Lowy Institute

The Foreign Minister's new consular strategy, which she wrote about here this morning, signals a harder new direction in the Government's approach to providing consular assistance to Australians in distress overseas.

The new strategy is the culmination of a year's work by the Minister and Department of Foreign Affairs and Trade, after the Minister invited submissions in December last year, (here's ours). The basic challenge for Australia's consular services, as the Minister outlined in her speech yesterday at the launch, is that the number of traveling Australians continues to increase almost exponentially – at 9 million trips last year, they've doubled over a decade and are five times the number 25 years ago.

With an increasingly anaemic budget, DFAT cannot continue to provide a gold-plated consular service at this rate of travel growth. And this is what the Minister was referring to when she said: 

I have decided to introduce the scope to limit consular assistance in some circumstances...[where] individuals have acted illegally or have deliberately or repeatedly acted recklessly and negligently and put themselves and others at risk despite warnings [or where there has been] a pattern of behaviour that has required multiple instances of consular assistance in the past.

This is a clear signal of a new and sterner approach. The Minister emphasised that consular assistance is a privilege, not a right, and that priority will be given to the most vulnerable and those in the most difficult circumstances. Assistance will be reduced to 'the absolute minimum level' if Australians 'deliberately or wilfully abuse the system'. Travelers are urged to take more responsibility for their actions, take out appropriate travel insurance, and not flout the laws of other countries.

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Importantly, the Minister left as a 'live option' the idea of introducing a cost-recovery system for consular services. The way she phrased it, an up-front consular levy (which I have proposed in the past) is off the table, but the fall-back option of recovering the cost of services – which could range from hourly charges for advice and assistance to charging for emergency evacuation from crisis zones after traveling against government travel advisories – is a distinct possibility.

Of particular relevance to DFAT's consular work is Australia's overseas diplomatic footprint. Its embassies and consulates are the front line of the consular work and bear the majority of the burden on staff and resources. In the Q&A yesterday, I asked the Minister about the status of the Government's review of its overseas network. This network is  small and overstretched, with limited or no representation in the majority of countries in the world. We have no consulate in Phuket, for instance, one of the most popular overseas destinations for Australian travelers, and in a country where the highest number of Australians die overseas every year. In response to my question, the Minister said the review had been finalised and was being considered by the Government. While the Minister has advocated for increased funding for her department and an expanded diplomatic footprint, this looks increasingly unlikely after the ominous hints in the press yesterday.

Just as well, then, that the Government has introduced a consular strategy that attempts to conserve some of the Department's scarce resources. It will need them.

Photo by Flickr user Jeremy Little.

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The $254 million in cuts to the ABC budget, outlined today by ABC Chief Executive Mark Scott after Malcolm Turnbull's statement on Wednesday, have been coming for a long time – at least since the Lewis review which proposed efficiencies to reduce the ABC's annual budget requirement.

Since then, there have been numerous rumours of the steps the ABC will take to implement the cuts, including axing or trimming Stateline and Lateline, and closing its international bureaux in New Delhi and Tokyo (with the result that no Australian media outlet would have a correspondent in Tokyo).

The Minister's statements last week yet again emphasised his view that the cuts would not require programming changes, and could be implemented by driving back room and administrative efficiencies. Mark Scott's announcement today to the ABC staff is in stark conflict with the Minister's view. As rumoured, Stateline is gone, Lateline moves to ABC24, and several regional bureaux are cut.

As for the international bureaux, they will undergo a euphemistic 'shape readjustment'. The Auckland bureau will be entirely closed and others thinned down, with 'multi-platform hubs' installed in their place. London, Washington, Beijing and Jakarta reportedly remain, with no mention yet of the fate of the Tokyo bureau. 

This is 'highly contentious', as Crikey points out today, 'as some believe it exposes journalists to greater risks in hostile environments, but is increasingly becoming the global standard as media companies cut costs'.

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According to some in the ABC, budget surgery on the scale required by the Government could not possibly have been achieved only in administrative efficiencies, so programming changes were inevitable. While the Lewis review set out five broad areas in which, in its view, those administrative efficiencies could be achieved, it did not quantify or itemise those efficiencies. Given the heavy blows inflicted on the broadcaster today by its management and board, it's hard to believe that the cuts could have been made solely by reference to the Lewis recommendations.

One available conclusion, then, is that the Minister has relied on something of a fiction to lay the responsibility and the blame squarely on the shoulders of ABC management, rather than accepting some responsibility on behalf of the Government which is mandating the cuts.

Regardless of where responsibility lies though, the reality of $50 million plus cuts per annum for the ABC — coming on top of the axing of the Australia Network and the massive restructuring of ABC International which resulted in swingeing cuts to Radio Australia and a decimation of its programming to the region – is a severe curtailing of the ABC's ability to cover international news. 

Thinner representation of journalists across international bureaux, with leaner resources, will mean more sparse news coverage, more perfunctory reporting and less analysis. This is to Australia's detriment in a century where everything is global, and where we need to be vigilant that our geographic remoteness doesn't render us geopolitically isolated.

Photo courtesy of Flickr user Sarah_Ackerman.

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The latest news from the ABC bunker is that while Lateline may survive the latest round of cuts, the bureaux in Tokyo and Delhi may be shut down.

The ABC Board met yesterday, reportedly to decide on measures to achieve efficiencies of up to $100m following the Budget and the Lewis Review, and in the wake of the Australia Network axing

Many have been shocked by ABC management's post-Budget decisions. The slashing of Asia Pacific News Centre and Radio Australia services, as Jenny Hayward-Jones outlined back in July, has resulted in the decimation of news coverage in and from the region and the exit of veteran international correspondents and journalists such as Sean Dorney, Catherine McGrath and Jim Middleton.

The Minister for Communications, Malcolm Turnbull, insists that the requisite efficiencies can be met through administrative and back-office cuts. Others are less confident and hugely concerned at ABC management tactics.  

