NZAID

FAQs

NZAID's work

The FAQs area has been designed to be a helpful resource for people who are looking for quick reference information on NZAID work and wider development issues.

FAQs on this page are about understanding poverty development and aid, what role we play, and how we choose our priorities.

What is poverty?

Poverty is "a condition characterised by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information" (Copenhagen Declaration 2002)

NZAID recognises three types of poverty:

  • Absolute extreme poverty - an inability to meet basic needs.
  • Poverty of opportunity - where opportunities to participate in economic, social, civil and political life are seriously limited.
  • Vulnerability to poverty - where individuals, communities and countries are particularly vulnerable to circumstances likely to damage their livelihoods, ability to meet basic needs and ability to participate actively in economic, social, civil and political life.

In money terms, the World Bank identifies "extreme poverty" as being people who live on less than US$1 a day and "poverty" as less than US$2 a day. There are currently more than 1.1 billion people living in extreme poverty, a disproportionate number of whom are the elderly and women and children.

What are the challenges that make it difficult for countries to support themselves?

There are many reasons why countries need international assistance in their fight against poverty. Some of these reasons are:

  • Health and education challenges - many poor countries face major challenges in providing basic health care and education opportunities to their populations
  • Lack of infrastructure - people need reliable transport networks or shipping services, so they can move about and transport goods to markets easily
  • Lack of natural resources - sometimes the soil is not fertile enough or there is too little rainfall to reliably grow crops
  • War and conflict - war takes a tremendous toll on a country's economy. It can take a very long time to recover from the effects of conflict
  • Poor governance - sometime governments hinder development by implementing flawed policies or not doing enough to prevent corrupt activities.
  • Limited capacity - sometimes governments and public services are still relatively new. It takes time to develop the range of skills and institutions needed to run a country, and for people to be empowered to help exercise accountability over the government and public service.
  • Vulnerability - some countries are susceptible to natural disasters and their governments, and the level of infrastructure, are not able to cope and respond without outside assistance and support.
  • Geographical isolation - significant distance to trading partners, volatile and expensive access to aviation routes can be barriers to development for some countries, especially those in the Pacific

Why do we give money overseas when there are still many New Zealanders living in poverty?

There are poor people living in New Zealand, and because of this the Government has a range of programmes and activities designed to assist those who are in need here.

New Zealand is a much richer country than the countries we help through our aid programmes. This is reflected by our average income per person, which at US$25,960 in 2006, was, for example, many times higher than Fiji (at US$3280) or Papua New Guinea (at US$660).

New Zealand's aid programme is about New Zealand being a good international citizen and helping people who live in extreme poverty towards a better life. The New Zealand government is committed to reducing poverty at home as well as overseas. It is not a question of 'either/or' both have to be addressed.

We also know that New Zealanders are generous and feel positively about helping those in need. An opinion poll that NZAID conducts every three years suggests that over 70 percent of those surveyed support the Government giving aid.

Why does NZAID focus on the Pacific region when the people there are better off than many other people in the world?

In our own neighbourhood of the Pacific, there are pockets of major poverty and hardship. Papua New Guinea, Solomon Islands and Vanuatu have the highest levels of poverty in the Pacific, and together account for over 80 percent of the region's population. Human development indicators put this region on a par with parts of Africa.

Relative to New Zealand, many people in the Pacific still face major challenges. For example, the risk of a mother dying in childbirth is ten times higher in Fiji (75/100,000) and over forty times higher (300/100,000) in PNG, than New Zealand. Our aid is working to reduce these terrible statistics.

In other parts of the Pacific different challenges are evident. Most countries are very small, have limited resources and infrastructure and are vulnerable to natural disasters such as tsunamis and cyclones.

We also have legal obligations to Niue, Cook Islands and Tokelau and special ties with a number of other Pacific nations. Our knowledge of the region means we are well placed to play a significant role in its future development.

More information about how NZAID works within the Pacific region.

Why doesn't New Zealand do more for Africa?

With so many countries around the world needing assistance we have had to decide priorities. NZAID has a budget of $5.7 million for our Africa programmes, but we focus more on the Pacific, because it is the region where we can deliver the most effective development aid. We also provide considerable amounts of assistance to Africa through our support for multilateral agencies (such as the World Bank), UN agencies and through our humanitarian relief programme.

More information about Africa programmes.

Why does New Zealand give aid to countries without the sort of democracy we have?

One of NZAID's goals is to encourage and help developing countries to promote good governance. This has to be based around participation, accountability and transparency.

Sometimes New Zealand might not agree with everything another country's government does, or we might not recognise a government at all. There is a range of ways that NZAID can operate in such circumstances.

