Let us start this session of the International Development Committee’s inquiry into the FCDO’s approach to displaced people. We have two panels today; for the first we have with us representatives from UNFPA and UNHCR. Arafat, will you please introduce yourself and your organisation?

Thank you so much, Madam Chair, and members of the Committee. I am Arafat and I am speaking to you from Kabul, where I am currently the representative for UNHCR’s operations. Prior to that I was the co-ordinator for our second Global Refugee Forum, and before that I was working in South Sudan.

Mónica, you and I know each other because I co-chair the all-party parliamentary group on global sexual and reproductive health and rights, but the rest of the Committee probably do not know you, so will you please introduce yourself and your organisation?

Thank you so much, Madam Chair. My name is Mónica Ferro and I have been the director of the United Nations Population Fund office in London for a year and a bit. Before that, I was the director of the office in Geneva. I have been working for UNFPA for the last eight years. The United Nations Population Fund is the sexual and reproductive health agency of the United Nations, although our mandate is much broader, as I will hopefully be able to demonstrate through this inquiry.

Thank you. Cuts to your organisation have come from the US, there is the potential of cuts coming from the UK, and that is layered on top of the cuts you have had over the last four years. How do you prioritise your programming going forwards?

That is a very difficult question. Of course, we are doing our best, first of all, to try to assess the impact of the cuts and how that will impact our work. If I may, let me be very clear that we should be in no doubt about the devastating impact of the cuts and what they will mean for many millions of women and their families in vulnerable situations. We have stated that this devastating decision will force thousands of health clinics to close. Women in crisis zones will be forced to give birth without medicines, midwives or equipment, and this is going to put their lives and their babies’ lives in jeopardy. Rape survivors will be denied counselling services and medical care, and midwives will be delivering babies in the world’s worst humanitarian crisis without the ability to function. It was brought to public attention very recently that shipments of lifesaving medical supplies to refugee camps will be disrupted. This is the dimension of the cuts. It is very hard to try to prioritise. Of course, we are defining what life services we can continue to deliver but, in all honesty, most of the services we deliver are, by definition, lifesaving: maternal health, post-rape care, making sure that health facilities continue the delivery of medicines and medical supplies. The prioritisation is being done by trying to reduce all possible costs, which is a huge challenge because we consider ourselves very nimble. We are a very light-footprint organisation, in the sense that we walk the localisation conversation with a lot of confidence. We are trying to see where we can be even more nimble and more strategic.

On displaced populations specifically, if you are not able to provide those services, predominantly to women and girls, who will?

The big challenge there is that the UNFPA is often the sole provider of GBV services—gender-based violence services; sorry, I will try not to use acronyms—when it comes to prevention, risk mitigation and response. We lead in the humanitarian system and the gender-based violence area of responsibility within the protection cluster that is led by UNHCR. We also co-lead the working group on sexual and reproductive health and rights within the health cluster. Those are two services that are led by UNFPA, and we are often the sole providers of these types of services. In an area of work that is already severely underfunded, any cut will have a dire impact. It is very important that this message comes out. We are also what we call the “last provider” when it comes to GBV: if no services are in place, we are the ones who are responsible for jumping in to deliver those services. Arafat can also talk a bit about the work we are doing together in Afghanistan on safeguarding. One example I would like to share of how we are trying to deliver relates to what we call the “white areas” in Afghanistan. We look at the services being provided, and if there are no other services available for more than 10 km or a three-hour walk, that is what we call a white area, and we are responsible for setting up the services there. Can you imagine a pregnant woman who is about to deliver, or someone who needs medical care, having to walk three hours until she reaches services? The type of cuts are impacting the two big areas of work that are led by UNFPA: GBV and SRH.

What you are saying is that you are the service of last resort, so there is no other service that can step in if you cut your services.

In those two areas, yes.

And you are going to have to cut your services.

Yes.

Arafat, have you made any assessment of being able to operate refugee camps in the face of US, and potentially UK, cuts? It is not just the US and UK; I believe other countries in Europe are going through a similar process.

The situation in Afghanistan is one where we are dealing with lives that have been interrupted, and we are trying to help people to resume those lives. In other words, what we are doing is dealing with the mass return of refugees from Pakistan, Iran and elsewhere. These are people who have been generously hosted for over four decades, but who are now returning home, sometimes voluntarily but also sometimes under coercion. What I am trying to do on this side of the border is to make sure that they are received and registered, and that we are able to provide them with assistance to integrate back home. Our belief, and our objective here, is that returns should not only be a solution for the individual but should contribute to regional stability, economic growth and regional harmony. The effect of the cuts is quite devastating. To give one example, at the borders, together with other UN agencies, we provide cash to people to come home, and our cash grant used to average around $2,000 per family. In a country like Afghanistan, we estimate that that amount of money—we did a survey with the World Bank—helps about 46% of the returnees to begin to reintegrate. In other words, they could start to purchase land, build a house and even invest in a business. This assistance was not just humanitarian: it was assistance to help people to resume those lives that had been interrupted. We have had to reduce our cash assistance by a factor of seven. We have gone from the $2,000 per family to about $145 per family. I was at the Pakistan border two weeks ago, and I can tell you that the impact is horrendous. Where we were once able to give people a bit of hope, with that helping hand and the safety net to resume their lives, now all we are doing is giving them enough to feed themselves. That is one of the immediate impacts. Beyond that, I would also like to support what Mónica said, because I have seen the amazing work of agencies such as UNFPA on the ground here. All of us are trying to work with women where we can. For UNHCR, one of the things we try to do is that wherever there is space—surprisingly, there is space, even in the Taliban emirate of Afghanistan—or wherever we find a means to work with midwives, to build structures for women’s businesses or to help entrepreneurs, we have done that. We are able to do that in a place like Afghanistan through, first, our reputation and the social capital we have, and secondly, our financial clout. Our money until now has enabled us to help those parts of this Government and those communities that want to help women. One of the interesting things about Afghanistan is that it is not a monolith. There are men, including governors, who would like to help women in this country. Our money and our efforts help them to do that. For example, we have built a three-storey mall in a province called Herat, with the assistance of the Taliban governor and the community. That sort of effort is possible only when we have enough funding. Without that funding, I fear that we will start to lose our social capital, which will also harm not only the individual recipients but those structures and people within the Taliban movement who are trying, in their own way, to make a difference and a transformation in this country, particularly for women.

