Tuesday, May 25, 2010

AusAID fat-cats

Millions wasted on ‘briefcase’ advisers


AUSTRALIA’S foreign aid programme, which also includes Papua New Guinea, is under siege after revelations that tens of millions of dollars are being wasted on huge salaries for consultants and rich contracts for private firms, Australian newspapers reported yesterday, The National reports.

An extensive investigation by the newspapers had uncovered what they termed “a lucrative foreign aid industry” and raising questions about the Australian government’s decision to double funding to more than A$8 billion (K18.69 billion) a year.

The damning publications come on a day when the high-level review of the Australia-PNG Development Cooperation Treaty was publicly released in Canberra, slamming the A$414 million (K967.5 million) programme, claiming that A$100 million (K233.6 million) was being paid to a handful of firms – but delivering little.

The latest developments confirms Foreign Affairs Minister Sam Abal’s worst fears expressed early this year when he called for an overhaul of  the annual aid to PNG, saying he believed too much money was wasted on costly consultants.

Yesterday, the newspapers – The Courier-Mail, Daily Telegraph, The Adelaide Advertiser and The Herald Sun – reported that aid experts were questioning the size of contracts paid to “briefcase” advisers who fly into poor countries, including PNG, Timor-Leste, Vanuatu, the Solomon Islands and Tonga.

The newspapers’ investigation reveal:

  • Just five firms – led by Coffey, GRM and Cardno ACIL – secured A$1 billion (K2.46 billion) in AusAID contracts;
  • More than a dozen aid consultants earn more than prime minister Kevin Rudd and fly around the Pacific advising on everything from “gender integration” to sport, transport, energy and justice;
  • Millions of dollars are being diverted to questionable aid programmes, including A$12 million (K30.38 million) to research the giant panda in China and A$13 million to redevelop a single school in Nauru;
  • nAusAID, the agency in charge of foreign aid, is investigating a small number of cases of fraud and is about to undergo significant restructuring; and
  • Millions are being spent by the AFL, girl guides, ACTU and other community groups on “selling” a pro-aid message to the public.

The newspapers named one highly-paid consultant in PNG as John Dinsdale, a former clerk of a court in Melbourne.

He is paid more than A$500,000 a year, tax-free, as PNG law and justice adviser.

Executive Gerald Gahima, a former justice in his native Rwanda, is no stranger to controversy. In February 2004, he suddenly left Rwanda amid questions about personal debts of US$S600, 000.

The US state department cited allegations of misuse of office in personal bank transactions against Gahima. Four years later, in February 2008, he was made “senior justice adviser” to Timor-Leste on a two-year A$757,960 tax-free contract, paid by Australian taxpayers.

Nikhil Desai, whose glamour address is listed as 6850 Melrose Drive, Los Angeles, was appointed as Vanuatu energy adviser on a two-year contract valued at A$746,730.

Around the Pacific Rim, questions are being asked as to why consultants, such as Peter Kelly, who is paid A$433,000 a year to supervise Vanuatu’s small road system, are paid so much. Partly it is because Australia has signed up to the so-called millennium development goals, which includes a commitment to gender equalisation.

That explained why Susan Ferguson earns A$293,423 tax-free a year as “gender integration adviser” to PNG, the newspapers said.

“The review into the flagship PNG programme is particularly embarrassing – and raises serious questions over the value of pumping billions of dollars into fragile states.

“The former Howard government tightened aid to PNG in 2005 after it received secret intelligence of scams involving senior members of the then PNG administration.”

They reported that AusAID will pour A$415 million into PNG next year but the review –  conducted by three independent experts Stephen Howes, from the Australian National University, Dr Eric Kwa from the University of PNG and Canadian Soe Lin – is scathing of the present scheme.

 They found tens of millions of dollars was “wasted” on consultants and glossy reports. Money also props up bureaucracies instead of buying life saving medicines and equipment.

The review team found Australia’s financial support was “being spread too thinly” across a raft of areas – including health, education, transport, law and justice and tackling HIV/AIDS.

The review has criticised the amounts being spent on highly-paid advisers and called for a shake-up in how the PNG scheme is managed. It did identify some positive outcomes – particularly in health programmes run by churches and other non-governmental organisations.

It wants a stronger focus on this sort of programme – and, yesterday, Australian foreign minister Stephen Smith backed changes in the aid programme when he announced the public release of the treaty review in Canberra.

“Advisers have been a feature of Australian aid over many years and, while we do not intend to pre-judge the outcome of the (PNG) review, it may be that there is an over-reliance on advisers in some countries,” Smith’s spokesperson said.

In a media statement, the minister said: “Under the Rudd government, the proportion of foreign aid spent on technical assistance is already significantly lower than it has been previously.

“During the Howard government, average spending on technical assistance was 41.8% of the foreign aid budget. It peaked at 47.4% in 2004.

“During the Rudd government, average spending on technical assistance has been 34.5%.”




  1. Anonymous12:07 PM

    The overhaul and investigations should be extended to other developing countries.

  2. Anonymous3:44 PM

    the best advisors are the people themselves, stop using these poor people for your own gains.

  3. Anonymous3:50 PM

    if we are truly serious to help the poor we will involve them right from the start for example, support refugees in Australia to play significant role in our oversea aid. Better than all of us and our expert advisors they know who, where and what development are needed most given that they are from there and have had the experience. Stop fooling around!!!!