Written by Zac Lowndes-Bull, Engagement Manager Climate Finance, Pegasys, in collaboration with the STAAR Facility

Interest has grown in how social protection interventions can strengthen responses to the impacts of climate change. This can be seen in recent developments in international climate change governance, with the formation of the Loss and Damage Fund, updates to the Global Goal on Adaptation, and the establishment of the Global Shield Initiative including social protection in more prominent positions in their decision-making.

This comes in the wake of increasing climate crises...

Responses have typically focused on the potential of social protection to build household resilience to, and recovery from, shocks through adaptive social protection and shock-responsive social protection. However, core social protection programmes can also play a significant role, helping to minimise and address the loss and damage associated with climate change by assisting households to prepare for, cope with, and adapt to climate-related shocks (USP2030, 2023). A growing body of evidence shows that climate strategies that include social protection offer more effective adaptation and mitigation, both in managing climate risks and enhancing adaptive capacities (Sitko, et al., 2023).

 

Yet many developing countries do not incorporate climate risks into social protection system...

This has understandably prompted discussion on the successes and benefits of social protection programmes, practitioners, and institutions accessing finance that is ringfenced to address the causes and impacts of climate change. And how providers of this finance should utilise social protection programmes and tools for their objectives.

Within the climate finance space, there is appetite for social protection instruments to be implemented as part of a suite of resilience-building interventions. However, social protection is not interpreted consistently by climate finance actors. What’s more, understanding of its long-term benefits for economic growth and climate action is mixed.

The volume of climate finance going to social protection is considered insufficient...

At least by those in the social protection community. But the total amount is unknown. Increasing the flow of climate finance relies, in part, on enabling climate finance providers to strengthen the links between social protection interventions and climate change objectives. Particularly for improving the climate resilience and adaptability of poor and vulnerable communities. In addition, integrating climate action objectives into social protection policies, and incorporating social protection within climate risk management strategies is fundamental for improving access.

In The Realities of Climate Finance for Social Protection, a report I co-authored with Matthew Hurworth and Robbie Hopper on behalf of the FCDO-funded Social Protection Technical Assistance, Advice and Resources (STAAR) programme, we assessed the status of international public climate finance going to social protection. The report focused on three categories of climate finance providers: bilateral, multilateral development banks, and climate funds. It proposes options for more efficient and targeted use of climate finance for social protection.

 

Recommendations for strengthening the use of climate finance for social protection are linked to six key findings:

 

1. Social Protection is not prevalent in national climate plans and strategies, with scant examples including social protection risks and measures. This makes the case for climate finance expenditure (either policy or project-based) challenging to substantiate from a climate change angle.

Recommendations:

  • Social protection practitioners should assess the extent of social protection’s presence in climate-specific national strategies, such as Long-Term Strategies, to complement similar exercises done for Nationally Determined Contributions.  
  • Developing country governments should promote social protection in climate strategies and frameworks to demonstrate its importance for climate objectives. Countries should advocate for the explicit reference of social protection in the strategies and investment frameworks of the climate funds.
     

2. Social protection is approached and understood inconsistently across the sources of international public climate finance reviewed, pointing to a limited awareness in the climate finance community of the role of social protection in achieving multiple climate change objectives, compounded by the inconsistency with how providers of finance define social protection.

Recommendations:

  • Social protection practitioners should ensure the climate rationale is robust when designing a programme to seek climate finance, especially from the multilateral climate funds.
  • Social protection practitioners should also develop a common definition of social protection in a climate change context that can be put to climate finance providers. Co-developing this definition with the climate finance community would strengthen its ability to mobilise finance for social protection.
     

3. Quantified social protection goals are not widely included within national-level climate change objectives and planning, this should include specific targets and measures that can set up resource requirements. This undermines accountability and leads to a lack of clarity on what the return on the investment would be. 

Recommendations:

  • When developing a climate-focused programme social protection practitioners should make use of preparatory and readiness funding to undertake feasibility assessments to determine whether quantifiable social protection targets can be developed.
  • To make their finance more accessible, climate finance providers should explore whether social protection is best quantified as an outcome within investment frameworks rather than as a sector or intervention type. Engagement from social protection practitioners in this process is essential.
     

4. In many cases, national-level social protection systems are not linked to climate change policies and plans. This makes the case for climate finance to fund social protection more challenging because the interconnectivity between climate risks and social protection is less clear, and the value of social protection systems creating increased resilience is less evident. 

Recommendations:

  • When considering how to create integrated responses to climate change and social protection, developing country governments should consider investments in relatively low-risk adaptation measures to build coherence between climate change and social protection.
  • Social protection practitioners should utilise readiness funding and preparatory support to build the evidence base for and implementation of social protection systems that factor in climate change risk.
     

5. There is no comprehensive assessment of the volume of climate finance going to social protection, and a full picture of the social protection objectives of climate finance providers is unclear. This is, in part, linked to the lack of a common understanding of social protection within the climate finance community.  

Recommendations:

  • Climate finance providers and social protection practitioners should work together to review the results and investment frameworks to agree on indicators that can be used to track financial flows to social protection. 
  • Social protection practitioners should initiate this process by assessing and agreeing on the priorities for social protection in the short- and long-term. Short-term targets need to be balanced by longer-term objectives that will result in sustainable financing.
     

6. The typical ownership model of social protection systems can limit sustained access to climate finance, with gaining accreditation to the multilateral climate funds particularly burdensome for national/government entities.

Recommendations:

  • When considering whether to gain accreditation to the climate funds, developing country governments should consider the benefits of having the direct access to resources this may bring against working with an existing non-government entity that already has accreditation.
     

Creating a clear link between social protection and climate goals is essential

Although there is a growing acceptance of the benefits of utilising social protection methods in responding to and preparing for climate change, it is not yet regarded as a key priority for providers of climate finance, and the lack of social protection presence in climate strategies makes the case for financing it challenging. By embedding social protection as interventions, targets and objectives in the climate policies and plans of vulnerable countries, funders will see it as an investment priority.

The report found that the onus to increase the flow of finance sits largely with the social protection community (practitioners and country governments). This is reflective of the highly competitive and political nature of climate finance, where changes in investment decisions are challenging and time-consuming and need to be driven by developing country priorities.

References:

Sitko, N., Knowles, M. & Bhalla, G. (2023). Should climate funds serve social security?. Available at: https://www.welthungerhilfe.org/global-food-journal/rubrics/climate-reso...

USP2030. (2023). Joint Statement of the USP 2030 Working Group Social Protection and Climate Change: Directing International Climate Finance to Social Protection, s.l.: USP 2030

Social Protection Building Blocks: 
  • Policy
    • Expenditure and financing
Social Protection Approaches: 
  • Social protection systems
Cross-Cutting Areas: 
  • Climate change
Countries: 
  • Global
Regions: 
  • Global
The views presented here are the author's and not socialprotection.org's