Have you done the maths? What does it cost to support a family in a refugee camp? If you were giving cash grants of $2,000 so that a person could re-establish themselves and go and build a future, what is the cost of that versus staying in a camp?

What we estimate, on this side of the border, is that it is around $4,000 to $5,000 to build a home. For a person to begin a business, it costs between $1,000 and $2,000. This is qualitatively different from the assistance that would be given across the border, in camps in Pakistan and Iran. It is initially more. I’m afraid that I do not have the figures on me of the per capita costs in Pakistan. If you were talking about an ideal response, which would enable somebody to have a roof over their head and start to work, it would be around $6,000 per family.

I asked because I am thinking that there is still a cost, and these people surely still need supporting one way or the other. Surely, while enabling them to be prosperous and secure back in their home has a cost, it is a one-off cost, versus keeping them in camp without a future, which is an ongoing cost. If you were able to give us those figures, we would be very grateful.

Thank you very much for your evidence—I know Mónica too, because I chair the all-party group on the United Nations. You have set out some of the impacts that the cuts would have on women and girls, including those who are displaced. What do you think will happen to those women and girls? Do you think it will have a bigger impact on some of the other migration flows? If women and girls cannot access services via you, where will they go? Do you think they will try to go elsewhere, based on your previous experience? Or do they, frankly, have to suffer?

We know from experience that women will not stop giving birth due to their displaced situation, and they do not stop getting pregnant in those contexts. Of course, they will try to find support and services elsewhere, which again exposes them to a different type of risk: they are much more exposed to trafficking, sexual exploitation and GBV. If I may, I will add to what Arafat said about women in Afghanistan, because I was thinking about this when I heard him. It is not only about the facilities we are closing. For UNFPA, about 550 supported facilities will be impacted, and more than 6 million people will lose access to those health facilities—we are including men, women and young people. It is also about—this is heartbreaking—the fact that more than 1,300 female service providers will lose their jobs in a context where we know they have very few options. These women have little possibility to find an alternative place to work. They will be left on their own in their houses, with very little access to information and services. On the wider perspective, if we look at the numbers when it comes to women and girls, we know that globally there about 92 million people who need services for gender-based violence. UNFPA was planning, with the resources that we wanted to raise, to reach about 23 million of them. We know that there are a lot of them, so that would fall short, but that was the best we were planning to do. Now, with the cuts, the best option is that we will be able to reach 9 million—and that is not prioritisation. This is about failing the people who were expecting services and now we can no longer provide for them. When it comes to women, we see that they are resorting to other alternatives and looking for alternatives, but the majority of them expose them to an even wider set of risks.

We have talked about Afghanistan; are there particular geographies where you are particularly concerned about the impact on women and girls? Mónica Ferro: We tried to put together a list of the projects and the countries that would be more severely impacted by the cuts. Let me take a step back. The volume of the US funding and the abruptness of the cuts, plus some cuts from other countries and the possibility of extra cuts—that cannot be matched by any other partner. It is very important that we are mindful of that. We are being asked, “What about the private sector?” We are talking about billions. It is impossible to have the private sector step in and compensate for the cuts, and even for the other countries who are stepping in and being generous—again, the UK is a very generous country for UNFPA and our work. It is impossible to match. There is another question on which I would like to be very forthcoming. It is impossible for countries to mobilise their own national resources in time to compensate for these cuts. It is virtually impossible. We are trying to be as transparent as we can in saying that the countries that will be impacted the most severely are countries where the volume and abruptness of the cuts are even more severe. We are talking about Afghanistan, Syria, Chad, Gaza, Sudan and Mali. These are all countries where we have the data on the programmes that will be shut down and how many people will be affected. It is things that are measurable, like the closure of clinics in refugee camps. You have 20,000 women losing access in Sudan because you shut down two clinics in refugee camps. Also, frontline medical workers will not be trained. A huge gap will exist there. It is not only about the cuts and the services that are going to be stopped: it is about a whole infrastructure that is going to be severely hampered. With all transparency, we cannot tell you that we will be able to revamp whatever is left behind. The situation in front of us is very dire.

Thank you for setting that out so powerfully. Arafat, could you outline a little more how the UNHCR supports women and girls in Afghanistan? I am also conscious that Pakistan, from 1 April, has deported a lot more Afghans back to Afghanistan—I think it is hundreds and thousands. Given the cuts that you are facing and that more people are coming back in, how do you think that will impact on your work to support displaced people?