The Minister has a deep and abiding respect for international journalism and an understanding of its importance for Australia. Below are some extracts from his speech here at the Lowy Institute in August, at the Institute's annual media awards for foreign policy journalism (you can read or listen to the full speech here):

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Only the ABC now has a substantial international presence with twenty Australian and 35 locally engaged staff overseas; a good example of what a public broadcaster should do in my view. It is, of course, much cheaper to fly in teams to cover specific stories on an on-needs basis. A study by the Media Standards Trust in the U.K. found this has become much more attractive for news organisations to cover locations when there is a specific event or crisis - such as, say, Ukraine. But this comes at the expense of a deep knowledge of the country and the contacts needed to develop stories in depth.

...

Media companies on digital platforms tend to chase two things to get clicks: cover immediate, breaking news on the one hand; and go for opinion and commentary, the more intemperate the better, on the other, to reap social media shares, likes and retweets. As I have said before, it often feels like the ‘news cycle’ has been replaced by the ‘outrage cycle’.

But there is a genre of news story that lies in the middle on these two extremes -- they are those stories which take a few days to put together, involve the skilful working of contacts and sources, and require a deep and nuanced knowledge of the subject matter. Reuters Editor-in-Chief David Schlesinger describes the new media world as enshrining the ‘dumbbell model’ of journalism -- all the weight has now shifted to the two ends of journalism, leaving not much in the middle.

And while management in media corporations might chase audiences through this 'dumbbell model', there is evidence that the audience itself values genuine foreign affairs coverage:

As one very senior journalist in Canberra’s press gallery told me: ‘There has been a huge amount of complacency, a growing lack of media interest in policy, [and] a function of that is a most conspicuous lack of interest in what other countries are doing in a policy sense, and this is reinforced by the problems of the business models of newspapers’. But interestingly, while there may be more of a focus on less weighty issues, consumers nominate foreign affairs as the most important reason for following the news.

The ABC, according to the Minister, has been the 'standout' in coverage of foreign affairs in Australia:

In recent years, The Australian has closed bureaux in Washington, New York, Los Angeles, London, Bangkok and New Zealand but still has correspondents in Jakarta, Beijing, Tokyo, Southeast Asia, Jerusalem and of course a very extensive network of correspondents to draw upon from the wider News Corp stable.

Fairfax has correspondents in Washington, London, Beijing, Delhi, the Middle East and has reinstated Lindsay Murdoch in Southeast Asia, based in Bangkok. Over the years it has pulled out from Wellington, Tokyo and New York.

The Australian Financial Review no longer has anyone in Tokyo, our second largest trading partner. The ABC is the standout in this area. It has bureaux in Washington, London, New Zealand, Jakarta, Beijing, Bangkok, Jerusalem, New Delhi, Tokyo and stringers in many other locations.

Perhaps no more. If the bureaux in Tokyo and Delhi are closed, there go two of the last remaining sources of first-hand news from two of Australia's most important partners and neighbours in the region: Japan, Australia's second largest trading partner and 'best friend' in Asia, and India, a rising power and Australia's 5th largest export destination, not to mention the soon-to-be recipient of Australian uranium following the recent agreement struck by the Government.

Last year Michael Fullilove touched on this issue in arguing the case for Australian eyes on the world, saying:

The rise of Asia means Australia finds itself a lot closer to the centre of geopolitical and economic action than in the past. It is vital to the national interest, therefore, that Australians understand what is happening beyond our shores...But we cannot simply rely on the homogenised worldview of international wire services...

The big international wire services might bring us news from around the world, but they won't necessarily cover the news that's of significance to Australia, because – gasp – Australia often doesn't figure in global news. When an important source of news and information is lost, so is an important input into the foreign policy debate in Australia. And we are the losers. 

Photo courtesy of Flickr user Brian Smith.

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Later today, the 69th session of the UN General Assembly commences. One of Australian Foreign Minister Julie Bishop's first official duties last year was to address the opening of the 68th session of the General Assembly, nine days after being sworn in as minister.

Bishop had a tough start as minister. First came the Indonesian spying scandal, with angry reactions in Indonesia and pointed criticism from Indonesian President Susilo Bambang Yudhoyono. A few days later came a dressing down from China after Bishop denounced Beijing's move to unilaterally establish an air defence identification zone in late November. Ms Bishop then had to deal with breaches of Indonesian territorial waters by stray Operation Sovereign Borders vessels. There has also been the painful process of the Peter Greste case.

Then of course, the MH17 catastrophe. Ms Bishop earned the respect of her international and national peers in brokering a Security Council response to MH17.

Our Foreign Minister has been busy.

Yet amid all this noisy foreign policy action, the Minister has been quietly going about her other business. The New Colombo plan is on track. Relations with Indonesia have stabilised, with agreement reached on a code of conduct in late August. Australia is back in China's good books.

And then there is the MIKTA initiative.

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MIKTA, you ask? As I wrote at the end of last year, this is a fledgling grouping which had its modest beginnings on the sidelines of the September 2013 UN General Assembly session. The acronym represents the five nations – Mexico, Indonesia, Korea, Turkey and Australia – who are 'members' of this informal group. They seek to 'strengthen the links between their nations, exchange views, consult and promote coordination on issues of common interest.' Early indications are that these are likely to include global governance reform, G20 work and finding solutions to global challenges such as the post-2015 development agenda. They have met twice this year, and in April spent a full day together in Mexico at the first MIKTA dialogue, resulting in a co-authored opinion piece in Huffpo in which the foreign ministers emphasised their similarities: they are all democracies, members of the G20, with open and dynamic economies, strategically located and each playing strong roles in their regions.

The first indications of how these nations will work together surfaced in the early days of the MH17 response, when the ministers of the five nations issued a joint statement condemning the downing and urging the peaceful resolution of the Ukraine crisis.

In August, Mexico hosted the first MIKTA academic seminar (which I attended) to identify some of the ways in which this diverse group ('a bunch of misfits' was the expression Michael Wesley used in his remarks) might cooperate constructively. While none of these academics spoke for their governments, there was a bundle of ideas, from working collaboratively against protectionist measures to freeing up visa restrictions, creating exchanges of students and journalists, and according each other 'most favoured nation' status.

