Speech to PNG Australia Alumni Conference
23 November 2006; Port Moresby, PNG
AusAID Minister Counsellor, Margaret Thomas
Introduction
Good morning ladies and gentlemen. As both the Governor General and High Commissioner have said, this conference is an excellent initiative with its focus on building networks and supporting Alumni. Scholarships demonstrate the importance of building closer links between Papua New Guineans and Australians and the conference provides Alumni with the opportunity to strengthen person to person links.
I welcome the opportunity to speak today on Engagement and Impact: AusAID’s in-country program response to GoPNG priorities.
I will be focusing on the development partnership that exists between PNG and Australia - the single largest donor contribution to PNG’s development. Australia takes its role as major donor in PNG very seriously and coordinates closely with the PNG Government and other development partners to maintain a well-informed, comprehensive and robust dialogue with PNG on development challenges and policy directions.
A key element of any partnership is the personal relationships that underpin it. The person to person links developed through the scholarships program play an important role in developing these links.
This conference had brought together past and future scholarship holders from all over PNG. As both the Governor General and the Australian High Commissioner have touched on, scholarships provide a real and lasting benefit to the scholarship holders themselves. Scholarships also benefit the relationship between Australia and PNG through the personal and institutional relationships developed and provide ongoing benefits to PNG’s development.
This year, 130 Australian Development scholarships were offered and as the High Commissioner mentioned, many of these recipients are here today.
As the High Commissioner has already mentioned, a major new initiative in 2006 is the introduction of Australian Leadership Awards. The ALA scholarships will support the development of future leaders in the Asia Pacific region to help influence reform and promote development in their own countries and the region by offering educational awards for postgraduate study at Australian universities at PhD and Masters Degree levels. This year 14 awards were offered in PNG for a range of courses including business administration, law, public administration and environmental management.
PNG is responsible for its own development
I would like to now set the scene for how this partnership approach fits with the big picture of the aid program. Australia makes a significant contribution to PNG’s resources for development. However, PNG is ultimately responsible for its own development outcomes. The goals and strategies for development must be defined by PNG, albeit in consultation with all stakeholders. Policy decisions and the programs to implement them must be delivered by the Government of PNG - the elected representatives of the people and the bureaucracy that serves them.
Aid funds have much greater impact when used to support existing government strategies and programs.
Although the Australian aid program is a lot of money, it is not sufficient to meet all of PNG’s development needs. PNG’s own resources need to be harnessed to support development priorities. Similarly, PNG’s Development Budget, which is approximately 20% of PNG’s total budget envelope, will only be effective if the remaining 80% is being used effectively to support the core functions of government, such as delivery of basic services in health, education, law and order, and infrastructure maintenance.
Of course the government must work in partnership with PNG society, be it business houses, NGOs, farmer associations, church groups or others. And also with donors.
This is a partnership in which each party is dependent on the other – we need to work together to ensure both our efforts are effective. But much more than that a partnership approach is necessary so both our efforts deliver improvements in service delivery and consequently in people’s quality of life.
Responding to PNG’s development agenda
I’d like now to talk about how Australia is planning to support PNG’s development agenda over the coming years.
The starting point for all donors must be the Medium-Term Development Strategy 2005 – 2010, which sets out PNG’s goals and strategies for economic and social advancement. The MTDS places a strong emphasis on the link between economic growth and better development outcomes. The MTDS refers to the ‘virtuous circle’ from economic growth of rising incomes leading to rising tax revenue contributing to macroeconomic stability and increased spending on the core services. This further contributes to the enabling environment for growth.
The White Paper on Australia’s Overseas Aid Program also places a strong emphasis on growth as underpinning development.
It is an important document and provides the strategic framework to guide the direction and delivery of Australia’s overseas aid program over the next ten years. The White Paper underlines Australia’s commitment to poverty reduction and sustainable development. In order to achieve this, the aid program will be organised around four themes: accelerating economic growth; fostering functioning and effective states; investing in people; and promoting regional stability and cooperation.
The jointly developed PNG-Australia Development Cooperation Strategy was developed earlier this year to guide how Australia will support PNG’s development priorities. An important part of the process of developing the Cooperation Strategy was prioritising the MTDS objectives and being selective about where Australia’s assistance could have the most impact.
