Chief executive says she can’t understand the move, which she says will harm drought-affected families

This article is more than 1 year old

This article is more than 1 year old

Australia’s largest food charity has called out the government for slashing its funding for a key program by almost half just six weeks from Christmas, a situation it says “beggars belief”.

Foodbank helps provide pantry essentials to more than 710,000 Australians impacted by natural disasters or economic hardships through its Key Staples program, which sees the organisation work with manufacturers, suppliers and transporters to provide rice, flour, cereals and canned goods to 2,600 charities and 1,750 schools around the country.

But in the third cut to its federal funding since 2014, Foodbank chief executive Brianna Casey said the government was now asking the organisation to absorb another cut, which would leave it with less than $430,000 a year for a key program. Three years ago, the organisation received $1.5m a year to do the same job.

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The latest cut, which works out to about $323,000 a year, comes into effect from January 2019, impacting contracts and arrangements the organisation already had in place.

“I just cannot fathom why this is happening at all, let alone at one of the most challenging times of year for vulnerable Australians and our drought affected communities,” Casey said in a statement.

Earlier this month, the social services minister Paul Fletcher announced $4.5m would be allocated to three organisations – Foodbank, SecondBite and OzHarvest – as part of a $204.5m emergency support funding package.

“This funding enables community organisations to get food supplies to many Australians impacted by crisis, including those currently doing it tough in the bush, Fletcher said.

“And we can pay for these vital grants by keeping our economy strong and the federal budget on the path to surplus.”

In a statement, the minister defended the decision and said overall funding for food relief programs had not been cut.

“After applications from six NGOs, it’s now being applied to three organisations – Foodbank, OzHarvest and SecondBite – instead of two,” he said. “The allocations were made after a rigorous, competitive selection process, managed by the Department of Social Services.

“Foodbank does excellent work in the food relief space. They’ve received $1.925m in the latest round of grants – more than any other organisation. OzHarvest is receiving funding for the first time and SecondBite has had an increase of $100,000 …

“Emergency relief is being provided to 89 regions covering all of Australia. For most, funding has remained constant or has increased.”

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Guardian Australia understands the $4.5m had originally been budgeted over three years for two organisations, but with the government now spreading it across three, Foodbank’s key staples program was cut.

Foodbank works by utilising relationships with suppliers, who either subsidise or donate stores, which is then sent to manufacturers who produce and package the goods using spare production capacity.

“The federal government funding is essential to glue these productions arrangements together,” Casey said.

“… In our pre-budget submission we made a compelling case for why it is critical that this funding be increased to address the hunger crisis we are currently facing with 4 million Australians exposed to food insecurity every year. Instead, our flagship program is now at risk and our ability to deliver emergency drought relief in times of natural disaster will be compromised. We call on the prime minister to correct this short-sighted decision.”

While Foodbank’s key staples program deals with pantry stores, OzHarvest collects surplus food from supermarket and the hospitality sector and diverts it to those in need.

The Labor leader, Bill Shorten, has picked up Foodbank’s case, writing to Scott Morrison in an effort to reverse the decision.

“Foodbank uses this modest amount to secure more than $8m worth of essential food for hungry Australians. All of this is now at risk,” he writes, in the letter seen by Guardian Australia.

“Your government’s cut will have a major impact on Foodbank’s supplies, and risks compromising their ability to distribute emergency food relief during natural disasters.

“I am genuinely surprised by this mean and foolish decision.”

The situation is similar to the situation charity founder Father Chris Riley found his Youth Off the Streets organisation in last month, after a change in funding instruments left the education arm of his charity with a $630,000 debt.

Less than a day after his story went public, education minister Dan Tehan stepped in to wipe the debt, while promising to find a long term solution to the “unique” issue the funding formula change had created for Riley’s program.