McCully axes Pacific aid programme

Foreign Affairs Minister Murray McCully has axed a $1.95 million Pacific aid programme while he awaits the results of two reviews into the future of NZ Aid, Labour's Associate Foreign Affairs spokesman says.

Mr McCully personally asked that funding be withdrawn from the Foundation for the Peoples of the South Pacific, a Fiji-based non-governmental organisation which operates in seven Pacific Island nations, Phil Twyford said.

"This is an example of McCully meddling in the aid programme.

"It shows the minister's hostility to the kind of high quality grassroots development work that NZ Aid is doing around the Pacific and secondly it demonstrates his willingness to medal and intervene."

The majority of western aid organisations were either semi or fully autonomous and were focused on poverty elimination, as NZ Aid currently is, Mr Twyford told NZPA.

Mr McCully said the majority of the $1.95m funded salaries and overheads of the foundation and did not meet his criteria of funding projects which made a "tangible" difference to peoples lives.

He said NZ Aid funds two other programmes administered by the foundation - a $1.6m youth and mental health programme and a $1.5m disaster risk reduction programme - and that funding will remain in place.

Ministry of Foreign Affairs and Trade (Mfat) chief executive Simon Murdoch and NZ Aid executive director Peter Adams declined to answer questions on the reviews and future of NZ Aid at a select committee hearing today because the minister was yet to be briefed on them.

The State Services Commission is looking into the structure of NZ Aid, with the possibility of re-integrating it with Mfat. Mfat and NZ Aid were reviewing NZ Aid's policy of poverty elimination. The agency has a $480 million annual budget.

The minister previously said he hoped to have one of the reviews by April but wanted them to be done properly, not in a hurry.