There is extensive debate about the potential impact of the climate mechanism REDD+ on the welfare of forest-dwelling people. To provide emission reductions, REDD+ must slow the rate of deforestation and forest degradation: such a change will tend to result in local opportunity cost to farmers at the forest frontier. Social safeguard processes to mitigate negative impacts of REDD+ are being developed and can learn from existing safeguard procedures such as those implemented by the World Bank. Madagascar has a number of REDD+ pilot projects with World Bank support including the Corridor Ankeniheny-Zahamena (CAZ). Nearly two thousand households around the corridor have been identified as ‘project affected persons’ (PAPs) and given compensation. We compare households identified as project affected persons with those not identified. We found households with more socio-political power locally, those with greater food security, and those that are more accessible were more likely to be identified as eligible for compensation while many people likely to be negatively impacted by the REDD+ project did not receive compensation. We identify three issues which make it difficult for a social safeguard assessment to effectively target the households for compensation: (a) poor information on location of communities and challenging access means that information does not reach remote households; (b) reluctance of people dependant on shifting agriculture to reveal this due to government sanctions; and (c) reliance by safeguard assessors on non-representative local institutions. We suggest that in cases where the majority of households are likely to bear costs and identification of affected households is challenging, the optimal, and principled, strategy may be blanket compensation offered to all the households in affected communities; avoiding the dead weight costs of ineffective safeguard assessments. The Paris Agreement in December 2015 recognised REDD+ as a key policy instrument for climate change mitigation and explicitly recognised the need to respect human rights in all climate actions. However, safeguards will be prone to failure unless those entitled to compensation are aware of their rights and enabled to seek redress where safeguards fail. This research shows that existing safeguard commitments are not always being fulfilled and those implementing social safeguards in REDD+ should not continue with business as usual

Background: While the importance of conserving ecosystems for sustainable development is widely recognized, it is increasingly evident that despite delivering global benefits, conservation often comes at local cost. Protected areas funded by multilateral lenders have explicit commitments to ensure that those negatively affected are adequately compensated. We make the first comparison of the magnitude and distribution of the local costs of a protected area with the magnitude and distribution of the compensation provided under the World Bank social safeguard policies (Performance Standard 5).Methods: In the Ankeniheny-Zahamena Corridor (a new protected area and REDD+ pilot project in eastern Madagascar), we used choice experiments to estimate local opportunity costs (n= 453) which we annualized using a range of conservative assumptions concerning discount rates. Detailed surveys covering farm inputs and outputs as well as off-farm income (n= 102) allowed us to explore these opportunity costs as a proportion of local incomes. Intensive review of publically available documents provided estimates of the number of households that received safeguard compensation and the amount spent per household. We carried out a contingent valuation exercise with beneficiaries of this compensation two years after the micro-development projects were implemented (n= 62) to estimate their value as perceived by beneficiaries.Results: Conservation restrictions result in very significant costs to forest communities. The median net present value of the opportunity cost across households in all sites was US$2,375. When annualized, these costs represent 27–84% of total annual income for median-income households; significantly higher proportionally for poorer households. Although some households have received compensation, we conservatively estimate that more than 50% of eligible households (3,020 households) have not. Given the magnitude of compensation (based both on amount spent and valuation by recipients two years after the compensation was distributed) relative to costs, we argue that no one was fully compensated. Achieving full compensation will require an order of magnitude more than was spent but we suggest that this should be affordable given the global value of forest conservation.Discussion: By analyzing in unprecedented depth both the local costs of conservation, and the compensation distributed under donor policies, we demonstrate that despite well-intentioned policies, some of the poorest people on the planet are still bearing the cost of forest conservation. Unless significant extra funding is provided by the global beneficiaries of conservation, donors’ social safeguarding requirements will not be met, and forest conservation in developing countries will jeopardize, rather than contribute to, sustainable development goals.