Syrian refugee crisis Contents

2Funding, livelihoods and the humanitarian architecture

Cuts to funding

5.Since the Syrian conflict began, DFID has allocated over £1.1 billion to support those affected, making the UK the second largest bilateral donor to the crisis. While the UK was widely commended for its funding contributions in evidence to our inquiry, concerns were also raised regarding the current status of the total global fund for the Syria crisis, with only half of the 2015 requirement fulfilled.8 This shortfall is due to the under commitment of the UK’s donor partners, and many Syrian refugees have cited reductions in humanitarian assistance as a major factor driving them towards Europe.9 Analysis by Oxfam suggests that the UK is the only G7 country that has contributed its ‘fair share’ in funding. Whilst the UK has generously contributed 229% of its fair share, France, for example, has contributed 22%, Japan 24% and Italy 21%.10 We are deeply concerned about the lack of financial support from the UK’s partners, particularly European countries and members of the OECD Development Assistance Committee (DAC).

Fig 1: Total funding to Syria Crisis, 2015 ($US)

This shows the 10 largest European donors in order of their financial contributions to the Syrian crisis fund in 2015. The UK has made by far the largest contribution – over 36 times more than that of France in 10th place.

Source: UN OCHA, Financial Tracking Service (accessed 7 December 2015)

6.The humanitarian situation has worsened over the past year and conditions for Syrian refugees in neighbouring countries continue to deteriorate.11 A lack of adequate funding is likely to further exacerbate these conditions, especially for the most vulnerable. The World Food Programme (WFP) has been forced to reduce its overall food assistance by 30% in 2015 due to cuts, with over 355,000 vulnerable refugees in Jordan and Lebanon losing their assistance entirely, and those designated extremely vulnerable receiving only half the food assistance that they did at the end of 2014.12 This has directly contributed to the increase in the proportion of Syrian refugees in Lebanon living below the poverty line from 50% in 2014 to 70% in 2015.13

7.Refugee families are resorting to behaviours such as begging, child labour and commercial sex work to help them cover rent, food and other basic needs in the face of reduced assistance. We are concerned that early and forced marriages of girls as young as thirteen has increased as funding has been cut.14 George Graham of Save the Children explained:

It is because their parents are desperate and because they see that as a way to “keep them safe”, or, frankly, to have one less mouth to feed.15

8.Children have also been withdrawn from school and sent to work in efforts to make ends meet. In Jordan, the proportion of under-aged children in work increased from 5% before September 2015 to 29% now, and in Lebanon, the share of those removed from school has doubled since 2014.16 DFID has taken steps to address this problem, in particular through the No Lost Generation Initiative, which Minister of State Desmond Swayne MP described as “our principal offering”.17 Yet if underfunding by other donors endures, this global effort to minimise the adverse impacts of the crisis on Syrian children is likely to fail.

Host community pressures

9.The vast majority of Syrian refugees—around 90% according to some—live in local communities rather than camps, placing immense pressure on local resources and services, including health and public education systems.18 Lebanon’s population is now close to the levels previously projected for 2050, with the refugee influx the equivalent to the UK accommodating nearly 14 million refugees.19

10.At a national level, concerns have been expressed by Syria’s neighbours about the fiscal sustainability of accommodating so many refugees. The total fiscal impact of the crisis on Jordan in 2015 is expected to stand at around US$2.07 billion.20 The Jordanian Embassy has highlighted the impact of Syrian refugees on the economy as Jordan’s principal challenge and concern.21

11.Refugee-hosting countries, particularly Turkey, Jordan, Lebanon and Iraq, are at the forefront of the crisis and continue to bear the brunt of its political, economic, social and security consequences. Turkish authorities alone have spent almost US$8 billion on services to support Syrian refugees so far, while contributions from the international community have amounted to US$417 million—a situation which we have been told is simply unsustainable.22

12.Easing the pressures on local services in refugee-hosting countries should be a key priority. An important instrument to achieve this is the Regional Refugee and Resilience Plan (3RP)—a model to better coordinate national plans and channel assistance into the sectors where it is urgently needed. In addition, the 3RP combines humanitarian support for refugees with development assistance to hosts, yet it is useless without adequate funding. The 3RP is just 56% funded for 2015, and as figure 2 indicates, key sectors of particular concern to us are severely underfunded.

