ANALYSIS OF FY2007 INTERNATIONAL AFFAIRS BUDGET PROPOSAL

Feb. 7, 2006 - President Bush sent his Fiscal Year 2007 budget proposal to Congress on Monday, February 6. His proposal would increase International Affairs spending for the coming fiscal year by $3.539 billion – an 11 percent increase from FY 2006.

The International Affairs Budget, which funds the State Department and key foreign affairs initiatives, was one of the few areas of the president’s proposal that calls for an increase in spending. However, total spending for foreign affairs still comprises less than 1 percent of the $2.77 trillion federal budget.

Both chambers of Congress will now take the president’s request into consideration as it begins the tedious process of forming its own budget through various appropriation committees. Each chamber will propose a budget of its own and then come together later in the year with a final version that will go to President Bush for his approval or veto.

Some of the key line items in the International Affairs budget that Citizens for Global Solutions will closely monitor throughout the year are:

**Fiscal Year 2007 Budget will fund spending from October 1, 2006 to September 30, 2007**
 

Overall International Affairs 150 Account

FY 2007 Request: $35.12 billion
FY 2006 Enacted: $31.57 billion
Increase from FY 2006-2007: $3.54 billion (11 percent)

Foreign Operations Account

FY 2007 Request: $23.72 billion
FY 2006 Enacted: $20.86 billion
Increase from FY 2006-2007: $2.86 billion (14 percent)

Department of State Operations

FY 2007 Request: $9.31 billion
FY 2006 Enacted: $8.75 billion
Increase from FY 2006-2007: $563 million (6 percent)


Highlights of Specific Accounts:
 

Foreign Operations

• International Organizations & Programs (IO&P)
FY 2007 Request: $289 million
FY 2006 Enacted: $326 million

Change from FY 2006-2007: - $37 million (11 percent)

Voluntary funding for UN agencies and other International Organizations is cut $37 million in the president’s budget request from $326 million to $289 million. According to the State Department, IO&P funds address issues of global concern that “require international consultation and coordination”, where, “solutions cannot be effective unless problems are addressed globally.” The significant decrease is of serious concern to Citizens for Global Solutions and we encourage Congress to supplement the president’s request.

Included in the president’s proposal are cuts of $15 million to the United Nations Development Program (UNDP), the primary development agency in the UN system that works to alleviate poverty, solve environmental problems and fight HIV/AIDS. One bright spot, however, was a request for $10 million for the UN Democracy Fund (UNDEF), which would bring the total U.S. contribution since the fund’s inception in 2004 to $18 million. UNDEF is an important new initiative that will bring together international donors states and non-governmental organizations to provide grants to democracy promotion programs worldwide. Citizens for Global Solutions urge Congress to fully fund $10 million for the UN Democracy Fund.

• Conflict Response Fund
FY 2007 Request: $75 million
FY 2006 Enacted: $ 0 million

Change from FY 2006-2007: + $75 million

The FY 2007 budget proposes $75 million for the Conflict Response Fund (CRF) to build the civilian response capabilities of the United States, including establishment of a civilian reserve component that can quickly provide needed expertise to rebuild the institutions of government in post-conflict or failed-state situations. The CRF would be administered through the State Department’s the Office of the Coordinator for Reconstruction and Stabilization (S/CRS), however no specific funds have been requested for this office.

Although this is a bright spot in the FY 2007 budget, the president has requested larger amounts for similar initiatives (e.g. $100 million was requested for CRF in 2006) in the past and Congress has refused to provide any funds. Citizens for Global Solutions hope that the administration will articulate the vital importance of this program to U.S. national security interests and we urge the Congress to provide the full amount.

• Global AIDS Initiative (GHAI)
FY 2007 Request: $2.894 billion
FY 2006 Enacted: $1.975 billion

Change from FY 2006-2007: + $919 million (47 percent)

The FY2007 request includes $2.894 for the Global AIDS Initiative of which $2.136b is
for the 15 focus countries, $100m is allocated for the Global Fund, $480m for centrally managed programs, $27m as a contribution to UNAIDS, $65m for technical oversight and management and $36m for “strategic information”. The FY2007 total reflects approximately $1b more than was appropriated in FY2006.

• Global Fund to Fight AIDS, TB and Malaria:
FY 2007 Request: $300 million
FY 2006 Enacted: $545 million

Change from FY 2006-2007: - $245 million (45 percent)


The President requested $300m for the Global Fund, $245m less than was appropriated in FY2006. This is approximately $900m less than the $1.2b calculated as the U.S. share of the Global Fund’s needs for the year.

