World's poorest should not be sacrificed in Budget 2021

Posted on Friday, 17 July 2020

Though Ireland faces a number of significant challenges, it is important to remember that hundreds of millions of people in much poorer countries face a far worse situation.

Budget 2020 allocated €837m in overseas aid. At the time, Social Justice Ireland estimated that this would bring Ireland’s ODA allocation to 0.41 per cent of projected GNI* in 2020. However, the Covid-19 lockdown  and the resultant economic contraction means that GNI* for 2020, while difficult to project, is certain to fall. This means that ODA for 2020 will be a much higher proportion of national income.

The United Nations-agreed target is for developed countries like Ireland to provide 0.7 per cent of national income in development aid.

Since 2008, when Ireland’s ODA reached a peak of 0.59 per cent of GNP, expenditure as a proportion of national income (regardless of how that is measured) has decreased significantly. This limits the resources available for tackling extreme poverty, hunger, and human rights abuses. This funding is needed now more than ever, as developing countries attempt to get to grips with Covid-19 and the resultant economic disruption. This crisis will expose afresh the depth of the inequalities within and between countries.

Budget 2021 should at least maintain the nominal financial amount of overseas aid, and - given the inevitable fall in GNI* - could even be used as an opportunity to make inroads on Ireland's UN target.

Social Jusice Ireland also supports calls for the permanent cancellation of all external debt payments due from developing countries in 2020, with no penalties, and the provision of additional emergency finance that does not create more debt. Currently, more than 60 countries spend more on debt financing than they do on healthcare. Debt cancellation is the quickest way to make funds available to tackle Covid-19 in the developinig world.

Government should also make a commitment to increase the aid budget over the following four years to reach 0.7 per cent of GNI* by 2025.