Senator Eric Abetz – Estimates question about increased aid to Palestine

photo of Senator Eric Abetz
June 2, 2011

Questioned increased aid to Palestine and the breakdown of funding support.

Aid to the Palestinians: I understand that that has been doubled in this year’s budget—is that right?

Whole interaction with Mr Peter Baxter (Director General, AusAID), Ms Catherine Walker (First Assistant Director General, Africa, West Asia, Middle East and Humanitarian Division, AusAID) and Senator Stephen Conroy (Minister for Broadband, Communications and the Digital Economy) during Senate Estimates (Foreign Affairs, Defence and Trade Legislation Committee, Foreign Affairs and Trade Portfolio).

Senator ABETZ: Aid to the Palestinians: I understand that that has been doubled in this year’s budget—is that right?


Mr P Baxter: That is correct.


Senator ABETZ: To about $70 million?


Mr P Baxter: Eventually, over the forward period.


Senator ABETZ: Yes, over the forward estimates. Are you able to confirm—I daresay there is no controversy here—that Fatah and Hamas have recently concluded a power-sharing agreement to jointly run the Palestinian Authority?


Mr P Baxter: I think that in the broad that is correct. This is obviously an area for DFAT rather than AusAID, but the implications of the Hamas-Fatah reconciliation agreement are not yet clear, and Hamas is not currently represented in the Palestinian Authority. We are aware that Prime Minister Abbas has stated that Hamas will have no direct role in the new government.


Senator ABETZ: Well, that is as it is. Can you confirm to me that the military wing of Hamas is proscribed in Australia?


Mr P Baxter: Providing funding to Hamas is illegal under Australia’s Criminal Code, yes.


Senator ABETZ: Thank you. And the Hamas charter calls for the violent destruction is Israel, and that is one of the reasons why it is a proscribed organisation. Are you able to shed any light as to whether the power-sharing agreement requires Hamas to amend its charter?


Mr P Baxter: I do not want to be unhelpful but it is really the province of Foreign Affairs and Trade.


Senator ABETZ: Which is fair enough, so I simply ask that that question be taken on notice, and the department hopefully after reading the transcripts will answer that question. I accept that. Will Australia withhold funding from the Palestinian Authority until such time as this issue is absolutely clear and certain—that Hamas has no say in the running of the government? It sounds a bit strange that they have entered into this agreement yet Hamas allegedly has no role in the government.


Mr P Baxter: Our aid goes towards supporting the development of a more transparent and responsible Palestinian Authority which is capable of achieving a negotiated peaceful two state solution with Israel. We do not know yet what the implications of this reconciliation agreement are, as I mentioned. But at the moment we provide our funding to the Palestinian Authority through the World Bank’s Palestinian Reform and Development Plan Trust Fund. We have funded the Palestinian Authority through that trust fund since 2007, alongside the United Kingdom, Canada, France and a number of other donors. And since 2007 we have had in place safeguards that help ensure our funds are not provided directly or indirectly to terrorist entities. Those safeguards include counterterrorism clauses in the AusAID-World Bank administration agreement for our contribution to the trust fund; that international advisers working in all Palestinian ministries provide scrutiny over how budget finances are used, so the people within the Palestinian Authority; a World Bank implemented electronic financial management system which meets international best practice standards to follow where the funding actually goes; and the establishment of a Palestinian Authority anticorruption commission and a corruption crimes court. The trust fund finances are disbursed following World Bank approval of the Palestinian Authority’s execution of budget and reform processes. We have also, along with other donors, required the consolidation of the Palestinian Authority’s commercial operations within an audited and transparent entity, the Palestinian Investment Fund. It is our assessment that the trust fund has the highest potential development impact amongst the available systems that we can use to disburse funds, and that it does so at an acceptable level of fiduciary risk. Should the situation change as a result of the reconciliation agreement, of course the government will take that into consideration. We are watching that quite closely. But, as I have already said, there is no indication at the moment that there has been any significant or any change in the way in which the Palestinian Authority is running itself.


Senator ABETZ: So the government, though AusAID, guarantees that this is being monitored on a very regular basis?


Mr P Baxter: Absolutely.


Ms Walker: As well as the safeguards Mr Baxter has mentioned we have an AusAID representative at the Australian representative office in Ramallah, and obviously a DFAT head of post in Ramallah, and they liaise very closely with the World Bank and IMF representatives in the Palestinian territories and with the representatives of other donor countries. They attend regular meetings of a fiscal sector working group co-chaired by the Palestinian Authority’s ministry of finance and the IMF which considers, in the broad, financial management questions across the Palestinian Authority. In addition we regularly send AusAID officers from Canberra to monitor our aid program in the Palestinian territories and they conduct discussions with the World Bank representatives, with the representatives of other donors and directly with the Palestinian Authority. So it is an additional layer of monitoring of the program.


Senator ABETZ: What motivated the doubling of the aid to the Palestinian Authority? What is the correct term—Palestinian Authority or—


Mr P Baxter: Palestinian Authority.