• Child Survival and Health Programs Fund (CSH)
FY 2007 Request: $1.43 billion
FY 2006 Enacted: $1.64 billion

Change from FY 2006-2007: - $211 million (13 percent)

FY07 funding for the Child Survival and Health Programs Fund (CSH) is cut by 13 percent in the President’s request, to $1.433 billion, undermining a long term development assistance program that has emphasized expanding basic health services and strengthening national health systems to significantly improve people’s health, especially that of women, children and other vulnerable populations in the developing world.

• Millennium Challenge Corporation (MCC)
FY 2007 Request: $3.00 billion
FY 2006 Enacted: $1.75 billion

Change from FY 2006-2007: + $1.25 billion (71 percent)

The president requests $3 billion for the Millennium Challenge Corporation (MCC), $1.25 billion over 2006 spending levels and a large chunk of the proposed increase for the entire International Affairs FY 2007 budget. The administration sought the same amount in FY06, but Congress funded the MCC more than $1 billion below the requested amount.

The MCC is designed to provide development aid to countries that pass a series of “measurable indicators” , as determined by the State Department, that are meant to gauge a government’s performance with respect to "ruling justly, investing in their people and promoting economic freedom". The administration deserves praise for increasing America’s commitment to the world’s poorest people; however, the president must demonstrate his commitment to this initiative so that Congress provides the funds necessary to effectively manage the program.

• Peacekeeping Operations (PKO)
FY 2007 Request: $201 million
FY 2006 Enacted: $173 million

Change from FY 2006-2007: + $27 million (16 percent)

As opposed to the U.S. share of UN-assessed peacekeeping operations, which is financed in the State Department budget (see below), PKO funds provide voluntary support for international peacekeeping activities. The majority of PKO funds for 2007 are aimed at resolving conflicts in Africa; $41 million in new funs for Sudan, and $103 million for training and equipping the Global Peace Operation Initiative (GPOI).

The FY 2007 budget increases funding for Sudan by $28 million, from $13 million to $41 million. However, these funds were shifted from 2006 funds allocated for African Regional peacekeeping operations in Burundi, the Democratic Republic of Congo (DRC), Uganda and Rwanda.

GPOI is a presidential initiative would double the number of peacekeepers worldwide over the next five years. It provides financial and technical assistance, primarily to African countries, with the understanding that, by 2010, they will be able to effectively respond to or prevent violent conflicts on their own continent. Armed with such a capacity, these countries will become more effective partners in UN peacekeeping missions around the globe. In conjunction with other G8 nations, GPOI focuses on military training which will increase and improve African peacekeeping forces, as well as the equipment, transport and logistical support necessary for successful peace operations.


Department of State Operations

• Contributions for International Peacekeeping (CIPA)
FY 2007 Request: $1.135 billion
FY 2006 Enacted: $1.022 billion

Change from FY 2006-2007: + $113 million (11 percent)

President Bush’s request includes $1.135 billion for the Contributions to International Peacekeeping Account (CIPA) which pays the U.S. share of 17 UN peacekeeping missions worldwide. This amount is only slightly higher than the FY 2006 enacted level of $1.035 billion. Given that the State Department is already estimating a $500 million shortfall in CIPA funds for 2006 and has announced that it will be forced to stop UN peacekeeping payments in June of 2006 the requested amount is seriously deficient. Even a proposed increased for the UN Mission in Sudan was only achieved through downsizing other operations.

• Contributions to International Organizations (CIO)
FY 2007 Request: $1.269 billion
FY 2006 Enacted: $1.151 billion

Change from FY 2006-2007: + $117.2 million (10 percent)

The 2007 budget proposes increasing by 10 percent, to $1.269 billion, the Contributions to International Organizations Account, which pays U.S. assessed contributions to 47 international organizations, including; the United Nations, the World Health Organization, the North Atlantic Treaty Organization, the International Atomic Energy Agency, the Organization for Economic Cooperation and Development, and others.

The administration has requested $423 million for the UN regular budget, $16.2 million less than last year’s contribution of $429 million.

Other Notable Accounts

International Agriculture Programs (Food Aid and Famine Assistance)

FY 2007 Request: $1.22 billion
FY 2006 Enacted: $1.14 billion

Increase from FY 2006-2007: $80 million (7 percent)

Global Health Programs

• Global HIV/AIDS, Tuberculosis, Malaria and Research
FY 2007 Request: $4.27 billion
FY 2006 Enacted: $3.43 billion

Change from FY 2006-2007: + $843 million (47 percent)

The President’s budget request includes a total of $4.27b for global AIDS, TB, Malaria and Research, a net increase of $843m over FY2006 spending levels. The increase is largely the result of a large increase in the President’s Emergency Plan for AIDS Relief focused on 15 countries and the newly announced President’s Malaria Initiative.
 

+ Budget Table

Updated February 8, 2006