Posted on 22 May 2025
By Sam London - Standards & Humanitarian Manager
There’s a myth we like to tell ourselves in the aid world (or perhaps more accurately, as self-identified “developed” nations): that the Global North funds the Global South out of the goodness of its heart. That aid, especially humanitarian aid, is a noble gesture, a charitable and virtuous gift, and one unsullied by the manoeuvring of politics. But history tells a different story, and as the NZ Budget drops this week, it’s worth unpacking a little how, and why, the very idea of modern development assistance came to be.
In 1970, amid Cold War paranoia, decolonisation upheavals, and growing pressure from newly minted independent nations (especially through the Non-Aligned Movement and the G77 coalition), the UN General Assembly called on wealthy countries to commit 0.7% of their gross national income to what they called “official development assistance (ODA)” (UN Resolution 2626). This didn’t happen on a whim nor was it a knee jerk reaction. It was the result of sustained advocacy, hard political bargaining, and a recognition, however muted, of the Global North’s historical debt to the South. That’s a very important bit to note, the debt that the North owes the South. This was an admission, however symbolic, that the global economy, intensified in the post-war era, had been built on uneven terms: shaped by colonial extraction, unequal trade, and institutions designed, often explicitly, to serve donor interests. The 0.7% target was, at least in theory, a modest attempt to acknowledge and rebalance that structural injustice.
And why 0.7%? Contrary to popular myth, it wasn’t the outcome of overly sophisticated economic modelling. The target emerged from a series of studies in the 1960s, most notably the 1969 Pearson Commission, a landmark report commissioned by the World Bank to assess development progress and future financing needs. The report concluded that 0.7% of GNI would be a realistic and politically achievable target for wealthy nations to support development in the Global South (Pearson Commission Report, 1969). In other words, 0.7% was a politically palatable floor, not a ceiling. It was a modest compromise, but fundamentally it was grounded in an idea of justice, not generosity, virtue or charity.
And yet, more than fifty years on, only a handful of countries have ever met that target. New Zealand, for its part, hovers around 0.23% of GNI (MFAT, 2023), less than a third of the UN benchmark. We can, of course, afford more. We always could. That’s the thing about budgets: they’re rarely just about what’s affordable. They’re about what we prioritise. When governments want something badly enough, be it tax cuts, tanks, or fibre, they find the money. They borrow, rephase, reallocate. The fiscal tap turns on. Because budgets are belief systems. They reveal what governments truly value not just what they can afford, but what they’re willing to trade when things get tight.
Let’s crunch that belief system. In Budget 2023, New Zealand allocated around NZ$1.47 billion to Vote Official Development Assistance, roughly 0.23% of GNI. By contrast, the government announced plans to invest NZ$12 billion over four years to boost defence spending, aiming to increase it from just over 1% to 2% of GDP (Reuters, 2025). Meanwhile, in 2022, the government spent an estimated NZ$2 billion on fuel tax subsidies to ease cost-of-living pressures (Wikipedia). That’s not to say we don’t need these things, it’s just to give some tangible comparisons of scale.
So, if we wanted to meet the 0.7% target, what would that cost? Just over NZ$4.5 billion, give or take. That’s roughly the same as our annual spend on subsidising petrol, building highways, or funding tax cuts. This is not an economic impossibility. It is a political decision.
Meanwhile, global humanitarian need continues to balloon. The UN’s 2024 humanitarian appeal is over US$46 billion, and less than one-third of that got funded (OCHA, 2024). Sudan, Gaza, the DRC, Afghanistan, crises are deepening, not disappearing. And Pacific Island nations in our backyard, remain chronically under-resourced in disaster preparedness, despite being on the frontlines of climate collapse.
Here’s the kicker: aid only gets to posture as virtuous and generously altruistic because we frame it as a sunk cost, as tithings to the poor. It gets written off (like all other social goods) as an investment without return. And yet, for all the talk of “value for money” in political pomp, humanitarian funding is one of the most cost-effective things we can indeed spend on. Every dollar invested in disaster risk reduction saves up to US$15 in future response and recovery (UNDRR, 2015). It’s almost like preventing bad things happening is far cheaper than cleaning up after them!
So as the Finance Minister delivers the Budget this week, let’s ask: what kind of international citizen is New Zealand choosing to be? One that sees aid as a reparative investment in a more just and equitable world, or one that treats it as a discretionary spend, offered when times are good and quietly trimmed when they’re not?
Because in the end, this isn’t about generosity. It’s about responsibility. If we believe in a rules-based international order, in partnership, in climate justice, in human dignity, then (say it with me) aid isn’t a gift. It’s part of the bill.