By Lehlohonolo Lehana.
Forestry, fisheries & the environment minister Barbara Creecy says the idea behind the climate change response fund was to set up a mechanism to raise money towards protecting and restoring infrastructure at risk of damage or having been damaged by extreme weather events.
The fund has been developed following the decision at COP28, which took place in the United Arab Emirates last year, to operationalise a Loss and Damage Fund, as well as the African Union Commission’s establishment of a Climate Finance Unit in recognition of the continent’s “extreme vulnerability to the effects of global warming”.
President Cyril Ramaphosa announced the fund at this year’s State of the Nation Address (SONA) and told the minister that it should be set up in a way that would resemble the Covid-19 Relief Fund through crowd-in private financing.
The Covid-19 relief fund, which amounted to around R500 billion, was used to assist several sectors.
While highlighting wildfires in the Western Cape, heatwaves in the Northern Cape, continuing drought conditions in the Eastern Cape and intense storms in Gauteng, the president also noted the reoccurence of flooding this year “even before we could properly recover and rebuild after the 2022 floods in KwaZulu-Natal, Eastern Cape and North West”.
Additionally, the President said that the fund “includes climate-proofing existing essential infrastructure and facilities, such as water and food systems, roads, rail and ports, human settlements and health care.”
The fund would also form part of what was described as a “comprehensive response to climate change” that included both adaptation and measures to mitigate greenhouse gas emissions.
At a meeting of the Presidential Climate Commission, Creecy said that the fund would be designed and operationalised by either the Development Bank of Southern Africa or the Industrial Development Corporation of South Africa and would act as a channel for South Africa to access the international loss and damage fund that is being set up under the United Nations Framework Convention on Climate Change.
Commissioners asked Creecy how the government would ensure the climate change response fund did not face a similar fate of misuse and fraud by those in government and the private sector.
Many issues relating to the Covid-19 fund occurred, including overpricing, unfair processes, potential fraud and supply chain management legislation being sidestepped.
“The difficulty during the Covid-19 pandemic was that there was no organised oversight [over how funds were disbursed],” said Creecy.
To attract more finance, people and businesses would “want to know if I give R1 to this fund will it go to deal with climate [change] or will somebody eat it up, “said Creecy.
As such, the minister said that it will be independently administered, with proper due diligence, and money is used for the purposes for which it is connected.