Memorandum submitted by the United Nations
High Commissioner for Refugees (UNHCR)
I. INTRODUCTION
UNHCR is one of the few UN agencies depending
almost entirely on voluntary contributions to fund its operations.
Only two per cent of UNHCR's annual budget is covered by a subsidy
from the UN Regular Budget. Most of UNHCR's programmes are funded
by governments. This reliance on voluntary funds, compounded by
large and unforeseen refugee crises, has in recent years resulted
in serious funding shortages, which have had a severe effect on
the organisation's ability to respond to the needs of the people
it is mandated to serve.
About 96 per cent of the funds received by UNHCR
in any given year come from 15 donors—14 governments and
the European Commission. Despite efforts in recent years to expand
this relatively narrow donor base and thus reduce its inherent
vulnerability, UNHCR's success in this area has been decidedly
modest. This can be attributed to a variety of factors, including
the economic downturn experienced by many emerging economies during
the 1990s, the strong US dollar, political problems diverting
the attention of governments away from refugee matters or the
absence of an established culture of multilateral assistance.
(See annex—Contribution Chart).
II. THE BUDGET
UNHCR operates on the basis of an annual calendar
year budget cycle. The annual budget is the result of a planning
exercise that commences in the field in the months of February
and March preceding the target year. Field submissions are then
consolidated at Headquarters into a budget document that is sent
to the members of the Executive Committee of the High Commissioner's
Programme in September. The annual budget is considered and approved
during the annual session of the Executive Committee which takes
place in October in Geneva. It is important to note that approval
of the budget is in no way a guarantee that it will be funded.
It is merely an endorsement by the Executive Committee that it
properly addresses the needs of refugees and that the High Commissioner
may on that basis seek to mobilise adequate resources. The annual
formal Pledging Conference is held in Geneva in December, to permit
donors to announce contributions for the next budget year. This
early pledging is crucial to ensure that UNHCR's programmes in
the field can be pursued without interruption. UNHCR's policies
, planned programmes and the accompanying budgets, are published
in a public document, the Global Appeal, issued shortly before
the Pledging Conference.
Unforeseen needs that arise in the course of
the budget year, that cannot be covered with existing allocations
and that are too large to be covered with transfers from the Operational
Reserve become the object of Supplementary Programmes, and are
presented to donors on an ad-hoc basis as Special Appeals. Depending
on their public visibility, political relevance, and particular
appeal to donors, these refugee situations and appeals at times
benefit from genuinely new funding, at time from funds which were
"diverted" as they were expected to meet the requirements
of the initial Annual Programme.
UNHCR's budget has a "unified" character,
i.e. all programmes (whether initially approved by the Executive
Committee, or subsequently added as Supplementary programmes)
are included into one unified budget, which is adjusted upwards
or downwards as the operational or funding situation may require.
III. QUALITY
OF FUNDING
Not only the quantity but also the "quality"
of funding—its predictability, promptness, and flexibility
is important. Although some government donors have indeed increased
the predictability and promptness of contributions, others continue
to announce their contributions well into the year, transfer pledges
with considerable delays, or earmark their contributions heavily.
Earmarking can be done at the regional, sub-regional, country
or sectoral level. In average, a rather low 20—25% of UNHCR's
budget is covered by unearmarked contributions. Tight earmarking
is being discouraged since it limits UNHCR's independence and
flexibility to allocate resources according to where the needs
are greatest at a particular moment.
IV. CONSTRAINTS
The unpredictable results of the current funding
mechanisms has a negative impact on UNHCR's ability to carry out
its mandate of protecting and providing durable solutions to refugees.
Whilst acute refugee crises in general generate adequate support
from the donor community, both in financial and political terms,
protracted refugee situations receive less attention and financial
support from donors.
In order to secure a predictable minimum level
of funding, the High Commissioner, Mr. Ruud Lubbers, has suggested
several "normative" elements which governments could
consider when determining the level of their support to UNHCR.
These include the wealth of a country (expressed in GDP) or an
amount per inhabitant per year ("one dollar or one Euro").
Although this level of funding is purely indicative, it provides
a good yardstick against which donor support to UNHCR can be measured.
United Nations High Commissioner for Refugees
(UNHCR)
5 December 2001
| 