It's early days, but each of the MIKTA foreign ministers appears enthusiastic about the possibilities of the new grouping. None of the five are part of a natural regional or security bloc, so their thinking is presumably that the grouping can achieve more together than each can achieve alone – the whole being greater than the sum of the parts. And while the parts are significant, the whole is potentially formidable. MIKTA nations are the world's 12th, 14th, 15th, 16th and 17th largest economies. Combined at US$5.8 trillion in GDP, they amount to the third-largest economy in the world after the US and China. Taken together, their populations rank the group as the third-largest in the world after China and India. If they can harness their collective strengths, this could be a useful grouping.

At the opening of the 69th session of the General Assembly, Ms Bishop will again meet with her MIKTA counterparts to progress their agenda. Watch this space. 

Photo courtesy of the Minister for Foreign Affairs.

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Almost a year since the Coalition took the reins of government and introduced its policy of 'economic diplomacy', a term which was probably foreign to many Australians at the time, Foreign Minister Julie Bishop and Trade and Investment Minister Andrew Robb launched the Government's Economic Diplomacy policy today at the Lowy Institute. Since the election, it's a term the Foreign Minister has used frequently, along with the 'open for business' mantra and its emphasis on promoting the economic interests of Australia and Australian businesses internationally.

The ministers must have received a considerable amount of feedback about the policy, including questions about what 'economic diplomacy' actually means, because both today went to considerable lengths to explain it. The complexity of the task is illustrated by the length of the ministers' speeches: almost an hour, taken together, and followed by a short Q&A session.

In the Foreign Minister's parlance, 'economic diplomacy' means:

harnessing broader aspects of our international diplomatic work to promote trade, encourage economic growth, attract investment and support business.

To do this, Australia's global network of 95 ambassadors, high commissioners and consuls general, together with 72 trade commissioners, will make economic diplomacy their guiding principle: 'promoting our national reputation as an open export-oriented free market economy (and as a country which is) a great place to invest and with which to do business.' Several times in her speech, Ms Bishop underscored the role of the private sector, particularly small and medium enterprises; she also included players in the broader Australian community: NGOs, think tanks, the arts and sporting people and organisations.

In the increasingly globalised international environment Australia now faces, this economic diplomacy agenda will be a complex one to prosecute: it implies a far greater role for non-government entities, particularly the private sector, and means a much greater involvement for the Australia's Department of Foreign Affairs and Trade in formulating and facilitating the Australian Government's approach to international trade and foreign investment.

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Because economic diplomacy requires domestic policy settings which reduce barriers to trade, economic growth and investment, DFAT, along with its two ministers, will need to lead a whole-of-government, whole-of-society effort to achieve positive economic outcomes through diplomacy. As Ms Bishop described, the strength and uniqueness of this policy is that it aligns all Australia's international efforts – foreign policy, trade, tourism, investment and development – so that they are 'pulling in the same direction.'

As pointed out by one of the participants in the workshop which followed the Ministers' speeches, this means Australian diplomacy is no longer an 'elite sport' played only by diplomats and government officials. Because it will involve Australians and all kinds of Australian business, economic diplomacy will bring the business of Australia's international engagement much closer to home.

But it also makes Australia's diplomacy much more complex, at a time when DFAT, our principal agency for international engagement, has been resource-strapped for decades. And there are risks in making Australian business and industry the spearheads of our international engagement; the AWB scandal and Indian students' crisis are two examples of aggressive economic 'diplomacy' gone awry. These risks will require careful management by skilled diplomats abroad, and appropriate domestic policy-making and regulation by government at home.   

Australia is no outpost in prioritising economic diplomacy: Canada, the UK, and the Netherlands are examples of significant and like-minded nations pursuing similar goals to those outlined today by Bishop and Robb.  The key to success will be making sure that the policy doesn't become, in Bishop's words, 'the pursuit of Australia's naked self-interest to the potential detriment of others', but balances Australia's economic ambitions with broader and less self-centred aspirations for prosperity and peace in the region.

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Since Fergus Hanson first polled Australians on the value of democracy in the 2012 Lowy Institute Poll, our findings about how Australians, particularly young Australians, view democracy have variously provoked astonishment, bewilderment, disbelief, worry and frustration. Our 2014 Poll, released early in June, sought to understand better the thoughts of young Australians by adding 150 more 18-29 year olds to our usual polling sample, making a total of 364 of that age group in our overall sample of 1150 Australians of voting age this year. The larger sample makes the error margin even smaller than in our previous polls (down to 2.9% on the overall sample and 5.1% on the sample of 18-29 year olds).

The larger sample confirmed what we found in our earlier polls: the majority of young Australians either don't think democracy matters or think some other system might in some circumstances work better.

Less than  half (42% actually) of 18-29 year olds say that 'democracy is preferable to any other kind of government'. Thirty-three percent say 'in some circumstances, a non-democratic government can be preferable', and nearly one in five (19%) say that 'for someone like me, it doesn't matter what kind of government we have'. 7% say they don't know when presented with these three options about their views on democracy.

On learning about our polling on democracy and young people, the Speaker of the Queensland Parliament, the Hon Fiona Simpson, convened some groups of young Australians to talk about 'Why democracy matters' at Queensland Parliament earlier this year. These two short videos (one above and one below; each about 3 minutes long) offer a pretty compelling insight into how these articulate and thoughtful young people think about democracy. One young woman put it this way:

I think we take democracy for granted. I don't think that we actually know what a world without democracy would look like.

If you're interested in why we continue to get these low results from young people about the value they place on democracy, then watch these clips. They're beautifully produced pieces featuring young Australian leaders eloquently expressing their ideas about democracy, our political system, and what matters to them.  The Speaker summed it up like this:

There's a difference between having a voice and actually making a difference, and that's why I think we need to learn from those who already at a young age have discovered the difference and who also hold the keys for how we can make democratic processes more open to people.

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So here I am at the budget lockup, deep in the bowels of Treasury, with the idea of getting a much-anticipated preview of the Foreign Affairs and Trade budget for this, the Coalition Government's first federal budget. Only, there is no Portfolio Budget Statement for the Foreign Affairs and Trade portfolio. It hasn't arrived (it's on its way; according to the budget official on duty, there was a last-minute hitch. These things happen, she says).