That is a great question, and the answer is massively. At the moment we are facing a major demographic shock in this country. From 1 January to date, we have had around 180,000 returns. We are trying to receive people at the border. What we are doing, together with IOM and other agencies, is screening these people, doing biometrics and importantly, looking into their protection concerns. That is the first line of response that we have for the women who are being kicked out. I must say, the stories that we hear—I spoke to several women a couple of weeks ago when I was in Torkham on the border—are brutal. What is happening to them inside Pakistan is a rampant assault on families in general. The women were often pulled aside if they could not find their husbands or sons, and basically held until the women told them where the men might be. These women then find themselves on the other side of the border with nothing, because they are not allowed to take more than $180- worth of possessions with them from Pakistan to Afghanistan. Many, if not most of them, have never set foot in their supposed home country, and they are expected to fend for themselves. What we do is try and identify those most at risk. In a country like Afghanistan, that would generally be single female-headed households. We then pay special attention to the provision of cash and special assistance, all of which has been impacted by the cuts. We are also on the look-out for those with particular profiles. For example, we have a small number of people in mixed marriages, who tend to be at particular risk here, as do those in certain professions, particularly in the arts, the performing arts and those with a political profile. On the ground for women, there are specific types of activities that we have been able to do. We share this with UNFPA: midwifery is one of the areas that until now has been quite open and available to women. Because it is something that is readily available and needed, we have gone into it even though it is not a tradition UNHCR activity. In addition, we do a lot of work supporting women entrepreneurs. I mentioned the grant of about $1,000 to $2,000 that we give. I have seen it myself: there is one woman in particular who started a carpet business, and she now employs 50 other women. In fact, she is herself a donor—when there were earthquakes over here, she wanted to be a contributor to victims. We have a number of success stories like that. There is another female entrepreneur who we are trying to work with to revive the silk industry in Herat, which has a specific silkworm. I think that would be a great project. Those are the types of things that we do. We try to find those areas that are somehow permissible in Taliban Afghanistan. I mentioned the three-storey mall that we have in Herat. That was a very carefully thought-out project that has received protection from the authorities and the Government—from the so-called morality police. These are the types of things that we do. In all our projects, whether it is housing, job creation or the provision of cash, we always put women first. Again, I echo what Mónica said about employment in the health sector. We are also very aware that where women are employed—even above and beyond the services that they provide—we try to make sure that that employment is safeguarded. We are protected by our Ministry, which is somehow considered more liberal on women’s issues, and enables us to hire and work with women more than others. I am conscious that we must safeguard that space, even in the face of these very devastating cuts.

Arafat, could you clarify one thing? You said that women in mixed marriages and in certain professions—for example, the arts—are more at risk. Of what are they more at risk, and why?

The mixed-marriage issue is often people from different ethnic groups—what they call a love marriage over here, so it is not agreed by the parents. They tend to be at risk from their communities. Essentially, they would not be able to return to their particular community; however, they may have more luck in a big city. With cases like that, we have tried to discreetly locate them and provide them with initial assistance so they can set up in relative anonymity in a place like Kabul. We had a female martial artist who was prominent because of her posts on social media, and we provided her with very discreet assistance so she could blend in in an urban area. We are increasingly worried that we will have more and more politically high-profile deportations. The first line of defence has to be with Pakistan and Iran, to make sure they are aware and do not deport such people. Certainly, from a policy perspective, they have said that they will protect such people, but things can always slip through the net so we try to work with the countries of asylum and, through our protection filtering, capture those people. We also have to be very discreet. Let me be open: it is difficult in this country—

Arafat, I am going to have to pause you there, because we are rapidly running out of time.

Arafat, has any impact assessment been made of the viability of operating refugee camps, given the likely impact of funding cuts?

We do not actually have a policy of encampment. We have operated camps for internally displaced people in the past, and we are very much trying to transition out of them. Essentially, the arc of our work here is away from pure humanitarian responses and towards solutions. These solutions, as the Chair indicated, require an initial investment that may be higher per capita than warehousing somebody in a camp, but we think it is worth it. It creates hope in an otherwise hopeless situation and enables transformation. These types of initiatives, which go beyond camps towards integration assistance, are very hard hit by the funding cuts at the moment.

Mónica, you mentioned Sudan. It is not just funding cuts that are the issue: there was a huge attack by the RSF on the Zamzam camp, which housed more than half a million people, who were effectively displaced again and are therefore not receiving the sexual and reproductive health services available in that camp. As well as coping with the cuts, how are you coping with the fact that a refugee camp is not a guaranteed safe environment that is not going to be subject to an attack like the one we saw at Zamzam?

Thank you for that question, which paints a very accurate portrait of what we are finding in a couple of situations. The funding is not only causing us disruption in services, as the Committee member rightly said, but creating points of pressure. As to your point about more people coming to places that they still perceive as safe, and that still are delivering services, we are trying to make the point that if any prioritisation can be made, it is about highlighting that certain places are even more at risk because services are interrupted. However, we are also getting a huge number of people who are fleeing conflicts, climate change or political tension in other countries— that is one of the most dire cases of all. We are trying, in any way possible, to not only shift funding from one project to the other, but to see where we can create synergies, and to understand how we can keep on providing some services to the people who are coming to us. Also, and this is something that is even broader than this conversation, we are always trying to talk about the continuum, or the triple nexus. We are constantly saying that the investments that are made in peacetime are very important, so that when conflict hits, or when a humanitarian situation is looming, you have the responses in place. I think Arafat would agree with me that one of the worst situations that we have to deal with is that prevention is already underfunded. It is always underfunded because it is very hard to measure prevention. Imagine, in situations such as this, where prevention services are already at the minimum, you have to respond, and not only is the response more expensive but you would have lost lives in the meantime. It is a very difficult situation. This is why we constantly say that we are talking about rights and investments, not just costs. Investing in pre-positioning anticipatory action, and the voucher schemes that Arafat was talking about are all excellent points to try to detect when a conflict is looming, and when we will have to quickly move from a situation, like you did in Afghanistan. That is, all of a sudden moving from a development operation to a humanitarian operation to a conflict—or sometimes you move from a development situation to a conflict. We are doing what we can to try to plan ahead and anticipate, but with less funding. It is impossible to do more with less. We are already so nimble—Arafat is nodding because he understands better than I do what this means in the field. We are already to the bone, so there is not a lot more you can cut when it comes to UN operations.

I want to turn to the subject of climate refugees—I think there were 26.4 million such internal displacements in 2023, but by 2050 that number is projected to grow to 200 million or more people moving within their own countries. Arafat, in your view, is it feasible to revise the 1951 refugee convention to give better protection to climate refugees and internally displaced people?

