Subject: AFR: Doubt On Long-Term Effects Of Timor Aid

Australian Financial Review

January 6, 2004 Tuesday

Doubt On Long - Term Effects Of Timor Aid

Allesandra Fabro

The sustainability of Australian aid activities in East Timor is at risk despite the significant contribution made by bilateral aid programs, an Audit Office report has found.

The report assesses AusAID's planning and management of aid programs to East Timor, which has continued since the independence ballot in 1999.

Australian aid has cost about $235 million since 1999, and is expected to continue in the near future. Other components of Australian government assistance include security and policing.

The Australian National Audit Office found that AusAID had made a "significant and timely contribution" to the humanitarian crisis that followed the independence ballot, including key planning and logistical support in addition to financial contributions.

But it also found there were administrative shortcomings in AusAID's interim strategy for the delivery of post-crisis assistance, particularly in risk management.

"Risk management did not include an assessment of the likelihood and consequences of individual risks, to assist in prioritising risks and their treatment," the report said.

"Identified risks were not regularly updated to reflect changing conditions . . . in addition, limitations in performance management at the country program level hampered AusAID's ability to assess whether overall desired aid objectives had been met."

On a longer-term basis, the Audit Office found improvements could be made to some of the supporting structures for the design and implementation of bilateral aid activities, although it said general management had been sound.

It raised concerns about the long-term sustainability of projects - the likelihood that benefits would continue after donor assistance had ended.

"A number of project staff and experts expressed the view that their projects or technical assistance would require longer time frames than are currently approved to ensure sustainable outcomes," the report said.

"The audit visit to East Timor indicated that East Timor government agencies and assisted communities have limited organisational, financial and human resources, and this is likely to be a significant constraint on their capacity to maintain the ongoing benefits from Australian bilateral assistance."

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