So to give you an overview of the foreign affairs and trade budget, there are just the overall budget papers themselves, which give a high-level summary.  Here are the highlights:

  • The aid budget has been dramatically shaved. We knew this was coming, and there will be more on this later in the week from development experts, but the top line is that Government will save $7.6 billion over five years 'by maintaining official development assistance (ODA) at its nominal 2013-14 level of $5.0 billion in each of 2014-15 and 2015-16'. From then, it will be pegged to CPI, as foreshadowed by the Minister early this year. This will cut particularly deeply in 2017-18, where the savings will amount to more than $3.5 billion. These are deeper cuts than previously  thought.
  • As expected, the Australia Network, Australia's international broadcasting service to the region, has been axed, saving $196.8 million (or around $22-23 million a year for the remainder of the contract made by the previous government). There goes a significant contributor to Australia's voice to the region, leaving Radio Australia to struggle on manfully, shouldering the burden of providing a broadcasting service and source of independent news in a region severely starved of it (and that means the Pacific, including some of the world's most impoverished nations, and not just the Chinese cash-box to our north). It is not, according to the Government, a 'cost effective vehicle for advancing Australia's broad and enduring interests in the Indo-Pacific region'. It remains to be seen what the Government thinks will replace it as a vehicle for Australia's soft power, for engaging with the diverse populations in our region and building enduring relationships.
  • The Department of Foreign Affairs and Trade will be subjected to even further efficiency demands. Having endured over 20 years the euphemistically-named efficiency 'dividends', there will be further savings of $397 million over four years, flowing from the absorption of AusAID into DFAT and finding more efficiencies, including in the administration of Australian aid. 
  • The Australian embassy in Baghdad will be co-located with the British Embassy (presumably delivering considerable savings, though the overall commitment to Iraq is $35.6 million in this budget).
  • There are some sundry small measures for tourism and Australia Week in China, amounting to around $12 million.
  • On the plus side, there is a $748 million replenishment of the World Bank's International Development Association (IDA), which provides interest-free credit and grants for programs that boost economic growth and alleviate poverty. Some of it is a loan component (and so has no impact on the fiscal balance). 

Because of the AusAID integration into DFAT and the addition of tourism and climate change functions and responsibilities, it's hard to divine the exact impact of this budget on departmental fortunes. In terms of the cost of running the department (taking out the big-ticket administered expenses such as aid and the Australia Network), before the merger the combined appropriations from government for both organisations was around $1.34 billion.  

This year, the amount is around the same. What the budget papers don't state, though, are the measures already introduced in December's mid-year economic forecasts, which saw commitments to the Foreign Minister's signature 'New Colombo Plan' ($100 million over five years) and the scrapping of the proposed new post in Senegal. What is stated in the budget papers is the overall staff reduction for DFAT, which amounts to a substantial 550 positions, presumably across both the foreign affairs and aid functions. It is hard to imagine the impact of a 10% staff reduction on a department so recently disrupted by a major merger and which has made only tentative steps towards rebuilding itself after decades of under-resourcing and bipartisan inattention

Now to defence. Once again, this is one for the experts later this week, but here's a brief preview:

  • The Treasurer has consolidated the commitment foreshadowed by the Defence Minister last year to lift defence spending to the 'magic' 2% of GDP 'within a decade.' Last year it was 1.6%. This year's appropriation of $26.8 billion is a 5% increase on 2013-14, around the same proportion (1.64%) of GDP and 6.5% of general government expenditure. Over the forward estimates, this will lift to $32.6 billion and around 6.8% of government expenditure. The Minister's press release commits the government to 'lay down a credible path to achieving our target following completion of the 2015 (Defence) White Paper.'
  • $191.8 million has been committed over four years to 're-establish the Australian Defence Force Gap Year Programme', delivering on a Government election commitment.
  • Defence Materiel has not been re-integrated into Defence (contrary to the Audit Commission recommendation).
  • There is $1.4 billion over four years to improve the indexation of payments under the Defence Forces Retirement Benefits Fund and super schemes. Again, delivering on the election promise. There will also be better CPI and tax treatment of benefits. New members of the defence forces will join a different super scheme, reducing the Government's super liability by $126 billion by 2050.
  • Finally, the Audit Commission's call for efficiency gains and defence bureaucracy reductions have been partially heeded for Defence: $1.2 billion over four years in efficiency gains, to be reinvested in Defence capability and so with no impact on overall funding. There will be cuts of 1200 public service positions and some changes to living allowances and benefits. This is nothing like the return to Canberra staffing levels of 1998 sought by the Audit Commission, but cuts nonetheless.

The Treasurer's budget speech outlines many of the budget and agency cuts which have been discussed in the last few weeks. Seventy government bodies are to be axed and the public service will be cut by 16,500 positions, as already announced. However, while the Audit Commission recommended abolishing Austrade and EFIC, this is not in the budget. Austrade lives another day, having absorbed responsibility for tourism in October 2013. EFIC will be given $200 million in capital for export assistance to small and medium-sized businesses.

For DFAT, this is a difficult and probably disappointing budget. The argument that Australia's diplomatic service has been chronically under-resourced for several decades has now reached a level of received wisdom. It has been cited by the previous prime minister, the Asian Century White Paper, the former DFAT secretary Dennis Richardson, the current foreign minister, and has been integrated into her party's formal foreign policy, which noted concerns about 'Australia's relatively low diplomatic presence around the world' and promised to review diplomatic resources and put 'in place a long-term policy to ensure Australia's global diplomatic network is consistent with our interests.'

It might have been too much to expect of the new foreign minister to deliver this year on her 'plan to expand our diplomatic footprint overseas' in this austere, deficit-reducing, bottom-line repairing budget. 

However, Australia urgently needs a diplomatic service and an overseas network to meet the demands of an international environment which is undergoing rapid and profound transformations. Our international engagement increasingly fuels our prosperity: exports account for around one fifth of our GDP, one in five jobs is trade-related, Australian investment abroad has reached around $1.3 trillion, foreign investment has doubled over the five years to 2012 to more than $US231 billion, and the Australian dollar was the world's 5th most traded currency last year.

This is a government which has committed (as the Foreign Affairs and Trade Ministers reiterate in their budget release today) to 'strengthen our relationships with key partners and refocus foreign policy on the advancement of Australia's core strategic and economic interests'. It came to government with a promise to refocus Australia's diplomacy on economic diplomacy.   

