Let the money flow: Funding flood resilience at local levels

By Adrianna Hardaway

The Green Climate Fund is currently reviewing its work plan for engagement in the water sector. Reconsidering the make-up of its portfolio; how funding is distributed and projects implemented will be a critical step in ensuring flood resilience is built at regional, national and local levels. Ensuring it’s easier for subnational governments and NGOs to apply for funding for the Green Climate Fund to implement proven flood resilience programming is an essential first step in helping communities around the world fight the growing impacts of climate change.

Stronger monsoon winds and extreme rainfall have made floods more destructive in recent years, and the Terai plains - where more than half of Nepalis live - is the worst affected area in the country. As a result of climate change, rivers in the Terai plains are changing course more frequently, submerging paddy fields, and washing away homes. 

Unlike in the past, when we used to have gentle showers every other day during monsoon, nowadays it does not rain for weeks and when it does, it comes down in destructive torrents, - Bal Sugriv Rana who lives in the Shuklaphanta municipality in the Kanchanpur plains.

Globally, climate change has led to rising sea levels and more frequent storms, which have increased the intensity of flood events, including coastal, river, flash, and urban flooding. There is an urgent need to build flood resilience, yet while climate finance has increased over the last few years little of it (only an estimated 10 percent) is reaching local levels where the impact of climate change is most acutely felt.

Solutions to building flood resilience

The Zurich Flood Resilience Alliance works in a dozen countries supporting communities in becoming more resilient to floods. Our work has shown how effective, community-led interventions can sustainably build flood resilience and provide multiple dividends. 

In Nepal, Mercy Corps’ Managing Risk Through Economic Development program helps farmers grow crops along flood-prone river banks, which serves to mitigate flooding through bank stabilization, while simultaneously providing economic opportunities to communities by providing a source of income from the sale of crops.

Despite the evidence, little funding is available for these types of local-level climate change adaptation programs from international donors and national governments. Nor is there sufficient engagement with communities to develop effective interventions. This is problematic as communities and local authorities hold vital knowledge. Local stakeholders understand the economic, social, and environmental systems that enable effective climate change adaptation programs, and are critical to meeting development goals. 

Since the current climate financing system is not fit for purpose, improving how funding is directed to local communities is critical for ensuring funds are spent effectively and increase people’s resilience.

The Green Climate Fund and building local flood resilience

As an example, let’s look at the Green Climate Fund (GCF) which will direct how 100 billion USD committed by wealthy countries will be utilized for developing countries’ response to climate change. Ensuring funds from the GCF flow to where they are most needed is critical for realizing the ambition of the Paris Agreement. 

While the GCF has financed national and regional projects that support flood and watershed management, the Fund has not significantly invested in locally led investments and programs. 

Alliance research shows not enough funds reach community level

For example, the Alliance analysed 48 GCF projects that support flood resilience or flood management and found the following:

• 35 projects (73 percent) have gone to multilateral organizations like UN agencies, international finance institutions, and development banks (worth a total of 3.1 billion USD)
• 6 projects (13 percent) went to national government ministries or finance institutions (worth a total of 301.4 million USD)
• 3 projects (6 percent) have gone to regional entities (including 1 finance institution and 2 NGOs worth a total of 99.8 million USD)
• 2 projects (4 percent) went to international NGOs (worth a total of 156 million USD)
• 2 projects (4 percent) went to national NGOs (worth a total of 22.4 million USD)

This breakdown of funding highlights an imbalance in the implementation of flood management and flood resilience programming. While it makes sense for large, trans-boundary programs to be led by large, multinational organizations, funding local governments or civil society organizations working on flood resilience at the community level also has considerable value. 

The sub-national, national, or regional organizations that implement GCF projects, are better suited to implement tailored projects that address climate change impacts and can engage deeply with a variety of stakeholders at the local level. 

Building flood resilience through localization

To increase support to such local organizations, the GCF must: 

• Be more flexible in its accreditation and include a ‘tiered’ or ‘sliding’ criteria to make the application for funding simpler for local actors including indigenous peoples and vulnerable groups who currently have no mechanism for participation
• Increase support and funding for capacity building of local organizations so they can apply for, absorb, and implement program funding; and, 
• Streamline processes to open up more direct funding channels to agencies working at the local levels who do not have resources and capacities to go through costly and lengthy proposal development. One method for reducing costs would be the dispersal of project preparation grants from the GCF for approved concept notes from organizations working at local levels.  

Learning from examples of successful decentralized climate finance programming, like the Devolved Climate Finance (DCF) approach, provides examples of how to get climate finance - including water infrastructure funds- into the hands of local communities. 

Through the DCF, 90 percent of each fund is allocated to investments prioritized by communities and local authorities to ensure local people benefit. In Tanzania, to better understand the climate change adaptation needs of pastoralists, district planners conducted resilience assessments to capture livelihood strategies, barriers to continued development (as perceived by the community), and prioritized lists of potential interventions. 

The DCF commitment to incorporate local knowledge and community priorities into climate finance decisions can yield the type of paradigm shift the GCF strives for. 

Act now

The need for building flood resilience is urgent, and also has the potential to reap multiple dividends. By building resilience to floods through its programming, and increasing the level of financing to local levels the GCF can realize its mandate to help developing countries, and communities like Mr. Rana’s enhance their ability to respond to climate change.

This blog is based on the paper The Green Climate Fund: Recommendations for Meeting Climate Change Adaptation Needs, and the accompanying submission to the GCF for the Water Sector Guidance which includes examples of local level solutions to flood resilience.