By Barbara Adams and Sarah Dayringer

The UN has released the advance unedited version of its report of the UN Development System (UNDS), lightly entitled the “Implementation of General Assembly Resolution 67/226 on the Quadrennial Comprehensive Policy Review [QCPR] of operational activities for development of the United Nations system.” The UNDS comprises the activities of some 30 agencies – coordinated by the UN Development Group – and the intergovernmental bodies that provide guidance and oversight, such as the Economic and Social Council (ECOSOC) and its commissions. This report is the key input for the ECOSOC Operational Activities Segment to be held at the UNHQ on 22-24 February 2016.

In addition to its annual assessment of funding patterns, the report addresses the implications for the UNDS of the three major 2015 agreements (2030 Agenda for Sustainable Development (2030 ASD), Addis Ababa Action Agenda and the Paris Climate Agreement). It also explores the changing needs of developing countries; the increasing role of non-state actors in implementing development agendas and agreements; and the growing demand for participation in decision-making on multiple levels (government/multi-lateral, national and sub-national levels).

According to a survey of the perceptions of governments of “programme countries” (those receiving assistance), the UNDS ranked much higher than other partners for “facilitating participation of civil society and national NGOs in national development processes.” As in last year’s survey, the UNDS remained with a ranking of second in “mobilizing external resources for development, for which the Bretton Woods Institutions play the main role.” A development on the negative side this year is the loss of first rank in terms of being a preferred provider for “supporting regional or sub-regional cooperation”, where other multilateral and regional institutions topped the UNDS by a significant margin.

Navid Hanif, Director of ECOSOC Office of Support & Coordination (DESA) identified the following key messages:

• The UNDS remains the preferred provider for institutional capacity development for programme countries.
• There is a downward trend “in terms of being a preferred provider for supporting regional and sub-regional cooperation.” The report shows that multilateral and other regional institutions have surpassed the UNDS by significant margins.
• The thematic areas in which programme countries are seeking UNDS support have changed since the last cycle of the QCPR. From survey results, programme countries identified primarily the areas of environment and natural resources; sustainable development policies; agricultural development; and economic growth and development.
• Countries have greater expectations for the UN to deliver solutions, specifically countries facing special challenges such as LDCs, LLDCs, SIDSs and countries in conflict.

The report recognizes the challenge posed by the 2030 Agenda of moving from coordination and coherence to integration (see paragraphs 13, 293 and 310). “We must address integration by looking at strategic financial and operational gaps, which continue to hamper the ability to look at these issues in their entirety and NOT as fire fighting exercises” added Hanif.

According to the report, the total funding for development received by the UN for 2014 was USD 28.4 billion, up 7% from the previous year. However, this was largely composed of non-core funding. Funding from developing countries has increased to 26% in real terms since 2011. Core funding decreased by 5% and is currently only 24% of total funding – the lowest share of core funding in the history of the UN Development System. And, as the report points out: “The growing imbalance between core and non-core funding and lack of flexible, pooled non-core funding is resulting in the vast majority of resources received being tightly earmarked to specific projects and trust funds. This challenges efforts for UN system-wide response as it encourages siloed functioning, increases fragmentation and transaction costs, and fosters competition and overlap of UN entities’ activities. Consequently, the functioning of the UNDS is increasingly dictated by the nature of the funding it receives.“

Furthermore:  “In 2014 the top 3 state donors [USA, UK and Japan] provided 45% of the total funding received from Governments, and the top 10 together accounted for 73% of the total funding from Governments. In 2009, these shares were 40% and 74%, respectively, indicating that there has been no improvement over the past 5 years in terms of reducing the UNDS reliance on a limited number of Government contributors.”

“Expanding the donor base is still a question the system must consider seriously.” said Hanif. “There will need to be a framework that can look at funding for the system as a whole in order to meet the requirements of the 2030 Agenda, which are to reduce fragmentation, minimize unpredictability, and encourage us to work together as one.”

For more on the challenges and pitfalls in financing the UN Development System, see  Global Policy Forum’s publication “Fit for Whose Purpose?”