International aid enters historic decline with Australia among lowest contributors

As global crises mount, international aid spending has entered a historic decline, with Australia’s contribution among the lowest in the world.

Preliminary figures released by the Organisation for Economic Cooperation and Development (OECD) show Australia gave just 0.18 per cent of its gross national income to official development assistance in 2025 –26.

The rate falls well short of the United Nations target of 0.7 per cent, placing Australia 25th out of 32 donor countries in the OECD’s Development Assistance Committee (DAC).

“DFAT must restore its aid budget and shore up the global humanitarian system that faces its most serious crisis in decades,” said Oxfam Australia’s Head of Humanitarian, Lucia Goldsmith.

She said there was no shortage of clear, readily available options for the government to find revenue, “such as taxing the wealth of the super-rich and fossil fuel corporations”.

According to the Australia Institute, a 25 per cent gas export tax would raise $17 billion every year.

Its research also shows a 2% wealth tax on people worth more than $5 million would raise $41 billion per year.

Bill Browne, director of the Democracy & Accountability Program at the Australia Institute, said these untapped revenue streams could transform the country’s spending.

“Under successive Liberal and Labor governments, Australia’s foreign aid contribution has reached its lowest ebb,” he said.

“Australia is a wealthy country, and a small contribution would save lives, lift children out of poverty and help future trading partners develop.”

For 2025-26, the Albanese government allocated $5.097 billion in Official Development Assistance (ODA); an increase of $135.8 million from the previous year.

However, Oxfam Australia’s Chief Executive, Jennifer Tierney, said the increase does little to change the dire situation.

“The slight increase in the dollar value of aid from last year is nominal when compared with real terms inflation and should not fool anyone,” she said.

Globally, OECD data showed foreign aid fell by $56.7 billion in 2025, or 23 per cent, the steepest decline on record.

“The governments of wealthy nations are turning their backs on the lives of millions of women, men and children in the Global South through severe aid cuts,” said Ms Goldsmith.

“Aid plays a crucial role in combating diseases like HIV-AIDS and malaria.”

Earlier this year, Oxfam’s analysis found that if the cuts continue, a child under five could die every 40 seconds by 2030, with more than 9 million deaths linked to reduced aid funding over the decade.

Ms Tierney said the projections highlight the devastating human cost of sustained aid cuts.

“We’re living through multiple chronic global crises, from climate change-accelerated flooding and cyclones to gas price inflation due to war in the Middle East,” she said.

“Considering this context, Australia’s aid contributions have never been more important to a stable world.”

OECD Secretary-General and former Australian Finance Minister Mathias Cormann warned the economic backdrop is worsening an already dire situation.

“Fiscal pressures on developing countries are growing, and the ongoing conflict in the Middle East represents a significant risk for global growth and food security,” he said.

The OECD said the US alone drove three-quarters of the decline, with its assistance recording the largest single-year drop by any provider on record.

And for the first time recorded, the top five largest providers – Germany, the US, the UK, Japan and France – all reduced their contributions, accounting for 95.7% of the overall decline.

“The message is extremely sombre,” said OECD DAC Chair Carsten Staur, who pleaded for countries to start increasing their budgets again.

Oxfam Australia is calling for the Albanese government to lift its aid contribution from 0.65 per cent to 1 per cent of overall spending in next month’s federal budget.

“In working towards the UN target for aid, Australia can take its place as the generous nation its people believe it is,” said Ms Tierney.

Mr Browne said increased aid spending would not come at the expense of Australians, but rather strengthen support at home and abroad.

“Countries that are generous providers of overseas aid usually also provide more social services to their own citizens. Instead of one coming at the expense of another, support for domestic services and support for foreign assistance reinforce each other.”

However, the OECD is not expecting the outlook to improve, projecting a further 5.8 per cent decline in aid support in 2026.