Designing a funding framework for the slow-onset impacts of climate change: insights from recent experiences with coastal retreat
Current policy and funding systems for climate change responses tend to focus on the rapid-onset impacts and disaster recovery. In contrast, the effective management of the slow-onset impacts of climate change and their often-transformative impacts on communities and countries has remained relatively unexplored. These impacts include coastal erosion, desertification and sea level rise.
Drawing on relevant global experience, this paper investigates recent approaches to planned relocation of communities as one possible response to climate change impacts. Numerous coastal settlements will need relocation over the coming century and beyond. The authors find that funding for this pre-emptive response strategy is inadequate and consider principles to inform the design of a fair and effective funding system for planned relocation. These include minimising long-term societal costs, pursuing intergenerational equity, integrating funding with broader sustainable development objectives, and ensuring a high degree of transparency and accountability for the use of public funds.
Key points for decision-makers
- This analysis focuses on planned relocation within countries.
- In many locations, planned relocation of people and assets, or ‘managed retreat’, is increasingly seen as an important response to coastal flooding and erosion, and it may represent the only credible response for low-lying atoll states and other vulnerable islands.
- Planned relocation is usually based on decisions made by public authorities rather than individuals but requires significant community buy-in, acceptance and planning. It also requires robust funding mechanisms. Currently funding is generally ad hoc, poorly coordinated, and limited in scale and scope. Many of the key funding issues, such as who should pay for the various costs associated with relocation, have not been properly resolved.
- The paper highlights how governments in various high-income and low-income countries have begun experimenting with different funding arrangements.
- The authors find that the major source of financing often comes from the national and federal level – for example, in the US via the Federal Emergency Management Agency (FEMA) or in Vietnam via the Living with Floods programme. International aid and development assistance have been important sources of relocation funding for many low and middle-income countries, including the Philippines after Typhoon Haiyan, and in other cases, responsibilities for funding relocation rest with sub-national government.
- The responsibility for implementing planned relocations, however, tends to be more decentralised. It is therefore important to ensure that funding flows effectively to those tasked with implementation of planned relocation, and the authors find this to be a key challenge.
- The authors propose five high-level principles to guide future policy developments: i) Minimising long-term societal costs; ii) ensuring intergenerational and intra-generational equity; iii) enabling those directly affected to get on with their lives with minimal disruption and uncertainty; iv) integrating the funding of planned relocations with national strategies for sustainable development and societal resilience; and v) ensuring a high degree of transparency and accountability for the allocation of public funds.
- They conclude that while some of the costs associated with planned relocation can and should be met from private sources, other costs will almost certainly require public funding; and that concerted efforts at all levels of governance – international, national and sub-national – are needed to develop cost-effective, equitable and politically sustainable funding solutions.
Read a commentary by the authors on their paper here.