Senator ABETZ: Yes.


Mr P Baxter: There are two things. First, as I mentioned, Australia supports the development of a more transparent and responsible Palestinian Authority as part of achieving a negotiated peaceful two-state solution. There is also enormous need in areas of the Palestinian territories, as you would be aware, in Gaza and the like.


Senator ABETZ: Were there any areas in our aid budget where we doubled the funding to a particular area or a particular people?


Mr P Baxter: Yes, there have been over the last few years.


Senator ABETZ: In this budget?


Mr P Baxter: I do not think so, but say in the last 18 months. Pakistan and Sri Lanka come to mind as countries where we have doubled our programs, obviously because of particular development issues but also because of security issues.


Senator ABETZ: You told us about the AusAID funding via the World Bank et cetera to the Palestinian Authority. Do you also give money to Palestinian type aid projects through third parties, and how much is that expected to be as a result of this budget or this financial year?


Ms Walker: There are four elements of our support to the Palestinian territories. The first we have described: our support to the Palestinian Authority. The second element is our support to the United Nations Relief and Works Agency, UNRWA. That support goes to the provision of basic health and education services and technical and vocational education and so on in both the West Bank and Gaza, and also for Palestinian refugees in Lebanon, Syria and Jordan. The third element is our support for the Australia-Middle East NGO cooperation program known as AMENCA. It is in its second phase. It involves a partnership between four Australian NGOs and quite a large number of civil society organisations.


Senator ABETZ: So it is an acronym of acronyms, is it?


Ms Walker: That is right.


Senator ABETZ: What are those four organisations?


Ms Walker: The four organisations are ActionAid Australia, largely working in the West Bank with the Asala Palestinian Business Women’s Association involving provision of microfinance and microcredit to women; APHEDA, also working in the West Bank and Gaza, in partnership with the Palestinian NGO the Ma’an Development Center but also involved with a number of community based organisations; CARE Australia, working in the West Bank and Gaza in a program that is designed to improve livelihoods and to help strengthen civil society; and World Vision, also working in the livelihoods area in Gaza. The total funding for the AMENCA program is $30 million over four years. The estimated expenditure in 2011-12 is $6 million.


Senator ABETZ: How much are we anticipating giving to APHEDA?


Ms Walker: APHEDA has received $6,922,000.


Senator ABETZ: In this—


Ms Walker: No, that is over the life of the program.


Senator ABETZ: And it is still ongoing?


Ms Walker: It is a five-year program. It is in its second year.


Senator ABETZ: Are you aware of the proportion of APHEDA’s budget which is provided by AusAID?


Mr P Baxter: Do you mean the total APHEDA budget, Senator? I am not sure we would have that.


Ms Walker: I think we will need to take that on notice.


Senator ABETZ: I accept that. What criteria does AusAID use to allocate funds to APHEDA?


Ms Walker: In relation to this program in the Palestinian territories, clearly one of the criteria that we accepted was the extent of the relationships which various organisations have with their partner organisations in the Palestinian territories. APHEDA has been working in the West Bank and Gaza for many years—and so, I must say, have ActionAid, CARE and World Vision. It was a competitive tendering process and we worked in the second phase of the AMENCA program to develop with each of the four selected NGOs their detailed design work for the programs that they are supporting. So it was a collaborative exercise between AusAID and the four NGOs.


Senator ABETZ: What are the safeguards in place that prevent AusAID funding being used by APHEDA or any of the others in a manner that contravenes Australian government policy on Israel? Let us just pluck an example out of the air like BDS—Boycott, Divestment and Sanctions.


Ms Walker: We have no information that any of the NGOs we are supporting through this program are involved with that program. We regularly review the activities of the AMENCA program. We have a contracted monitoring and evaluation specialist who assists us in this task. Our AusAID officer in Ramallah and AusAID staff from Canberra regularly conduct reviews of all of the AMENCA activities. And of course we seek the normal reporting from each of the NGOs.


Mr P Baxter: And I note that those organisations have gone through our accreditation process that I mentioned in an earlier answer.


Senator ABETZ: You have already confirmed, as I understand it, that AusAID is aware that APHEDA funds the Ma’an Development Center.


Ms Walker: The Ma’an Development Center is APHEDA’s main partner organisation; that is right.


Senator ABETZ: It is heavily involved in the BDS campaign, is it not?


Ms Walker: I am not able to confirm that. I would have to take that on notice.


Senator ABETZ: Please do, because it is a matter of great concern, at least to me, that that suggestion has been made. From what you were saying, Ms Walker, I understand that money AusAID provides to APHEDA does go to the Ma’an Development Center. I think we have established that as being agreed. Is that correct—that is the money trail: from AusAID to APHEDA by—


Ms Walker: The Ma’an Development Center is APHEDA’s main partner but not its only partner in implementing the program that we have agreed with APHEDA under the AMENCA program.


Senator ABETZ: But I trust it would be a matter of concern if AusAID became aware that the Ma’an Development Center was heavily involved in the BDS campaign. Would it not?


