Aid to the rich - Currents - Brief Article

New Internationalist, July, 2002 by Clare Doube

Worth $3.3 billion, Australia's richest man, Kerry Packer does not fit the picture of a person in need of aid. But while the public's attention is on the high-profile media group Publishing & Broadcasting Limited, controlled by the Packers, another of their companies - GRM International -- manages aid projects funded by the Australian Government and the Asian Development Bank.

Like most companies delivering aid, GRM's main expertise is management. Such companies hove only minimal expertise in the services they are contracted to deliver: in GRM's case this includes education, health and public-sector reform. An example is a $16-million Australian-funded project to improve English, science and moths teaching in the Philippines.

Not only does GRM manage these projects but, like all private companies in the aid sector, it also profits from them. According to Aidwatch, a non-profit organization monitoring aid, almost all Australian aid is administered in this way, with only five per cent handled by Australian NGOs.

As Australian aid is tied (donated on the condition that goads and services come from the donor country), 80 per cent of official aid is spent on Australian goods and services. This assists companies such as Packer's, as well as those working on the projects -- consultants routinely command tax-free salaries over $55,000, with short-termers receiving up to $810 per day.

This policy is mirrored by other donors such as Canada and the US, despite the concern that it increases procurement costs to the South by between 15 and 30 per cent. Eyes are now turned to Britain, which untied its own aid in April 2001

More information:

Aidwatch: www.aidwatch.org.au GRM International: www.grm.com.au