The grand bargain: Three years on: Multi-year humanitarian financing
Long-term crises, short-term funding
It is estimated that 132 million people are in need of humanitarian assistance in 2019, a number that has been steadily rising over the past decade. As needs rise, the length of time that people are in need of assistance also continues to grow. At the end of 2018, 78% of refugees—15.9 million people—were in protracted displacement situations.
Donors have been more generous than ever before, yet humanitarian aid is still not suited to today’s challenges. Typical humanitarian assistance awards are still short-term (less than 12 months) and restricted. This prevents aid actors from long-term planning, create delays in delivering services, especially between contracts, and incentivize short-term results rather than sustainable improvements in people’s lives and livelihoods.
Today’s humanitarian crises require adequate, predictable and flexible funding. At the World Humanitarian Summit in 2016, 34 donors, multilateral agencies and implementing organizations signed the Grand Bargain and committed to increase the amount of multi-year humanitarian financing (MYF) available—a key step toward more efficient and effective humanitarian assistance. Many have stepped-up; however, overall progress remains slow—and often difficult to track.
The benefits of multi-year financing
A growing evidence base suggests MYF can drive improved efficiency and effectiveness of humanitarian response. MYF can increase effectiveness of program outcomes in emergency settings and create cost-saving measures that reduce the gap between available funding and humanitarian needs. MYF can lower staff costs, enabling longer staff contracts and decreasing staff turnover, and reduce administrative burdens resulting from constant cycles of proposal submission and reporting that derive from short-term grants. World Food Programme in Ethiopia estimated that reduced administrative requirements saved more than $38,000 over a three year period.
Case studies suggest predictable and flexible humanitarian financing enables early and rapid response, increasing the ability to be prepared, plan programming and procure items before market prices spike. Organizations have also reported that MYF helped build greater trust with local communities by enabling for consistent community engagement. MYF can help align responses with changing needs as crises evolve.
Progress since 2016, but not enough
The Grand Bargain created momentum and put pressure on donors to provide more MYF. Self-reporting shows some progress from bilateral donors, but it is still unclear how MYF is flowing to first-line responders and what impact MYF has for beneficiaries. There is a lack of regular, transparent data and significant evidence gaps. It is difficult to know where MYF is going—what regions, sectors, partners—and there is scant analysis of long-term cost savings and program impact.
Our review of Grand Bargain self-reports suggests UN agencies—which are overwhelmingly the first beneficiaries of bilateral humanitarian financing—are not passing MYF received to first-line implementing partners. In 2017, 65% of all humanitarian funding went to just three UN agencies: WFP, UNICEF and UNHCR. Only half (5 of 10) UN agencies—UNICEF, WHO, WFP, and OCHA, UNFPA—are in a position to pass down MYF (those with an operational presence and work with/through implementing partners) and reported that they had done so; UNICEF was the only agency to report an actual figure. Although UNHCR now pursues multi-year planning cycles, it has not passed on MYF to implementing partners.