As to whether it is advisable to do that or not, I leave it to colleagues who work directly on it to respond. However, from my own experience, we have enough ammunition and material in the convention, and in customary law, to deal with climate refugees. I use the example of South Sudan: as anybody familiar with that beautiful but unfortunate country would know, it is very much on the frontline of climate change. Since biblical times, it has been mentioned as a country whose lands the Nile has spoilt. It is often under floods, and it experiences droughts. What we see with this type of climate change—and we also see it in Afghanistan—is that it becomes an exacerbating factor. It amplifies forced displacement. It also forces people to compete for scarcer resources, and that itself can lead to further conflict. I think that within our existing means of working, we can and do—if we have the funding—run operations that mitigate that. I have been particularly keen on climate adaptation models, where we can stem the flows of dangerous rivers, and enable pastoralists and others to adapt to changing climate patterns so that they do not come into conflict. One of my favourite projects when I was in South Sudan was when we simply dug a massive hole in the ground. I literally mean that: it was a big hole about the size of a small lake. We had excess capacity—we had bulldozers because we had been building a road. We left it there and when the rains came—the torrential floods—they filled it up and it became an artificial lake. I spoke to the pastoralists around it several times because I had always loved to visit that project, and they all said, “This has changed our patterns. We no longer have to seek food and come into conflict with others. We’re able to water our animals in this place.” To answer your question, I do think that if we want to and if we are creative, we have enough material in the convention to deal with climate refugees.

That makes sense. Mónica, obviously there will be mass movement—the climate will require that. How do you think we solve the problem of states being unwilling to accept or assume responsibility for citizens who have been displaced when travelling between countries?

We are working with countries of origin, countries of transit and the destination countries on their responses—that is the vision of UNFPA. We are trying to provide a lot of data on the composition of those fluxes of people. It will not surprise you if I say that one of our priorities is to be able to identify women in those groups. We ask for gender-disaggregated data, but also age-disaggregated, because we have seen very clearly that although the majority of the programmes for dealing with climate change acknowledge that climate change is not gender neutral, the majority of the responses are gender blind. Even where countries are very keen on acknowledging that sexual reproductive health and rights and maternal health are impacted by climate change, sometimes—pardon the expression—it is nothing but lip service, because they do not allocate the funds or make the policies necessary to implement what there is already consensus on—the impacts of climate change on women and girls and their health. Committee members were talking about movement; in that movement, they are more exposed to sexual exploitation, abuse and trafficking. That is why we are clearly advocating for better, disaggregated data, so that it can be fed into public policies that lead with that and, of course, women sitting at the table throughout this conversation.

But ultimately, when that data is available, how do we make it easier or more likely that countries will accept the movement of people?

By providing advocacy, and by showing the value of inclusion. One of the things that we say very often—it is not just a catchphrase—is that sexual reproductive health and rights are non-negotiable. They cannot be transitioned into other values. This is a very humble but very clear ask: please make that non-negotiable in your conversations and negotiations. On climate change, that conversation is also important, making sure that, first of all, countries understand that some people are forced to move because of climate-related impacts, that movement impacts disproportionately women and girls, sometimes with the collapse of health infrastructures. According to recent data, 60% of all maternal deaths occur in countries affected by fragility or crisis, which is about 500 women every day or one every two minutes. It is not acceptable. Climate change does have an impact on that. We are trying to provide the best evidence we can to mobilise countries into building the right public policies.

Thank you. We have some quick questions from Noah; could we have quick answers from you both, please?

Because of the global cuts in assistance, one of the things we are noticing at the moment is a breakdown of some of the implicit bargains that we have. We all know that humanitarian assistance is never intended as a long-term solution, but it is there as the safety net and as a cushion for those states that are upholding their obligations under the 1951 convention. As per the previous question about climate refugees, in terms of there being an implicit bargain, hosting is a global public good that will be paid for. What we are seeing at the moment is a breakdown in that order. The deportations from Pakistan and Iran are a direct consequence of that, but it is not just Pakistan and Iran; we are seeing it globally. On the one hand, of course, the UNHCR supports solutions, and that is what I am here for, but what we would like to see is an ecosystem of hope. I use the example of Pakistan, but I am not singling it out. If the international community were really playing its role, it would say to Pakistan, Iran and other countries, “You have generously hosted people for decades. Don’t let up right now.” The international community needs to keep supporting them with humanitarian assistance, but at the same time provide that support inside countries like Afghanistan, so that we can wean them off humanitarian assistance and put them on track to resuming their interrupted lives. Then, in addition to the humanitarian and development assistance, we really need political support. Here, I make a shout out to countries such as the UK. We have had very fruitful and constructive discussions with the FCDO and your diplomatic representatives on how diplomats can nudge the discussion towards creating this kind of ecosystem of hope.

What we would like to see, of course, is a connection between the pure humanitarian agencies and the humanitarian work in the countries of asylum, as well as a much more joined-up approach with the development actors and the private sector. Here I also refer to the international financial institutions: the World Bank, the Asian Development Bank and so forth. Mónica mentioned the private sector—we always hold out this hope for the private sector. It will never be a substitute. However, if we can make the case, even the business case, that return and solutions are a force for stability, a force for economic growth and an opportunity for you to invest, I think that we will start to square the circle a bit.

