Bob McMullan MP - International Development Assistance

Improving poor people's access to financial services

Wed, 10 Mar 2010 07:33:48 +0000

A new strategy launched today will help poor people improve their way of life through increased access to crucial financial services, increasingly being seen as important to reducing poverty and achieving the Millennium Development Goals.

The Australian Government's Financial Services for the Poor: A strategy for the Australian aid program 2010-15 was launched today by Parliamentary Secretary for International Development Assistance, Mr Bob McMullan.

'As many as 2.7 billion adults in developing countries, or almost three-quarters of the adult population, still do not have access to financial services, such as savings, credit, payment services and insurance,' Mr McMullan said.

'Their inability to borrow or save money safely makes finding a way out of poverty more difficult and makes them more vulnerable when adversity hits.

'Financial services give poor people, especially women, opportunities to set up small businesses, insure against crop losses and save in case of illness or disaster. This has the potential to transform their lives.'

The Australian aid program has been spending an average of $10 million a year since 2004 to improve poor people's access to financial services and this will increase to up to $20 million a year by 2012-13.

Australia will assist formal and informal financial institutions to offer quality, affordable and fair financial services to the poor, including through microfinance and new technologies such as mobile phone banking.

Financial literacy programs will help clients understand the available services and make informed decisions so they can take advantage of financial opportunities and plan for the future.

Governments will be assisted to create a policy and regulatory environment that helps expand financial services while protecting consumers.

The Financial Services for the Poor: A strategy for the Australian aid program 2010-15 can be accessed at www.ausaid.gov.au.

Speech - McMullan - The Power of Small - 10 March 2010

Wed, 10 Mar 2010 07:32:44 +0000

(Check Against Delivery)
Acknowledgements

Thank you all for coming tonight to this discussion on ‘the power of small’.

I would like to extend a special welcome to Professor Muhammad Yunus.

Professor Yunus is in Australia at the invitation of Business for Millennium Development – an organisation that encourages the business sector to reduce poverty while doing business with the emerging markets of Asia and the Pacific.

Thank you for making time to come to Canberra.

In a moment I will hand over to Professor Yunus.

But first I’d like to set the scene for this discussion and then to launch the Australian aid program’s new ‘financial services for the poor’ strategy.

Over the past twenty years poverty levels in the Asia Pacific region have fallen dramatically.

In 1990 almost half the people in the region lived in extreme poverty.

Now it’s one-quarter – some 950 million people. This is still is a huge number, but a big drop nonetheless.

There are many reasons for the reduction but economic growth and a strong private sector have been critical.
Business creates employment and stimulates economic growth.

But in order to set up a business, you need access to basic financial services.

At present, about 2.7 billion adults in developing countries don’t have this access.

If they are subsistence farmers who sell surplus produce for a bit of extra cash, they don’t have the assets that banks require to lend them money.

Women are often not given loans because of rules and regulations that discriminate against them on gender grounds.

People with disability find it hard to get anything at all.

Business can directly target the poor in different ways.

It can do it through philanthropy or corporate social responsibility.

Alternatively there is ‘inclusive business’ where the aim is to generate profits and to deliver socially beneficial outcomes.

In this model, steps are taken to deliberately include poor people in the business cycle as employees, suppliers or distributors and as consumers.

Another way in which business can reduce poverty is through what is called ‘social business’.

These are businesses that have social outcomes as their main goal, not profit.

This is what you have come to hear Professor Yunus talk about so I won’t say any more about this.

The fact is that we need to engineer opportunities for those who are economically underprivileged.

One of the ways Australia is doing this it to help poor people in developing countries access financial services.

Through these services, poor people can set up small businesses, insure against crop losses and save in case of illness and disaster.

I am pleased to announce that by 2012-13 Australia will double our spending on financial services.

Our approach is outlined in the new Financial Services for the Poor Strategy, which I have the pleasure of launching right this evening.

The aid program will be working with financial institutions to offer quality, affordable and fair financial services to the poor.

We will be helping governments to create enabling policies and regulatory environments to support the changes needed to serve the interests of poor people.

And we will be providing funding for financial literacy programs to help clients understand their finances so that they can make informed decisions for their future.

This assistance will give people access to opportunities to transform their lives.

Today’s technology makes many things possible. Mobile phones and branchless banking give people in even the most remote areas access to financial services.

In the Pacific for example, Australia is working with a bank in Vanuatu to establish a satellite communications network powered by renewable energy that will bring rural branches online and provide full services to their communities.

Business in general has been a latecomer in efforts to meet the Millennium Development Goals by 2015.

