Proposal for new US$10 billion disaster fund wins plaudits, criticism

Waters still are rising in Bangladesh’s south-central Ullapara region. These women are heading for the nearby flood shelter established by the government. Bangladesh, September 2007.
Waters still are rising in Bangladesh’s south-central Ullapara region. These women are heading for the nearby flood shelter established by the government. Bangladesh, September 2007 (Shamsuddin Ahmed/IRIN)

A proposal in a recent UN report for a unified global mechanism for disaster relief and risk mitigation, with a US$10 billion budget, is receiving a mixed welcome, with praise for increased spending and prevention efforts, but concern over the idea of a one-stop shop.

The umbrella facility would absorb what the proposal calls the fragmented existing bodies that fail to pass the “acid test” of providing sufficient financing quickly and automatically to countries hit by disaster, and would ultimately assume a much larger role in investments in disaster planning and preparedness.

“Creating a global disaster mechanism, possibly under the auspices of the UN, could bring together and scale up in a more holistic manner the existing fragmented resources,” says the proposal in the World Economic and Social Survey 2008, published on 1 July by the UN Department of Economic and Social Affairs (DESA).

Resources are currently provided by such facilities, among others, as the UN Office for the Coordination of Humanitarian Affairs (OCHA) with its flash appeals, OCHA’s Central Emergency Relief Fund (CERF), which has a target annual budget of $500 million, the UN Development Programme (UNDP), the UN International Strategy for Disaster Reduction (ISDR), and the World Bank’s Catastrophe Risk Deferred Drawdown Option, which gives loans of up to $500 million, limited to 0.25 percent of a country’s gross domestic product (GDP).

The $10-billion budget, which would be topped up as necessary, would come from a new assessment on UN member states based on a ratio system linked to GDP. Under such a scheme the USA would have contributed $800 million annually over the period 2000-2006. In contrast Guyana would have contributed only $27,000 a year but would have been a net recipient of $158 million for the same period.

Scepticism about benefits of unitary facility

It is the idea of the unitary facility that has raised the most hackles, although there has also been scepticism over the ability to reach the $10-billion target, which would increase the UN’s current overall funding of $20 billion a year by 50 percent, according to Rob Vos, director of DESA’s Development Policy and Analysis Division and one of the report’s main authors.

''Creating a global disaster mechanism, possibly under the auspices of the UN, could bring together and scale up in a more holistic manner the existing fragmented resources.''

“There’s certainly room for improvement, but we shouldn’t throw out the baby with the bath water and we don’t believe that the solution is to start all over again with one unified facility,” ISDR Deputy Director Helena Molin Valdés told Reuters in a telephone interview from Geneva.

“We don’t believe it will solve the fragmentation that way. If you were to put all of that under one roof, it’s going to be a mess and you won’t solve any problem. You need a different mechanism for the quick things; you need a different mechanism for the disaster risk reduction; you need another mechanism for real project monitoring. It’s not necessarily positive to believe that you put it all in one pack and you solve the problem.”

She said there had already been improvements on the issue of fragmentation and that current facilities were complementary and working well in a coherent manner.

But she strongly supported the call for greater funding and an up-scaling of responses, especially of action to mitigate risks and prepare for disasters such as tsunamis, floods and earthquakes with early warning systems, preparedness training and quake-proof buildings. In fact she felt that overall $10 billion was on the conservative side.

“10 billion is a good start obviously; it’s a good round figure, but it’s not going to be enough. But you don’t need it all in a fund, because actually what we are propagating is that development investment needs to reduce risk,” she said.

In defence of the proposal

Vos defended the proposal, stressing that a unified facility would have a more transparent, defined financing mechanism and lead to more coherence and coordination.

“One of the key points for making the report is that in practice what happens is that the immediate relief and needed repairs are never fully integrated into a scheme where you get preventive action and improvement of infrastructure that can become more resilient against the consequences of natural disasters,” he told IRIN.


Photo: Tahira Sarwar/IRIN
Rescuers dig survivors out of the rubble in Islamabad following an earthquake that hit Pakistan, Afghanistan and India in October 2005. Some experts say there is too much focus on disaster response as opposed to disaster preparedness

CERF was studying the issue and had no immediate comment. OCHA said the report made a valuable contribution to the body of work on climate change, natural hazards, and economic security.

“We concur with the authors that more needs to be done, particularly in disaster risk reduction and recovery, which will require not only financial resources but political commitment at all levels - local, regional, national, and international,” OCHA spokesperson Stephanie Bunker told IRIN.

On the issue of the $10 billion budget, and a $2.5 billion target as a start-up for the mechanism, she said it was difficult to determine a price tag for activities as diverse as disaster relief, recovery, and risk reduction.

“There is therefore a risk that such a mechanism could result in a sense of complacency, a sense among member states that they have ‘done their part,’ even as either of these estimates may actually understate the amount of funding required,” she added.

Officials speaking on condition of anonymity said the proposal could lead to a major fight with the agencies and organisations - each with its different mandate. The 192-member UN General Assembly would have to approve the $10-billion assessment.

Disaster response versus preparedness

The proposal elicited interest from academics and non-governmental organisations (NGOs). Bill McGuire, director of the University College of London’s Benfield Hazard Research Centre, a leading European institution in disaster mitigation, was relatively supportive. “Any mechanism that provides for an integrated and more effective means of funding disaster response has to be good news,” he told IRIN.

“My concern, however, is that there remains too much focus on disaster response as opposed to disaster preparedness. My hope for the new mechanism, therefore, would be for it to embrace preparedness to a much higher degree in order to redress this balance. Countless studies and examples have demonstrated that time, effort and money spent on preparedness leads to significant disaster risk reduction and therefore reduces the need for post-disaster relief.”

Competition among aid agencies?

Richard M. Walden, president of Operation USA, a disaster and relief NGO that works in dozens of countries, said his organisation had long been calling for UN action on both a permanent standing professional peacekeeping force and a disaster response mechanism that does more than coordinate and collect information.


Photo: IRIN
Tsunami damage in Sri Lanka. The 2004 Indian Ocean Tsunami saw more competition among agencies than cooperation, said Richard M. Walden, president of Operation USA

In the rare cases where the world is motivated to support relief efforts, as with the 1984 Africa famine and the 2004 Indian Ocean Tsunami, there is more competition among agencies than cooperation, he told IRIN.

“Money… is hoarded and those with the most effective ‘brands’ and ‘marketing’ tend to get most of the funds and not fund other agencies out of their own surplus. This continuing problem might just be ameliorated by a UN entity with real legal standing,” he said.

In fact the mechanism would seek to address just such inequities. Scale and direction of aid appear to be heavily influenced by economic and geopolitical interests, including colonial ties and by biases in news coverage, the report said.

The consequences are significant. According to one estimate, such biases may have reduced the flow of funds to disasters in Asia by over one third, in Africa by over one fifth, and in South America by more than one sixth.

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This article was produced by IRIN News while it was part of the United Nations Office for the Coordination of Humanitarian Affairs. Please send queries on copyright or liability to the UN. For more information: https://shop.un.org/rights-permissions

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