Underfunded Report, September 2022

2022 has seen a huge increase in the number of forcibly displaced people around the world, largely a result of the Russian Federation’s invasion of Ukraine. Ukrainians have received the kind of welcome that should be accorded to all people forced to flee: access to safety and protection, and freedom to travel, work and study, supported by a great surge of solidarity and generous funding from public and private donors alike. However, conditions for forcibly displaced people elsewhere in the world have not improved. In fact, the economic repercussions of the war in Ukraine – which are being felt in families across the world including in donor countries – have weighed heavily upon displaced communities, particularly in the world’s most forgotten situations. People who were self-reliant before have had their reserves sapped by the COVID-19 pandemic, which added to their marginalization and increased the risk of dropping out of school, being forced into early marriage or suffering gender-based violence. Now the war in Ukraine has caused a global economic shock, disrupting supplies of food and fuel and driving up prices. Food insecurity has worsened significantly, exacerbated by increasingly intense and frequent climate-related events, putting millions on the brink of famine.

All these factors have combined to deepen the vulnerability and increase the numbers of forcibly displaced and stateless people around the world, pushing UNHCR’s needs-based budget above $10 billion for the first time. Donors have responded in a timely and generous fashion – to Ukraine especially, but also to other emergencies. However, there remains an urgent and sizeable gap between funds available and the funds required to meet the most urgent and essential needs of people who have been forced from their homes, especially in those crises that are far away from the spotlight. The funding situation was already extremely tight at the start of 2022. In 2021, the underfunding rate had reached its highest since 2015, with the largest funding gap ever in absolute terms. UNHCR had been forced to make very tough prioritization decisions. The people that UNHCR serves are already forced to make heartbreaking choices such as whether to educate their child or buy medicine for older parents. Nobody should be forced to choose between equally life-saving priorities. Nine months into 2022, with even greater underfunding, growing vulnerability and unprecedented forced displacement, UNHCR needs the support of its donors now to prevent even more costly and long-lasting needs in the future. These exceptional circumstances call for exceptional support.

This report looks at the funding situation of 12 of UNHCR’s most important operations, countries with large numbers of forcibly displaced people and persistent vulnerabilities. In these countries alone, UNHCR has $612 million less in funding in 2022 than it spent in 2021. These 12 countries account for around half of UNHCR’s most acute underfunding. Globally, just to maintain the same level of assistance as UNHCR provided in 2021 would require a further $1.15 billion in funding by the end of 2022. As shown in this report, UNHCR has already been forced to reduce its assistance, but a lack of funding may mean its plans have to be scaled back further, just as inflation, food shortages and – in some climates – winter begin to bite. Fuel costs have soared as a consequence of the war in Ukraine. In the first half of 2022, UNHCR spent 45% more on fuel than it did in the same period of 2021. Cost planning scenarios – based on diesel prices and overall inflation – now show that UNHCR is expected to spend between $65.8 million and $82.8 million on fuel in 2022, more than double the planned expenditure of $31.7 million. The shortfall in funding for fuel, which is concentrated almost entirely in Africa and Asia, will mean reallocating resources. Even higher price spikes may result from emergencies such as the flooding in Pakistan, where fuel and electricity prices were 63% and 123% higher in August than a year earlier, and disrupted food supplies are likely to accelerate inflation. The Government has said it will restrict its expenditure in view of limited resources.

Forcibly displaced people in the countries detailed in this report have very differing needs: some are experiencing the sharpest consequences of disruptions to the food supply chain. Others are less exposed to food insecurity specifically but still desperately in need of funding that will allow refugees to build better and sustainable lives, thereby reducing their future reliance on UNHCR’s donor-funded assistance. UNHCR’s donors have been steadfast: in the three months since UNHCR first highlighted the pressing needs for these 12 operations, their overall funding level has more than doubled from 17% to 37%. Nevertheless, except for the Afghanistan and Ukraine situations, UNHCR’s operations in all regions are more underfunded now than at the same point in 2021. Donors have also given UNHCR more discretion in how their funds are used – a welcome and vital shift that helps tackle emergencies and meet the most acute needs. Around 40% of the funds received globally so far this year have been flexible – not earmarked for a particular use.

The latest tranches of donor funding have allowed UNHCR to provide cash-based assistance in the Middle East and North Africa, continue operating in Bangladesh, meet increased fuel costs globally, and maintain partner agreements for health, education, gender-based violence and child protection services. UNHCR’s border monitoring has also been sustained. But without fresh funding, all these activities are at risk of being reduced or cut altogether later in 2022 or in 2023. Already, many operations have undertaken austerity measures to cope with fewer funds. Some have reduced their plans to procure core relief items, with supplies set to last only until the end of September. Others have reduced the scope of services or goods they provide, or have reduced the provision of basic goods in order to ensure sufficient supplies for the coming winter months. This report shows how continued underfunding may result in cuts to the assistance that UNHCR is able to provide, including life-saving support for the most vulnerable but also crucial support to help forcibly displaced people to return to their homes and resume a more normal life. Among the countries highlighted in the report, UNHCR is particularly concerned about the funding gaps in Lebanon, Jordan and Yemen. These countries will have far less money for cash assistance, compared even with last year. At a minimum UNHCR will have to provide approximately $180 million less in cash in the region — affecting 1.7 million people. The effects could be greater. Other hard-hit operations include Ethiopia and Uganda, which lie in a region facing conflict and a drought that has put 20 million people into acute food insecurity, and where UNHCR is short of $125 million for the purchase of core relief items and shelter. Without additional funds for Uganda, UNHCR will not be able to pay salaries for teachers and medical workers in the fourth quarter of the year, and is short $4 million for purchasing medicines. The 15,000 Burundians who wish to return to Burundi and resume their lives there will not receive assistance to do so. Another country highlighted in this report is Bangladesh, where recent advances – such as in the provision of education and water supplies – could be undermined by severe underfunding in areas such as health, infrastructure and sanitation.

This report gives an updated snapshot of the needs in a sample of major countries. It is not an exhaustive list. UNHCR’s operations in many other countries, such as the Central African Republic and Somalia, are also experiencing acute underfunding and need the support of UNHCR’s donors to ensure the most vital protection and assistance for millions of people.

Source: United Kingdom for UNHCR

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