The World Humanitarian Summit: The System’s Broken, Not Broke

Nine thousand delegates gathered last week in Istanbul for the first World Humanitarian Summit. There was no shortage of great commentary in advance, all of which pointed to the pivotal role that the WHS could play in the future of humanitarian aid. And there was widespread consensus that we must do better: emergency aid is overstretched; delivery systems are often poorly matched to people's needs; refugee crises are overwhelming international organisations’ ability to respond; and lack of security for humanitarian workers signals a worrying trend of blurred battle lines that imperils both humanitarians and civilians.

How could the Summit have tackled these mounting problems? Depending on who you ask, the humanitarian system is either broke or broken.

If the system is simply broke, then the problem is that donors are simply not providing enough money. Last year, humanitarian agencies appealed for $15 billion more in funding than they received, a deficit which is set to grow larger this year. Donors currently spend about $25 billion a year on humanitarian aid—less than a quarter of all aid—and on this view, a relatively affordable increase in humanitarian aid would go a long way towards meeting the world’s obligations.

The alternative view is that the humanitarian system is broken—that is, in need of fundamental reform. The majority of humanitarian aid is spent on long-lasting crises rather than short-term emergencies, and the system does a poor job of helping people to move from dependence on humanitarian aid into safer, more productive lives. Large international agencies often fail to work with local governments and civil society partners. There are few independent needs assessments, and little rigorous evidence about what works. Agencies are mandated and organised to distribute supplies rather than give people control over their own lives and building markets by giving people cash. There is little information about what happens to the money: the humanitarian system is far behind the development system on improving aid transparency. We don’t even know how big the funding shortfall really is, since humanitarian agencies have every rational incentive to overstate needs, knowing that donors will only fund a portion of them; nor do we know how much more the humanitarian system could achieve if it were better organised. And conflicts are dangerously changing in character, threatening a greater number of civilians and increasingly targeting humanitarian staff.

In the absence of a consensus on whether the system is broken or merely broke, little progress was made on either issue at the World Humanitarian Summit. The so-called Grand Bargain was an effort to bring these two points of view together, acknowledging the need for systemic reform and for more money. But the overall result was a series of incremental, rather than transformational, improvements—and some absolute setbacks—along three dimensions of humanitarian aid: how to spend it, how to pay for it, and how to fix it.

How to spend it

Locally, transparently, and in cash. That sums up some of key commitments from humanitarian organisations and donors. One of the Grand Bargain’s few hard numerical targets is the shift to spending at least 25% of humanitarian spending through local organisations by 2020—which, if achieved, will be a dramatic increase from the small fraction that goes to them today. There is a clear and welcome call for greater transparency in how aid is spent, leveraging the International Aid Transparency Initiative, a simple electronic format for recording resource flows that many development organisations already use to help them transparently report on what, where, and when they are spending money.

There’s also been a strong endorsement of the need to give more humanitarian aid as cash transfers. We’ve worked with the Overseas Development Institute and others on collating the evidence. Not surprisingly, people are better than bureaucracies at knowing what they need and want. Markets are good at delivering those things (and can often do so much more efficiently than an international logistics system). And cash transfers are not ‘wasted’ on ‘sin goods.’

On this point, the Grand Bargain’s final language doesn’t match the impressive leadership from few forward-thinking organisations, like World Vision and the International Rescue Committee, both of whom pledged substantial targets for the share of their aid to be delivered as cash. Instead, it emphasizes 1) the need to further evaluate the evidence for providing cash transfers (when in fact this cash transfers are one of the most widely and rigorously evaluated modes of delivery in the history of humanitarian aid), 2) using cash alongside in-kind aid (often it should substitute for more expensive in-kind aid), and 3) ensuring that the delivery of cash is coordinated (thus sidestepping the need for a single organisation to deliver a single unrestricted payment to families, rather than dozens of organisations duplicating each other and requiring coordination).

How to pay for it

Reliance on single-year funding through humanitarian response plans for what are multi-year problems is a long-standing frustration in humanitarian aid, a fundamental misalignment of finance and purpose akin to trying to buy a home using a credit card rather than a mortgage. In 2015, only 13 (of 35) response plans had funding lasting more than a year, even though over half the countries that needed a response plan had had one for at least five years, and nearly a quarter of countries had had one for a decade or longer.

The Grand Bargain explicitly tackles this problem, promising to both increase “collaborative” multi-year funding from donors and reduce the number of earmarks that are applied to those funds, so that agencies get the kind of flexible financing they need to respond effectively instead of managing an endless portfolio of grants too small to make a dent in the problem, each of which carrying its own reporting requirements and administrative expenses. Although donors need to have their feet held to the fire to ensure that these promises stick, that feels like progress. (And though it is, in effect, one giant earmark, so did the announcement of a multi-billion dollar special education fund to pay for schooling for children affected by disaster or fleeing violence, a longstanding lacuna in humanitarian budgeting.)

While the big donors and agencies read prepared speeches to each other in one part of the conference, the side events next door was the venue for some of the most progressive, transformative thinking. Whether or not there’s actually a $15 billion shortfall, there’s no doubt that the system is not keeping up with needs. The result is an urgent push for innovation in how to pay for big parts of the humanitarian caseload, and agencies are increasingly turning towards insurance.

Side events convened by groups like the Insurance Development Forum highlighted an exciting future in which large organisations and vulnerable countries can insure themselves against a growing list of perils like drought and earthquakes. That would make money readily available when things go wrong, protect humanitarian funding for emergencies that can’t be insured, and ensure that vulnerable governments can plan effectively to tackle crises because they know the resources that will be brought to bear.

How to fix it

If the Summit was about finding solutions, then unfortunately it failed to address one of humanitarian aid’s core problems: the incidence of violent conflict. Research published last year found that although there were fewer armed conflicts in 2014 than in 2008, each one caused a death toll that was three times higher on average: in other words, for a complicated set of reasons we’re struggling to understand, conflicts are becoming much more lethal.

Of course, it was never realistic to think that a single summit could achieve real change in the number of protracted conflicts responsible for a large share of the humanitarian caseload. But to the extent that progress could have been made, the absence of even a core group of world leaders meant that real change was probably never in the works. In this sense, the WHS was about treating symptoms, rather than curing the disease. Chancellor Merkel led Germany’s delegation, but the UK was represented by its Secretary of State for International Development, Justine Greening, rather than Prime Minister David Cameron, and the US delegation was led by Gayle Smith, head of USAID, rather than Secretary of State John Kerry.

The absence of senior leaders also meant that real progress on refugees—one of Europe’s most bitter political discussions—was never really on offer. The outcome document from the section of the Summit dedicated to finding a way for countries to provide asylum to refugees and facilitate their integration lapsed into vague promises (“The Summit affirmed more political leadership was required for mediation, peaceful resolution and conflict prevention...”) rather than setting hard targets or measurable commitments.

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The Summit brought global attention to these important issues. Disruption and strong political leadership rather than gradual evolution are needed to create a system that can rise to modern challenges. But a meeting convened by the organisations most in need of reform and without a core group of senior political leaders was always going to struggle to be truly transformational. Political leaders need to confront the realities of paying for and integrating refugees. Donors should use their financing to demand transparency and efficiency from frontline organisations, including the local NGOs now poised to receive a greater share of it. And we must all support efforts to find peaceful solutions to violent conflicts.

Theodore Roosevelt said that good foreign policy should “speak softly and carry a big stick.” The World Humanitarian Summit—and its Grand Bargain—spoke softly. For the many problems addressed at the World Humanitarian Summit, now is the time for the main humanitarian donors to demand reform and delivery by wielding the big stick a little more conspicuously.