The Shifting Humanitarian Aid Landscape: From Traditional Granting to Neoliberal Commercial Contracting

Since early 1990s, the humanitarian funding landscape has evolved from accountable grants and MoUs to include a strict funding criteria through a competitive bidding process. Governments have adopted commercial contracting, a process that involves application by actors, both private sector and International Non- Governmental Organizations (INGOs), through tendering process, for delivery of goods and services for humanitarian action. Commercial contracting previously focused on development side, but more recently it has increasingly moved to relief work as there exists a blurry line between relief and development. United Kingdom Department for International Development (DFID) has increased its commercial contracts funding stream from 9 percent in 2011/12 to 14 percent (Great British Pounds 1.4 Billion) in 2019 (Bond 2019), and reduced traditional grants from 86 percent in 2014 to 72 percent in 2017. The nexus between relief and development is a growing concern for stakeholders in the humanitarian space (Humanitarian Policy Group. 2014), and governments have resolved to fund actors who demonstrate that they address the link between Relief, Rehabilitation, and Development (LARD), through commercial contracting. There is a lack of reliable research on the effect of commercial contracting on INGOs who are not-for-profit entities that have been thrust into a new world of profit-making in aid delivery. This not only presents a mandate challenge for INGOs, but also raises questions of potential compromise on the very humanitarian principles that guide their work-humanity, impartiality, neutrality and independence. A case study design was employed with a qualitative approach using liberalist, neoliberalist and post-constructivist theories in understanding the shift from traditional granting processes by governments, to commercial contracting in highly business- risky protracted crisis settings. The focus is on Somalia which represents one of the most serious and complex humanitarian crises in the world (European Civil Protection and Humanitarian Aid Operations. 2019). With a population of approximately 15 million people. Somalia is rated highest in the INFORM risk index with a score of 9.1/10, has the highest vulnerability index in Horn of Africa at 9.2/10, a hazard and exposure index of 9/10, a lack of coping capacity score of 9/10, a projected conflict risk of 10/10, uprooted people index of 10/10, humanitarian conditions score of 3.5/5, and a natural disaster index of 7(DG ECHO. 2019). Data has been collected from key informants from DFID, the private sector, INGOs, and agencies that profile DFID humanitarian funding in the UK. This data is complemented by secondary data from DFID policies and other official documents.