In previous blogs I have talked about how humanitarian action is underfunded globally and about the work that is being under taken to address this. Earlier this week, the 15 largest Government donors, major UN agencies and several NGO networks held their final meeting to agree a “Grand Bargain”. It is the culmination of nearly two years of cutting edge research and debate as captured in reports like the Future Humanitarian Financing Report Looking Beyond the Crisis, the High Level Panel Report on Humanitarian Financing and the UN Secretary-General’s Report, One Humanity: Shared Responsibility. Throughout the Grand Bargain discussions ICVA, SCHR and Interaction have done a great job representing the interests and concerns of NGOs of all types.
The Grand Bargain will be launched at the World Humanitarian Summit on 23rd & 24th May 2016. There are many things that will be great for implementers such as reducing the reporting burden, and harmonising UN capacity assessments. However, it is worth asking, ‘What could be done to make the Grand Bargain more successful? Below are four things that should be done to improve the Grand Bargain for those impacted by disaster and the organisations that seek to directly assist them.
Pass the benefits on to implementers
In my January Blog, I made the case that the Grand Bargain should pass the benefits onto implementing organisations. Following our joint lobbying with the NGO community, it is welcome that the Grand Bargain contains commitment language requires that the benefits of multiyear funding and reduced earmarking should be passed onto implementers. As the detail of the Grand Bargain becomes clearer it is possible to identify ways in which it could be made better for implementers. If the UN’s Central Emergency Response Fund (CERF) pooled fund is doubled to USD 1 billion, serious discussion should be held about opening up access to NGOs and non UN pooled funds like the Start Fund. As the whole sector looks to implement the Grand Bargain, a focus should be placed on what is best for implementers of all types, particularly local and national organisations.
Increased transparency and efficiency in the system
As part of the Grand Bargain commitments, NGOs and other humanitarian organisations will be expected to increase their reporting against the IATI (International Aid Transparency Initiative) data standard. World Vision and other NGOs are already posting a lot of data on IATI’s portal which is well worth a look. However we need to improve the timeliness and quality of IATI reporting. Humanitarian organisations of all types should be transparent about how much of their funding is implemented directly by them and how much is distributed to partners. This is particularly the case for UN agencies that frequently work through implementing partners because this could help to shed light on real overhead rates. INGOs should also disclose how much they distribute to local partners. This will be vital when measuring progress towards the GB target of 25% of funding going to local and national responders by 2020.
Currently the Grand Bargain is making welcome commitments to provide transparency and comparable cost structures by the end of 2017. It is welcome that humanitarian organisations are looking for costs efficiencies at the organisational level. However, greater clarity around partnering will also be critical to build up a comparative picture of the costs of the different ways that funding can flow from donor to final implementer, as outlined in previous blogs. This would enable the Grand Bargain to go beyond improving the efficiency of individual organisations to look at broader systems savings. Choosing the most efficient ways to get funding to intermediaries (or fundamediaries) could reduce transition costs going to middle men, and enable more money to be spent as close to the field as possible.
Develop more detail and targets for cash programming
The potential for the sector to use direct cash transfers in humanitarian operations is very exciting. During World Vision’s Typhoon Haiyan response, a study by Accenture found that cash transfers could reduce costs per beneficiary by up to 60%. This enabled us to reach twice the number of children with existing resources. While it is welcome that the Grand Bargain calls for increases in cash programming, it is disappointing that no targets are set. Currently 25% of WV’s humanitarian grant funding is used for cash transfers and we plan to do more. To harness the potential of cash programming, it would be useful for the Grand Bargain to set some targets around scale up and identify and implement the sector changes needed to support them.
Targets need to be complimented with an understanding that cash programming is not solely a cost saving that reduces humanitarian action to a blanket set of transfers into bank accounts. A field presence is required for beneficiary registration, selection, complaints, monitoring and evaluation and to meet protection needs. NGOs and frontline responders have an important role in this process. The scaling up of cash raises fundamental questions around what parts of the humanitarian system can be bypassed (e.g. logistics and procurement costs) and what needs to be preserved. These decisions should be made based on community needs.
The Grand Bargain needs to be a journey not a destination
It is encouraging to hear that the Grand Bargain session at the World Humanitarian Summit will be a call to action that will invite others into a more inclusive process. So far the work of Kristalina Georgieva, and others has been critical in opening up a political moment where we can all move forward. We need to use the WHS to build on this moment and turn it into serious momentum to tackle the complex funding issues that the sector faces. To do this, the continued engagement of political leaders like Ms Georgieva is being seen by many as critical. Over the next two years, Humanitarian Organisations need to rally round the Grand Bargain and work together to develop and implement the details. Will this succeed? Much will depend upon how all of us engage at the summit and can work together afterwards. In a humanitarian system that was 50% underfunded in 2015, financing challenges are having a real impact on the lives of children and their families worldwide. We have no option but to succeed.
Other blogs by the author on humanitarian financing include:
 36% of our Food Assistance programming in FY15 was through cash-based programmes