ECONOMIC AND SOCIAL COUNCIL HOLDS PANEL DISCUSSION ON NEEDS-BASED HUMANITARIAN FINANCING, INCLUDING CENTRAL EMERGENCY RESPONSE FUND

ECONOMIC AND SOCIAL COUNCIL HOLDS PANEL DISCUSSION ON NEEDS-BASED HUMANITARIAN

FINANCING, INCLUDING CENTRAL EMERGENCY RESPONSE FUND

(Reissued as received.)

GENEVA, 17 July (UN Information Service) -- The Economic and Social Council (ECOSOC) this morning continued its humanitarian segment, holding a panel discussion on the theme of needs-based humanitarian financing, including the Central Emergency Response Fund (CERF).

Hjalmar Hannesson (Iceland), Vice-President of the Council, introducing the discussion, said the scale and magnitude of humanitarian emergencies had put pressure on the international community to make more efficient use of funding, thus prompting the development of new mechanisms to improve the predictability and impartiality of funds.  The establishment of the CERF by the General Assembly was one important step towards meeting the demands of affected countries for faster, more predictable and impartial funds.

John Holmes, Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator, said humanitarian relief was everyone’s business.  This put increased pressure on the international community.  The funds available should be impartially applied to the areas affected.  There was a need for a more needs-based effort.  The good practices codified had a critical role to play, not least to make sure that there was rapid funding where it was needed, and some progress had been made in this regard.  However, the gap between the best and the least funded emergencies remained as wide as ever.

Marika Fahlen, Ambassador and Special Envoy of Sweden, Chair of the CERF Advisory Group, said when the General Assembly decided to upgrade the Central Emergency Revolving Fund as it was then called, it signalled reform in two ways: existing funding mechanisms could not compensate for inequities in selected donor response; and the coordination, coherence, timeliness, transparency and predictability of humanitarian response in general were in need of improvement.  It was therefore logical that the coming into being of the CERF was part and parcel of a broader reform of the humanitarian system, and was seen as a catalyst in this regard.

Oluseyi Bajulaye, United Nations Deputy Humanitarian Coordinator and Officer-in-Charge and Deputy Special Representative of the Secretary-General in Sudan, said Sudan was in a situation marked by ongoing conflicts, particularly in Darfur.  But there were also opportunities for peace, such as with the signing of the Darfur Peace Agreement.  There was a mixed situation of an ongoing peace progress and humanitarian operations.  The humanitarian financing mechanisms in Sudan had four components, he said.  The largest was the bilateral funding, followed by the common humanitarian fund since 2006.

Daniel Toole, Deputy Executive Director, a.i., Director of the Office of Emergency Programmes of the United Nations Children’s Fund, said determining humanitarian needs was central to any crisis response.  At its core, failure to address basic needs violated fundamental human rights - so clear identification of needs was crucial.  Needs-based financing, a central component of the humanitarian agenda, aimed to strengthen the collective response to humanitarian crises.  Financing of these crises should be informed by a clear understanding of the needs of affected populations, especially the children, women and elderly who were the most vulnerable groups in an already-vulnerable population.

Nick Roseveare, Humanitarian Director of Oxfam, said there was no reliable data available on how much assistance actually reached intended beneficiaries.  Despite the ground swell of good will and unprecedented levels of emergency aid and development assistance, for too may people the help was too little, too late.  These shortfalls in humanitarian funding and the global imbalance of assistance effectively resulted in increased poverty, suffering or death.  The United Nations and non-governmental organizations (NGOs) must agree upon more effective partnerships to simplify funding relationships: United Nations agencies must improve their financial management structure with regards to NGO allocations and funding disbursement.

The moderator of the panel discussion was Sylvain Maliko, Minister of Planning, Economy and International Cooperation of the Central African Republic.