In Tonga, New Zealand has offered assistance focussed on political reform, including support to strengthen local civil society and expertise to strengthen the public sector. More information about Tonga.

Following the 2006 coup in Fiji, New Zealand instituted a range of sanctions against the military regime. This included freezing New Zealand's assistance to the Government and reviewing all other initiatives. Visit the Fiji page for further information. But we are continuing to look at ways in which we may be able to continue to help the poorest Fijians, especially those living in urban squatter and other informal settlements.

Often un-democratic processes impact most on the poor; the people that New Zealand's aid programme is trying to help. Because of this, even when there are good reasons for us not to support or engage with a country's government, NZAID still tries to find ways of continuing to help those living in poverty.

What role does NZAID play in sudden emergencies like cyclones, earthquakes or tsunamis?

The Pacific region is extremely vulnerable to natural disasters such as cyclones and tsunamis. When a disaster like this occurs in the Pacific, we take a lead role - responding with a hands-on approach.

Often the first donor on the scene, New Zealand is well placed to assist with immediate relief efforts, particularly in the form of urgent supplies. Direct assistance may include the provision of essential goods such as tarpaulins, blankets, building materials, water purification tablets and water containers and food. It may also include technical expertise such as an engineer or communications expert to assist in the restoration of essential infrastructure like water supply and sanitation, phone lines and power.

Whatever form the response takes, it is designed to ensure that the affected country is helped back onto its feet as quickly as possible. NZAID works closely with the New Zealand Defence Force and other government organisations.

For more information on NZAID's Pacific Disasters Management programme, view the fact sheet: Pacific Disaster Management (pdf 280k).

If the disaster occurs outside the Pacific, like the 2004 Asian tsunami or 2005 Pakistan earthquake, NZAID offers assistance through humanitarian organisations like the United Nations or the Red Cross. Working with partner organisations is an effective way of making sure that the assistance reaches those in need.

New Zealand also contributes to the Central Emergency Response Fund (CERF), established by the UN in 2006. This fund enables the UN and other agencies to respond immediately to disasters anywhere in the world, without waiting for funds to arrive through special appeals, which can take some time to organise.

How does NZAID choose its priorities within a country?

Most countries have their own national development or poverty reduction plan which set out the priority areas for assistance and NZAID aims to align our support with these.

Priorities are set out in country strategies that are jointly agreed by NZAID and partner governments through comprehensive consultation with interested parties - in the country concerned and in New Zealand.

More about our priorities.

What is tied aid?

Tied aid is when governments provide assistance, but with strings attached. This might include insisting that any goods or services used are purchased from the donor country or that nationals of the donor country always implement the aid work. This has the effect of increasing the cost of aid and often involves the loss of capacity-building opportunities that could be gained through using in-country personnel. The obligation to purchase goods from a range of different donor countries also contributes to maintenance and repair problems.

Many countries are moving away from this practice however there are still several large donor governments that still operate tied aid programmes, or programmes that require countries to seek special permission to use goods and services from other countries.

Is New Zealand's aid tied?

While some of NZAID's work is carried out by New Zealand contractors, none of the aid budget is tied.

One of the aims of the 2005 Paris Declaration, is to promote further progress in untying aid and New Zealand supports this in policy and practice.

What is the difference between aid and development assistance?

Aid is an umbrella term that is commonly used to describe either development assistance or short term humanitarian support.

Development assistance is longer term assistance that is provided by developed countries to support the long term economic, social and political development of developing countries. An example of this is New Zealand's support for the Solomon Islands government's education programme. Here, NZAID is supporting getting all children to school - a programme that will take at least a decade. See the Solomon Islands page for more information.

Development assistance can also include developed countries' efforts to increase the coherence of domestic and development policies, for example in the areas of trade, investment, migration and arms control/exports.

Humanitarian aid is the support given to alleviate a short term crisis situation. It's the type of aid that is provided when responding to a disaster like a cyclone, tsunami, earthquake or flood.

What's the difference between multilateral and bilateral aid?

Bilateral aid is money that is given by one country's government directly to another country. NZAID has 18 core bilateral programmes with countries in Asia and the Pacific.

Multilateral aid is the term used to describe the aid delivered by international organisations such as UN agencies and the World Bank, where different donors' money is pooled together before being delivered by the international organisation on everyone's behalf.

What are the Millennium Development Goals?

In September 2000 a summit of 189 countries, including New Zealand, agreed to work together to reduce extreme poverty. They identified eight goals around which to rally their efforts, known as the Millennium Development Goals (MDGs). These goals were reconfirmed at a special UN summit in 2005.