Mr P Baxter: The issue that you have raised with us is whether funding that we provide to APHEDA is then passed on to the Ma’an Development Center.


Senator ABETZ: Yes, and I think we are agreed on that, from what Ms Walker’s evidence has been. The only issue then is whether the Ma’an Development Center is involved with the BDS campaign. My information is that it is, and is so heavily. I cannot vouch for that but that is what I have been informed. So I invite AusAID to check that out very carefully and come back to me and the committee on notice because, as you might imagine, that is a matter of some substantial concern. According to APHEDA’s annual reports all of APHEDA’s funds for Middle East projects originate from AusAID. Would the money that APHEDA gets be allowed to be used for a ‘study tour’ of individuals from Australia to go over to have a look at how things are progressing?


Ms Walker: Senator, no AusAID funds are contributed to the BDS campaign. I believe that we have provided that information to you in relation to an earlier question on notice. And I understand that no AusAID funds are contributed to visiting union delegations.


Senator ABETZ: Can you check that for me on notice? Also, whilst I know what may have been said in the past, I would not mind having it absolutely checked out to ensure that the Ma’an Development Center is not involved in supporting the BDS campaign. On their website the Ma’an Development Center published a guide to grassroots and international BDS campaigns in 2009. That is the information I have been provided. It appears that Australian taxpayers’ money, via the money trail that we have agreed upon, unfortunately ends up with the Ma’an Development Center courtesy of the trade union movement. There was a recent Senate motion about this listing a whole host of Australian trade unions that support this offensive campaign. The ACTU has the APHEDA program and it is quite clear that the ACTU and APHEDA have no difficulty with the BDS campaign. It would appear that the Ma’an Development Center has on its website a guide to grassroots and international BDS campaigns, and that is why I have asked this bracket of questions—to express great concern about that and to ensure that AusAID is very vigilant to ensure that the money is withdrawn in the event that that assertion is correct.


Mr P Baxter: We have undertaken to again look at those details that you have raised with us and that, as Ms Walker has said, we have provided information on in the past. We will have a look at it on notice and come back to you.


Senator ABETZ: I am indebted to you for that. If I have a follow-up question I will either come back to it or simply put it on notice. Thank you very much.


Senator ABETZ: Thank you. Can you confirm that the funding to APHEDA of $6 million or something like that is doled out on an annual basis?


Mr P Baxter: I will ask Ms Walker to answer that.


Senator ABETZ: Then I have a follow-up question on that.


Senator KROGER: You said there was only one!


Senator ABETZ: The Senate always allows supplementary questions.


Ms Walker: My understanding is that the funding for the APHEDA and the other NGOs that are part of this program is provided on an annual basis.


Senator ABETZ: Can you possibly take this notice: if it is established that APHEDA’s official position is to support the BDS campaign, would AusAID reconsider its funding of APHEDA?


Senator Conroy: Can I add some information for you. I think we had a response to a question on notice. I do not have the number, but this is what it said: no AusAID or other Australian official development and assistance funds are provided to any groups for the Boycott, Divestment and Sanctions campaign. AusAID is aware of the Ma’an Development Centre. AusAID does not directly fund the Ma’an Development Centre; however, under the Australian Middle East NGO Cooperation Agreement, AusAID provides funding to Union Aid Abroad-APHEDA to undertake development activities in Gaza and the West Bank. Ma’an Development Centre works in partnership with Union Aid Abroad-APHEDA to undertake these activities. The Australian NGOs funded by AusAID to undertake work in the Palestinian territories have confirmed that no AusAID funds are being used to support the BDS campaign, nor are they involved in the campaign. We are hoping that settles your mind on some of the issues.


Senator ABETZ: That basically confirms what Ms Walker had told us, other than the fact that Ma’an Development Centre has on its website the campaign basis for a local and global pro-BDS campaign. That is new information, and AusAID has kindly agreed to go away and investigate that and come back with an answer on notice. In relation to APHEDA, if it could be established that APHEDA itself is supporting the BDS campaign, would that mean that funding to APHEDA would stop?


Mr P Baxter: It would be a decision for the minister to make if there were information that caused us to question the way in which Australian aid funds were being used.


Senator ABETZ: I thought there was a government ruling or principle or whatever it is called that no aid would be given to an organisation that supports the BDS campaign.


Mr P Baxter: That may be so, but it would still be the minister’s decision, not AusAID’s decision. You asked if AusAID would cut funding. I am just saying that this is a decision for the minister to make.


Senator ABETZ: Thank you for that, because I had been under the misapprehension that, given the government policy, AusAID would be duty-bound to cut funding if this were to become known. But, if it were to become known, it would then go to the minister for the minister to make that decision?


Mr P Baxter: That is right.


Senator ABETZ: Thank you for that. I look forward to the answers that will be provided on notice.

Link to full Hansard transcript (Foreign Affairs and Trade Portfolio, 2 June 2011).