The Asia Pacific is one of the most climate vulnerable parts of the world. Weather patterns are changing, and the frequency and intensity of natural disasters are on the rise across the region. Nepal itself is witnessing retreating glaciers and affected mountain hydrology. Recognising these threats of climate change, global leaders have committed to provide $100 billion a year to help nations in need, and it is crucial to ensure that these funds reach those who are most susceptible. 

To this end, many countries in the region including Nepal, Bangladesh, Thailand and Cambodia are aiming to integrate climate finance in national planning and budgeting—funding to reduce carbon emissions (mitigation) and adapt to climate change. However, while financing for mitigation and adaptation is of paramount importance to countries such as Nepal that are highly vulnerable to climate change, climate finance—financing channeled by national, regional and international entities for climate change mitigation and adaptation projects and programmes—is a relatively new area where there is a lack of clarity on integration of climate finance in the government’s budget cycle. 

A litmus test

In this context, on April 4 and 5, UNDP organised a workshop in Kathmandu titled ‘Budgeting for Climate Change Finance: A collaborative approach for effectiveness’. The purpose of the workshop was to enhance the understanding of the link between climate finance and the national budget among various actors including civil society, media and parliamentarians, and to promote a collaborative knowledge among different actors so that they could benefit from each other’s comparative advantages in addressing the gaps that hinder climate responsive budgeting. 

“Budget is a litmus test to understand the status of government plans and policies, and talking about climate budgeting is very important to understand to what extent the government can take action to address the climate change impacts,” said Sophie Kemkhadze, Deputy Country Director of UNDP Nepal. 

The topic of climate change was introduced from a knowledge perspective identifying areas that are well covered through research, as well as gaps in information that need to be filled to support decision makers for climate compatible low carbon development. It was noted that working with global and regional partners to step up policy engagement, investing in media and knowledge brokers, and local level knowledge generation has proven to be successful. The need to make practical and applicable climate change related knowledge accessible to public and policy makers for effective budgeting was also highlighted in the session. 

Role of civil society 

Civil Society Organisations (CSO) can add significant value in this process and the ways the countries can do so were discussed. It was emphasised that CSOs should provide a forum for poor people to raise their voices and hold officials accountable, and that their involvement in the budgeting process can improve service delivery to the poor.

As a central tenet of the workshop was to ensure effective targeting of climate vulnerable people, the budget cycle was elaborated, looking at both the budget formulation (pro-poor targeting), monitoring and reporting to assess effectiveness of spending. Some of the challenges in targeting climate response to the poor were also elaborated, such as lack of gender and poverty sensitivity in policy implementation, lack of community based interventions and insufficient data collection to analyse how much finance has actually reached those in need. Dr Mahfuz Kabir from Bangladesh delivered a presentation on making social protection schemes more adaptive to climate change by adopting a rights-based approach and promoting resilient livelhood.

During the course of the workshop, the experiences of different stakeholders were shared regarding climate finance budgeting, with discussion on the stages where the government can open up the space to CSOs. On engagement of CSOs at the strategic planning (pre-budget) phase, developing climate change actions, sectoral plans and a case study of CSO partnership with provincial governments in Pakistan were discussed. On the budget formulation phase, budget partnership with people and experiences of Nepal on Constituent Development Fund were elaborated. And to prevent conflict between the changing contexts of climatic demands and the functioning of government, Ajaya Dixit from the Institute for Social and Environmental Transition, Nepal spoke about the need for a “reflexive, shared, flexible learning approach, with the government being open to new ideas.”

Way forward

Towards the end, the focus was on how partnerships can evolve among different actors, based on existing experiences, and on identifying future areas of work both at regional and country levels to strengthen climate change sensitive budgeting. The problem of “tagging fiesta”, the inclination to tag everything in budgets as climate related expenditure, was also discussed. Through group work, the participants identified capacity constraints, informal institutional structures, insufficient citizen participation and lack of disaggregated information on budget and inter-ministerial coordination as areas that require focus.

“Various actors including the government have been studying the challenges posed by climate change and have gathered a large amount of knowledge. Sharing of such knowledge regionally would be beneficial for all,” said Tulsi Prasad Gautam, Joint Secretary, National Planning Commission of Nepal.

Sujala Pant, Local Governance Programme Specialist at UNDP Asia Pacific and the lead organiser of the workshop, said UNDP relies on a “whole of government approach” to broaden the discussion around climate change and make the response to climate change more systematic and cross institutional. “Through an integrated package of services including initial assessments, engagement with policy actors, expenditure tracking and recording, UNDP hopes to achieve improved climate change budgeting and accountability at the national level,” she said. 

Mehroze Shachi is a development professional working on climate change and disaster management at UNDP Bangladesh. She was a Climate Tracker Youth Fellow for COP 21