The Grand Bargain in Practice: UNFPA’s pooled fund reducing the costs of humanitarian response
UNFPA’s Humanitarian Action Thematic Fund (HTF) shows that flexible, predictable and multi-year funding reduces transaction costs, and enables a comprehensive response to people in humanitarian settings.
To get more resources in the hands of people in need, the Grand Bargain foresaw making humanitarian action more efficient, including through multi-year planning and funding, which lowers administrative costs and catalyses more responsive programming. Increased un-earmarked funding facilitates swifter response to urgent needs and investment in fragile, potentially volatile situations, emergencies and disaster preparedness.
Lower costs and rapid response
UNFPA’s HTF, currently supported by Norway, Denmark, Republic of Korea, Canada, and Friends of UNFPA was launched in 2018 to provide flexible and multi-year funding to holistically cover UNFPA’s humanitarian response appeals, without geographical, thematic or time-related earmarks. Unearmarked funding greatly reduces the transaction costs associated with management of individual agreements, allowing for a lower indirect cost rate (7% in lieu of 8%), while harmonising and simplifying reporting requirements (an annual multi-donor report is produced, summarising HTF activities during the year). These actions result in significant efficiency gains, and enable UNFPA to flexibly provide rapid resource allocation in response to emergencies and opportunities to support underfunded crises.
So far the funds have been used in 12 different crisis contexts, supporting the provision of life-saving sexual and reproductive health services for women, adolescent girls and young people, and strengthening the prevention and response to gender-based violence. The funds have been used for emergency response and preparedness, and in bridging humanitarian and development work.
For example, when flooding impacted the Republic of Congo in 2019, UNFPA was able to deploy HTF resources to help 18,750 people, including 12,500 women of childbearing age. UNFPA strengthened the capacity of service providers in health centers, improved access to quality health care for the flood victims, and ensured access to sexual and reproductive health services and clinical management to survivors of gender-based violence.
Following the Marawi crisis that displaced hundreds of thousands of people in the Philippines, UNFPA used the HTF to provide time-critical, life-saving assistance. Targeting the needs of vulnerable populations in evacuation sites, resettlement sites, and host families, UNFPA was able to reach 1,372 pregnant women directly and 45,000 indirectly with services relating to sexual and reproductive healthcare, gender-based violence, cash voucher assistance and women-friendly safe spaces.
Other HTF responses included strengthening preparedness for early action during climate-related emergencies (droughts, floods) in Kenya and support to the Venezuela Response.
“The HTF allows us to ensure effective and timely humanitarian responses and better coverage for underfunded and forgotten emergencies, as well as early actions for preparedness to unforeseen and emerging threats. Donors' money is more efficiently spent this way, as the administration and transaction costs are lower, and our staff members have more time to respond to crises,” said Shoko Arakaki, UNFPA’s Humanitarian Director.
As local as possible
Across all of its responses, whether supported by the HTF or other resources, UNFPA has a strong focus on localisation. As part of its Grand Bargain commitment to provide more support and funding tools to local and national responders, UNFPA allocated a significant portion – 38,6 % in 2019 – of its humanitarian funds to national and local partners, including women-led and women’s rights groups. Furthermore, in 2019, 29 % of total CERF expenses by UNFPA went to local or national partners: 27% to local NGOs and 2% to governments.
A 1-pager with further information on the fund is available here.
Disclaimer: Information in this article was provided to the Grand Bargain Secretariat by UNFPA.