From our perspective, it is a mix, of course, but it is everything related to sexual and reproductive health and rights, safe spaces—which we are managing in together with the UNHCR—and the World Food Programme. The work has to be delivered in a context where there are never enough resources, and we can be very clear about that. Even before the cuts, we did not have enough resources to establish the conditions that would allow women to not only stay in a setting, but thrive. This is a bit about being aspirational: we want people to lead their best lives. In that context, we work a lot on health, because it is a key component of our wellbeing, but we also invest a lot with other organisations in setting up the spaces where they can get some vocational training and get a livelihood. We see our safe spaces, for example, as an entry point—as the beginning of a conversation. Often, these women go to get one of the services; they can get family planning, or they can get medical care related to pregnancy or a situation of violence. They go into this space and get a set of services, and that allows them to restart their trust in the system, which is very important, but also to have this idea—I loved your expression, Arafat—of the ecosystem of hope. It has to be done by all the organisations together. In terms of the difference between organisations that do development and the ones that do humanitarian work, the path of the UNFPA has been very clearly that the work in the humanitarian sector has grown, and that does not make us happy, because it is just because the crises are putting women and girls in more danger, and the scale of needs has increased. To go back to the question, everything related to health, livelihoods and education—the basics that a woman needs to thrive in these complex situations.

If only they had them all over the world. It seems to be getting worse rather than better, unfortunately. Thank you both very much for the evidence you have given to us. We really appreciate your time today and the work that your organisations do. They are literally a lifeline to millions of people. Thank you so much.   Witnesses: Colin Buckley and Achim Steiner.

Let us resume the session. Could you introduce yourselves and the organisations you are representing today?

With great pleasure. Good afternoon to all of you. My name is Achim Steiner. I am the administrator or the head of the United Nations Development Programme. I am also the vice-chair of the UN Sustainable Development Group and managing director of the UN Capital Development Fund. I sit here in New York at the headquarters of the UNDP.

My organisation is BII, which is the UK’s development finance institution. My name is Colin Buckley. I am a managing director and general counsel at BII. I have been at BII for 13 years, and I lead our work on fragility and conflict. For example, in 2018 I helped found the fragility forum at Oxford University. In 2021, I helped create the Africa Resilience Investment Accelerator, which was launched at the UK’s G7 and encourages investment in fragile states in Africa. I advise the FCDO on the reconstruction of Ukraine and have oversight of BII’s investing in Ukraine.

Thank you very much. I will hand over for the first set of questions to one of your former colleagues.

Thank you for the question. I was listening to the last part of the previous panel. As we have learned over time, there are particular moments when an internally displaced crisis situation is, indeed, a crisis, and the focus at that moment has to be on essentially the emergency response, which is very much driven by the food, shelter and safety that needs to be provided. In our work, we often see the humanitarian response very much being about saving lives and providing that initial response, but as my colleagues alluded to, what has become clear, particularly with internally displaced people, is that to some extent, they remain principally the responsibility of the country to which they belong, and therefore their Government also need to be a frontline actor in this. The Mogherini and Kaberuka report, which I am sure you are all familiar with, looked at how we are responding to internal displacement. Obviously, the numbers have been growing. We have all learnt over time that there is an emergency moment, when helping people simply to have a place, food, and safety for their children and families is the operative priority. Almost on the day after, however, we must begin to think about how we help people to regain their ability to earn their livelihoods—perhaps their physical return is not an immediate possibility, but certainly we should have a developmental perspective on helping people to come out of being dependent, being a humanitarian caseload, and to regaining their dignity, their ability to earn a living, and ultimately to find a permanent place that they call home. That is where the interaction between the humanitarian response to that emergency and the development response is so crucial. One of the hardest lessons we have learnt is that the reason why we have so many protracted displacement situations is that we have focused very often on the initial support response. In a sense, Governments have deferred to the international community. Such people might be in refugee camps or are being supported, and that deliberate and by-design attempt to help people come back into a normal life and livelihood has therefore been neglected. That is very much the focus in our work. I will mention one brief example, which was massive. In Iraq, when cities were being liberated, over 5 million Iraqis were internally displaced in camps. A massive programme was started to help restore quickly basic infrastructure that would allow those internally displaced people to return to their homes. Yes, obviously, that was with destroyed infrastructure, but by re-establishing schools and health centres, and helping them to repair and reconnect water and electricity, within six months we were able to help 4.5 million people to return to their homes. That is an extraordinary success story, because the alternative scenario could have been people still being in those IDP camps two, five or even 10 years later.

The funding cuts affect us in two ways. First, very often—this is perhaps an important part of today’s discussion—when countries face crisis, we often default to a purely humanitarian response, particularly in the international community. Development support is suspended, sometimes for political reasons, and at a moment of greatest crisis and vulnerability, a significant part of our ability to stabilise and support communities is therefore stopped or suspended. We have faced that in many instances. In recent years, in the UNDP we have taken a very deliberate decision to say that when a country is in a crisis situation, it is not a moment to pack up and basically wait for sunnier days; it is when we step forward. For example, with our work in Afghanistan—our colleague Arafat spoke about it—when the Taliban returned, we focused very much on trying to reach the 80,000 women who were leading micro and small enterprises. They are remarkable in the sense of the role that they play in Afghanistan’s economy. Focusing on them, trying to stabilise them and helping them to get their businesses going again was precisely the kind of activity that is needed, but most international donors were not willing to engage, because they said, “No, this is development. Afghanistan is only humanitarian funding.” In the end, we managed to convince a number of partners, and those 80,000 women only required grants of $300, $400 or $500 to restart their businesses. They then employ five to six people, each of them often looking after eight to 10 people. That is how to pre-empt the desperation that leads people to give up, get up, go to a provincial capital and stand in a queue to get a handout. That is one major financing issue that I want to bring to your attention. The second one is the erosion of funding in general, and of the core funding, particularly of institutions like ours—

Achim, may I just pause you there with that one example, because of time? Perhaps you will write to us with more. We are pushed for time today.

