Until relatively recently our understanding of humanitarian financing to and through the spectrum of delivery agencies has been limited to the funding received from DAC donors. Financial tracking mechanisms, such as UN OCHA’s Financial Tracking Service (FTS), the ECHO 14-point system used by European Union government donors and the OECD Development Assistance Committee (DAC) statistics only capture part of the funding received by alternative channels. However none of these account for the substantial amounts of money raised by delivery agencies from private sources nor the complexity of the funding chain from initial donation through delivery agencies and finally to recipients.
Humanitarian financing channelled through NGOs, the UN and the Red Cross and Red Crescent Movement naturally accounts for a huge proportion of humanitarian assistance. The funding these organisations receive, some of which they pass on to other organisations to implement and some of which they implement themselves, reached US$15 billion in 2008. There are however some marked differences in the funding profiles of the different delivery agencies. Whilst the NGO sector usually receives close to 60% of its funding from private contributions and the remainder from government sources, the UN organisations we have examined have received the vast majority solely from governments.
Funding sources as a share of total income in 2008
NGOs work in the front line of humanitarian programming and aid delivery, and it is natural to see them implementing the bulk of the humanitarian assistance to affected populations. A conservative estimate of the total funding NGOs received directly and indirectly from donor governments – including funds that have passed through multilateral organisations – would suggest that they have received US$2.3 billion, US$3.4 billion and US$4 billion in the years 2006 through to 2008. Whilst government donations are clearly of importance to NGOs, many of them actually raise significant humanitarian financing through their own fundraising and their own direct private contributions. The sums are quite substantial. We estimate NGOs to have raised US$2.2 billion, US$3.2 billion and US3.7 billion in each of the years between 2006 and 2008 – a total of US$9.1 billion. This is funding that they largely control themselves whilst humanitarian funding from donors is much more likely to be tied to particular interventions in particular countries and contexts.
The volume of humanitarian assistance financed by private sources also varies dramatically between organisations. Some of the big NGOs exercise decision-making over more money than government donors. MSF, for example, consistently contributes more humanitarian assistance than 20 of the 23 individual OECD DAC members. In 2008 the private contributions raised by MSF International reached some US$800 million whilst in the same year Germany, Sweden or France had humanitarian budgets of US$751 million, US$603 million and US$445 million respectively.
UN agencies, funds and organisations are collectively a big player in humanitarian assistance. With the World Food Programme (WFP) alone having approximately US$4.6 billion for humanitarian activities in 2008, the total of the five UN agencies we have analysed – the United Nations Children’s Fund (UNICEF), UN High Commissioner for Refugees (UNHCR), UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) and the Food and Agriculture Organization (FAO) – have collectively reported a total budget of US$7.6 billion. Given that we estimate global humanitarian assistance for 2008 to be at least US$16.9 billion, the UN is therefore handling nearly half of total funding. The primary source of humanitarian funding for the UN is the government donors and only marginal amounts come from private sources. Although the proportion of private support for humanitarian assistance trough the UN accounted for an average of only 2% of the total humanitarian income for 2007 and 2008, it has doubled in volume over the same period. The increase in the share of private funding has however risen by only 0.5% since the volume of government funding has kept a similar pace of growth. Considerable variations can be observed between the different UN agencies. UNICEF accounted for the largest share of private funding with over 12% in 2008, while FAO showed the lowest proportion with 0.1% in the same year.
The International Federation of Red Cross and Red Crescent Societies (IFRC) is perhaps the largest world disaster response organisation with an unmatched global presence, with a unique network of 186 national societies and therefore a presence in almost every country in world. The IFRC’s funding patterns place it closer to the NGO group than to the United Nations we have examined. In 2008 it raised 65.5% of its humanitarian income from private sources, US$191 million. But while other delivery agencies receive private funding mainly from individuals, charities, and private companies and corporations, it is, in fact, the national societies that provide the larger share of IFRC funding both from private and government sources. The IFRC’s federal body, the Secretariat, raises very limited funding directly. The International Committee of the Red Cross (ICRC) has quite a different pattern of funding. Over 90% of ICRC financing comes from government donors and the European Commission, and a mere 2%-3% comes from private sources. This places the ICRC closer to the group of UN agencies than to NGOs. In monetary terms private funding amounted to US$26.3 million in 2009, US$32.7 million in 2008 and US$18.6 million in 2007. These amounts are a very small percentage of the total $3.7 billion that ICRC has raised over the last four year.
Delivery agencies have managed the staggering volume of more than US$36 billion of humanitarian aid between 2006 and 2008, a budget exceeding the gross domestic product of many developing economies. However, even more important than tracking the volume of resources allocated to humanitarian delivery is disentangling the complexity of the delivery system itself and understanding the implications of channelling resources through each one of its components. Because each one of them will determine the path the funding flows down, empowering some organisations to the loss of others, and each choice about who does what will determine what a beneficiary might receive.