Climate Finance Transparency OGP Draft Concept Note
Commitment Title:
Developing Climate Finance Tool for Transparency and Civic Participation
Background of the Proposal:
Financial resources intended for mitigation and adaptation actions must be managed effectively and with full accountability. Thus South Korea, as a signatory of the Paris Agreement, should actively promote methods of governance for its climate actions that support transparency and anti-corruption, including developing an open tool for climate finance.
Also, the new government of President Moon Jae-in promised to promote transparency and eradicate corruption. Promoting climate finance transparency supports the government’s growing efforts for broader public finance accountability that include an open data system (www.data.go.kr). Through such open and public accessible data, the opportunities for corruption and misuse of funds will be greatly reduced especially for climate change finance.
Relevance:
- The responsible government ministry(ies) should provide “comprehensive, timely and useful” information on climate finance projects and programmes through online tracking tool. Transparency of budgets, expenditures, and project results will help to ensure that climate finance is properly spent on its intended projects and recipients by strengthening the scrutiny and assessment of the public and formal oversight institutions.
- Improve the consistency, comprehensiveness and comparability of timely and public reporting by all providers of climate finance, including information on the status, sources, financial instruments and thematic focus of financing provided to developing country partners.
- Implement cross-government budget systems and processes that enable the identification, tracking and regular reporting of domestic resources mobilized for low and high-emissions activities. This can align revenue and expenditure decisions with low-emission, climate-resilient, and national development strategies.
- Having publicly accessible data on climate finance allows citizens, civil society and other stakeholders to understand the funds available to the government for climate action, from domestic and external sources, and the government’s plans for the use of these resources and the intended results. With this information and their community-based knowledge and grassroots experience, citizens and civil society can offer comments and provide best practices for improvement during decision making on policies. And, the information on how funds are to be used allows the public to play an effective oversight role in monitoring implementation and participating in audit and review processes. All of this can help ensure that well-chosen policies, projects and programmes actually deliver the intended results to the environment (or country and world) and communities.
- Climate change finance should be different from development finance (for both local and international). Creating policies and laws to differentiate climate finance and development finance (such as ODA) can reduce corruption and abuse of resources and money. The two finances should have different systems to prevent confusion and to eliminate corruption and misuse of money.
Commitment Benefits
- Through greater transparency, the public can help ensure that climate finance is spent on projects that address the most critical needs to support climate adaptation and mitigation. Hence, it can make citizens trust the system and authorities managing the climate finance actions.
- It can provide greater certainty for investors of the government’s commitment to a low-carbon future.
- Through a transparent and participatory system of financing climate change mitigation and adaptation, the government can build public ownership and legitimacy of climate change and sustainable development goals to support implementation and political support.
- In the long run, the people can adapt to the impending effects of climate change, protect their livelihood, and secure their well-being.
- By helping to increase the credibility of the government among citizens, civil society and private sector actors, it has the potential to raise the country’s transparency ranking by international corruption watchdogs (e.g. Corruption Perception Index). Thus, it improves the image and integrity of the country’s government system.
Commitment Proposal Contents
Goals: To provide a transparent climate finance online tracking tool that can strengthen public participation in climate finance processes and improve accountability.
Main Contents:
- The national relevant ministry (Ministry of Strategy and Finance, Ministry of Environment, Korea Development Bank?) will publish data on climate finance for climate-related projects, activities, budgets, and programmes.
- The climate finance data tool should be a product of collaboration by various stakeholders including government sectors, civil society, and private sectors.
- The open online tools allow people to access financial data and other details on projects, programmes, and activities supported with funds intended to address climate change.
- Citizens and other stakeholders will have space to provide useful inputs to improve climate finance transparency and climate policies.
- Includes all users of climate and environment-related finance – such as climate technologies, renewable energy projects, Korean indigenous climate technology, climate funds for developing countries (e.g. donations for the Green Climate Fund and other international climate institutions), greenhouse gas reduction (specifically power generation, buildings, transport, public and other facilities, water, agriculture, forest, and fisheries) (*South Korea has budgeted for these specific sectors to reduce gas emissions)
Methods of Implementation
- Organize consultative workshops with stakeholders on climate finance transparency tool (Jesse: I Identify sources and mechanisms for climate finance, how finance is tagged as climate finance, who responsible actors are, etc. – Also what methods are currently being used to track climate finance? How can this build on something that already has attention or support? – Also, consider if there are likely political opponents who could create implementation challenges–whose public support and commitment are needed to abate these challenges?)
- Prepare innovative information materials on South Korea’s efforts on climate finance transparency
- Organize forums in preparation for creating an open tool for climate finance in which citizens, civil society organizations, and other stakeholders can provide input on the types of data and information that they are interested in and would find useful
- Publicly report how the inputs from the forums and other public consultation were used in developing the tool.
- Create a centralized online tool for climate finance (project budgets, expenditures, procurement, etc.)
Expected Results:
1 – People can easily monitor how the government is spending their taxes and other public money for climate change projects, programmes, and activities aside from knowing the government’s climate change actions.
2 – People will be better able to participate in the government’s climate change projects, policy-making processes, and implementations that directly affect their lives. (Link these to specific national climate priorities and strategic goals. Otherwise, it will be difficult to assess success. What is the baseline? How will we know if it’s been effective?)
3 – People will become more aware of and able to report any anomalies and corruption issues through monitoring or matching the data with the project results.
4 – People and their immediate environment will get the full benefit of the project or programmes if they are implemented properly without issues of corruption, mismanagement or loss of money. This could apply to both domestic and international funds that are managed by the government.
Notes
South Korea’s Funds that Needs Tracking
- 6 billion Won (USD81.5 million) – develop climate-related technologies
- 77 billion Won (last year and will increase by 9.6 percent this year) – secure technologies for climate change
- 8 billion Won – for fuel cells and secondary batteries
- 780 million Won – for exporting S.Korea’s indigenous climate technology