Browne and al’s “Sweden’s funding of UN funds and programmes: analyzing the past, looking to the future” reviews the funding patterns of  the UN development system (UNDS). The paper was commissioned by the Swedish Experts Group on Aid Studies, an independent policy evaluation/analysis function kick-starting topical conversations within the Swedish government.

The background for the study is the rise of earmarked funds to UN funds and programmes: from 58% of the total budget in 2007 to 80% now. Its findings and recommendations were discussed this week with Sweden’s State Secretary for International Development, a panel of respondents in which I participated, and about 100 civil servants from different ministries and SIDA. A key issue was the funding strategy Sweden should adopt moving forward. A key concern was whether, by being one of the last long-standing core-funding supporters, Sweden was being “taken for a ride” (the title of the event).

The report reviews the finances and effectiveness of funds and programmes. It uses CEB data cross-referenced with data from agencies. UNICEF is portrayed as an exemplary agency having grown in size thanks to non-core contributions, but having strategically redirected these resources towards pre-identified needs to service its mandate (pp 58-61). The recommendations, presented by the authors as “doable” and received by the State Secretary as “helpful”, go from an ask for harmonized definitions to a call for Sweden to “withdraw its non-core funding from UNDP with the aim of encouraging it to emphasis its original central funding and coordination role within the UNDS rather than its role as an operational competitor within the system.” Ouch.

Other recommendations ask Sweden to (i) redirect its core support towards the most effective organizations and humanitarian work, (ii) champion predictable funding for normative activities, and (iii) request agencies to improve their messaging around the importance of core funding. Part of the discussion this week picked up on these. The Secretary of State noted how powerful field results were to advocate for core funding. Several speakers underlined the critical role of core funding for normative and humanitarian work, two functions presented in this report (and many others) as the undisputed comparative advantage of the UN. I used UNICEF illustrations to show how core funding supports universality, the role of first responder in crises, long term investments, the bridging of humanitarian and development work, and the delivery of results for children on the ground.

A thought-provoking table in the report (see below) was used to remind the audience that the core/non-core funding trend was not affecting all multilaterals similarly. One speaker argued that the UN should consider adopting a replenishment system akin to International Financial Institutions (IFIs) and most global vertical funds. Several participants supported this idea while others wondered whether the decrease of UN core funding was more a matter of political will than of technical fixes.

 

 

Another recommendation of the report is for Sweden to sponsor an independent international commission on UN funding. Having worked for several such commissions including two financed by Sweden, I was asked to react to this suggestion. The proposed mandate of the commission being rather narrow (“to review definitions and rationalize the allocation of UN funding”) and the terms of reference rather prescriptive, I suggested a more strategic and forward looking framing. Indeed, the report did not, in my view, do justice to the second part of its title: “looking to the future”. What are the key drivers of change that will influence development finance, and UN funding, in the coming 10-20 years? What would the UN funding debate look like in a future where financial technology combined with digital peer-to-peer platforms could become the norm for international financial transactions? How will more frequent disasters influence the nature of UN funding in particular as these shocks also affect richer countries potentially reversing their aid-eligibility? Could traditional donors increasingly channel their resources via IFIs transforming UN agencies as mere implementing partners in a shrunk UNDS? Could new donors increasingly channel their resources via multilateral organizations and revitalize the UNDS? Etc

My main take away from this conversation and what I read on the topic in the context of UN reforms, is that we should develop “what if” funding scenarios, one of which focusing on a further decrease of core funding and direct support to UN operations.