Funding and Donor Relations

Emergency Fund

43. The availability of funds is a prerequisite for any UNHCR emergency action. The initial funding in an emergency for project and operations delivery and administrative support expenditure is likely to be allocated from UNHCR's Emergency Fund. Under the terms of UNHCR's Financial Rules, the Emergency Fund is established to provide "financial assistance to refugees and displaced persons in emergency situations for which there is no provision in the programmes approved by the Executive Committee", and to meet additional administrative expenditures resulting from those emergencies. The High Commissioner may allocate from the Emergency Fund up to US$25 million annually, provided that the amount made available for any one single emergency does not exceed US$8 million in any one year and that the Fund shall be maintained at not less than US$8 million. Further details are provided in Chapter 4 of the UNHCR Manual and in Appendix 1, Catalogue of Emergency Response Resources.

Central Emergency Revolving Fund

44. The Central Emergency Revolving Fund of the UN Office for the Coordination of Humanitarian Affairs was established to provide funds within the UN system to respond rapidly to emergencies. The fund has a target level of US$50 million and is financed from voluntary contributions. It is used for cash advances to UN operational organizations and entities. In principle these advances are to be reimbursed as a first charge against income subsequently received, usually as a result of consolidated appeals. Further details are provided in the Catalogue of Emergency Response Resources (Appendix 1).

Using Existing Funds

45. If an emergency develops in an existing operation, immediate funds may be available from those already foreseen for that operation or, if appropriate, from the Programme Reserve. Depending on the scale of further needs, and also on the time of year when the emergency occurs, further funding could either be proposed to the Executive Committee as a new current year project or as a new project for the coming year, or could be the subject of a special appeal.

Communicating Needs to Donors

46. Operational needs, progress and constraints must be clearly communicated to donors. A donor relations strategy should be established in the first days of an emergency and maintained for its duration.

47. Donor relations should be maintained through:

i. Briefing meetings and regular contact at field level between UNHCR staff and donor representatives. Regular briefing meetings (see paragraphs 3 to 11 above) with donors should aim to keep them up to date on actions being taken, protection issues, and any constraints;

ii. Regular contact and follow-up at Headquarters level;

iii. Involving donor representatives in missions to see refugee sites and other points at which assistance is delivered;

iv. Indirect communication of operational needs through UNHCR visibility in the media.

48. It is important to highlight UNHCR's protection and coordinating role when communicating with donors. Coordination must be a reality on the ground with UNHCR taking, and being seen to take, an appropriate leadership role.

49.

Only request funding for operations and budgets which have been formally approved.

There are no exceptions to this. This is necessary to ensure funding is targeted where it is most needed, to provide consistency in operational priorities and objectives, and in communicating these priorities to donors. Several sections in UNHCR brief donors and it is important for credibility that the briefings be similar. In case of doubts regarding what should be presented to donors for funding, contact the Donor Relations and Resource Mobilization Service at Headquarters for advice.

50. Steer donors towards funding those activities or areas of the operation that are most in need of funding. When appropriate, promote regional funding. Do not forget that the emergency may have a regional dimension. Include this and other elements of the UNHCR operation in the briefing and be prepared to discuss funding for all aspects of the operation with donors.

51. Contributions tightly earmarked to one aspect of the operation impede flexibility. Sometimes substantial contributions are strictly earmarked and there is little scope for amending budgets once they are approved.

Donors should be encouraged to make unearmarked contributions whenever possible.

However, if donors do want to earmark a contribution to a specific part of the operation, advise them to check with the Donor Relations and Resource Mobilization Service at Headquarters to ensure that this portion of the operation has not been funded already, or offered for funding, to another donor.

52. Particularly in emergencies, donors may offer to supply commodities or services rather than make a cash contribution. To a large extent it will be up the Field to decide on the suitability of such contributions. The offer should be immediately reported to the Donor Relations and Resource Mobilization Service at Headquarters, and the donor requested to follow up with Headquarters. In kind contributions need to be coordinated by Headquarters to avoid duplication of similar contributions by different donors, and to avoid confusion over the amount of cash versus total contribution¹.

Preparation of an Emergency Appeal

53. The primary document for communicating with donors is the emergency appeal. It is the appeal which needs to be brought to the donors' attention at briefings, and it is the activities in the appeal against which progress should be reported.

54. The emergency appeal is developed by both the Field and Headquarters.

Information contained in the appeal about operational needs to be generated at the point of delivery - i.e. the field - so appeals written primarily in the field are the most effective in raising funds.

Headquarters is responsible for issuing the appeal: it should have all the information necessary from the Field as soon as possible to enable it to approve budgets and to issue the appeal at the earliest opportunity.

55. The government should be consulted in the development of the appeal. The appeal should also take into account the results of the initial assessment, and the budget should cover all foreseen expenditures.

56. If the situation changes dramatically during the emergency, and the current appeal becomes inappropriate, then the Field should review operational objectives and agree the new direction with Headquarters before the revised operation is presented to donors.

57. The appeal and the way the operation is funded can be a potential source of confusion when the government is UNHCR's operational partner. The total target can be misunderstood as being entirely intended for expenditure in the country, whereas the budget will, of course, cover all UNHCR's direct expenditure, such as for any international procurement and field and Headquarters operational delivery and administrative support, including protection. Clarity on this point from the start, for example in any local press release or comment, can avoid embarrassment later.

¹ Further information on contributions in kind can be found in Procedures for Handling Contributions In Kind, IOM/65/96 - FOM/74/96, UNHCR, November 1996. Budgetary procedures for dealing with contributions in kind are discussed in chapter 8 on implementing arrangements.

Communication Between the Field and Headquarters

58. Headquarters and the Field need to work together closely on funding and donor relations issues. The focal point for this at Headquarters is the Donor Relations and Resource Mobilization Service. The Private Sector Fund Raising Unit at Headquarters may also issue appeals to the general public or aimed at individual or corporate donors.
59. Donor Relations and Resource Mobilization Service at Headquarters should:

Advise how to deal with a particular donor;

Provide latest information on funding for the operation;

Follow up with donor capitals on potential contributions discussed in the field;

Produce and distribute appeals (with the active participation of the Field);

Prepare specific submissions to donor funding agencies (with the active participation of the Field);

Submit detailed reports to the donors.

60. The Field should:

Produce the basic operation information and information for the appeals;

Inform Headquarters when a donor has indicated an interest in contributing funds, whether to the appeal, to a particular operation, to earmarked activities, or as a contributions in kind, and should also ask the donor to follow up through the normal channels at Headquarters;

Provide information to the donors about the current situation and UNHCR's plans. When deciding on a contribution, donors need relevant information. Some information will be in the emergency appeal and given at briefings, but some donors require more detailed information. Timely and detailed responses will ensure the most rapid funding;

Provide reports and information to Headquarters to assist it in submitting reports to donors. To ensure continuity of funding it is essential that the required information be provided from the Field without delay.

Reporting to Donors and Special Requirements

61. A variety of reports are required by donors in order to account for their contributions and to release additional funds. Bear in mind that donor reporting cycles do not necessarily correspond to UNHCR's reporting and operation cycles.

62. Some major donors to UNHCR's emergency operation require particularly detailed reporting at both financial and narrative level in a unique format with strict deadlines. These special reports are prepared by the Donor Relations and Resource Mobilization Service at Headquarters on the basis of information from the Field. Some donors also monitor implementation directly through their local representatives.

63. A number of donors attach great importance to the visibility of their financial support, through the marking of assistance material and other means.