Yes. Among the most powerful drivers of displacement are poverty, conflict and climate change, and those are three areas that BII has especially prioritised, so although the reduction of migration or displacement is not a professed aim of BII, or of any other DFI, I think we find ourselves dealing with some of the root causes of displacement and migration. From listening to Achim, and also to the two previous people who gave testimony, I would say that we are much more operating on preventing displacement than handling the effects of displacement. When we think about fragile and conflict states, we really have three tools that we use when we invest in those states. One is the Oxford fragility forum, which is the pre-eminent forum to co-ordinate among investment partners and to generate and share learning. The second one is the ARIA fragility initiative, which was designed precisely to overcome the exceptional barriers in the enabling environment and to unlock investment opportunities in fragile and conflict states. The final one is a new tool that we have this year, which is £50 million of concessional finance that we can use to reach businesses and markets in these kinds of states. The proof, as they say, is in the pudding, and, as a result of all of these, we have invested substantially in fragile and conflict states. We have the largest FCAS portfolio of any European DFI. Indeed, we have 30% more than the second best. On internal analysis, the BII has already met the ambitious investment targets set for the IFC to reach by 2030 in investing in fragile and conflict markets. So yes, I think we have a role to play. It is not our principal aim, but I think that we are a significant player in the prevention of this type of displacement and migration.

At the moment, we are definitely on the prevention side of it. I mean, I have read the FCDO’s written submission, and it identifies a breadth of tools that the FCDO has to deal with displacement and migration after the fact, not the least being the UNDP, UNHCR and the UN Population Fund. Ultimately, that is a political choice, but, for this five-year strategy, I think we are going to stay on that prevention side of it.

Achim, on the trip that we recently made to Geneva, we heard a UNDP statistic that the more than 59 million people internally displaced at the end of 2021 resulted in an economic cost of more than $21 billion, which is a very powerful figure. Given that it is a UNDP statistic, we were hoping that you could explain that number a little bit further—the breakdown of it and how you came to it.

Yes, it is a figure that comes out of our partnership with the Internal Displacement Monitoring Centre, with which we work very closely. First of all, it is an approximation of the costs, so to speak, that these millions of internally displaced people are causing in terms of expenditure. The $21.5 billion represents the financial cost of providing every IDP with housing, education, health and security, estimated at about $390 per person per year. However, I want to emphasise that this is a kind of expenditure estimate and also an aggregate. Aggregates, like statistics, do not always capture individual realities. Importantly, it does not capture the opportunity costs. Many of these internally displaced people were economically productive. Very often, in situations of displacement, they become less productive or are unable to engage in any gainful employment. That is another major cost to the economy. What we have also often seen is that with dislocation—for example, in terms of family, children and education—one can provide temporary services, but neither the health service nor the educational services is equivalent. Sometimes, children in those situations essentially lose a great deal of their ability to learn the skills to recover from it. Whether we look to a country like Ukraine, Syria or Haiti, these are all very different contexts. Alternatively, let us take Sudan right now, which is perhaps the most dramatic crisis in terms of internal displacement. Very often, some of these fundamental services and infrastructure are not even there, and with the current cutbacks things are actually being cut, from food rations to these kinds of services. It is a very tragic scenario.

May I ask a follow-up question? Regarding the cuts to aid and development, we have been here before; we saw cuts under the last Government. Is there any evidence or modelling from UNDP that shows a correlation—maybe not a causation—between cutting some of that aid and increased migration, of whatever type, to countries like the UK?

Absolutely. First of all, a very clear empirical link and evidence was established with the Syrian refugees in Jordan, Lebanon and Turkey. Remember that first wave of cuts when, first, food rations were cut, then health posts were closed, and then educational services were closed. That immediately triggered people to get up and go. When you cannot feed your family, when you cannot educate your children and when you are trapped in a refugee camp or an IDP camp, the only option left is to get up and find another place. We saw a massive increase in people moving further, which is another tragedy, because most refugees—in a cross-border sense, but even IDPs—do not wish to leave their home country. Circumstances force them. The less they are able to survive in these circumstances, the further they will move; the further they move, the less likely they are to return. Consequently, there is a whole domino effect. As for UNDP, to put things in context, when the UK, which was one of the major core funders, essentially defunded UNDP by 80% between 2020 and now, we lost our ability to respond rapidly. UNDP is integral to the Inter-Agency Standing Committee; we work hand in hand with our humanitarian colleagues. Very often, the infrastructure of UNDP in a country is a platform that allows humanitarians to respond rapidly, as was the case in Ukraine. These kinds of investments are now being eroded. Essentially, our capacity to respond is then reduced by an equivalent amount. I do not want to go into the numbers now, but it is a drastic trend. USAID and the US State Department cuts over the last two months hit UNDP particularly in crisis countries, which means that precisely those programmes and services—including to Governments to provide for IDPs—have had to be suspended and terminated, with all the consequences that you are familiar with.

Picking up on the last conversation that we had with Colin, which do you think represents better value for money—programming aimed at preventing displacement, or deconfliction and stabilisation programming after displacement?

Speaking honestly, very often we do not have a choice, because these conflicts arise and then we have to deal with the reality. But if I may be very blunt, investing in development is ultimately a prevention tool. I think that with the security-development nexus that is now sometimes contested or questioned, we need to come back and examine it very clearly, because it is not only climate change that is a destabiliser and a driver—remember that 70% of refugees and IDPs come from very climate-vulnerable countries. That connection needs to be established more clearly. However, I say to my colleagues and to UNDP teams all the time that our work and development is all about prevention, and that derisks the future. This is not a mechanical equation, and many other factors play a role, but we can point to many circumstances where targeted development deconflicted either a community or even a relationship between countries. It has tangible impacts, and we can demonstrate them, but we have neglected to do so.

Achim, could you outline the extent to which UNDP works to develop the private sector across low-income countries?