Fig 2: Regional funding status of key sectors through the 3RP (US$)

This shows some key areas of the Regional Refugee and Resilience Plan (3RP) that are severely underfunded. For example, funding for health in Lebanon stands at 14% of the requirement and 22% for education in Turkey.

Source: adapted from 3RP, Regional Progress Report: June 2015

13.We strongly commend DFID for setting an exemplary standard in its commitment to funding humanitarian assistance to address the Syrian crisis. We are very concerned at the lack of financial support from other donors. Wealthy countries again committed to the goal of spending 0.7% of Gross National Income (GNI) on Official Development Assistance (ODA) this summer at the Financing for Development conference in Addis Ababa, but are not being held to account for delivery against this commitment. This is a serious problem in the face of increasing humanitarian needs. Evidence indicates a link between the reduction in assistance and increases in dangerous onward migration from the Middle East to Europe.23 We urge the Government to apply more pressure on other donors to meet their 0.7% commitment and direct an appropriate proportion of ODA towards the Syrian crisis. Efforts should be focused towards meeting the full financial requirement of the Regional Refugee and Resilience Plan (3RP), in order to support Governments of the region through a coordinated strategy to strengthen basic services in these countries, ease host-community pressures, and help prevent dangerous migration journeys.

14.The crisis has also taken its toll at the community level, as a high influx of refugees has been destabilising for host countries: it has generated significant social tensions between refugees and locals, largely due to increased competition for resources and for work.24 Chatham House highlighted the risks of the situation and stated that local frustrations with the perceived inaction of the Government and international community are already on the rise. If not addressed, these tensions could boil over into serious social unrest and contribute towards further regional instability.25 One way to help diffuse host community pressures may be through the use of cash programming.

Box 1: What is cash programming?

Humanitarian assistance involves transfers to individuals affected by conflicts or natural disasters. Such transfers can be provided either in-kind, in the form of food, shelter materials, or blankets, or it can be provided in cash (including voucher schemes), enabling people to decide what to buy based on their own needs. Research shows that cash-based assistance can have numerous benefits, particularly with regards to efficiency. A larger proportion of the total budget goes to beneficiaries (85% for a project in Somalia compared with 35% of in-kind food aid), it can increase the number of people reached with the same level of funding (by 18% in Lebanon), and can reduce fraud risks.1

While there has been an increase in the use of cash programming globally in recent years—from less than 1% of humanitarian spending in 2014 to around 6% now—it still represents a relatively small proportion.2 DFID has identified scaling up the use of cash as a key priority, reflected by the recent High Level Panel on Humanitarian Cash Transfers it convened to look at the barriers to moving towards a more cash-driven response to crises. It recently allocated £15m to a UNHCR programme in Jordan which provides a monthly cash grant to the most vulnerable refugees.

1. Overseas Development Institute/Centre for Global Development, Doing Cash Differently (September 2015), p19-20

2. Overseas Development Institute/Centre for Global Development, Doing Cash Differently (September 2015), p9

15.Perhaps the most important benefit in the context of the Syria crisis is the ability of cash transfer programmes to better support local markets. Poorly directed in-kind assistance can flood local markets, disrupt local supply chains and discourage production. Such disruption to local economies can have a negative impact on communities and generate hostility towards refugees. Greater use of cash transfers can help to reduce these tensions by enabling refugees to support local markets for goods and services.26 As Minister of State Desmond Swayne told us:

if those people come to market with money to spend in your shops, they are going to be a whole lot more welcome than if they had been sent a food parcel and do not go shopping.27

16.The economic benefits of cash assistance can be substantial. In Lebanon, cash has been shown to have a multiplier effect of 2.13, meaning that one dollar provided in humanitarian assistance generates $2.13 for the local economy.28 The US$51 million in cash-based humanitarian assistance injected into the economy in winter 2013/14 generated additional income of US$109 million for the local population. Cash based interventions are particularly effective in urban settings, which is where the majority of Syrian refugees reside.29