Among issues raised by speakers during the discussion was the need for a coherent humanitarian response strategy and the use of the CERF’s emergency funds for immediate action; the need to maintain the trend of widening the donor base to ensure sustained participation; that humanitarian need was the basis for improving financial mechanisms, and changes to the system should ensure better meeting of humanitarian needs with the provision of assistance to populations; if the United Nations ever had to undertake a diagnostic study of what national platforms existed in the developing world to address humanitarian problems; and whether added value had been found in creating CERF, and if so what made it so effective.

Speaking in the general debate were the representatives of Portugal on behalf of the European Union, United States, Norway, Germany, Bolivia, Somalia, Turkey, Russian Federation and Sudan.  Also speaking were representatives of the International Federation of the Red Cross and Red Crescent, and the Economic Community of West African States.

This afternoon at 3 p.m. the Council is scheduled to conclude its general discussion under the humanitarian affairs segment on special economic, humanitarian and disaster relief assistance, and take action on draft resolution L.15.  Subsequently, under its coordination segment, it is scheduled to take action on draft resolution L.14.

Opening Statements for Panel Discussion

HJALMAR HANNESSON (Iceland), Vice-President of the Economic and Social Council, introducing the discussion, said the scale and magnitude of humanitarian emergencies had put pressure on the international community to make more efficient use of funding, thus prompting the development of new mechanisms to improve the predictability and impartiality of funds.  The establishment of the Central Emergency Response Fund by the General Assembly was one important step towards meeting the demands of affected countries with faster, more predictable and impartial funds.  In addition, several country-level financing mechanisms had been developed to better target funds based on priorities determined by humanitarian coordinators and country teams. The success of these new mechanisms would depend on the way they were able to work together in a strategic fashion.

JOHN HOLMES, Under-Secretary General for Humanitarian Affairs and Emergency Relief Coordinator, said it was a pleasure to open the segment on humanitarian financing, which was of critical importance for everyone.  The humanitarian organizations were a very large family, but like in all families, things got complicated once they started talking about money.  The recent trends in humanitarian funding were significant.  The amount of funds mobilized showed a broadening of the donors.  According to the United Nations financial tracking service, total humanitarian funding for 2005 reached $ 13 billion.  This was part of a wider trend of the increasing scale of the funding levels.  In 2005 there was a combination of the tsunami and the Pakistani earthquake, which contributed to that high figure.  It was worth noting that this showed an unprecedented outpouring of generosity.  Although 70 per cent of humanitarian assistance was still financed by the most important donors, the donor base was following a broadening trend.  Humanitarian relief was everyone’s business.  This put increased pressure on the international community.  The funds available should be impartially applied to the areas affected.  Some countries were still chronically under funded, such as the Democratic Republic of Congo and the Central African Republic.

There was a need for a more needs-based effort, Mr. Holmes said.  The good practices codified had a critical role to play, not least to make sure that there was rapid funding where it was needed.  Some progress had been made in this regard.  Given the number of actors engaged, a greater degree of coherence needed to be reached among the funding community.  Pool funds were intended to provide more equitable distribution because they should provide better coordination.  The pool funds included the Central Emergency Response Fund (CERF), the common humanitarian funds at the local level and emergency response funds, also at the local level.   There was a shift to more strengthening in management and accountability in these funds.  The role and authority of the local coordinator was also strengthened.  Some significant headway of fully funding the CERF by 2008 had been made.  Donors had pledged around $ 350 million in 2007, so the goal set seamed to be reachable by 2008.  The ratio between the rapid response window and the under-funded window would be redressed by the end of the year to two thirds and one third.

