People living in poverty are hardest hit by disasters and insecurity, which in turn make them more vulnerable to future shocks and deeper poverty. At least 76% of people living in extreme poverty – around 677 million people – are estimated to live in countries that are either politically fragile, environmentally vulnerable or both. However, the real number is likely to be much higher, since it is often those most at risk who are missing from poverty data.
As conflicts continued in 2015, including in Syria, Yemen, Iraq and South Sudan, those living in forced displacement reached another record high of over 65 million people, with most displaced people remaining in middle- or low-income countries in their own regions. In the same year, disasters caused by natural hazards affected an estimated 89 million people. This included those affected by large-scale, sudden-onset emergencies such as the Nepal earthquake, though less high-profile and localised events undoubtedly affected many more.
In the face of such human suffering, the World Humanitarian Summit and other global processes have intensified the search for new types and scales of financing, efficiencies and good practice to make finite humanitarian resources go further and bring about better results for crisis-affected people. However, international humanitarian assistance is neither sufficient nor appropriate to address the full spectrum of people’s needs and vulnerabilities in crisis contexts.
Addressing these needs requires a wide range of resources and a sophisticated financing toolkit ranging from insurance for natural hazards, to concessional loans and guarantees for long-term refugee hosting. Not all tools will work everywhere, but combining finance streams and approaches that are right for the context, timed to anticipate and prevent crises, scaled appropriately, and targeted at the right people can mitigate the escalation of high-risk situations into humanitarian crises.
Domestic governments have the primary responsibility to prepare for and respond to crises in their own territories and often invest significant resources in doing so. Many governments invest significant amounts in national disaster risk reduction and response, while refugee hosting is another crucial domestic element of humanitarian response. However, counting the contributions of all governments to support refugees in-country is complex and there is no single platform that captures this expenditure. More transparent and comparable data is needed to inform predictable, durable and equitable financing solutions to support refugees and host communities.
International resources, both private and public, can be critical in supporting the investments of local, national and regional actors to address risk, build resilience and respond to protracted crises. In 2014, official development assistance, excluding humanitarian funding, accounted for an aggregate 12% of known international flows to the recipients of the most humanitarian assistance.
International humanitarian assistance accounted for just 4.8% of all international flows to the recipients of the most humanitarian assistance in 2014. While small in comparison to other investments, it remains a vital resource for many people affected by crises. As such, international humanitarian assistance has continued to grow year on year, reaching a record high of US$28.0 billion in 2015. This is the third consecutive annual rise – though less pronounced than increases in recent years.
Rises in humanitarian funding came from both government and private donors, who increased their respective contributions by an estimated 11% and 13% from the previous year. In 2015, 20 government donors contributed 97% of all international government contributions. The largest percentage increases have come from governments in the Middle East and North of Sahara region, a rise of almost 500% since 2011, mainly driven by contributions from Gulf states in response to crises in the Middle East.
While overall humanitarian funding increased in 2015, the gap between requirements and contributions to UN-coordinated appeals grew. The amount requested through UN appeals stood at US$19.8 billion, a slight decrease from the previous year; but contributions fell by considerably more, leaving an unprecedented shortfall of 45% (US$8.9 billion) – a funding gap that played out very differently from country to country.
Humanitarian funding in 2015, both inside and outside of the appeals, was increasingly concentrated in a relatively small group of emergencies. According to the UN Office for the Coordination of Humanitarian Affairs’ Financial Tracking Service (FTS), five crises – in Syria, Yemen, South Sudan, Iraq and Sudan – accounted for more than half of all funding allocated to specific emergencies. This is in contrast to 2011 and 2012, when the five largest crises received around one third of the total.
The annual list of persistently underfunded or ‘neglected emergencies’ frequently features the same countries year on year. The priority crises in the EC’s Humanitarian Aid and Civil Protection Department (ECHO)’s Forgotten Crisis Assessment index for 2015 included Algeria/Western Sahara and Myanmar, both of which have appeared on the index every year since 2004.
Long-term crises continue to absorb the largest volumes of international humanitarian assistance. In 2014, 91% of official humanitarian assistance from Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee donors went to long- and medium-term recipients, reinforcing the rationale for more multi-annual humanitarian planning and financing.
How funding reaches crisis-affected populations has implications for the efficiency and effectiveness of the assistance provided. In 2014, around two-thirds of funding from government donors was channelled via multilateral organisations, mostly to the six major humanitarian-related UN agencies. Despite calls and commitments for more support to local actors, data from the FTS shows that funding channelled directly to local and national non-government organisations (NGOs) remains low, accounting for just 0.5% of international humanitarian assistance in 2015.
Pooled funding continues to play an important role in humanitarian financing. UN-led humanitarian pooled funds mobilised US$1.3 billion in 2015, a 28% rise from the previous year. Investments in country-based pooled funds grew in particular, with an increase in funding of almost 50% in 2015 from the previous year.
Flexible financing is understood to bring a number of benefits. However, the proportion of fully unearmarked contributions to UN agencies received from government donors decreased from 24% in 2012 to 16% in 2014; and unearmarked funding for NGOs represented just 8% of the overall funding they received in 2014.
Greater transparency and traceability of funding could bring efficiency gains and improve accountability to crisis-affected populations. Likewise, an overview of all relevant resources in crisis situations, including and beyond humanitarian assistance, could improve the targeting of resources to those most in need. Better reporting to the International Aid Transparency Initiative (IATI) Standard provides an opportunity for achieving this.