17.As the Minister of State indicated, refugees have a better understanding of their own needs than any aid agency.30 Cash programming can better link the humanitarian response with these needs by allowing them to buy things themselves, rather than being given things they might not require.31 Cash-based assistance is particularly relevant for the most vulnerable as aid agencies often lack the detailed data required to understand the nature of their vulnerabilities. In particular, evidence suggests that there is under-reporting of conditions by refugees with disabilities.32

18.We are gravely concerned about the increased tensions between host communities and refugees, particularly given the risk that such tensions might further contribute to regional instability. We have received strong evidence about the need for a new approach to humanitarian assistance. Research suggests that cash programming may provide a valuable means of delivering support in a way that offers dignity for refugees and facilitates peaceful co-existence with host communities by benefitting local economies. We recommend that DFID build upon its existing efforts and scale up the use of cash-based assistance in the region. It should use the recommendations of the High Level Panel on Cash Transfers as a blueprint for how to do so, and strive to make cash its default means of delivering humanitarian assistance. This is particularly important for targeting the most vulnerable, as refugees with specific needs will have a better understanding of how to meet these needs than aid agencies. We are also gravely concerned about the overall impact on the economies of host countries, and urge DFID to work with the World Bank and other institutions to ensure that they receive the necessary long-term support which is vital to their economic survival.

Support in the region

19.The UK Government’s strategy has focused on helping refugees in Syria and elsewhere in the Middle East, yet other donors have been directing resources towards resettling refugees and supporting them in their own countries. While we recognise that resettlement is the most appropriate option in certain circumstances, we also received representations that for most refugees it is not in their best interests. As George Graham of Save the Children told us:

it is in the interests of the majority of refugees to stay relatively close to where they come from because they would ideally like to go back to where they came from.33

Whilst the UK Government strategy has focused on helping refugees in Syria and elsewhere in the Middle East, many of the British public appear unaware of the extent of this. The Government should ensure that the public are aware of both the extent of its support and the benefits of supporting refugees in their own country.

Fig 3: Total funding for Syria Crisis, 2012 to 2015

This shows the disparity between funding required and funding received for the Syria crisis each year since 2012. It is clear that while funding has increased for the crisis, the requirement has increased faster. As a result, the gap between what is required and what is provided has grown wider each year.

Source: UN OCHA, Financial Tracking Service

20.Ensuring the best possible outcomes for the majority of refugees requires helping them stay near their homes, yet this in turn necessitates investments in the region to provide an adequate standard of living and the prospect of a better future. John Ging, Director of the Operational Division, United Nations Office for the Coordination of Humanitarian Affairs (UNOCHA) told us that such investments are far less costly than providing for refugees in Europe:

The dramatic increase of refugee flows into Europe entails huge costs for the countries generously receiving refugees - many multiples of the cost of early investment in meeting basic needs and bolstering public services in host countries in the region.34

We commend the Government’s support within the region for three reasons. Firstly, evidence suggests that despite the operational challenges of delivering assistance in the Middle East, it is more cost-effective to support refugees in the region than it is to direct resources towards resettling them in the UK. Secondly, we heard that it is actually in the best interests of the majority of refugees to stay closer to home, though they require adequate funding to support this. Thirdly, one of the key factors driving refugees towards dangerous trips across the Mediterranean is cuts to humanitarian assistance, which in turn is driven by insufficient funding from donors.35 This suggests that sufficient funding to help humanitarian organisations support an adequate standard of living in the region will deter many more refugees from risking their lives in this way. As John Ging of UN OCHA wrote, it is only the prospect of a better future that will prevent refugees from leaving the region.36

Jobs and Livelihoods

Impacts of labour market restrictions

21.One of the recurring themes that emerged in this inquiry was legal access of Syrian refugees to host country labour markets. The vast majority of Syrian refugees have no, or limited, legal access to work. Yet as humanitarian assistance decreases, it is inevitable that increasing numbers of refugees will be depending on work opportunities to survive.37

22.The lack of access to legal work means that refugees are forced into jobs in the ‘informal’ (i.e. non-legal) sector, which is often associated with poor employment conditions and increased poverty.38 It is the desperation of their circumstances that forces refugees to seek such employment opportunities despite the lower wages, harsher conditions and fewer rights. With such a large influx of refugees, the structure of host country economies and the nature of economic security has changed—a change which the host countries are struggling to manage. As Nicholas Grisewood, Crisis Migration Technical Specialist at the International Labour Organization (ILO), said:

The unfortunate thing is that, with what has now become a protracted crisis, these issues are now becoming structural.39

23.Children are also directly affected by host country labour market policies in a number of ways. Firstly, informal economies often escape regulation: for example, children as young as six have been found to be working in Lebanon.40 While Syrian refugees in Lebanon were initially permitted to work, restrictions were introduced in late 2014 and those caught working illegally are subject to fines, detention or even deportation.41 Some parents have said that as a result they send their children to work because they are less likely to be checked for licenses by employers and authorities and subsequently punished.42 Secondly, in countries where there are few opportunities for work, returns to education are limited. The lack of foreseeable benefits from education through future wages means that there is less rationale to incur the cost of schooling now. As a result, parents are more likely to remove their children from school.43

Possible solutions

24.We recognise that the need to allow refugees to work is a complex issue unfolding in an incredibly complicated environment. Prior to the crisis, unemployment in Jordan was high at 12.7% and, as the size of the labour force has grown, employment generation has not kept pace.44 These pressures have been exacerbated by the influx of Syrian refugees, and the concerns of host country governments are understandable.45 We would not recommend a disorderly opening of labour markets to refugees. As Nicholas Grisewood of the ILO told us:

simply opening a labour market is likely to lead to further chaos in what is already a relatively chaotic environment.46

Demanding that host countries absorb Syrian refugees into their labour markets without support is unlikely to be a sustainable course of action.

25.In response to a report by our predecessor Committee and in oral evidence to this inquiry, DFID referred to discussions with host country governments on the issue of refugee employment.47 In his oral evidence the Minister of State described such discussions as “a work in progress”.48 We welcome the Minister’s statement that he hoped to bring forward a proposal early next year,49 and emphasise that such a proposal must move beyond short-term employment responses towards finding areas of economic growth that can create sustainable employment solutions. This should involve the provision of education beyond primary school age to include skills training. We see a coordinated and carefully planned effort to address this issue as essential to the long-term sustainability of refugees’ presence in host countries.

26.In his evidence, Nicholas Grisewood referred to a number of sectors of the Jordanian economy as opportunities for employment creation, including transport, alternative energy sources and recycling. Not only can investments in such areas provide short-term employment, but also jobs in the long-term through the improvement and maintenance of new and existing infrastructure.50 Mr Grisewood also commented on the need for a knowledge base of opportunities, saying:

We need to find areas of economic growth and we need to do that through broader economic data analysis, and that is something that has not really happened so far. We lack data. We lack knowledge. We lack understanding in terms of where potential opportunities are.51

27.As the refugee crisis has become increasingly protracted, the need for legal employment opportunities for Syrian refugees has grown. Evidence suggests that they want to work, yet legal restrictions mean they are forced to remain reliant on humanitarian assistance or find work in the informal sector. This model is unsustainable in the long-term and has a particularly negative effect on child refugees. DFID can help develop employment opportunities in host countries and put the Syrian refugee crisis response on a more sustainable development footing. Given that other countries are making considerable investment commitments in Jordan, we recommend that DFID engage with the Jordan Investment Commission and other partners to explore opportunities to leverage these projects to create jobs for refugees. We recommend that DFID use its expertise in the field of economic development and works with suitable partners to identify and develop opportunities for investment, economic growth and sustainable job creation to the benefit of Syrian refugees and host communities alike. Specifically it should extend its inclusive growth diagnostic exercise to refugee hosting countries in the Middle East.

28.We see the identification of long-term opportunities to create jobs in countries hosting refugees as a key response to the crisis. DFID should make use of CDC Group’s expertise in private sector investment and should discuss CDC’s remit with the CDC board and allow it to invest in countries hosting refugees. In addition, DFID should provide CDC with specific funds for it to invest on DFID’s behalf in sustainable job-creating businesses in those countries.

The global humanitarian system

29.Francois Reybet-Degat, Deputy Director of UNHCR for the Middle East and North Africa Region, told us: “Today, the global aid architecture is unfit for purpose for what we are witnessing”.52 This is a view that much of the evidence to this inquiry has echoed.