The overall system had benefited from the CERF because it was additional funding and not just displaced funding, Mr. Holmes said.  In the 45 countries where CERF funds were allocated, the Resident Coordinator had played a crucial role in identifying and prioritizing the most urgent needs and determining how to best use the funds.  As an example, the common humanitarian funds in Sudan and the Democratic Republic of Congo had helped to make out shortfalls.  They had also contributed to the increase of the overall availability of funds.  Other funds were dedicated to support non-governmental organizations on the ground.  They had financed over 500 projects within the range of lifesaving projects.  The relationship between the global and local funds needed to be clarified and rationalized to make sure their comparative advantages were best used.  Better and clearer guidance and training on how to best use the funds was also an important issue.  On the Consolidated Appeal Process, the common humanitarian action plans had to be improved.  Some significant progress had been made in this respect.  But the gap between the best and the least funded emergencies remained as wide as ever.  One could see increased effectiveness of humanitarian assistance.

MARIKA FAHLEN, Ambassador and Special Envoy of Sweden, Chair of the Central Emergency Response Fund (CERF) Advisory Group, said when the General Assembly decided to upgrade the Central Emergency Revolving Fund as it was then called, it signalled reform in two ways: existing funding mechanisms could not compensate for inequities in selected donor response; and the coordination, coherence, timeliness, transparency and predictability of humanitarian response in general were in need of improvement.  It was therefore logical that the coming into being of the CERF was part and parcel of a broader reform of the humanitarian system, and was seen as a catalyst in this regard.  The mandate of the CERF was quickly turned into practice; many donors showed their commitment through early and even multi-year pledges.  Within weeks, a small Secretariat was established, as were guidelines and training, and the first disbursements were made.

It its meetings to date, the Advisory Group had reviewed the situation of the CERF, performance and accountability, management of the CERF, transparency, and many other issues.  Reports and recommendations were publicly available.  It was hoped that the observations and suggestions, in addition to being support to management, would also help guide the Member States on the scope, extent and mandate of the Fund.  Throughout the meetings, the Emergency Relief Coordinator had been in attendance and available for questions and briefings.  In Geneva and New York there had been consultations with agencies eligible for CERF funding.  The delivery capacity of the agencies, perceived structural weaknesses of the Fund and ways of making better use of the CERF had been addressed.  The Group had urged transparency, and asked that the 3 per cent overhead be used to fund the CERF Secretariat.

The Advisory Group had also looked at the benefits of linking CERF funding with pooled humanitarian resources at the country level.  Non-governmental organizations (NGOs), currently not eligible to CERF funding, had more easy access to such country resources.  The Secretary-General, in his report on CERF, recognized the need for more rapid pool-funding.  In recognition of the fact that NGOs often accounted for the bulk of humanitarian work on the ground, more should be done to explore means in which NGOs and other partners could access CERF more easily.  Ultimately, it was the Member States in the Council and the General Assembly which decided on eligibility criteria for the CERF.  The Advisory Group had put much emphasis on the need to clarify the role of the Resident Coordinator in managing CERF resources, and these terms of reference should be reviewed.  There should be a consultative process with a number of Humanitarian Coordinators, and this was being arranged.  The CERF should show clear signs of being able to make a difference in terms of reducing the loss of life, and the speed of decision-making depended on the clarity of the criteria being used in this regard.

OLUSEYI BAJULAYE, United Nations Deputy Humanitarian Coordinator and Officer-in-Charge and Deputy Special Representative of the Secretary-General in Sudan, said that his presentation would give an overview of what was being done in Sudan.  It would focus on the key areas of pool funding.  Sudan was in a situation marked by ongoing conflicts, particularly in Darfur.  But there were also opportunities for peace, such as with the signing of the Darfur Peace Agreement.  There was a mixed situation of an ongoing peace progress and humanitarian operations.  The situation remained as volatile as ever with over 5.8 million people receiving humanitarian assistance.  In 2003, $4.2 billion were raised for humanitarian aid to Sudan.  Since 2004, it was approximately $1 billion per year.  Over the past years, a work plan had been developed.  It was a joint plan of United Nations agencies and non-governmental organization (NGO) partners.  It was a combination of planning, coordination and resource mobilization.  It incorporated relief, recovery and development.  The first plan was developed in 2005.  The plan was divided in regional and sectoral parts.  The implementation of the work plan was monitored by an evaluation unit, which was under the umbrella of the Resident Coordinator’s office.