It is a central part of our work. There are three lenses through which we approach this. One is that we are often an entity that helps Governments to develop the legislation, programmes and capacity through Government services, for instance by helping a country look at the digital ecosystem, and particularly digital public infrastructure. It is a core function of Government to quickly help a country establish that kind of digital public infrastructure as a platform on which markets, services, start-ups and entrepreneurs can operate. It is a central part of our work today, particularly with poorer countries, because they are struggling to catch up with those opportunities. In a few days we will release the human development report that this year will focus on development and AI. To provide an equivalent example, earlier I mentioned Afghanistan, and when we focused on women, we focused not only on women but on women entrepreneurs. The 80,000 women we helped through very targeted programmes were an unequivocal private sector investment. It was outside Government, and it helped people to create enterprises and to re-establish markets and supply chains. That can go all the way. That is the last example I will mention, and I am sure Colin can also relate to that. On insurance, today we are a key partner of the Insurance Development Forum. UNDP has an insurance and risk finance facility to help developing countries leverage the technology and expertise of the insurance industry, actuarial science and the pricing of risk, in order to create a more viable investment environment where the private sector does not shy away from investing in countries on the African continent. We can use the insurance sector, with its expertise and its products, to derisk the perception that you cannot invest in those countries—perhaps Colin will also say that is something that IFIs are looking at.

What is your view of the impact that displaced people have on the so-called black economy? Some people think it is an issue, but at least one of our witnesses has said that they didn’t think it was a major issue. What is your view?

When you refer to the black economy, I assume you mean the informal sector, outside of formal employment operations. Is that right?

Yes.

Again, the context matters a great deal. We have in UNHCR what we call a regional refugee response programme that, in countries such as Jordan, Lebanon and Turkey, for instance, is looking at how we, UNHCR and UNDP, can work together hand in hand to support refugees and IDPs in host communities. Obviously, the danger is that a significant number of people coming into another part of a country, a community or an economy can create tensions when they are perceived to be taking away jobs or, because of how they bid and play in the marketplace, providing competition. More often than not, we find that with good policies and support programmes, where the international support is not only focused on those who have been displaced or refugees, but where we also invest in the host community, we can turn what could potentially be a lose-lose relationship or perception into a win-win, whether that is in Turkey, Chad or Bangladesh, which is hosting so many refugees. In general terms, it is a matter of how you respond to that and how you shape programmes around it. I do not believe that IDPs are necessarily an informal sector. First, they are a significant reality, and secondly, they are not something that you can stop by decree or legislation.

Colin, may I ask you to outline BII’s work to engage and stimulate the private sector in its investment portfolio?

Let me speak specifically about conflict-affected states, and let me do that through the lens of ARIA. In 2018, when I spoke to Paul Collier and Hans Peter Lankes and we launched the Oxford forum, no DFI had a fragility strategy, so the Oxford forum and then ARIA was principally designed to bring the particular challenges of fragile states into the DFI mindset. It started out in 2021 and was funded solely by BII, but—

What was the impetus for doing that?

We did it as part of the UK G7.

Did the Government suggest to you that it would be helpful, or did you proactively do it?

I think we suggested it, coming out of the Oxford forum. The Oxford forum started in 2018, and very soon thereafter Paul, Hans Peter and I were talking about how it needed a practical arm, rather than just the theoretical discussions in Oxford. Since 2021, we have got funding from the Dutch and the French—at the end of last year, we even managed to get the Americans to give us some money. More importantly, we have 18 DFIs and MDBs that are members. It is open architecture, so no one has to spend any money or pay any fees to be part of it. More importantly, we are doing a deep dive in five countries: Sierra Leone, Ethiopia, the DRC, Benin and Liberia. We have four in-country managers—we will come back to the importance of having people in country in these types of environments—and those four managers are supported by a further 10 professionals, mostly investment professionals. When we started this, in 2021, the generally accepted view was that there was no investing to be done in these countries; they were uninvestable. But in truth, since 2021, we have discovered 144 opportunities, which total $3.3 billion. These are difficult, don’t get me wrong. They are not easy lifts, but we have already had seven deals approved, totalling $67 million. There is a long way to go, but that is a lot more than we had when we started in 2021. ARIA works with proto-businesses and makes them investment-ready. It does this by giving them technical assistance. It also aligns with a lot of the FCDO’s programming. We have a memorandum of understanding in Sierra Leone with an FCDO programme called Invest Salone. We have an MOU in Ethiopia with Manufacturing Africa. The effort is to have an—I love the word used in the last presentation, so I’ll take it—ecosystem. It takes a village to get investment-ready in these types of environments, and ARIA is the way of bringing that together. The result, at least for BII, is that we managed in 2023 to invest £650 million in the poorest of the countries that we operate in. Of that, £268 million is in the most challenging markets, which are the alpha markets. By our own investing, I think we have shown that you can do this if you make the effort.

But there must be some areas that would be considered uninvestable. You could not suggest at the moment that there would be an investment in Sudan, for example.

Well—

Or would you?

I would maybe say the Central African Republic, but it is far fewer than you would think. We had planned to do Burkina Faso, and even after the first coup, we still planned to go there. It took the second coup to persuade us to cancel that. We have looked at potential investments in Sudan. We are investing in Ukraine. It is possible to do this almost anywhere. The issue is the effort involved, and that, at the end of the day, is a political decision in this time of making hard choices about resources—how many resources you want to commit to those difficult lifts.

British International Investment’s climate change strategy was published in 2020, but what we are seeing is obviously a significant shift in the data. The World Bank is estimating that by 2050, climate change could force more than 200 million people to move within their countries. So is work ongoing to update that strategy at all?

That strategy would be reviewed at the same time as our five-year strategy. We have one more year in that. Strategies to the side, we recognise the increasing challenge. Even during this strategy, we have increased our climate investing. We invested £1 billion across ’22 and ’23. We have mobilised £665 million of private-sector investment alongside us. As you perhaps know, as part of this five-year strategy we entered into south-east Asia. It took a while for us to set up those offices and begin hiring people, but we are now seeing increasing pipeline in south-east Asia. Even in this strategy, you are seeing a dramatic increase in climate finance that responds to that challenge.