To do this, Australia's foreign affairs capability and its overseas network need to grow so it can deliver on the Government's ambitious promises, and follow up on its important initiatives in deepening engagement with our neighbours and trading partners. But with just 95 embassies and consulates in 77 nations to service Australia's needs spanning 200-plus nations of the world — far short of the OECD average of around 130 posts — DFAT, as currently resourced, will struggle with the task. It has only one post in booming inland China. It has no post in eastern Indonesia, the location of Indonesia's second largest city. It is under-represented in Africa and Central Asia despite our significant investment interests there and abundant mining opportunities. Add to that the massive consular drain on the Department from the ever-increasing numbers of Australians travelling overseas every year, and the urgency for rebuilding the overseas network becomes even clearer.

Politicians on both sides of Parliament have acknowledged this 'diplomatic deficit' since we first coined the term in 2009.  After five years of talk, it's time to start addressing it.

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My previous post analysed the Commission of Audit's recommendations on defence, foreign affairs and aid. Below, some of the less prominent recommendations made by the Commission in the realm of international policy, which range from sensible to questionable.

First, the sensible recommendations:

Other recommendations seem to either tinker at the edges, are unsupported by much evidence or would make nary a dent in the Government's bid for a surplus. Here are some questionable ones:

  • The outsourcing of passport production: this is a function which the Commission notes provides $374 million in revenue at the cost of around $223 million. It turns a profit. For consolidated revenue, not DFAT, mind you.
  • Apply interest to traveler loans: not a big ticket item, at around $200,000 per year (most of which is recovered). More of an 'entitlement' issue and a bit small-fry.
  • Scrap the Australia Network, because it is, so the Commission says, 'an expensive option for meeting diplomatic objectives given its limited outreach to a small audience'. But expensive compared with what? No comparative data from the Commission, no analysis of efficiency. At $23 million per year, reaching 36 million homes and 46 countries, this is one of the few public diplomacy functions DFAT still funds, reaching out to publics in our region to inform them of our nation, values, culture and economy. Historically, international broadcasting is one of the most cost-effective ways of reaching audiences in their millions on a regular basis. With two recent distribution deals announced by ABC International, the recommendation to abandon it after nearly a decade of consistent investment seems premature and short sighted, and not about funding or efficiency. In any event, it is a matter more appropriate for party policy than a Commission of Audit.
  • A number of other small-ticket recommendations such as reviewing the criteria for the International Relations Grants Program ($5 million per annum).
  • As for the recommendations to halve funding for Tourism Australia, abolish the Export Finance and Insurance Corporation, cease funding for Export Market Development Grants and reduce the activities of an (already reduced) Austrade, these would seem to counter the Government's own emphasis on economic diplomacy.

Photo by Flickr user Wojtek Gurak.

 

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Plenty has been said about the Government's National Commission of Audit's recommendations on domestic policy. But what are the potential ramifications for the agencies responsible for Australia's international functions of defence, diplomacy and aid? (Though following the subsuming of AusAID into the Department of Foreign Affairs and Trade late last year, aid is these days a 'program' rather than an 'agency', and we await the renaming of DFAT. Will it be DFAAT? DFATA?)

The incoming Coalition Government made promising noises about defence funding and Australia's global diplomatic representation both in its pre-election policy statements and in its first months in government. It also telegraphed a scaling-back of the rate of increase in Australia's official aid funding, pegging it to the consumer price index (CPI) rather than the ambitious target set by the former Labor government of reaching 0.5% of GNI by 2017-18.

On aid, there are no surprises (and nothing original) from the Audit Commission. CPI it is. Then again, after the massive disruption to the aid function (and foreign affairs infrastructure) caused by AusAID's 'integration'  into DFAT ('enabling the aid and diplomatic arms of Australia's international policy agenda to be more closely aligned'), the Australian aid program must be becoming habituated to shock.

But the recommendations on defence funding and DFAT create a sense of foreboding as the Coalition prepares to hand down its first budget next week.

In opposition, now Defence Minister David Johnston attacked the Labor Government's cuts to Defence (over 10% in 2012) here at the Lowy Institute, going on to say: 'Our aspiration is that as soon as we have come to terms and corrected the current fiscal situation we will return to the aspiration of 2% of GDP and 3% real growth in the Defence Budget. My mantra is to under promise and over deliver!'

The sense of déjà vu, and concern that bland promises of increased funding avoid the tough decisions on the strategic direction and capability of Australia's defence forces, were expressed by James Brown when the Coalition released its pre-election defence policy. On cue, the Minister's commitment to 'under promise and over deliver' looked increasingly like a commitment to 'under promise, and under deliver as well' by the time he spoke at ASPI in December. The Audit Commission's report gives the Defence Minister every excuse he needs to do just that:

  • It draws on former Deputy Secretary of Defence Paul Dibb's argument about a bloated Defence bureaucracy, recommending the reintegration of Defence Materiel into the Department.
  • It questions the magic '2% of GDP' commitment, calling for the Government to 'assess the balance of strategic and fiscal priorities and how this compares with the commitment to increase Defence expenditure to 2 per cent of GDP within a decade'.
  • It calls for a reduction of Canberra Defence staffing to 1998 levels. 1998! Before 9/11, Bali, and in the very year that China has announced a significant increase to its already formidable defence budget.

Now to foreign affairs and what the Coalition has called Australia's 'global diplomatic network'.

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Shortly after the election, Foreign Minister Julie Bishop echoed the argument we've made at the Lowy Institute that Australia's diplomatic capabilities have eroded from decades of resource starvation and political inattention. She said in October that 'the pendulum has swung too far', and 'it's time for DFAT to reassert its position as the primary source of advice on foreign policy.' Over time, she said, she intended to pursue a plan to 'expand our diplomatic footprint overseas'.

The mid-year economic forecast added $100 million over five years for Ms Bishop's signature New Colombo Plan. But that looks about as far as the pendulum is set to swing, for the short term at least. The Government has scrapped the establishment of the new post in Senegal announced by then Foreign Minister Bob Carr in 2012, saving about $20 million. This post was intended to provide a diplomatic service in Francophone Africa after a parliamentary inquiry found Australia was unrepresented in an area where Australian resource companies were making serious investments.