The Development Cooperation Strategy guides the implementation of Australia’s aid program to PNG, in accordance with MTDS priorities, for the period 2006 – 2010. The Strategy is structured around four core, interlinked pillars: improved governance and nation-building; sustainable economic growth and productivity; improved service delivery and stability; and combating HIV.
Let me give a little bit of detail about each of those pillars while noting that the Strategy is still pending final Ministerial approval so has not yet been publicly launched.
‘Improved governance and nation-building’ highlights the contribution of both state and non-state actors to the development of a strong, dynamic, and participatory state that meets the needs and aspirations of its people.
With regard to sustainable economic growth and productivity, the MTDS and the White Paper on Australian Aid have both served to refocus development efforts on achieving gains in economic growth. The DCS emphasises the key role of government in creating the enabling environment for people to access economic opportunities and contribute to increased growth and productivity.
Our focus on improved service delivery and stability is in recognition that a number of factors cause effective service delivery to be one of the key challenges PNG faces. The PNG Government has a key responsibility in the delivery of basic services including health, education, transport and law and order. Australia will continue to support the delivery of services in accordance with the decentralisation of responsibilities under the Organic Law, and encourage innovative and efficient modes of delivery.
And finally we have put further effort and resources into assisting PNG to combat HIV/AIDS. Papua New Guinea faces a serious HIV and AIDS epidemic and has the highest incidence of HIV/AIDS in the Pacific Region. The virus is firmly established in the general population and although found mostly in urban centres, it has now reached every province and is appearing in the remote parts of PNG. Latest studies confirm that 2.0% of the population is living with HIV/AIDS – this is around 64,000 people. If current trends continue, it is expected that over half a million Papua New Guineans could be living with HIV/AIDS by 2025. From these figures, PNG is already facing a very serious epidemic which, if it continues to grow as predicted, will have a devastating impact on its communities, the economy, its social fabric and on government service delivery. HIV/AIDS is clearly having, and will continue to have, a major impact on the PNG workforce and PNG’s future development.
Australia is supporting PNG’s response through the National HIV/AIDS Council and the implementation of the National Strategic Plan, as well as assisting PNG to mainstream the response in all sectors and programs. However, it is essential that strong leaders emerge to take on a leadership role in combating this epidemic.
Our approach
Of course, it is not just what we do that is important but how we do it. The Development Cooperation Strategy also outlines key principles and ways of working to ensure that the aid program is delivered in the most effective manner possible and tailored to PNG’s own requirements, challenges and strengths.
Australia is committed to working in partnership with PNG to integrate the delivery of Australian assistance with existing PNG programs and systems.
Our work with the law and justice sector is an example where AusAID support is integrated with the budgeting and prioritisation of resources across the sector as a whole.
Working through PNG systems also means a commitment to strengthen those systems where necessary and building the capacity within PNG to plan, implement and monitor programs effectively, whether government or donor funded. Sometimes there is an expectation that the Australian aid program should deliver goods and services directly. But our focus is on supporting PNG to deliver.
I’ve already spoken about the relationship between Australia and PNG as a partnership, and the fact that partnerships require contributions from both partners to work effectively. This also means that Australian funding to these important sectors of health, education, and infrastructure cannot substitute for adequate PNG Government funding being directed to core functions and responsibilities of government.
Of course, Australia and other donors don’t just support PNG in financial terms but we, and all donors, have a strong focus on capacity-building throughout all the programs that we implement in partnership with PNG. Capacity-building is a gradual process of strengthening institutions, organisations, and the individuals within them to perform their roles and functions effectively and deliver the outcomes necessary for sustained progress.
In order to build capacity within PNG, the aid program utilises PNG people, systems and organisations in order to deliver. The participation of PNG individuals and companies in the aid program has increased substantially over time. For example, currently, in the infrastructure sector over 85% of road maintenance funding goes directly through existing GoPNG implementation agencies such as the National Department of Works and also the Technical Services Division of the Autonomous Bougainville Government. That means that Australian funds are being used to maintain PNG roads, using existing systems established and managed by the PNG Agencies responsible for maintenance.