Yet there is plenty that businesses can do to reduce poverty.

Professor Mohammad Yunus knows better than anyone the power of financial services for poor people and the impact business can have on reducing poverty.

Professor Yunus is a Nobel Peace Prize Laureate and is known as a banker to the poor.

In the early 1980s against the advice of just about everyone, he set up Grameen- a bank which gives small loans to the poorest of the poor in Bangladesh.

The bank has a fundamental principle which is that credit is a basic human right and not the privilege of a few.

Grameen now provides micro-loans to more than two million families in Bangladesh.

Most of the loans are taken out by women and repayment rates are very high.

Professor Yunus is now also a strong advocate of ‘social business’.

Social business is cause-driven and its purpose is to achieve a social objective, rather than make personal profit.

Professor Yunus presents a compelling argument for social business as a viable poverty reduction tool.

Please welcome Professor Muhammad Yunus.

ends

$10 million to boost agribusiness in the Pacific

Wed, 10 Mar 2010 00:52:43 +0000

Australia will provide $10 million over four years to improve marketing opportunities and boost agribusiness in the Pacific.

The Pacific Agribusiness Research and Development Initiative (PARDI) provides a platform for stronger economic growth of Pacific island countries. The initiative aims to substantially improve the livelihoods of smallholder farmers in Solomon Islands, Vanuatu and Fiji, with expansion into Tonga, Samoa and Kiribati.

Parliamentary Secretary for International Development Assistance, Bob McMullan made this announcement today at the Pacific Conference on the Human Face of the Global Economic Crisis being held in Vanuatu.

'The Pacific faces a number of challenges if it is to meet the Millennium Development Goals, particularly given the impacts of the global food crisis and more recent recession,' Mr McMullan said.

'This initiative makes it easier for farmers in the Pacific to get their products to markets. It enables them to be competitive players in the region, whilst ensuring their businesses are sustainable,' Mr McMullan said.

'The initiative incorporates commodity, supply chain, marketing and capacity-building initiatives to give farmers the skills and knowledge to enable Pacific agribusinesses to grow.'

The Australian Centre for International Agricultural Research (ACIAR) initiative will be delivered through a partnership of Australian and Pacific island agencies including the Secretariat of the Pacific Community, the University of the South Pacific, national agricultural, forestry and marine departments in each country and National Agricultural Research Systems. Australian partners are the University of Queensland, Department of Employment, Economic Development and Innovation (Queensland), the University of Adelaide, University of the Sunshine Coast, James Cook University and Rural Solutions, SA.

Part of the Australian Government's international development assistance program, ACIAR helps identify problems and opportunities in developing countries, and commissions collaborative agricultural research between Australian and developing country researchers in fields where Australia has a special research competence. Visit www.aciar.gov.au

FIRST SHIPMENT OF EMERGENCY ASSISTANCE TO CHILE

Fri, 05 Mar 2010 00:49:43 +0000

Australia is sending an initial shipment of emergency supplies to Santiago de Chile, on the next LAC Chile flight out of Sydney, currently scheduled for Saturday 6 March 2010.

The emergency supplies include 50 generators, 150 family tents and 1,060 collapsible field beds, all requested by the Government of Chile.

The supplies will arrive in Santiago and then be transported to the worst-affected areas around the city of Concepcion to provide temporary housing and power.

On 2 March 2010 the Foreign Minister, Stephen Smith announced an initial contribution of $1 million in emergency assistance and a further $4 million in reconstruction assistance to Chile after the devastating 8.8 magnitude earthquake struck on 27 February 2010.

The most recent situation reports indicate at least 2 million people affected, 500,000 homes destroyed and 802 deaths, with this figure still expected to rise.

Australia has also offered a team of structural engineers to support the Chilean Government to carry out damage assessments on public buildings and infrastructure affected by the earthquake, if required.

The priority at this stage is emergency assistance. We will continue to coordinate our efforts with the Chilean authorities, the United Nations and other Latin American countries.

Transcript of interview with Peta Donald – ABC - 23 February 2010

Tue, 23 Feb 2010 03:58:06 +0000

PROOF ONLY

Subject: Australian support for the Global Fund, PNG’s application for Global Fund support, aid to Africa, Pacific Seasonal Worker’s Program

Donald: Mr McMullan, will Australia increase its contribution to the Global Fund in the next round?

McMullan: Well it still is a budget matter, there’s still a bit of discussion but we’re very positive about the role of the Global Fund and I told Professor Kazatchkine that he can rely on Australia as a strong supporter of the fund in the future.