The Audit Commission's coverage of DFAT is disappointingly low on detail and makes some unsupported claims about what we've argued is the chronic under-resourcing of Australia's diplomacy since our first report into this issue, Australia's Diplomatic Deficit, in 2009. The Commission concludes: 'the Commission does not consider that the case for a significant increase in resources is compelling'. It does not contest, and indeed confirms, our argument that DFAT funding 'has been largely constant in real terms since 1995-1996, while peer comparison agencies have been growing rapidly' (indeed the entire public service grew by over 60% between 1997 and 2013). It notes that DFAT staffing levels are lower than in 1996, and particularly in the number of Australia-based staff posted overseas. It acknowledges that DFAT (actually, Australia) has a smaller diplomatic footprint than any similar-sized G20 or OECD country (while querying whether the comparative G20 data presented in DFAT's chart inflated the size of other G20/OECD diplomatic network by including honorary consuls. The Commission could have asked us: it doesn't).

The Commission goes on to assert that DFAT 'delivers essentially the same function as it did twenty years ago (and it is therefore unsurprising it) should have essentially the same funding in real terms'.

This sweeping assertion ignores the massive transformations in Australia's international environment in the last twenty years, which includes the end of the Cold War, the shifting of global economic power to Asia, 9/11, the global financial crisis, the increasingly complex threats of international terrorism (including close to home in Bali), climate change, cyber threats, the Arab Spring, the Syrian crisis, a doubling in the numbers of Australians traveling overseas in the last decade, natural disasters with global consequences...the list goes on.

And with the new Government's emphasis on economic diplomacy and the Australian economy's reliance on exports, the Abbott Government's energetic efforts to achieve free trade agreements with our major Asian trading partners and its early initiatives in sending major business delegations to deepen trade ties in the region, surely Australia's international environment is becoming more, not less, demanding.

Putting this into a bit of fiscal context, DFAT's annual operating budget of around $1 billion (excluding the now-merged aid function) is about 0.35% of total government expenditure. So when the Commission says that 'DFAT resourcing is an important issue for the Commission as additional funding for diplomacy makes the task of achieving a longer-term surplus more difficult', it all sounds a bit silly.

Of course, the audit commission issued recommendations, and the Government is not bound by them. However, by hitting so many small targets, they will no doubt supply whatever hooks the Government requires to make its budget cuts next Tuesday. As I have argued before, 'money for diplomats' is never a big winner at budget time. For the future of Australia's international engagement, I wish it were not so.

Photo by Flickr user Cyril Bosselut.

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And now the news: the Australia Network (described in The Australian's story as the 'Asian broadcasting service') is ‘likely to be scrapped in the May budget’.

No surprise, coming on the heels of the Prime Minister's comments that the ABC lacks 'basic affection for the home team', following the Indonesian phone-tapping furore.

It has been difficult for successive governments to embrace international broadcasting as a useful (and for Australia, almost its only) public diplomacy tool. International broadcasters such as the Australia Network can help win over foreign publics in ways that support the national interest.  As a tool of public diplomacy, international broadcasters can inform the public in other countries about a nation's values, political systems, people, lifestyles and businesses. For Australia, public diplomacy helps ease the way for Australia to conduct its foreign affairs, and promotes Australia as a place to visit and invest in.

Australia's public diplomacy budgets have been whittled dramatically over the last decade, to the point where the Australia Network is about the only serious exercise in public diplomacy that remains.

Annmaree O’Keeffe and I are on the record supporting the existence of a government-funded international broadcasting service for Australia run by the national broadcaster.* Annmaree succinctly summarises our argument here. While we were critical of the tender process under which the ABC was ultimately rescued from its reputedly unsuccessful tender by the Gillard Government, the fundamental argument in favour of an international broadcaster remains.

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And lest one fall for the usual '$223 million service' (ie. suggesting it's some sort of gold-mine or bottomless pit, depending on your viewpoint), it's rarely explained that this amount is for a contract to be spent over ten years. That is, it's more like $20 million a year, a pittance compared with spending by international broadcasters like the BBC, China's gargantuan CCTV network ($6 billion), European broadcasters which have expanded into Asia, as well as the Asian stalwarts in Korea and Japan.

Now for the serious part. To be effective, international broadcasters need to be independent. They shouldn't just 'play for the team'. As Nicholas Cull concluded in 2010, the BBC, 'through its telling of bad news – as well as good – throughout the Second World War effectively reversed the reputation for creativity with the truth that Britain had earned in the First World War'. Likewise, it was their ability to criticise the US which gained Radio Free Europe and Radio Liberty standing in the eyes of Soviet bloc listeners.

It is a government's ability to allow criticism of itself which gives it credibility in the world. The converse is also true. Government control of the media nullifies its credibility. There are plenty of examples of this from nations which few admire for their freedoms.

This is not intended as an assessment of the Australia Network's programming, something which may well be due for a comprehensive and independent review. But as for its existence, there is ample evidence for keeping it

*Disclosure:  the study was commissioned by the ABC in 2010.

Photo by Flickr user misterbisson.

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Foreign Minister Julie Bishop has called for public submissions on the development of Australia's consular strategy for 2014-16.

This is a welcome move.

The UK has had a formal, publicly available consular strategy since at least 2007, and earlier this year published its 2013-16 strategy. A well-informed and executed consular strategy can set some ground rules for consular engagement in a transparent and publicly accessible way.

My policy brief earlier this year outlined the problems confronting Australia's consular service caused by record levels of Australians traveling and living overseas. Most of these problems were referenced in the Foreign Minister's issues paper.

These problems are compounded by the impact of decades of political neglect and under-resourcing of the Department of Foreign Affairs and Trade (DFAT), a point we've made repeatedly. The Government has indicated elsewhere that it will review Australia's diplomatic footprint  'to ensure that Australia's global diplomatic network is consistent with our interests.'

However, the Minister's latest media release presses home the point that 'consular resources are finite', and her call for submissions argues that 'consular assistance should not be the first resort' for Australians caught up in disasters or political turmoil abroad. This suggests that one of the Government's primary consular strategies will be to educate the traveling public about the level of service it can reasonably expect. 