Policy dialogue
Australia’s policy dialogue with PNG is not limited to individual sectors but encompasses a range of cross-cutting issues that have been identified, through the MTDS and the DCS as having a significant impact for PNG’s development. This includes our support to HIV/AIDS, which I have previously mentioned.
It also includes good governance which is central to Australia’s engagement with PNG. International experience tells us that the quality of governance in any nation can either enable or undermine development efforts. Good governance can mean strong, accountable democratic institutions; it can mean transparent and open public decision-making; at the institutional level it means effective public administration.
The fight against corruption is one aspect of a broader good governance agenda, but one that Australia is very committed to. Reducing corruption at all levels of government can make a significant contribution to PNG’s development.
Challenges such as reducing HIV infection rates, combating corruption, reaching rural areas with better health and education services – these are serious challenges that confront PNG. We seek to have robust discussions with PNG about these and other issues. Australia has a role in supporting PNG to find and implement innovative and appropriate solutions to address these challenges. But it is important that PNG takes the lead to respond to the challenges ahead. It is also important that Australia as a partner has a view on these issues which we communicate to PNG.
Delivering Effective Assistance
To deliver aid effectively, it is important to adopt a combination of long, medium, and short-term planning approaches. Our long-term commitment says that we are ready to support PNG for as long as it takes for reforms to take hold and become effective. This has led to a move away from short 3 year projects to 5-10 year program approaches.
We also realise that in the short-term, things can change rapidly in a dynamic context like PNG. Australia’s approach needs to be sufficiently flexible to respond to these changes, and to ensure that the support we are providing today is not targeting last year’s or last week’s problems.
Building and maintaining a strong relationship with PNG Government, which enables us to discuss and debate the issues and challenges, is an important part of achieving that flexibility.
Performance Review and Dialogue
The development process is not a straightforward or an easy one. There are no blueprints, no ‘one-size-fits-all’ solutions. Ensuring that Australia’s development assistance to PNG is effective and achieves the desired impact requires robust and ongoing analysis, dialogue, monitoring and evaluation.
How do we know if our development assistance is having an impact? And how can we encourage the Government to focus on getting the biggest bang for their development buck?
The first step is monitoring and evaluation systems across all programs, and ensuring that the lessons that emerge are fed back into programming decisions and directions.
At the higher levels, Australia and PNG have agreed to implement an annual Performance Review and Dialogue process, which focuses on measuring a small number of key indicators of progress, particularly focusing on public sector reform issues. Achievement against these indicators will trigger the release of an approximately PGK70million performance grant for this year. This performance grant will be available to Government to invest in MTDS priority areas that are performing well and would benefit from expansion.
This is an innovative approach to performance management that seeks to reward achievements based on a policy dialogue that looks at key reform processes and outcomes.
The Performance Review and Dialogue also provides PNG with an opportunity to discuss Australia’s performance as a donor. Once again, I return to the idea of a partnership – where both parties need to agree on what they will contribute to the partnership and both parties need to be able to say if the other is keeping up their end of the bargain.
Conclusion
I have talked a lot about partnerships at the level of countries and institutions, but in concluding I would also like to re-emphasise the importance of partnerships at the individual level.
Personal links between Australians and Papua New Guineans are strong and diverse. In addition to the Australian Development Scholarships and Australian Leadership Awards already mentioned, they are also forged through the Australian-funded volunteer sending programs, such as the Australian Youth Ambassadors for Development program which supports young people with energy, enthusiasm, and fresh ideas to work side-by-side with Papua New Guinean colleagues on a learning journey.
These person-to-person links are so important because they help us to develop a deeper understanding of our shared goals and aspirations, and a positive appreciation for our cultural difference.
There are many challenges ahead for PNG. Australia plays a role as a donor in supporting and enhancing the talent, enthusiasm, and energy of Papua New Guineans for addressing those challenges. It is a complex role, in a complex country and only one part of a complex and dynamic bilateral relationship. But we are committed on both sides to making it work well and to ensuring that it is serving PNG’s development needs and aspirations effectively.
END