Is closing the humanitarian funding gap as simple as saying yes (to new sources of funds)?

Julian Srodecki is World Vision's Technical Director of Humanitarian Grants.

“Traditional donors” including western governments and private donors to organisations like World Vision, are being more generous than ever before.  In 2014 over US 12 million was given to support humanitarian action and tracked through UN appeals.  This was a record-level of funding and up 50% from 2013. 

Despite increasing generosity from traditional donors, the gap between the funds provided and the needs defined by the UN appeals has remained constant.  

Despite this, the gap between the funds provided and the needs defined by the UN appeals has remained constant.  For the last few years the UN system has only been able to attract around two thirds of the funds that they’ve requested in order to meet the need on the ground.  As needs are growing increasing funding is part of the solution, but there are complexities to deal with on the way.

What are these new sources of funds?

Growing diversity in the world economic order is an opportunity to bring in new financing.  In World Vision we have seen the impact of these changes first-hand, as approximately a third of our funding now comes from India and Asia – up from 10% just 10 years ago (WVI,2012). 

Different humanitarian actors have advantages in different geographies, contexts and types of disasters.  In January 2015, The Emirates Red Crescent was able to raise US $40 million for Syria in a five hour telethon in UAE.  This was roughly the same as the total funds raised by the 2012 appeal from the DEC, a UK based fundraising group of 13 NGOs.  In the Syria crisis, we see the growing importance of Turkey and Middle Eastern donors, while in Asia national level business is becoming more important. 

These new donors have different strategic and geographic interests. Funding mechanisms need to go beyond 'one size fits all’ and embrace a range of approaches that better reflect local contexts and opportunities.  The future of humanitarian funding is likely to pull together a patch-work of these local and regional solutions, rather than a single global approach.

What do these donors want?

Making the most of this emerging patch-work can be challenging.  Last November, I was part of a group (World Vision, CAFOD and the Food and Agriculture Organization of the UN), which held a series of cross sector dialogues to discuss funding issues.  In both Jordan and Senegal, we listened to local and regional organisations who saw themselves as part of the global humanitarian effort, but wanted to do things their own way.  They wanted to be more than an ATM (cash point) for the current system and to shape humanitarian action in line with their beliefs and views of the world. 

If humanitarian work is based on empathy and the universal rights all of mankind, then it is fair that all of mankind has a say in how it operates. 

The current formal humanitarian system is set up to reflect the needs and wishes of predominantly western donors and international organisations (UN and INGOs).  If humanitarian work is based on empathy and the universal rights all of mankind, then it is fair that all of mankind has a say in how it operates. 

This will require the current system to develop the flexibility to deal with new donor requirements and interests.

Private companies and corporations, which provided US $1.6 billion in humanitarian funding between 2009 and 2013 (GHA, 2015, p.43), have shared similar sentiments. Businesses want to work in new ways to support humanitarian action along a wide spectrum of engagement – beyond cash or in-kind donations - including corporate social responsibility, co-creation, social enterprise and impact investment.  Humanitarian organisations will have to learn new skills and partner in new ways, to make the most of this opportunity.

New donors can also drive much needed reform.  The UN provides essential coordination, planning and other services in emergencies but many emerging government donors question its cost-effectiveness. A focus on efficiency gains in the UN and other funding mechanisms could help make more  money available for the implementation of programs at field level.  Less money would need to be raised and the current system would become more attractive to emerging donors. 

A panacea for the humanitarian funding crisis?

Embracing new donors to build a sustainable increase in funding will play a role in addressing the widening humanitarian funding gap. But it is not a panacea. In my last blog I wrote about the need to establish the limits of humanitarian action and ensure the accuracy and credibility of funding appeals. It is also critical that we look at mechanisms for multi-year funding in protracted crises, and address the need for political solutions to conflict.

As new donors emerge, we must ensure that the humanitarian finance system they join is an effective and efficient one