We used to think there were some issues that were too important to drag into the political bear pit and foreign aid was one of them. This is no longer the case, writes Mike Steketee.

To adapt the words of 18th century Prussian general Carl von Clausewitz, government is the continuation of politics by other means.

The gentler, kinder, quieter Tony Abbott we have seen since the election should not be mistaken for a reluctance to practise the special brand of brutal politics he perfected in opposition.

The day after his swearing in last week, the Prime Minister appeared with NSW Premier Barry O'Farrell to promise $1.5 billion in Commonwealth funding for a Sydney motorway project.

Where's the money coming from? A $4.5 billion reduction over four years in foreign aid spending. This is from a program running at around $5 billion a year. It was by far the biggest of the new cuts announced when the Coalition finally released its policy costings two days before the election.

Politically, the aid budget was a sitting duck: it has been growing rapidly, it already had been cut several times by Labor, and, as populist causes go, sending money overseas does not rank highly. If that wasn't enough, foreign aid had been a particular priority of Kevin Rudd.

As well as the Sydney motorway, the Coalition said the foreign aid savings would fund major road projects in Melbourne and Brisbane. There was no reason to make such a link, other than a purely political one; the Coalition simply could have said the extra spending would come from its overall $42 billion of claimed savings.

There is no doubting which form of spending has the greater potential to win votes, and it was not a point that Abbott missed. In his 2009 book Battlelines, he wrote that people who could afford to live in the inner-city or on a train line underestimated:

...the sense of mastery that many people gain from their car. The humblest person is king in his own car ... For too long, policy makers have ranked motorists just above heavy drinkers or smokers as social pariahs. Motorists are not self-indulgent burdens on the community, too unfit to ride a bike or too selfish to catch a bus. They're citizens going to work, doing the shopping, taking the kids to school or visiting their relatives.

Yet Abbott also acknowledged the limitations of road building in capital cities:

Of course, new major roads would quickly become congested in peak times but that would largely be due to the additional economic activity that they'd generate.

He did not add the significant costs to the economy from congestion - costs that will rise because the new government is withdrawing federal funding for urban public transport.

We used to think there were some issues that were too important to drag into the political bear pit and foreign aid was one of them. It is an area that can succumb quickly to popular prejudice, along the lines of "why don't we spend the money on things we really need, like more roads". And there always are examples of waste in the foreign aid budget, as there are in most government programs.

But in government, politicians generally come to realise that, in terms of priorities, aid spending is worthwhile. The first two budgets of the Howard government cut heavily into foreign aid. But then in 2005, John Howard committed to large increases, doubling aid spending to $4 billion by 2010 as part of Australia's contribution to the United Nations Millennium Development Goals. There since has been significant progress in meeting these goals, including large reductions in the numbers going hungry, in deaths of children under five, and deaths in childbirth.

The debate continues over how much aid has contributed to lifting people out of poverty, as distinct from the spectacular economic growth generated by countries like China and India. Mind you, there are large parts of the world, including small island states and landlocked countries, that will never be able to turn themselves into economic powerhouses.

But aid programs have another objective - saving lives. Programs to encourage breastfeeding in the first hours of life greatly reduce infant deaths. Oral rehydration kits and antibiotics could prevent many of the 29 per cent of deaths before age five that are due mainly to diarrhoea and pneumonia. Bed nets and immunisation are other simple solutions that have saved millions of lives. International aid from government and private sources has largely eradicated diseases such as smallpox and polio.

AusAID lists programs that helped immunise 900,000 children in Papua New Guinea against measles and other diseases between 2009 and 2011. A worldwide vaccination initiative to which it contributed immunised 288 million children, preventing an estimated 5.4 million deaths. Malaria deaths in the Solomon Islands, where Australia is the major donor, have halved. Australian aid will pay for an estimated 630,000 poor children to go to school in Indonesia and Papua New Guinea.

Money is spent in many other areas, such as strengthening institutions and improving governance, where progress is harder to measure but which are important in the long run. Under Rudd, the sharpest focus of the aid program has been on alleviating poverty - a position endorsed by the Coalition.

The Coalition also committed to matching the large increase in spending that started under Howard and continued under Rudd, with the aim of lifting aid from 0.25 per cent of gross national income in 2005 to 0.5 per cent by 2015-16 – that is, 50c in every $100. But subsequently it went along with successive Labor decisions to postpone this target and divert aid money into spending on asylum seekers.

Now, the Coalition has gone further with its $4.5 billion cut that, according to economist Stephen Howes of the Australian National University, will see aid falling from 0.35 per cent of GNI in 2012-13 to 0.31 per cent in 2017. The 0.5 per cent figure remains what Abbott calls "an aspirational goal" but one without a target date.

Since the election, the Coalition has sent a further signal by downgrading AusAID from an independent agency to one absorbed into the Foreign Affairs department. Whatever the argument for bureaucratic rationalisation, it means the loss of significant expertise in foreign aid and inevitable competition between foreign policy goals and those of alleviating poverty and economic development. In a Foreign Affairs department that has been complaining for years about a shortage of funds, it raises the real risk that AusAID resources will be diverted.

In April, Julie Bishop, now Foreign Minister, said: "It makes sense to have a Minister for International Development because of the size of the foreign aid budget." She added that the minister should be in charge of a separate department. Abbott did not agree, not even retaining the parliamentary secretary for aid he had in opposition.

That is one more signal about his priorities.

Mike Steketee is a freelance journalist. He was formerly a columnist and national affairs editor for The Australian. View his full profile here.