30.When gaps in essential services emerge in conflict or disaster-affected countries, humanitarian organisations are forced to step in, often becoming the default providers of these services.53 Once affected populations are reliant on humanitarian assistance for the provision of such services, it is difficult to withdraw support. This is demonstrated by the fact that nearly 90% of humanitarian funding from OECD Member States is spent on countries that are in long-term crisis such as Syria.54

31.Responses to the Syria crisis have involved repetitive, short-term actions to meet the immediate needs of refugees. While meeting these needs is undoubtedly important, such an approach cannot evolve into a long-term solution without carefully considered planning and effort. John Ging, Director of the Operational Division at UN OCHA illustrated the implications of the current system in written evidence, saying:

Humanitarian funding can help those in the greatest need to survive the impacts of displacement and conflict over the short-term, but it is only the prospect of a better future – of education for people’s children, of adequate healthcare and livelihoods opportunities – that will prevent people having to make the difficult choice to risk their own lives and those of their families by leaving the region.

32.The global approach to protracted crises should be a key topic at next year’s World Humanitarian Summit in Istanbul. We are concerned about the lack of a comprehensive, long-term strategy to deal with such crises and shift funding from a reliance on humanitarian assistance towards a more development-centred approach. We recommend that DFID focus its efforts at the Summit on this issue in three respects. Firstly, promote early investment in public services and economic infrastructure which can yield long-term dividends that a narrow focus on immediate humanitarian needs cannot. Secondly, negotiate commitments to provide humanitarian and development funding over multi-year timeframes, enabling the response to be better managed and more strategic. Thirdly, focus on developing areas of economic growth which will create sustainable employment solutions and ultimately help a country from aid dependency.

8 UN OCHA, Financial Tracking Service, accessed 28 November 2015

9 World Food Programme (SRC0025) para 21

10 Oxfam, Solidarity with Syrians (October 2015)

11 World Food Programme (SRC0025) para 2

12 World Food Programme (SRC0025) para 8

13 World Food Programme (SRC0025) para 18

14 CAFOD and Caritas Lebanon Migrant Centre (SRC0023) para 2.6

15 Q30

16 World Food Programme (SRC0025) para 13

17 Q67

18 Q13

20 Embassy of the Hashemite Kingdom of Jordan (SRC0030) para 11

21 Embassy of the Hashemite Kingdom of Jordan (SRC0030) para 6

22 Turkish Embassy in London (SRC0005), para 5

23 World Food Programme (SRC0025) para 21

24 Coffey International Development (SRC0009) para 7

25 Chatham House (SRC0027) para 4

26 Overseas Development Institute/Centre for Global Development, Doing Cash Differently (September 2015), p14

27 Q66

28 Venton, C., S. Bailey and S. Pongracz, Value for money in cash transfers in emergencies (February 2015), p26

30 Q66

31 Overseas Development Institute/Centre for Global Development, Doing Cash Differently (September 2015), p13

32 Q33

33 Q34

34 John Ging, Director of Coordination and Response Division, UN OCHA (SRC0033)

35 World Food Programme (SRC0025) para 21

36 John Ging, Director of Coordination and Response Division, UN OCHA (SRC0033)

38 ILO, ‘Informal Economy,’ accessed 1 December 2015

39 Q48

40 World Vision (SRC0018) para 13

41 Norwegian Refugee Council, No Place to Call Home (June 2015), p13

42 World Vision (SRC0018) para 13

43 ILO, World Report on Child Labour in 2015 (June 2015), p xviii

45 John Ging, Director of Coordination and Response Division, UN OCHA (SRC0033)

46 Q51

47 International Development Committee, Third Special Report of Session 2014—15, UK Support for Humanitarian Relief in the Middle East: Government Response to the Committee’s First Report of Session 2014–15, HC 673

48 Q55

49 Q55

50 Q49

51 Q49

52 Q14

53 John Ging, Director of Coordination and Response Division, UN OCHA (SRC0033)

54 John Ging, Director of Coordination and Response Division, UN OCHA (SRC0033)

© Parliamentary copyright 2015

Prepared 21 December 2015