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Humanitarian financing mechanisms

Humanitarian financing mechanisms

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Published by: Development Initiatives on Apr 12, 2010
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04/12/2010

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It’s not just about amounts ofmoney. 
By coordinating the response to funding humanitarianemergencies and post-conflict activities, thehumanitarian community aims to greatly increase theeffectiveness of action taken to address the needs ofcrisis-affected communities. Pooled fundingmechanisms, such as the CERF, CHFs and ERFs,provide donors and humanitarian actors with the toolsto for doing this. Their goal is to increase the flexibilityand speed of funding to recipients whilst reducing thecosts of humanitarian financing. In addition, it could beargued that pooled funding mechanisms play a key rolein providing small and new donors ways of channellingfunding in support of responses to humanitarian crises.Pooled funds are not only used in emergencysituations. Increasingly, MDTFs are being establishedalongside humanitarian pooled funds to provide moneyfor reconstruction and development following a conflictor natural disaster. The emergence of these fundscould help to narrow the transitional gap betweenhumanitarian situations and long term development inmany affected countries.We look at the volumes and trends in donorcontributions to these pooled funds – as well as howpooled funding is spent – and are exploring ways ofassessing the funds’ impact.We collect and analyse data on the incomeand expenditure of various pooled financingmechanisms both at a global and country levelin order to provide a detailed picture ofhumanitarian financing. We do this by:
analysing donor contributions to thevarious humanitarian and reconstructionpooled funds
highlighting NGO access to pooled funds toassist others in lobbying for increasedinvolvement
assessing the advantages anddisadvantages of using pooled fundsalongside an assessment of theadvantages and disadvantages of bilateralfunding
looking at disaster risk reduction,peacebuilding and recovery pooled fundsas well as those with a purely humanitarianmandate
paying close attention to the humanitarianreform process and monitoring theprogress made in the areas ofcoordination, leadership, accountability andfinancing.
WHAT WE DO
Pooling resources for acoordinated resonse
   P   h  o   t  o  :   S   t  e  a   l   t   h   F  o   t  o   N   i  n   j  a
GLOBALHUMANITARIANASSISTANCE.ORG
   F   i  n  a  n  c   i  n  g  m  e  c   h  a  n   i  s  m  s
Central Emergency ResponseFund (CERF)Common humanitarian funds(CHFs)Emergency/humanitarianresponse funds (ERFs)Peacebuilding Fund (PBF)Multidonor trust funds (MDTFs)Global Fund for Disaster RiskReduction (GFDRR)Disaster Relief Emergency Fund(DREF)
FAST FACTS
The formal humanitarian reform processstarted in 2005 and resulted in the creationof specific global and country-level pooledfunding mechanisms.
The UN’s Central Emergency ResponseFund (CERF) allows donor governmentsand the private sector to pool their financingon a global level to enable more timely andreliable humanitarian assistance to thoseaffected by natural disasters and armedconflicts.
Common humanitarian funds (CHFs) are in-country pooled mechanisms. Fundingreceived is totally unearmarked. This allowsmoney to be allocated on the basis of needs(as defined in the emergency’s humanitarianaction plan).
Emergency response funds (ERFs) are alsocountry-level mechanisms. They vary fromCHFs in that they have the facility to providefinance to small-scale projects, allowingmore national NGOs to access resourcesdirectly rather than via UN agencies.

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