The humanitarian financing mechanisms in Sudan had four components, Mr. Bajulaye said.  The largest was the bilateral funding, followed by the common humanitarian fund since 2006.  In Southern Sudan, there was also the emergency response fund since 2005.  The CERF facilities were there since 2006.  The common humanitarian fund framework was managed by the humanitarian coordinator through a decentralized allocation process.  NGOs had access to common humanitarian fund funding through partner agreements with the United Nations Development Programme.  The average allocation size was approximately $ 385,000.  It was mainly non-food allocation.  Only the prioritized activities were selected and funded.  The objectives were, among others, to provide early and predictable funding to most critical humanitarian needs in the work plan.  It also supported coordinated and strategic funding of humanitarian activities.  With regard to the emergency response framework, it was particularly important for NGOs, which were the main beneficiaries.  The allocation process was managed by the Office for the Coordination of Humanitarian Affairs (OCHA).  The strength lay in the fast decision making process, normally within 48 hours.  The CERF had enabled the United Nations to respond to urgent humanitarian needs that the common humanitarian fund could not support.  There were $ 46 million in grants since the beginning of 2006: $ 40 million for rapid response and $ 6 million for under-funded sectors.

There were complementarities of the funding mechanisms, Mr. Bajulaye said.  The CERF served for emergencies not covered by the common humanitarian fund.  The emergency response fund was addressing gaps in emergency response, implemented as a fast track window within the common humanitarian fund.  The coordination between the funding mechanisms was at the country level working with the technical support of OCHA.  NGOs had access to the common humanitarian fund as participating actors.  There were eight steps for the allocation of common humanitarian fund funding, such as the determination of the initial volume of common humanitarian funds for allocation, among others.  The last step of the work plan was then the disbursement of funds to the recipients.  The benefits of the common humanitarian fund framework were, among others, the empowering of the role of the humanitarian coordinator and a greater ability to target funds.  The NGOs’ participation in the planning process was also strengthened.  Among the common humanitarian fund partners’ concerns with the fund was a concern on the lack of adequacy with regard to the sector capacity at regional level.  In addition, there was a lack of predictability of common humanitarian fund funding, caused by late donor commitments.  With regard to the issue of monitoring and evaluation, a sector reporting on all sector plan indicators was being conducted twice a year.  Among the lessons learnt by the common humanitarian fund was the necessity of a high transparency of the allocation process, among others.

DANIEL TOOLE, Deputy Executive Director, a.i., Director of the Office of Emergency Programmes of the United Nations Children’s fund (UNICEF), said determining humanitarian needs was central to any crisis response.  At its core, failure to address basic needs violated fundamental human rights -- so clear identification of needs was crucial.  Needs-based financing, a central component of the humanitarian agenda, aimed to strengthen the collective response to humanitarian crises.  Financing of these crises should be informed by a clear understanding of the needs of affected populations, especially the children, women and elderly who were the most vulnerable groups in an already-vulnerable population.

There were four main pillars to recent efforts to improve humanitarian response.  First, the work to strengthen the predictability and accountability of response had undoubtedly led to increased attention to long-standing gaps, increased and timely deployment of capacity, and clearer responsibilities for leadership.  Second, to strengthen overall coordination, there had now been significant efforts to ensure that Humanitarian Coordinators and sitting Resident Coordinators were sufficiently equipped to address humanitarian concerns when they occurred.  Third, there had been increasing commitment and inclusive dialogue for strengthened and broader partnerships.  Finally, the different funding mechanisms were leading to more timely and dependable resource allocations.

