The world’s overstretched humanitarian system needs substantial reform, new sources of funding and greater efficiency to safeguard a global public good simply “too important to fail,” a new study said.
Nine experts, who were appointed by UN Secretary-General Ban Ki-moon, produced a report on humanitarian financing to inform talks at May’s World Humanitarian Summit. Officials at the meeting are to be tasked with devising ways to reinvigorate the aid system in a time of unprecedented displacement caused by multiple man-made and natural disasters.
As well as providing concrete fundraising suggestions — including micro-levies on corporations, a voluntary solidarity tax and increased use of Islamic funding, such as zakat religious contributions and Islamic bonds — the experts had sharp words for a system often riven by “turf wars.”
Illustration: Mountain people
The world already spends about US$25 billion — 12 times more than it did in 2001 — to support the estimated 125 million people left destitute by war and natural disasters, but at least another US$15 billion is needed, the report’s authors said.
“This is a lot of money, but not out of reach for a world producing US$78 trillion of annual gross domestic product,” wrote the high-level panel of experts, adding that the funds raised for humanitarian aid in 2014 amounted to just 0.031 percent of global GDP.
European Commissioner for International Cooperation, Humanitarian Aid and Crisis Response Kristalina Georgiev, who co-chaired the panel, told reporters in Brussels that the number of people in need had almost quadrupled since the beginning of the millennium.
“If they were a country, this would be the 11th largest country in the world — just between Japan and Mexico — and people in this country would, most of the time, be scared for their lives. They would be often out of their homes — 60 million of them, with an average duration of displacement being 17 years,” Georgiev said.
Should the needs of citizens of this “invisible country” remain unaddressed, the world would fail to achieve the sustainable development goals adopted at the UN in September last year, the report said.
Georgieva said fixing the aid system is possible.
“This is one problem that, if we muster the political will, we can solve. Why? Because not only is it morally right, but it is also in our own self-interest. We do not have to look further than Europe’s refugee crisis to understand this,” she said.
The report focused on reducing humanitarian needs, raising more money and improving efficiency.
Global political leadership was identified as key to achieving the first of these goals, with the emphasis on preventing conflicts and increasing investment in disaster risk reduction. To this end, the report recommended that official development assistance should focus on fragile situations. The experts called for a threefold increase in funds for the International Development Association’s crisis response window and an easing of eligibility criteria to allow middle-income nations to access grants and low-cost loans if needed. The experts also recommended that UN member states put 1 percent of core funding allocated to peace operations into the UN Peacebuilding Fund.
They also advocated the creation of a voluntary solidarity levy at the May summit in Istanbul, Turkey, although Georgieva said the panel was unable to agree on specifics. Some proposed an air ticket or gasoline levy, while others were “dead against” any tax.
Georgieva, a Bulgarian national and former vice president of the World Bank, said the panel had also looked at micro taxes on entertainment and travel.
“Here you have concerts, you have entertainment, movies, sport, potentially taxi rides,” she said, adding that a working group should study the issue further before the summit.
Businesses must play a bigger role in the humanitarian system, helping to manage risk and modernize transparency, while there should be greater use of social impact bonds, micro-levies on corporations and Islamic social finance.
“If you take one of the Islamic financing platforms — this is zakat, mandatory giving — zakat is somewhere between US$300 billion and US$500 billion a year. Just 1 percent of zakat will go a long way to closing the US$15 billion gap,” Georgieva said, adding that concrete products would be piloted to show how to tap into this funding stream.
To address inefficiencies, the panel proposed a “grand bargain” under which “donors would not simply give more, but give better, by being more flexible, and aid organizations would reciprocate with greater transparency and cost-consciousness.”
This pact would also involve the use of more cash-based aid, give a greater role to local organizations and prompt donors to give more long-term, predictable funding.
“Right now, we have ‘competitive inefficiency,’” Georgieva said. “Something happens and we are like eight-year-olds playing soccer — we are all chasing the ball.”
The report praised the dedication of thousands of humanitarian workers, but had sharp words for the “wasteful” competition between aid agencies for funds.
“While the need for joint planning is often talked about, in reality, every organization is an island. ‘Turf wars’ are a common occurrence, with each organization trying to position itself as the best implementer,” it said.
The study was presented to Ban in Dubai on Jan. 17; the location was deliberate, Georgieva said.
“Tragically this is the region that is now the example of people in need. Three out of every four appeals that exceed US$1 billion take place in the Middle East,” she said.
The experts stressed change is urgent. If current trends continue, by 2030, when the UN’s Sustainable Development Goals are due to expire, the cost of humanitarian assistance would have risen to US$50 billion and 62 percent of the world’s poor could be living in fragile and conflict-affected nations. Despite the challenges, they said they were optimistic.
“The record sums being raised are a powerful signal that our collective humanity is a force to be reckoned with and can be harnessed to even greater effect, but we also need the political will to create change at scale,” they said.
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