NEW YORK — Climate change disproportionately impacts the world’s most impoverished. So, experts are asking, why can’t they receive direct compensation and support?
Compensation for climate-related loss and damage for the world’s lowest-income countries is being debated in the lead-up to the next United Nations Climate Change Conference, COP26, in November. But another adaptation strategy that governments are being urged to consider is direct financing — offering payments to support the individuals who increasingly bear the brunt of recurrent and strong droughts, floods, and other environmental phenomena.
“When you look at transformative climate adaptation outcomes, they’ve tended to be the ones where they've had more localization. There's more local engagement, more local leadership, and in defining what interventions will make the biggest difference,” said Clare Shakya, director of the climate change group at the International Institute for Environment and Development.
“Only 18% of global climate finance reaches LDCs [least developed countries]; and less than 10% of climate finance from dedicated climate funds gets to the local level,” according to IIED.
Climate change will push up to 132 million people into extreme poverty by 2030, according to the World Bank. And in the first half of 2020, climate disasters displaced 9.8 million people, making them the biggest cause of internal displacement.
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But the long-term impacts of slow-onset events, such as droughts, can be challenging to accurately track and assess in terms of lasting damage. It is equally challenging to successfully identify the full scope of people who migrate as a result of climate change or suffer cyclical damage to their crops and work opportunities, among other challenges, experts say.
“Most people wouldn’t readily say that they are moving because of climate change. They are looking at the symptoms of what climate change has caused and just say: ‘I am moving because I need better land. I am moving because my home was destroyed,’” said Lauren Whitehead, director of technical assistance at BRAC Ultra-Poor Graduation Initiative.
BRAC UPGI recently announced that it received additional funding to expand its “graduation approach” of poverty intervention to cover an additional 21 million people by 2026. This model often involves cash transfers, sometimes conducted in partnership with social protection or agricultural ministries. People who are vulnerable to climate change are covered under this scheme.
“It would make sense to explore this idea of direct cash assistance, given the fact that getting any amount of finance related to climate change to the people who are most affected is at such a roadblock at the global level, especially for climate negotiations,” said Kayly Ober, senior advocate and program manager of the climate displacement program at Refugees International.
Envisioning a new way of doing work
A large-scale reimagining of climate financing would likely require both substantial donor funding and redistribution of money within governments’ national climate adaptation strategies. There are several emerging — though relatively small-scale — models in different countries that offer a blueprint for what directly assisting climate-impacted communities could look like.
In India, for example, the government’s Mahatma Gandhi National Rural Employment Guarantee Act guarantees 100 days of employment to people living in rural areas. If they do not work during this time, people become eligible for unemployment insurance.
For climate vulnerable countries, loss and damage will be a key measure of success at COP26. But higher-income governments are reluctant to engage.
The MGNREGA has recently expanded in three states to cover people who also experience severe drought. These people are now guaranteed an additional 50 days of employment, according to Ritu Bharadwaj, senior researcher at IIED, who previously worked with the Indian government on this plan.
“How do we compensate for the losses, in a way? What will be the optimum way to help families coping from this climate crisis to absorb and also recover from that?” Bharadwaj said.
India is now working to scale this initiative to reach six more states that are often hit by cyclones. The expansion of the employment initiative, though, is not an easy fix. Declaring drought in India is politically fraught, and the process can vary state to state. The guarantee of work might not also be enough to prevent climate-induced migration or other losses.
“It's not just about the minimum wage. It’s about the cost for a household to be resilient. They need access to health, they need access to continued education, they need access to food, they need access to clothes,” Bharadwaj said.
Kenya has also expanded access to its social protection system to deliver about 1.3 million severely drought-impacted households regular cash payments of $54 every other month, according to Ahmed Ibrahim, CEO of the Kenyan community-based organization Arid Lands Development Focus.
“Most people wouldn’t readily say that they are moving because of climate change. They ... just say: ‘I am moving because I need better land. I am moving because my home was destroyed.’”— Lauren Whitehead, director of technical assistance, BRAC UPGI
“Climate change is a reality in this area. There is frequency of droughts, floods, and locusts. Frequency of this happening has gone from 10 years, five years, three years, to every other year,” Ibrahim said. “If there is not a drought, there is a flood.”
The Kenyan government is considering further scaling the program to reach more people.
“The model is good as long as there is scalability, both in the size of the value of the project,” Ibrahim said.
Malawi and Bhutan are two other countries that are considering opening their social protection schemes and public funding to directly target people impacted by climate change.
“So, whilst we're not able to talk about hundreds of examples yet, we're seeing more and more examples of how this can work,” Shakya said.
Setting out a new way of working
In its 2050 vision paper, the Least Developed Countries Group — which is made up of 47 LDCs — calls for a coherent climate finance architecture that includes 70% of climate finance directly supporting transformative, locally led climate action.
The group’s plans for implementation have been slowed by the COVID-19 pandemic, according to Gebru Jember Endalew, former chair of the LDC Group. But the organization plans to put forward specific national platform plans next year.
During COP25 in 2019, the LDC Group signed a memorandum of understanding with a group of donor and least developed countries — Bhutan, Austria, Burkina Faso, Denmark, Ethiopia, Finland, Gambia, Germany, Ireland, Malawi, Sweden, the U.K., Uganda, and Italy — to “set out a new way of working together to deliver climate ambition at an accelerated pace.”
This could take time to develop, experts say, but signals the direction that climate finance and adaptation plans should be heading: directly back to the communities most impacted.
“Of course, with time, this work needs to be integrated into the development of a country. If we keep it as a project, then it is not sustainable. This is about rethinking business in an unusual way,” Endalew told Devex.
This focus area, supported by the U.N. Development Programme, explores how climate change and other planetary imbalances impact the rising trend of human inequality and vice versa. Visit the Focus on: People and the Planet page for more.