Emergencies, particularly natural disasters, were likely to increase in both number and scale in the coming years, so improvements needed to expand urgently.  A clear understanding of the nature, scope and breadth of how populations were affected by humanitarian crises and their needs was critical to informing the system response.  Such a needs analysis should be led by national and sub-national Governments along with other partners.  No single tool could provide all the information that was needed, and harmonization of these tools was, therefore, essential.  Financing decisions should be closely linked to needs.  The Central Emergency Response Fund had made an important contribution both to rapid life-saving activities and to critical humanitarian interventions in under-funded crises.  Nevertheless, too many protracted crises remained chronically under-funded.  Significant progress had been made in the development and use of needs-assessment tools to improve funding decisions - there should be greater participation and ownership of these assessment tools by national and sub-national Governments and national capacity should be adequately strengthened by these tools.

NICK ROSEVEARE, Humanitarian Director of Oxfam, said that in 2005/6, an estimated 46 million people were affected by natural disasters or conflict and in need of humanitarian emergency assistance.  In 2005/6, donors committed an estimated total of $ 18 billon to humanitarian assistance, which showed a rise in total humanitarian spending for the fourth successive year.  2005 and 2006 also saw a surge of new, non-traditional donors of both bilateral and multilateral emergency funding.  However, global humanitarian assistance for 2005 was exceptional.  Of the $ 18 billion contributed, an estimated $ 6 billion alone was driven by the tsunami relief.  More importantly perhaps, there was no reliable data available on how much of this assistance actually reached intended beneficiaries.  Despite this ground swell of good will and unprecedented levels of emergency aid and development assistance, for too may people the help was too little, too late.  These shortfalls in humanitarian funding and the global imbalance of assistance effectively resulted in increased poverty, suffering or death.

Oxfam was generally supportive and engaged in the reform agenda, Mr. Roseveare said.  However, the organization was a critical supporter.  Oxfam welcomed many of the conclusions highlighted in the report of the Secretary-General on the Central Emergency Response Fund (CERF) and understanding that the interim review of the CERF was making good progress in several areas.  There was a need for increasing the speed and predictability of disbursement.  The original intention of the CERF was to provide predictable funding allocation.  This could be only successful if it would arrive within a predictable timeframe and impact upon the beneficiary within a predictable timeframe.  On average, the time lag between the date of application for CERF funding and disbursement of funds to United Nations agencies was a month and a half to two months.  Some improvements had been seen over time, as well as certainly a high awareness of this issue and determination to address it.  The CERF Secretariat and United Nations agencies must increase transparency and efficiency by standardizing the inclusion of non-governmental organizations (NGOs) in in-country CERF decision-making and prioritization.

The United Nations and NGOs must agree upon more effective partnerships to simplify funding relationships, Mr. Roseveare said.  United Nations agencies must improve their financial management structure as regards NGO allocations and funding disbursement.  With regard to the amount of the funding, evidence showed that under-funded emergencies benefited from the availability of extra-funding.  CERF allocations were too small to cover existing needs.  There remained a very valid concern that significant amounts of funding were being withheld by United Nations agencies as overheads and were therefore not being translated into new and better programmes to benefit people in need.  The CERF alone clearly could not address the global shortfall in humanitarian funding.  The CERF had been a key mechanism to enable some otherwise forgotten emergencies or unpopular ones from donor perspectives, to be more reliably funded.  On the issue of the funding mechanisms, it was very important that a diversity of mechanisms existed since the flaws and successes in applications varied enormously geographically between different funding mechanisms.

Discussion

In the discussion following the presentations, speakers raised a range of issues and questions, including, among other things, the need for a coherent humanitarian response strategy and the use of the Central Emergency Response Fund’s (CERF) emergency funds for immediate action; the need to maintain the trend of widening the donor base to ensure sustained participation; that further measures could be taken to ensure rapid dispersion of CERF funds and that delays continued to take place although there had been cases of success; that humanitarian need was the basis for improving financial mechanisms, and changes to the system should ensure better meeting of humanitarian needs with the provision of assistance to populations; the need to look at the interface between vulnerability and humanitarian assistance; how to measure and define humanitarian vulnerability as part of the humanitarian assessment; that analysis of humanitarian work should be based on field experience; the issue of CERF’s overheads and a request for what were the overhead costs of Oxfam when getting United Nations money; if the United Nations ever had to undertake a diagnostic study of what national platforms existed in the developing world to address humanitarian problems; and whether added value had been found in creating CERF, and if so what made it so effective.

