ForestAction Policy Brief No.

48 January 2022

Enhancing climate finance accountability:

Lessons from local action research in Nepal
Dipak Bishwokarma, Rahul Karki and Naya S Paudel

KEY MESSAGES
1. While targeted vulnerable communities may have benefited from climate adaptation projects, they are largely excluded
from the planning, implementation, and monitoring process.
2. Financing of climate actions are often decided at the federal and provincial governments, giving little space to the local
governments in designing and implementing such schemes.
3. Successional approach to raising awareness on climate change science and financing accountability enhances wider
stakeholder acceptability and ensures climate justice.
4. Evidence-based grassroot advocacy and collective civic action can facilitate on course correction towards a transparent
and accountable climate financing ecosystem.

Introduction
Financing climate action is prerequisite to achieving of the project with little space to local government
the goal of reducing vulnerabilities and enhancing resulting in their low ownership and therefore poor
resilience of vulnerable communities. However, a implementation; iii) top-down approach of decision
transparent, accountable and equitable financing and planning means vulnerability and need of the
is at the heart of its effectiveness (Baatz, 2018)1. In marginalised groups is not adequately understood
fact, poor climate finance governance, especially in and addressed; and iv) conventional instruments to
developing countries, has often been cited as one of maintain financial accountability are inadequate to
major issues hindering the much-needed mobilisation ensure climate finance accountability. This demands
of climate finance globally (Steele, 2015)2. for a decentralised and inclusive approach to climate
financing, with central focus on climate finance
Nepal has been receiving and mobilizing finance
accountability through direct citizen engagement.
through various bilateral and multilateral agencies.
However, the effectiveness of such financing has been This policy brief brings lessons and insights on
limited due to: i) business-as- usual development strategies towards enhancing climate finance
projects are designed and implemented that carry the accountability based on a year-long action research
legacy of the failure of development actions; ii) federal project conducted in two municipalities namely
and provincial governments decide and plan most Devchuli (Nawalpur) and Kalika (Rasuwa) (see Map 1).

Map 1: Research sites (Devchuli Municipality- Nawalparasi and Kalika Rural Municipality - Rasuwa)
1 Baatz, C. 2018. Climate Adaptation Finance and Justice. A Criteria-Based Assessment of Policy Instruments, Analyse & Kritik, 40 (1): 73-106.
https://doi.org/10.1515/auk-2018-0004
2 Steele, P. 2015. Development finance and climate finance: Achieving zero poverty and zero emissions. IIED Discussion Paper. International
Institute for Environment and Development (IIED), London. http://pubs.iied.org/16587IIED
Beginning with a joint commitment to follow a Development Projects
collective inquiry and self-reflective process with the
municipality officials, five actions were implemented Non Effective 3%
with parallel documentation, reflection, and synthesis.
Major activities included: i) formation of a climate

Response
justice action group represented by vulnerable and Very Effective 45%
marginalised groups, various natural resource user
group leaders, ward representatives and media; ii) Generally Effective 47%
participatory assessment of a locally funded climate
adaptation project; iii) training and workshop on
Don’t Know 5%
climate change, financing and accountability; iv)
public hearing of the assessed project; v) household
survey (n=60) based on public expenditure tracking Figure 1: Beneficiaries’ satisfaction towards climate
survey (PETS); and vi) self-reflection workshops. relevant development project outcomes in Devchuli
Municipality and Kalika Rural Municipality
Pathways for a Transparent
Climate Financing at Local Level
Not an active agent, but passive beneficiary

Findings from the household survey showed that

while people in general are benefiting from the
project services, they are excluded from the design,
planning, implementation and monitoring of local
government funded schemes (see Figures 1 and 2).
Over 55% of the respondents expressed that they
were not aware on the amount of budget allocated for
this project. Local governments are overshadowed by
development priorities and disaster risk reduction
related actions, which are largely perceived to
be climate change interventions. It is mainly Figure 2: Informed beneficiaries on climate relevant
because of the heavy political commitment of local development project planning, implementation and
leaders to deliver pure development projects. monitoring process in Devchuli Municipality and
Kalika Rural municipality
Moreover, studies have revealed that vulnerable
and marginalised populations have not received
meaningful spaces in local level climate actions
Complementarity between bureaucratic
(Dhungana et al., 2017)3. Rather local elites and even
instruments and direct public engagement
political leaders dominate the process including the
decision to fund mobilisation (Nightingale, 2017)4 There is a stark difference between the projects
. This is evident from the findings of the survey which implemented by the federal and provincial
shows that over 80% of the respondents did not see government with that of local government. The local
any notice about the project at the municipality. leaders and citizens have no idea of the project budget,
the contractors, progress, quality of work and benefit
A Dalit member expressed his views in regard to their sharing arrangements in federal and provincial
marginalisation as “first, Dalits are discouraged to government projects. Even the local government
participate in the decision-making process; second, officials are not adequately aware of it. All the available
even if they are formally in the decision-making institutional mechanism for ‘check and balance’
bodies, their voices are little heard; and third, there including the Auditor General’s office, parliamentary
is a slow progress in the project implementation even committees, and national vigilance center are located
if any activities are prioritised”.

