived the fees associated with it.

Senator KROGER: In that private briefing—and I am not asking for the substance of that briefing, because the meeting was private—did you indicate to Ms Bishop that there was more than one document which might be of interest? Did you give an indication of the extent of documentation you have in relation to this matter?

Mr Dawson : From memory, we did not talk about the FOI request at all during that briefing. It was a briefing about the issues which had been raised and we were simply using the briefing to explain AusAID's position.

Senator KROGER: You hold some 2,409 pages of documents. Is that correct?

Mr Dawson : That is the amount of documentation we identified, in responding to the initial FOI request, as being relevant to the request. An FOI request can be very broad and that was our estimate of the number of documents.

Senator KROGER: You have just indicated that you were considering a request for which the parameters have narrowed from that original request.

Mr Dawson : The applicant has agreed to narrow the request.

Senator KROGER: So what is the current request?

Mr Dawson : I do not have the terms with me.

Senator KROGER: Is the request in relation the 2,409 pages?

Mr Baxter : I have the reduced scope. Mr Briggs submitted a revised scope for his FOI request to AusAID: all correspondence between AusAID and the liaison office concerning feedback from AusAID on the draft report by TLO into the security situation in Chora district of Uruzgan province in Afghanistan; the decision by AusAID to cancel the $3.6 million contract with the TLO; all briefing documents from AusAID to the Minister for Foreign Affairs concerning TLO's final report and/or draft report into the security situation in Chora district of Uruzgan province in Afghanistan; and the decision to cancel the $3.6 million contract with TLO. That is the reduced scope of the FOI request.

Senator KROGER: Given your view—which you have tabled many a time and is incorporated in your many comments and responses to questions—about the rigorous improvement of and necessity for transparency and scrutiny, why don't you, Mr Baxter, right now agree to releasing those documents on 17 November? What is the issue here? It is pretty straightforward. We have the report. What is the problem in releasing those documents?

Mr Baxter : As I mentioned earlier, we have offered to brief the applicant directly and to answer any questions that he has. We cannot be more transparent than offering to provide him with a briefing on the issues that he is concerned with.

Senator KROGER: But it is not just Mr Briggs who is concerned.

Mr Baxter : The FOI report was submitted. It has been discussed with Mr Briggs and his office and they have agreed to revise it. I saw a media report in the paper today that talked about:

… the apparent lengths to which AusAID will go to avoid having the truth be known about what's really going on in Oruzgan.

That is an accusation that AusAID reject entirely. If you go on our website and read our country page about Afghanistan, you read our Afghanistan strategy or you read our submission to the Senate inquiry into the Australian aid program in Afghanistan, you will find very frank and clear assessments of the situation on the ground in Afghanistan. It is also the case that we have in previous hearings talked about the reason why we terminated the contract of the TLO based on its nonperformance. That was a decision that was jointly agreed by Australia and the Dutch government. I would like to read for the record the position of the Dutch government, which we have in writing:

The Dutch embassy noted repeatedly that TLO reports were not delivered on time and that the project as a whole was not of good value for the donors.

Our responsibility is to provide good value for money for Australian taxpayers. Both the Australian government and the Dutch government came to the view that this did not represent good value for money for the Australian or Dutch taxpayers. We had tried over a period of several months to address the issue of underperformance. We were unable to have that addressed successfully, and reluctantly and after a lot of effort on all sides to try and come to a resolution the best thing to do was to part ways. It was in no way an attempt to prevent anyone from saying anything about the situation on the ground in Afghanistan.

Senator KROGER: But the best way in which you can demonstrate that this is not a whitewash and being brushed under the carpet is by actually coming clean with this stuff. Are you aware of the Office of the Australian Information Commissioner calling for an overhaul of the department of immigration in the way it handles sensitive FOI requests?

CHAIR: I am going to let Mr Baxter respond to that, and then we will wind up.

Mr Baxter : We have offered briefings, as you mentioned, to the shadow spokesperson on foreign affairs and to the applicant and to the shadow spokesperson on international assistance on this matter. We remain very happy to do that.

CHAIR: Thank you, Mr Baxter.

Senator KROGER: Chair, we have got one minute.

CHAIR: No; you have got 15 seconds.

Senator KROGER: Okay; 15 seconds. It is not two individuals who are interested in knowing what is going on here, Mr Baxter. That is why it is being raised in estimates. I really strongly recommend you consider this FOI request, because there are a lot of people who are interested in knowing what is going on.

CHAIR: Thank you, Senator Kroger. Did you want one last shot at it, Mr Baxter?

Mr Baxter : No, thank you, Chair.

CHAIR: That concludes our examination of AusAID and indeed of all the foreign affairs, defence and trade portfolio areas. I thank Mr Baxter and his officers for their assistance this evening. Thank you also to Senator Conroy, representing the Minister for Foreign Affairs. Thank you to Hansard and Broadcasting and the secretariat for your assistance, and thank you to other senators for your cooperation. I remind senators that questions on notice need to be provided to the secretariat by close of business on 26 October.

Committee adjourned at 23:00