Context of the peer review of Australia

Political and economic context

The current government of Australia is composed of the Liberal-National Coalition, a centre-right party alliance. The current prime minister is Malcom Turnbull of the Liberal Party, who took office in September 2015. Mr Turnbull replaced Tony Abbott, the former leader of the Liberal Party. The Liberal-National Coalition has been in power since 2013, when it replaced the Australian Labor Party led by Kevin Rudd. The next federal election will be held between August 2018 and May 2019.

Australia is a prosperous country with 26 years of uninterrupted economic growth. Projected GDP growth for 2018 is 2.8% (OECD, 2017c), above the OECD average of 2.1%. GDP per capita is also well above the OECD average; average household income per capita and average earnings are among the highest in the OECD (OECD, 2016). Living standards and well-being are also high. However, socio-economic gaps for Australia’s indigenous community and gender gaps persist.

Public debt and public spending in Australia remain below the OECD average (OECD, 2017a).1 Fiscal deficits have been declining in recent years and the current government has a target of reaching a budget surplus of 0.4% of GDP by 2020/21. Government expenditure of 37.2% of GDP is below the OECD average of 40.9% of GDP (OECD, 2017b).

Challenges include high greenhouse gas emissions and an ageing population (OECD, 2017a). Following a long commodity boom, recent fluctuations in commodity prices have slowed recent Australian growth. Price fluctuations have affected the mining sector in particular, long an engine of Australia’s economic growth (OECD, 2017a: 2).

The population of Australia is 24.5 million people, of whom 28.5% were born overseas in nearly 200 different countries. Almost half of the people living in Australia today are either migrants or children of migrants.2

Development co-operation system

In 2013, a restructure of government departments and agencies led to the integration of the Australian Agency for International Development (AusAID) into the Department of Foreign Affairs and Trade (DFAT) with the aim of more closely aligning “the aid and diplomatic arms of Australia’s international policy agenda” (DPMC, 2013). A new policy framework for Australian aid was introduced in 2014.

The last OECD DAC peer review of Australia was conducted in 2013, prior to the integration. Australia’s official development assistance (ODA) has steadily decreased since the last review and is now heavily concentrated (93.7% for 2015/16) with DFAT.

The parliamentary Joint Committee on Foreign Affairs, Defence and Trade established a Foreign Affairs and Aid Subcommittee for additional accountability towards Parliament. The review team was not able to meet with the Subcommittee during the mission to Canberra.

Sources:

Australian Government (n.d.), “How Government Works” (website), www.australia.gov.au/about-government/how-government-works (accessed 19 October 2017).

DPMC (2013), “The Coalition will restore strong, stable and accountable government”, statement of Prime Minister Tony Abbott, 18 Sept. 2013, Department of the Prime Minister and Cabinet of Australia, www.scribd.com/document/169037461/13-09-18-The-Coalition-will-restore-strong-stable-and-accountable-government-pdf.

OECD (2017a), “Australia: March 2017 overview”, OECD Economic Surveys, OECD Publishing, Paris, www.oecd.org/eco/surveys/Australia-2017-OECD-economic-survey-overview.pdf.

OECD (2017b), “Australia: Country Fact Sheet”, Government at a Glance 2017 series, OECD Publishing, Paris , www.oecd.org/gov/oecd-gov-at-a-glance-2017-australia.pdf.

OECD (2017c) OECD Economic Outlook, Volume 2017 Issue 2: Preliminary version, OECD Publishing, Paris. http://dx.doi.org/10.1787/eco_outlook-v2017-2-en,

OECD (2016), “How’s life in Australia?”, OECD Better Life Initiative, OECD Publishing, Paris, www.oecd.org/australia/Better-Life-Initiative-country-note-Australia.pdf.

Notes

← 1. In 2015, the Australian government’s gross debt was 43.6% of GDP, compared to the OECD average of 112% of GDP.

← 2. See IOM website at www.iom.int/countries/australia (accessed on 18 November 2017).