3 Dhungana, N., Khadha, C., Bhatta, B., and Regmi, S. 2017. Barriers in Local Climate Change Adaptation Planning in Nepal.Journal of Law, Policy
and Globalization, 62: 20-24.
4 Nightingale, A.J., 2017. Power and politics in climate change adaptation efforts: Struggles over authority and recognition in the context of
political instability, Geoforum, 84: 11-20.
in the federal or provincial capitals, and they disclose Evidence-based grassroot level civic actions
information in highly refined language which are and public deliberations
not readily accessible to the public. This makes the
project’s proponents and implementers accountable Organised citizen actions with credible evidence
only to the higher authorities far from people. As a serves as a complementary approach to centrally
result, transparency and accountability are left solely designed political and bureaucratic instruments for
to bureaucratic rationales that avoid public scrutiny. ensuring financial accountability. Formation of the
climate justice action group, represented by local social
Successional focus: from climate change to and political leaders, natural resources user group
climate finance accountability representatives, and local media representatives and
supporting them with intellectual inputs and logistics
The advocacy approach directly focusing on climate was key part of our action research initiative (see
finance accountability often invites confrontation Box 1 for details). A similar informal and loose group
rather than constructive engagement towards a represented by most climate vulnerable and other
solution. There is rather low appreciation of such an marginalised groups, in addition to those involved in
approach by the local government representatives local social and political fronts in general, and media
and officials. They sometimes try to avoid and even can be a potential strategy. Incentivising such a group
reject any outside, civic initiatives on climate finance for maintaining their enthusiasm for a long time and
making it a porous body by allowing members to be
accountability. However, beginning with the climate
a part of, and leave at their will, would be crucial for
change agenda and its overarching impacts across the
its sustainability.
community was able to draw their attention. Initially,
this project began its capacity building initiative by Box 1: Grassroot level climate justice action group
introducing climate change agenda, gradually moving for transparent and accountable climate financing in
to climate finance and finally to climate finance Rasuwa
accountability. Once climate change was established
as an important common concern, it helped to Households in Kalika Rural Municipality were dire need
increase wider acceptance of the climate finance of additional source of drinking water due to drying up
of the existing source. They managed to supply drinking
agenda and finally of its governance. The logical water from the Dobhikhola nearby their community
sequencing at the local level is very similar to the in 2013 with their own expense. Per household water
national discourse and policy initiatives which focus demand was increased due to increasing practices of
much on climate change and its impacts followed by commercial farming. Community thought that water
reservoir tank would solve the issue with equitable water
north-south funds flow and little is discussed on the distribution. However, there was crunch of funding.
governance of climate finance. This entails that any
Local communities formulate the ‘Climate Justice
attempts to understand and improve climate finance Action Group (CJAG)’ comprising 11 members ensuring
accountability should start with a climate change the representation of vulnerable communities,
agenda followed by climate finance (Figure 3). representatives of local formal and informal groups
including farmer’s group, youth club, buffer zone
community forest users’ groups, local political leader
including member of tole development committee, and
representatives of cooperatives. The CJAG collectively
advocate to allocate funding at the municipality level.
Realizing the need, rural municipality allocated Nepalese
Rupees 400,000 (Around USD 4,000) in FY 2020/21 which
was spent to construct two water collection tanks with
water volume controller. The CJAG also conducted the
public hearing to confirm transparency.
This case demonstrates an example on influencing local
authorities to climate financing through evidence-based
grass-root level climate change justice group and ensure
transparency.

A participatory assessment conducted by these groups

included planning, implementation, monitoring and
Figure 3: Trajectory for transparent and accountable evaluation of its costs and benefits. The evidence
climate financing at local level was synthesised and presented during the public
hearing of the project. This helped i) identify gaps are a general requirement for many development
in design, planning and implementation and extract projects, the one that we conducted productively
lessons for future project planning; ii) make changes integrated citizen science with public deliberation
in distribution system towards equitable benefits; that addressed some immediate concerns and drew
iii) adopt established protocol and procedures for commitment for future improvements in climate
effective public hearings. Though public hearings finance accountability (see Figure 4).

Figure 4: Process and outcome of the public hearing

Policy Recommendations Acknowledgement

• Build a common understanding among We would like to express our appreciation to the
stakeholders on climate finance accountability local government representatives and officials of
and justices. This may guide design and Devchuli municipality and Kalika rural municipality
planning of climate actions and fund for supporting us during the project implementation.
allocations. Our sincere thanks go to all the individuals that have
• Recognise, encourage, and nurture been supportive to us throughout our engagement in
participatory inquiry and evidence-based the two sites. Our sincere gratitude to the Swedish
review and planning to influence the local Postcode Foundation for the financial support for
level decision making process this project.

• Experiment, pilot, and foster diverse

institutional windows and mechanisms for
meaningful participation of citizens, especially
the marginalised and climate vulnerable
groups in planning, implementation and
monitoring of climate actions.
ForestAction Nepal
• Acknowledge the fact that a general awareness House No. 71, Ashram Street, Bagdol,
on climate change agenda and climate finance Lalitpur Metropollitan City-4
GPO Box: 12207, Nepal
is a prerequisite to enhance climate finance Tel: +977-1-5191062, 5190144
accountability at all levels, especially at the Email: fa@forestaction.org
local level. Website: www.forestaction.org