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Review of the Potential for Assessed Funding for the Central Emergency Response Fund (CERF), 26 February 2015

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EDWARD TSUI

EXECUTIVE SUMMARY

This study was commissioned by the United Nations Office for the Coordination of Humanitarian Affairs (OCHA) to examine the feasibility of having an increase in the Central Emergency Response Fund (CERF) to be funded in total or in part from assessed contributions, to determine the financial, administrative, policy, and political implications of such a proposal, and to outline the process leading up to the adoption of the proposal.

The CERF was last upgraded by the General Assembly in 2005 to include a grant element of $450 million to be funded from voluntary contributions. Any changes to the CERF in terms of its scope, size, management, and oversight would need to be a decision by the General Assembly. Moreover, the Charter of the United Nations rests the General Assembly with the authority to decide on all matters pertaining to the financing of the Organization. An increase in the target size of the CERF would therefore require a decision of the General Assembly, regardless of whether the increase is to be funded from voluntary or assessed contributions.

Currently, the United Nations funds its activities and staffing through primarily a regular budget and a peacekeeping budget with slightly different scales of assessment. The five permanent members of the Security Council contribute a larger share for peacekeeping operations. While the UN budget has been under considerable constraints, there has been steady increase in recent years, particularly in peacekeeping operations and special political missions. The United Nations, and the Security Council in particular, are the only intergovernmental bodies that have the mandate for the maintenance of peace and security and Member States fund peacekeeping and political missions from the budgets of the United Nations. The same however could not be said about humanitarian assistance that has been funded up to now almost exclusively from voluntary contributions.

While member states appreciate the leadership and coordination role of the United Nations in humanitarian assistance and the performance and management of the CERF, they expressed their preference for the continuation of a decentralized humanitarian financing structure and to fund disasters and emergencies, particularly the mega emergencies, on a case-by-case basis. Many donors also mentioned that their funding decisions have to take into account the changing humanitarian environment with an increasing number of humanitarian actors outside the UN system. Any proposal to strengthen the CERF will have to take these considerations into account.

In recent years, conflict related emergencies accounted for more than 80 per cent of humanitarian needs as reflected in OCHA humanitarian appeals. For all the conflict-related emergencies in 2014, the United Nations also has peacekeeping missions, special political missions, or good offices of the Secretary-General. This clearly demonstrated that humanitarian assistance is essential to the maintenance of peace and security. The United Nations expects humanitarian assistance to be delivered for the affected populations of these emergencies and yet has not provided any resources from its budgets for such assistance. Governments have also recognized their responsibilities to provide humanitarian assistance within their countries and to support such efforts of other countries. These are some of the compelling reasons to explore funding an increase of the CERF through assessed contributions as a manifestation of the collective responsibilities of Member States to humanitarian assistance and the critical importance of humanitarian assistance for peace and security. In addition, assessed contributions would also provide predictability and sustainability of funding for the CERF.

On the other hand, OCHA must find an arrangement whereby the use of assessed contributions would not compromise the flexibility and quickness of the CERF while ensuring accountability. This is important given the tendency of the Fifth Committee of the General Assembly and the Advisory Committee on Administrative and Budgetary Questions (ACABQ) to engage in reviewing financial details of all activities funded from assessed contributions. Since no indirect costs could be charged to activities funded from assessed contributions, OCHA would also need to see how best to support CERF activities that would be funded from assessed contributions in the future.

While Member States appreciate the need to increase the size of the CERF as a result of the steady increase of humanitarian needs in recent years, there is little support so far to have such an increase to come from assessed contributions. The major contributors to the UN have expressed serious reservations or objections to such a proposal. Major contributors to the CERF have also indicated their difficulties to increase substantially to a strengthened CERF if it is to be funded from voluntary contributions. They have advised OCHA to seek additional support from other potential donors, including the Gulf and BRICS countries.

The study explored a number of options relating to funding of the CERF from assessed contributions, and the possible scope and size of a strengthened CERF. It also outlined a number of considerations that OCHA may wish to take into account in moving forward. At the request of OCHA, no recommendations were made. It should be stressed however that Member States appreciated the CERF because it is simple, focused and easy to understand. The CERF is considered well managed, it’s use flexible, and it’s disbursements quick. Member States would like the strengthened CERF to retain these characteristics.

The process leading to a decision of the General Assembly to strengthen the CERF would take time. Taking into account the World Humanitarian Summit in April 2016, it seems that the 2016 fall session of the General Assembly would be appropriate for the SecretaryGeneral to make a proposal for consideration and hopefully adoption by the General Assembly. The study outlined the steps that OCHA may wish to consider in the preparation of a proposal to strengthen the CERF, the mobilization of support for the initiative, as well as the broader context to best put forward such a proposal.

UN Office for the Coordination of Humanitarian Affairs
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