Donald: So it is good enough for Australia to remain as the number sixteen donor or do you think Australia should do better?

McMullan: Well you’d expect him to say that wouldn’t you, and we will be strong supporters. We think the Global Fund is important, we want to see some reforms, but the Professor is in the process of implementing those and we expect to continue to be strong supporters of the Fund. It does important work globally and in our region.

Donald: How much more would you like Australia to be able to contribute, obviously you’ve got this commitment to increase our aid budget...

McMullan:...Even in a rapidly increasing aid environment, and that is where Australia is at the moment, you’ve still got to make choices. Every extra dollar we give to the global fund is a dollar we can’t give to some other important project. So it’s a hard balance to strike but we will do more there, it is an important organisation and we will stay active on its board and as a contributor.

Donald: [Professor Kazatchkine] had some things to say about aids in PNG. Obviously PNG’s application failed to be Global Fund last time around, the Global Fund wasn’t convinced it had the systems and the abilities to put a good program in place, what is Australia going to do to make sure PNG is more successful next time around?

McMullan: What we don’t want is to see the Global Fund reduce the rigor with which it scrutinises applications, even though it causes some difficulty in PNG it’s a good thing because it lifts the standard of what the systems and programs are like. So we are working with the Global Fund and the Government of PNG to lift the standard of their application, what is called a Round Eleven application, and the principle responsibility is with the Government of PNG, they are putting more resources in and we’re helping.

Donald: So AusAID has got officers there helping on the financials?

McMullan: Well the Australian Government has got some advisors, but it’s being led by the Government of PNG and they’re putting more resources in which is good. We’re pretty optimistic and you should know that we’ve already got that there will be what’s called a ‘Continuity of Service’ operation so people won’t lose their treatment but we need it to grow. That will need a new agreement and that’s where we are providing some assistance to the Government of PNG now.

Donald: So how confident are you that their application will be successful next time around.

McMullan: Well optimistic. We support the Fund being rigorous and not supporting applications that can’t guarantee to deliver value for money. We think we can get sufficient support for the Government of PNG with its leadership to deliver a value for money proposition but we haven’t got there yet.

Donald: On another issue, Australia has almost doubled its aid to Africa since Labor came to office, is this because Australia wants a seat on the UNSC.

McMullan: Absolutely not. I was involved in the first discussion with Kevin Rudd, when he was Shadow Minister for Foreign Affairs, about how we would increase our aid to Africa long before anybody was talking about a UNSC bid. It’s because if you care about the MDGs, if you care about global poverty, if you care about people who don’t have enough to eat, you have to focus on Africa. And we won’t ever be a big player in Africa but we have an interest and a responsibility to be more actively engaged, we will go on increasing our aid to Africa up to and beyond any decision about whether we get elected to the UNSC. This will not stop in 2012, we have a commitment to continue to increase this support.

Donald: But is there a risk that Australia is spreading itself too thin by giving a little bit to Africa, a little bit here and there?

McMullan: We have to be careful about the effective management of it but my view is no, we’re not spreading ourselves too thin. We will be predominately an Asia-Pacific contributor, this is our strength, but we’ll try and work cooperatively. For example the big water initiative we are taking we’re doing jointly with the African Development Bank and the World Bank. The initiatives we are taking about food there we are doing cooperatively with some of the big international agricultural research agencies. We are working with already established efficient donors and we think we can do it efficiently and effectively as long as we don’t try and grow it too quickly.

Donald: It is multilateral aid in a way, it’s not bilateral?

McMullan: Well, for example, on a water project in Malawi we’re talking directly with the Government of Malawi but it is a triangular relationship with us, the Goverment of Malawi and the African Development Bank, and so far it is working in the interests of all three.

Donald: Just finally with the Pacific Workers Scheme, where is it at? There’s been some talk of PNG considering an MOU for 650 workers, are they coming or what’s happening?

McMullan: Two things are happening. One is the second round of workers have started to come in for this picking year, and the best thing is we’re starting to see some repeat workers, 20 workers from Tonga who came picking almonds in Robinvale have been invited back again by the same employer to do the same job, which is exactly what we want. The trial is starting to pick up a bit of momentum. We’ve always said from day one that PNG would be part of it and some of the potential is set aside for PNG, but they don’t have a background of sending workers like this and so we are having to do a bit more bureaucratic work to building it up. But we do expect in the course of this year or next workers to start coming from PNG.

-ends-

Transcript of interview with Peta Donald – ABC - Subject: Australian support for the Global Fund, PNG’s application for G

Tue, 23 Feb 2010 00:50:32 +0000