Great if it were that simple.

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There is a vicious circle operating here which was outlined in Consular Conundrum and to which the Minister referred in her issues paper: media attention on prominent cases tempts politicians to override departmental protocols and consular service charters and provide higher levels of attention and service, bidding up the level of service Australians expect when they encounter trouble overseas. The pressures of the 24/7 news cycle suggest that prickly consular cases will continue to attract attention which foreign ministers find hard to resist (although as shadow foreign minister, Julie Bishop showed signs of restraint).

The task of 'managing down' public expectations will be long and hard, and will require consistent efforts from this and future governments. This strategy is necessary, but not in itself sufficient.

My policy brief controversially called for the imposition of a small ($5) consular fee or levy on the cost of every airline ticket. The Foreign Minister has rejected this idea. But the issue of resourcing for consular services, and for the DFAT as a whole, will not go away. It is a crucial consideration in this examination of the consular service.

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A month or so ago, with little fanfare, Australia participated in the first meeting of MIKTA, an informal grouping of five nations — Mexico, Indonesia, South Korea, Turkey and Australia — described in press releases by Turkey and South Korea as an informal and non-exclusive group of 'middle powers', cooperating to address some of the diverse challenges of an increasingly complex international environment.

The initiative has received little attention, with some notable exceptions. There has been some debate in Australia on the initiative, but it has focused less on the merits of the grouping than on the utility of the 'middle power' label to describe it. The delineation of a 'middle power' is not settled either in the academic literature nor by practitioners.

Some would define a middle power by virtue of its economic weight, its military might, its democratic values, its willingness to engage in multilateral institutions and endeavours, and to advocate responsible international citizenship. Australia's new foreign minister, Julie Bishop, appears to have no qualms about adopting the label.

But there are those who argue that rather than defining Australia as a middle power, the term 'pivotal' is more apt (it's heftier than 'middle', but still not 'great'). Dubbing Australia a ‘middle power’, according to this argument, is unhelpful and misleading. Calling Australia a ‘considerable’, ‘pivotal’ or ‘significant’ power would be more appropriate to its status and role in the international order.

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In the context of the MIKTA initiative, this debate is somewhat beside the point. The limited reporting available describes MIKTA as an informal, even spontaneous, grouping of nations conceived on the sidelines of the 2012 Los Cabos G20 leaders' summit.

Australia's Ambassador to Korea, Bill Paterson, described the aspirations of the group at a recent conference on middle powers hosted by the Korea Foundation in Seoul. While not locking in any formal program or organisational structure, the group has identified some issues on which it might work collaboratively to find common ground and pursue common interests: transnational crime, cyber security, energy security, food security, some aspects of climate change (such as mitigation and adaptation) and building the effectiveness and influence of the G20.

Australia is a member of a number of middle-power groupings. The Cairns Group of agricultural exporters and the Australia Group (advocating the control of chemical and biological weapons) are two. There is another one – the ‘constructive powers’ — meeting in Seoul this week.

Why should Australia shy away from informal groupings such as MIKTA on the basis that it somehow demeans us?

Mexico, Indonesia, Korea and Turkey are the world's 14th, 16th, 15th and 17th largest economies in GDP terms. Australia is 12th. No incongruity there. With the exception of Mexico, each spends around 2% of its GDP on defence (according to The Military Balance 2013). Each is committed to democracy and the rule of law, and each is influential in their regions.

Calling such a group 'middle powers' is beside the point. It's what they do, not what they're called, that counts. Tellingly, a Korean academic at the same Korea Foundation conference at which the Australian ambassador spoke, modestly decried the label 'middle power' for Korea, preferring the metaphor 'shrimp'. When pushed, he went as far as 'dolphin'. Definitely not 'whale'. Korea appears to be getting on with the job, rather than becoming bogged down in labels.

Judging by Bill Paterson's comments, it appears Australia will be similarly pragmatic, unfazed by debates about how to describe its constructive approach to diplomacy.

Photo courtesy of the Republic of Turkey.

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With the start of the Warsaw climate change talks today, combined with the election of the Abbott Government and its proposed repeal of the Gillard Government's carbon tax regime, climate change is back on the political agenda. There was considerable consternation at the linking of climate change with the recent bushfires in New South Wales, and Environment Minister Greg Hunt stirred the debate by using Wikipedia as a source of scientific evidence. 

So it's a good time to look at the trend of public opinion on climate change.The shift in opinion on climate change has been one of the most dramatic trends the Lowy Institute Poll* has recorded. We began asking Australian adults about climate change in 2006, asking survey participants to select the response which most closely mirrors their point of view: 

  • Global warming is a serious and pressing problem. We should begin taking steps now even if this involves significant costs.
  • The problem of global warming should be addressed, but its effects will be gradual, so we can deal with the problem gradually by taking steps that are low in cost.
  • Until we are sure that global warming is really a problem, we should not take any steps that would have economic costs.

The Poll interactive tool illustrates these dramatic results in graphic form. Concern about global warming peaked in 2006, during a period of deep drought and water restrictions in Australia. These results arguably contributed to then Prime Minister John Howard‘s shift to climate change 'realism', as he recounted in his recent speech in London:

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... late in 2006 my Government hit a “perfect storm” on the issue. Drought had lingered for several years in many parts of Eastern Australia, leading to severe restrictions on the daily use of water; not for the first or last time the bushfire season started early; the report by Sir Nicholas Stern hit the shelves, with the author himself visiting Australia, and lastly the former US Vice President Al Gore released his movie “An Inconvenient Truth”. To put it bluntly “doing something” about global warming gathered strong political momentum in Australia. 

In 2007, Prime Minister Howard announced that his government would introduce an emissions trading scheme in 2011. Kevin Rudd famously promised action on climate change in the 2007 election, and after a period of policy switches, the Labor Government eventually introduced a carbon tax in 2012. By then, however, and with the drought long broken, the number of Australians who said global warming was a ‘serious and pressing problem’ had dropped to 36%.

An examination of the Poll interactive shows that public sentiment on climate change has shifted direction this year for the first time since 2006. The number of Australians seeing global warming as a 'serious and pressing problem' has increased to 40%, four points up since 2012. While the level remains well below the 68% peak on this response, the shift is noticeable.