How do you work with states where the quality of governance is poor? What is the approach to making sure that we still see value for money out of the investments that are being made?

If we are trying to reduce economic migration, we are trying to promote economic growth. The promotion of economic growth requires leadership by the local country. I am a great fan of national self-determination. That is difficult. We know even here in the UK how difficult it can be to promote economic growth and the choices that you have to make—often of a long-term benefit in return for a short-term one. Those are being faced by Governments all the time. I was speaking with Stefan Dercon about this just the week before last; we were talking about it in the context of Sierra Leone. You have to both be supportive and give strong advice. One of the roles that I believe a DFI can play is that we can give honest, independent advice about what a Government have to do in order to attract investment to promote economic growth. The way that we think about it is that we have to be supportive and understanding of the political difficulties that these countries face, but we also have to be honest behind doors about what Governments have to do to attract that type of investment.

The pressure that comes from displacement is not just a UK challenge. It is arguably continental—for the whole of Europe, or broader. Do you have a view on how the EU and the UK could work more effectively in these places?

That is a broad question. I will restrict my answer to development finance because there is a really good story there. We work very closely with our European DFI peers to share learnings and to have common platforms, especially in these countries. I had the benefit and the honour the year before last of serving as the CEO of EDFI for a year. A large part of what I achieved in that year was instituting the Ukraine platform—a common investment platform for DFIs in Ukraine—and attracting DFIs into the ARIA platform. I believe that there is a lot of common cause between the EU’s global gateway plans and the UK’s ambitions for investment overseas. I see an increasing willingness to co-operate, especially in these countries and on these issues.

Achim, what will the effect on displacement be in the coming years if the annual climate finance gap is not met?

You have already cited the figures from the World Bank, the United Nations and many academics and think-tanks, which show that the numbers will grow exponentially. It is the phenomenon of people having to give up the place they call home in ever growing numbers, whether it is as a result of flooding, drought or other extreme weather events, or temperature. We underestimate the growing risk of heat literally making places impossible to live in and the economic consequences of that for agriculture or, in parts of southern Europe now, tourism. We are seeing a physical impact driving people out, but we are also seeing the domino effect in economic terms. In that sense, not investing in adaptation and in ultimately trying to stay within the 1.5° pathway will simply leave the world with an increasingly unmanageable number of people who have to find another place to live and survive in.

These will be the last questions from me, you will be relieved to hear. Colin, I am a fan of BII. However, some in the sector are not—not specifically of BII, but of development finance full stop. I think it is somewhat unfair, because in a toolbox, you are very useful, but by the nature of your work and the scale of investment, you tend to go to some of the less risky investment areas. Are you able to secure data to show that you are targeting investments at people and communities who need it most, or would that not factor into your choices?

That is probably the No. 1 criterion of how we invest. It can be tricky. There are some investments where it is easy and you have the data, but that is rare. We often look at proxies. For example, if we are doing something in agriculture, we will not know income, but we will know the average size of a farmer client’s property, and then we can use that as a proxy for income. In some cases, even before we invest, we will do rapid surveys. We have done quite a few with an organisation called 60 Decibels, which will go in and do a quick survey, but it will be sufficiently statistically significant to give us a sense of the range. After we have invested, we do not stop. We have an ex-ante score. After we have invested, we can gather data, and then we often will have a more engaged survey on exactly what the poverty is. That would then be reflected in our ex-post score. Everyone in the organisation is motivated to make sure that these are inclusive investments. I think the impact team has got quite good at being able to work in an area where data is either non-existent or pretty partial.

Can I ask a favour? To make your life and mine easier, is there any way you could be more transparent about that data, so that people understand what your priorities are? That would help.

Some of the 60 Decibels surveys are published online. I think every survey we do would be available, but as the senior manager responsible for transparency, I will take that away.

You are the right person. I think it would do us all a favour if you could. Achim, I want to ask you the last question. How are you able to monitor whether your resources are going to those most in need, including people with protected characteristics, for example? Is it possible for your partner organisations to do the same, or are you unique in being able to provide that?

In the aid transparency index, the UNDP usually scores in the top category. We have over years built up both a culture and a commitment to transparency that has to continue to evolve, partly because citizens across the world are able to access data much more frequently today than they could some years ago. We have to adapt our system so that it is not a barrier to being able to engage. We are all learning from each other. It has been interesting in recent years that some of the IFIs have advanced on the aid transparency index quite significantly. We need to invest in systems, and we have to have a commitment to it, but in the end, we are absolutely dependent on transparency, because all our work is the function and the product of demand. It is the countries in which we work that invite the UNDP in. It is our donors and funders who select the UNDP as a platform on which to deliver. I mentioned at the beginning that I am also managing director of the UN Capital Development Fund. Sometimes, we could make more deliberate attempts to build on one another’s ability, multilaterally and bilaterally. In some of the countries where the BII is working and where the UNDP is present and has a degree of data and information, there might even be a potential to co-invest, and perhaps with a little bit more intent, we could co-design some interesting ways that, to some extent, de-risk a BII investment, and on the other hand allow the UNDP to play a part in attracting the scarce capital that is needed, particularly the last mile capital, which is often the focus of our work, including—to make the connection to IDPs—in Syria. We desperately need to get local credit lines going there, so that people can start to invest in re-establishing their local enterprise. Business is a key priority, not just in the early recovery and reconstruction but in helping internally displaced people and refugees where they most need it, because the financial system is largely collapsed right now.

I am really glad you brought all that up, because it brings us back to the beginning. One of my frustrations, while we have been doing this inquiry, is that rather than seeing the journey and the needs of an individual, different organisations have their sectors that they work on. You go into one room, and if you are lucky, there is a connecting door to the next one, but often there is not. That also leads to duplication of resources, which in these times, no one can afford. That gives us a nice ending point and something to consider as we start to draw up our report. Thank you to all the witnesses in this session.