The goals are:

  • Goal 1: Eradicate extreme poverty and hunger
  • Goal 2: Achieve universal primary education
  • Goal 3: Promote gender equality and empower women
  • Goal 4: Reduce child mortality
  • Goal 5: Improve maternal health
  • Goal 6: Combat HIV/AIDS, malaria and other diseases
  • Goal 7: Ensure environmental sustainability
  • Goal 8: Develop a global partnership for development

The Millennium Development Goals represent an unprecedented global consensus on working together to reduce extreme poverty. They set out time-bound targets and indicators that will, if met, lead to substantial reduction in poverty and poverty-related conditions for hundreds of millions of people.

For New Zealand, working towards achieving the MDGs influences all NZAID strategies and policies and reflects the agency's long-term commitment to working with partners and the international community.

How well is New Zealand playing its part in the global effort to meet the Millennium Development Goals?

New Zealand was one of the 189 countries that signed the Millennium Declaration in 2000 and agreed to work towards reducing extreme poverty.

Internationally progress so far has been mixed, and New Zealand's progress reflects this; although there has been significant and positive progress, there is much to be done by the 2015 target date.

New Zealand's Contribution to the Global Partnership for Development - The Millennium Development Goals ( pdf 76k) explains New Zealand's progress and challenges. If you would like a hard copy of the report, please email enquiries@nzaid.govt.nz. New Zealand's next progress report will be published in 2010.

Do large aid programmes make countries reliant on handouts?

New Zealand recognises that to eliminate poverty will require long term international assistance in many countries. Building local capacity and ensuring everyone has access to reasonable education, health and other services is going to take time, especially when many of the countries we work with have quite limited funds of their own. So we accept the need for and expect many of our development partnerships to continue for the long term.

One of the foundations of New Zealand's aid programme is sustainability. In the past a lot of aid was given without an eye to the future and this has had some negative impacts on developing countries. To avoid this happening again, NZAID does a lot of work and planning around the long-term impacts and affordability of the initiatives we support.

Many of NZAID's programmes include activities intended to help support people develop and strengthen their livelihoods in the long-term. Even some of our disaster relief aid programmes are geared towards helping communities reduce the risk of natural disasters, for example, this might mean moving settlements away from flood prone areas so people are safer, and the need for emergency relief is less frequent.

Do countries who receive aid have to pay it back?

New Zealand's aid programme consists of grants and these do not need to be paid back. That said, donors such as NZAID, receive detailed reports on how the money is being spent and a financial record to back this up. This means we can be sure that the money we provide is being used appropriately and in a way that will help the country to develop.

Some countries and organisations (like the World Bank and the Asian Development Bank) provide aid through concessional loans, or a mixture of grants and loans. We provide support to the World Bank and the Asian Development Bank, and we are contributing to the Highly Indebted Poor Country and Multi-Lateral Debt Relief Initiatives, which are helping to reduce debt levels in many poor, heavily indebted, developing countries.

How does NZAID ensure that aid money doesn't go to corrupt people?

NZAID carries out reviews and evaluations to assess the performance and effectiveness of our programmes and activities. We require regular reports on how our money is being spent and we also provide assistance to help our partners strengthen their own public financial management systems.

Our development assistance is usually only a small proportion of a country's budget, so helping improve the overall public financial management system can have a much bigger impact than only focusing on how our own aid money is spent.

More about evaluating effectiveness

How does NZAID ensure that groups who receive NZAID funding spend it properly?

As a government organisation we are required under the Public Finance Act to have robust financial and contractual processes.

Organisations that receive NZAID funding have to follow agreed procedures - starting from the day the contract is signed or agreement comes into effect. Regular progress reports are also required. NZAID will take the appropriate course of action if there are any discrepancies.

When working through partner governments we place increasing emphasis on strengthening the monitoring and evaluation systems of the partner government.

When projects are completed evaluations take place to assess the performance and effectiveness of the activity. Lessons learnt are then applied to the planning and design of future programmes.

More about evaluating effectiveness.

How can we tell that aid programmes are working?

NZAID carries out reviews and evaluations to assess the performance and effectiveness of all its programmes.

Some examples of our recent successes include:

  • Reducing leprosy in Bougainville, Papua New Guinea
  • Supporting Samoa develop a 'beach fale' village tourism development programme - providing a new income stream for rural dwellers.
  • An increase the number of girls receiving an education in Solomon Islands by 10%.
  • A new hospital in Niue and improved health services to its people

Page Last Reviewed: 22 August, 2006

Document URL: http://www.nzaid.govt.nz/faqs/nzaids-work.html