Bushfires and heatwaves may well exacerbate this trend. Research from Columbia University in 2011 found that perceptions are influenced by individuals' immediate experiences of weather changes. With the Bureau of Meteorology reporting Australia's warmest 12-month period on record in September, the shift in public opinion may accelerate.

*The Lowy Institute Poll reports the results of its annual nationally-representative telephone survey of approximately 1,000 Australian adults. The most recent Poll was conducted in March 2013. 

 

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The swearing in of the new Abbott Ministry yesterday portends something of a new era for the Department of Foreign Affairs and Trade.

The inclusion of Investment in the Trade portfolio was no surprise, given the discussion and policy release in the election lead-up. It aligns with the Coalition’s ‘economic diplomacy’ strategy, outlined in Julie Bishop’s Interpreter piece and then emphasised in its policy document launched a day or so before the election.

In her Interpreter piece, the new Minister outlined a ‘clear focus on promoting the economic interests of the Australian people and Australian businesses in its international engagement’, together with building a stronger network of bilateral and regional FTAs, particularly in the Indo-Pacific region.

The enlarged trade and investment ministry takes on greater significance, however, when taken with other changes mooted for the Foreign Affairs and Trade portfolio overall. In the lead-up to the election, there were steady rumours in Canberra circles that the Coalition’s intention was to split the Department of Foreign Affairs and Trade into two departments, allowing Andrew Robb to take charge of a super-ministry with its own department (and make way for Arthur Sinodinos to take the Finance portfolio, a corollary which hasn’t materialised this week).

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This would be a strange move. There were strong reasons for merging Foreign Affairs with Trade in 1975, and not only relating to efficiency. Stuart Harris, Secretary of the Department in the period straddling the 1987 merger from 1984-88, assessed its benefits in 2002, arguing that the Hawke Government’s goal of a more internationally competitive economy favouring increased exports and openness to foreign investment was one of the drivers of the merger, and that it ‘resulted in practice in a higher priority being given to economic relations.’

The Abbott Government appears to be serious about economic diplomacy and driving foreign investment, to the point that the new Trade and Investment minister will be making an annual statement to parliament on the quantum of new investment and new jobs in Australia. The success of the Department’s 1987 merger demonstrates that re-dividing it would be organisationally counterproductive and damaging to the new government’s own economic diplomacy goals.

The Abbott Government also appears to be serious about cutting 12,000 jobs from the public sector. If it is, then dividing Foreign Affairs and Trade — a move which resulted in an immediate staffing contraction of around 6% after the 1987 merger — hardly seems logical.

The idea appears to have been shelved for the moment. If so, this is good news for the effective conduct of Australia’s foreign and trade affairs. A focus on ‘economic diplomacy’ can be code for deep cuts and major restructuring for a ministry of foreign affairs, as our friends across the ditch well know.

Photo by Flickr user neonzu1.

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There has been much consternation both at home and abroad about the lack of women in Prime Minister Tony Abbott's ministry, announced this week.

The Washington Post, following the lead of the AP wires, billed the cabinet numbers story as a ‘rekindling’ of the Abbott sexism debate, a line that was also picked up in Canada and the UK.

It’s a fair reflection of the domestic reaction in Australia: Penny Wong, Finance Minister under the Rudd and Gillard Labor governments, alluded yesterday to Mr Abbott’s comments during his student days that 'it would be folly to expect that women will ever dominate or even approach equal representation in a large number of areas simply because their aptitudes, abilities and interests are different for physiological reasons'. One of Abbott’s own, Liberal MP Sue Boyce, expressed embarrassment at the announcement of the ministry and said the ‘merit’ argument was a smokescreen for sexism.

However, before despairing of ever achieving gender balance in Australian politics or sheeting the imbalance home to a particular political leader, it’s worth reviewing some numbers and comparisons.

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The Abbott cabinet has one woman out of 19 members (5%), and there are five women in the Abbott ministry (17%). This is less than in Julia Gillard’s first cabinet, which had four women out of 19 in 2010. It’s also less than the last Howard ministry, which had six women of 32 ministers (19%), with four in cabinet (21%).

The composition of the Australian parliament, though, doesn’t look dissimilar to parliaments in places we’d regard as alike in culture and democratic systems. Take the US: only 98 of the 535 seats in Congress are held by women (18%), a record high for American politics. This compares with 25% women in Australia’s House of Representatives in the last (43rd) parliament and 37% women in the Senate, numbers which are almost identical to those in the 41st parliament in which John Howard was prime minister.

In the UK, 22% of parliamentarians are women and 19% of the ministry are women. 

Compared with business, things look more promising for female politicians. There are only 12 women CEOs of ASX 200 companies (6%), although 16% of non-executive board positions are filled by women. There are 21 in the Fortune 500 (4.2%), and a similar proportion (4.5%) in the Fortune 1000. 

Whether examining the Australian parliament or the Abbott ministry, Australian female politicians fare no worse and perhaps even slightly better than their counterparts in the US and the UK, and better than their corporate sisters, at least in executive roles.

Looking across the globe, though, Australia ranks quite poorly, coming in at equal 45th with Canada out of 142 nations in the Inter-parliamentary Union’s database on women in parliaments. Rwanda tops the list with 56% women in parliament, having recently overtaken Sweden with 45%. The IPU data shows that, where quotas are implemented by parties or parliaments to enforce female representation, the number of elected women almost doubles. So while quotas are a divisive issue, it might be on the agenda in Australia following the reaction to Mr Abbott’s controversial ministry decisions

Timor-Leste, one of the world’s newest nations, ranks 16th on the IPU ranking with 38% female representation in its parliament, a noteworthy achievement which Fergus Hanson and I observed in our 2010 study on leaders in Pacific nations, most likely stemming from the crucial role women played in the nation’s fight for independence at the end of the last century. That’s a result achieved (dare I say it?) in the context of the dominance of the Roman-Catholic faith and a leadership which drew heavily from those with Jesuit backgrounds.

The experience of Timor-Leste illustrates that a war of independence is one way to achieve healthier gender balance in national parliament. Quotas would be better.

Photo by Flickr user rudolfhelmis.

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