Concluding Remarks

Mr. HOLMES, Under-Secretary-General for Humanitarian Affairs and Emergency Relief Coordinator, said that he wanted to comment on the question of the overhead costs of the Central Emergency Response Fund (CERF) and the programme support costs going to the United Nations secretariat.  From the 3 per cent, the costs of the secretariat would be met from there.  On the question of the rational behind the increasing of the staff, the increasing number of projects made it necessary to increase the staffing as well, up to 12.  With regard to local judgement, it was better reflecting the realities on the ground.  On the question of vulnerability and needs assessment, the definition of humanitarianism was expanding.  Concerning the question about the national capacity to address humanitarian needs in different countries, this problem was recognized and it was of increasing importance and was under the mandate of the Office for the Coordination of Humanitarian Affairs.

The added value of CERF was to provide a more rapid response to new emergencies, Mr. Holmes said.  It had proved its value in this sense.  There could be regional appeals as there were for the tsunami.  On the question on which countries were well funded and which were not, countries better funded than in the previous years were Sudan, Burundi, Chad and the Central African Republic.  The reform had made a difference in improving the unevenness of the funding in the past.  There was a clear mandate through the existing mechanisms.  Finally, in response to the question of Sudan, OCHA made sure that budgets were used for local purchases rather than on the global market.

Ms. FAHLEN, Ambassador and Special Envoy of Sweden, Chair of the Central Emergency Response Fund (CERF) Advisory Group, said on whether the Advisory Group was either asking for or making its own evaluations of the CERF, the Group did support the management of the CERF in that it encouraged reviews and internal evaluations in the Office for the Coordination of Humanitarian Affairs, and reviewed these, much as it reviewed how the terms of evaluation and such exercises were done.  In the large two-year evaluation that would take place for the General Assembly to examine next autumn, the terms of evaluation would be reviewed, as would be the situation of CERF within the humanitarian agenda.

Mr. BAJULAYE, United Nations Deputy Humanitarian Coordinator and Officer-in-Charge and Deputy Special Representative of the Secretary-General in Sudan, said that on the common humanitarian fund management process in Sudan, an evaluation unit had been established this year to see how the tasks were performed.  Through the Advisory Group, consisting of the principle donors and other donors, the issues improving the common humanitarian fund process were taken into account.  On the question of the use of natural resources for natural disaster relief, food procurement was important for the internally displaced persons’ population.  In terms of logistics, the World Food Programme made arrangements with local transporters, for example.

Mr. TOOLE, Deputy Executive Director, a.i., Director of the Office of Emergency Programmes of the United Nations Children’s Fund (UNICEF), said on vulnerability analysis and needs assessment, there was a need for a modular approach with regards to the latter, which should be put together progressively.  Vulnerability analysis was an essential analysis which had to be built over time, and there should be assessment before the emergency, as this would make it easier to track vulnerability at the onset and subsequent stages of the emergency.  Regional organizations should promote greater awareness of the needs to be ready for emergencies, as these could strike anywhere, and Governments from all Member States should be ready to respond.  Regional organizations could help in this regard, and could also try to identify partnerships before emergencies.  Concrete measures should be taken at national and community level on how to prepare for emergencies and reduce risk.

Mr. ROSEVEARE, Humanitarian Director of Oxfam, said that it was important to analyse the situation, especially with regard of the phase of increasing problems caused by natural disasters.  On the question on overheads and core costs in reaction to funds taken from Oxfam’s zone, they were taken from the department in charge and not from the emergency fund.  The core costs were budgeted within the organization.  The amounts of funds received varied.

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