The lucrative awards provide elite students from poorer nations with a stipend of about $25,000 a year and also cover their university or college fees in Australia.

But while the program’s aim is to reduce poverty, the Howard, Rudd and Gillard governments have used it increasingly for diplomatic ends.

Analysis: Development dollars are too precious to waste

Last year’s budget revealed the Government planned to double the development scholarship scheme to about 3800 places a year by 2014, with AusAID predicting it would cost $1.7billion over the next five years.

However, documents obtained under freedom of information law reveal the aid agency has struggled for years to measure whether the program works. Despite requiring that graduates return home for at least two years to use their new skills to help their country, AusAID has no idea how many scholars do this.

One report also suggests ministers in poorer countries treasure the education awards as a form of patronage, seeing them as ”’rewards’ that can be granted to chosen candidates”.

Deep concerns exist within the aid sector about the program, which some groups say has no relevance to alleviating poverty. A Canberra Times investigation also found the 13-year-old Australian Development Scholarships scheme was used to train several students in courses of dubious merit, such as interior design, photography and real-estate studies.

AusAID also paid for the children of government ministers in at least two countries – Papua New Guinea and Laos – to study in Australia.

A confidential three-part evaluation of the scholarships, carried out by consultant Margaret Gosling between 2008 and 2010, found they ”are not clearly enough linked to the capacity-building objectives of country programs”. She also suggested the scheme was driven by politics and diplomacy as much as aid.

”As might be expected, this agenda is generally more important to ministers and to other whole-of-government representatives at posts and cannot be discounted … Travelling politicians also find scholarships handy ‘announceables’ …”

A separate study in 2008 reported, ”Unfortunately, the major findings of this review are that the selection, reintegration and [monitoring and evaluation] processes of most AusAID scholarships programs are not in good shape … These problems have, for a very prolonged period, consistently defeated all attempts to demonstrate any level of effectiveness.”

Auditor-Genera l Ian McPhee is understood to be investigating the program and is expected to issue a report within weeks.

However, AusAID has strongly defended its scholarships as ”a key aspect of Australia’s commitment to education in developing countries”.

”They achieve key aid objectives through education and increase the capacity for countries to drive their own development,” it said.

A spokeswoman said the agency now ensured that scholarships aligned to the ”development priorities of partner countries” and that all courses were in fields that supported those aims.

She said scholars were chosen fairly and some applications were assessed without details that could identify the applicants. ”Given AusAID selections are based on the quality of the candidate, a family relationship does not exclude a candidate from consideration.”

AusAID does not publish the courses in which its scholars enrol, but says more than half study governance, health and education, while about one in four study ”society and culture” or ”other” fields.

The agency says it lacks records of its scholars ever studying design and photography, though this newspaper has evidence of development scholarships awarded in those fields.

Aid/Watch co-director Gary Lee said the scheme inflates Australia’s official aid budget and has never been backed by evidence that it alleviates poverty.

”The more cynical view is that this is about propping up Australian universities. It appears many of these scholarships are more about building Australia’s brand and supporting diplomatic relationships rather than reducing poverty.”

The Australian Council for International Development has also urged the Government to cut spending on scholarships and instead use the money to help schools and colleges in poorer nations.

Executive director Marc Purcell said there was a place for tertiary scholarships, but ”the major focus needs to be building up primary and secondary education in poor countries”.

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