Australian aid cuts will cost lives: charities

Australia's plan to scale back foreign aid growth to help produce a budget surplus was criticised by charity groups Wednesday, with World Vision saying it could cost up to 200,000 lives.

Overseas aid was a big loser in the budget handed down Tuesday with the government highlighting Aus$2.9 billion (US$2.92 billion) in savings through the pushing back of development targets.

The ruling Labor party now plans to increase the aid budget to 0.5 percent of gross national income, from the current 0.35 percent, by 2016-17, one year later than promised.

"Funding for official development assistance will continue to grow each year. It will, however, grow at a slightly slower rate so that 0.5 percent of gross national income is reached in 2016-17," Foreign Minister Bob Carr said.

Aid groups said they were bitterly disappointed at the decision.

"(By) breaking this bipartisan promise, by pushing this out (and) saving $2.9 billion, we estimate this is going to cost up to 200,000 lives," World Vision Australia chief Tim Costello told ABC radio.

"When you are trying to live on $1.20 a day without clean water and food, this costs your life.

"For it to be pushed out, how can Australia that escaped the global financial crisis justify this? That will be the question in international ranks," he added.

In his budget, Treasurer Wayne Swan unveiled plans for a Aus$1.5 billion budget surplus, vowing to find Aus$33.6 billion in savings to meet the target for the 2012-13 fiscal year starting July 1.

In doing so, Australia will become the first major developed economy to balance its books since the global economic crisis.

Prime Minister Julia Gillard denied Australia was one of the lowest contributors of foreign aid in the Organisation for Economic Cooperation and Development despite surviving the global meltdown without going into recession.

"That is not the case. We are number 10 in the OECD, on our way to number six in the OECD," she said.

"Our economy is strong in its fundamentals, but there are certainly pressures on, and the government is not getting the same amount of revenue as it has in the past," she added in defence of the cuts.

Save the Children Australia said it was shocked that the government had targeted foreign aid, backing Costello's claim that people would die.

"The decision to delay aid in favour of a budget surplus will have dire consequences for many children in our neighbouring countries," Save the Children's policy adviser Nicole Cardinal said.

Around 70 percent of Australia's foreign aid is spent in the Asia-Pacific region.

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