Photo: RNZ
New Zealand's climate financing commitments will decrease from $250 million to $100 million this year, Budget 2025 revealed.
At the same time, an injection of $100 million a year into Aotearoa's aid to overseas nations has not stemmed a downward trajectory in aid levels through to 2027.
A spokesperson for Foreign Minister Winston Peters told RNZ that they will push for more overseas development assistance (ODA) funding next year.
"Unfortunately, the previous Labour Government left a $200 million a year fiscal cliff in the ODA budget from January 2026.
"As Minister Willis acknowledged in her speech, we argued for more ODA funding than was secured - and will seek more in the next budget cycle.
"But the ODA gap left by the previous Labour Government will take more than one budget to fill."
Peters' office could not confirm whether this would result in less funding for Pacific nations, both from aid and climate finance.
"New Zealand is committed to doing its bit to help the Pacific meet its development needs, including building climate resilience."
Labour Party associate foreign affairs spokesperson Phil Twyford called that nonsense.
"Governments don't budget in perpetuity for these things. Our Labour government made a four year commitment, and it's up to this government to budget to continue that."
"They've overseen a cut of 50% in climate finance, and that's not only letting down our partners in the Pacific, it's also welching on the commitments that we made internationally."
A spokesperson for MFAT told RNZ in a statement that future climate finance beyond 2025 will be determined before the end of the year.
New Zealand 'among least generous'
Photo: RNZ Pacific
New Zealand prioritises its Pacific neighbors, providing at least 60 percent of its development funding to the region, according to MFAT.
"The Pacific remains the highest priority for the IDC programme, with more than 60 percent allocated to the region. The new $100m a year funding is deliberately focused on the Pacific."
"It will allow us to sustain our funding commitment to the Pacific and support their priorities, including resilience to the impacts of climate change."
World Vision National Director Grant Bayldon wants the government to be clear on how overall Pacific-targetted aid will change in the years to come.
"This is very likely to impact Pacific communities when there's a cut of that size.. it's hard to see it not impacting the Pacific directly."
The United Nations has a longstanding target for developed nations to match their ODA to around 0.7 percent of their gross national income.
Aotearoa's proportion is set to slip from 0.33 percent in 2023/24 fiscal year to 0.25 percent in 2025/26, to 0.23 percent in 2026/27.
That will put aid levels at its lowest proportion since 2016.
Based on the OECD's current rankings, it would put New Zealand in the bottom third, just above the United States after the shuttering of their USAID programme.
In terms of climate finance, which sits separate from aid, New Zealand has commited to tripling its contribution to around $558 million annually by 2030, according to Oxfam Aotearoa.
Oxfam climate justice lead Nick Henry said that Aotearoa now looks set to break it's promise.
"We weren't expecting to get it all this year, but we were hoping to see it head in the right direction."
"It's going to mean that any new initiatives to support communities with their climate needs are going to be competing with other humanitarian needs, other development needs that are still there in a time of climate crisis."
Govt engaged in climate finance 'chicanery'
In 2021, the then-Labour government introduced a climate finance package of $1.3 billion between 2022 and 2025.
Strategically, at least 50 percent of it was supposed to be dedicated to the Pacific, mostly dedicated to infrastructure and disaster risk planning for climate mitigation.
That funding is due to expire next year, but the current government has not reintroduced a new funding package for 2026 onwards.
It means that MFAT will have to rely on the remnants of that funding, or $100 million, a $150 million reduction from 2024.
Dr Terence Wood, an aid expert out of Australia National University calls this a "fiscal cliff".
"More makes it sound like the budget is going up, but all they going to do is prevent the budget from falling as rapidly as it had seemed like it was going to."
With the passage of Labour's Zero Carbon Act, the government began to include climate considerations within policy planning and action.
This practice, called "climate mainstreaming", has also been applied to aid, where development projects are considered for their direct and indirect impact on emissions reduction or climate adaptation. (MFAT statement)
Dr Wood said it is a good idea being used in a bad way when it comes to international development.
"For example - they might no longer build schools by the beach, they might move them inland a little bit, or they might strengthen the construction of buildings to take into account increased cyclone frequency."
But Dr Wood said that this practice currently allows a project funded by aid could be classified as climate finance if they have some kind of indirect effect, rather than a full focus, on the climate.
In doing so, projects that have little to do with cliamte change can be recorded as evidence of action against benchmarked commitments. As a result, they can justify spending less.
"New Zealand is desperately trying to make it seem as if the amount of aid that it gives to help countries adapt to climate change is not falling, even though the amount of aid that it is giving to help countries adapt to climate change is actually falling."
"I think it's probably one of the reasons why many Pacific politicians view us as something as a fair-weather friend."
Bayldon said that World Vision also shares this concern.
"I think it's important for for all funders, all governments, to really be up for. And honest about that, how much of the funding is going to climate projects and resist effectively claiming things as climate projects that aren't."
An MFAT spokesperson told RNZ that climate outcomes are always considered strongly, and are not undermined.
"This includes considering factors such as the climate benefits of the activity, any impacts that climate change could have on achieving outcomes, how the activity itself might negatively impact climate change, and identifying any opportunities to improve resilience and incorporate these into design."
"Mainstreaming climate considerations in this way is good development practice."
