An open letter to OCHA on NGO pooled funds
In November, the International Council of Voluntary Agencies (ICVA) published a discussion paper entitled for the Pooled Fund Working Group (PFWG), entitled "What OCHA could do to increase field effectiveness through enhanced NGO partnership". The paper was designed to stimulate discussion at the December PFWG meeting, which was attended by Inter-Agency Standing Committee (IASC) members, pooled fund donors and NGO representatives, and was co-chaired by Norway and UN OCHA.
The paper argues that, "especially in cases of large-scale emergencies, where CBPFs are not existing (i.e. the Philippines or Iraq), OCHA has been unable to fulfil the critical need of direct NGO access to humanitarian funding." The first recommendation from this paper is particularly pertinent for the Start Network, namely, "Establishing a global facility managed by OCHA at headquarters" to address this gap.
The Start Network trustees have published an open letter to OCHA in response to this paper. Our letter describes how the Start Fund is a multi-donor pooled fund that is already providing direct funding to NGOs within 72 hours of a crisis alert. It suggests that another global pooled fund would be welcomed by the NGO community if it were able to exceed the performance metrics currently being met by the Start Fund. The letter also outlines other areas where OCHA could make a significant contribution to increasing field effectiveness, for example by brokering links between civil society and governments and supporting capacity building initiatives.
The letter is reproduced in full below and can be downloaded at the bottom of this post.
Open letter to OCHA
In response to the discussion paper “What OCHA Could Do to Increase Field Effectiveness through Enhanced NGO partnership”
From the Trustees of the Start Network 12 December 2014
The Trustees of the Start Network welcome the OCHA discussion paper. We appreciate the recognition of the integral NGO role in the formal international humanitarian crisis response system. The UN, Member States, and NGOs have a common mission in seeking ways to get better aid more quickly to those affected by humanitarian crisis.
The discussion paper and its proposed mechanisms are well reasoned, and we would welcome further dialogue about ensuring that the various elements of the humanitarian financing architecture play complementary roles. Toward that end, we would like to put forward some preliminary ideas in two areas. First, the paper shows that there needs to be a paradigm shift in the way the humanitarian sector thinks about financing. Second, we would propose other ways to “increase field effectiveness through enhanced NGO partnership”.
1. Financial mechanisms
The Start Network has established the Start Fund to address the problem of NGO financing and to give the system the means to become more resilient in a future of greater uncertainty and risk.
We would like to emphasize that the Start Network’s unique legal framework enables a way of working that unlocks the potential of wide-scale NGO alignment. Through this legal framework the Start Fund can reach over 200 countries and territories because the current 19 members have pre-existing legal agreements and contractual relationships with thousands of organisations. Moreover, the management of the Start Fund is predicated upon pro-bono contributions by the participating organisations: experienced operational managers decide how the Start Fund is invested through robust peer review process, based on continual feedback on agency performance. As a new multi-donor pooled fund run by NGOs, the Start Fund has no precedent and offers the system the ability to establish new rules, incentives and behaviours to transform humanitarian financing for the better.
Based on these design parameters, the 7 years’ investment by Start Fund NGOs, and support by DFID and Irish Aid, the Start Fund is able to offer the following results. We would encourage you to be inspired by these metrics while thinking about the establishment of additional NGO pooled funding mechanisms:
- Allocation decisions within 24 hours of crisis alert
- Project funding decisions made within 48 hours of crisis alert.
- Funding is deposited in bank accounts within 72 hours of crisis alert
- Peer management to progressively increase NGO strategic capacity
- Direct funding to national NGOs
- Decision making based on need, by practitioners who have the best knowledge of the crisis and those best placed to respond
It may be equally useful to explore the performance metrics of various different yet complementary pooled funding mechanisms. Were this to be the case, we would also encourage dialogue around metrics and goals for the whole financial architecture, for example:
- Minimised transaction costs
- Reach (an ability to deploy resources anywhere in the world)
- Scale (in proportion to present and future need)
- Agility (ability to respond to any type of familiar or unfamiliar crisis)
- Timeliness (rapid deployment of resources at any time)
- NGO alignment (creating effective means for maximising the contribution of a broad and diverse community of civil society organisations)
- More power and capacity located at the national level of the international humanitarian system, while still maintaining the efficiencies and strategic capability of a global mechanism.
- Systemic resilience through diversified global funding channels and a multiplicity of implementing organisations
- Addressing the entire range of humanitarian crises, including small-scale events that ordinarily do not trigger a response.
- Continual improvement in strategic capacity and innovation in NGOs
2. Other ways to achieve the same goal
We would equally suggest a wide range of additional measures that increase field effectiveness through engaging NGOs. For example OCHA could:
- Help NGOs have conversations with governmental donors about the impact of low risk tolerance and excessive controls
- Participate in local NGO capacity building initiatives, which go beyond simply helping local partners receive donor funding
- Acting as a more effective broker between NDMAs, other governmental departments non-governmental civil society organisations
The Member Agencies of Start Network intend that Start will be an international network. The challenges we face in responding to contemporary humanitarian crises are systemic, and international. Only an international network will have the capability to make a contribution in addressing systemic challenges. An international network with its roots in London, a city with considerable resources in the financial services and insurance industries, has a unique and valuable contribution to make. Due to its character and origins, the Start Fund is also enabling complementary financial products and tools. The Trustees of the Start Network see themselves as the temporary custodians of this new global public good.
We look forward to a productive and useful exchange. There is much to learn from sharing common challenges, and thinking about how the various mechanisms can be most effectively deployed. Toward that end, we would suggest that the Pooled Fund Working Group be the forum for that exchange, and that its remit be expanded to cover all financial mechanisms for humanitarian action.