Executive Summary: "With funding becoming increasingly difficult to sustain, 2009 never promised to be an easy year for the Thailand Burma Border Consortium (TBBC) or for the hundreds of thousands of refugees and internally displaced people either side of the Thailand Burma border. Humanitarian actors were increasingly becoming operational inside the country to seize whatever new opportunities might emerge after the 2010 General Election and there was a danger that ethnic conflict in the border areas, remote from Rangoon, might increasingly become the ?side-show?. But the ethnic issue is unfinished business. Armed ethnic conflict has dragged on for more than 60 years and, although both cease-fire and non-ceasefire ethnic groups have limited resources, they remain major obstacles to the State Peace and Development Council?s (SPDC) aim for complete control. Whilst everyone hopes that the General Election will indeed lead to meaningful change, the new constitution does not address ethnic aspirations and conflict could go on for many more years to come. There remains the possibility of a major emergency should SPDC decide to push for an early military solution. Against this backdrop of uncertainty, 2009 in fact turned out in many ways to be a good year for TBBC. Donor interest remained high: twelve governments were represented at TBBC?s annual meetings in Chiang Mai and funding needs were met. TBBC was able to sustain all of its regular activities, supplying 22,130 MT of rice, 5,454 MT of other food and 12,894 MT of charcoal to an average 138,000 refugees, but also was able to invest time and resources in strengthening its programme and planning new initiatives whilst playing a leading role in putting forward strategic options for change to the Royal Thai Government (RTG). TBBC is grateful to all of its Donors, large and small for the support and encouragement it received. This report provides details of the programme during the second half of 2009, and presents an operating budget of baht 1,230 million (USD 37 million or EUR 27 million) for 20101. Whilst primarily targeted at Donors, this report also aims to provide information and analysis useful to other concerned observers and practitioners interested and involved in the situation in Burma and along the Thailand Burma border... Refugee situation: TBBC?s 2009 annual report on displacement in eastern Burma showed how threats to civilian safety and livelihoods have grown even worse during the past five years as the Burmese army has gradually increased its presence and control in the border areas. At least 75,000 people were displaced from their homes between August 2008 and July 2009 and although many of these remain inside Burma, others joined the steady flow of new refugees into Thailand. The attack by the Democratic Karen Buddhist Army (DKBA) and SPDC against the Karen National Liberation Army (KNLA) opposite Tha Song Yang District in June reported last time, was seen as a likely prelude to an ongoing offensive in Karen State. It also illustrated the way similar emergencies might develop on other parts of the border if other cease-fire groups acceded to SPDC?s orders to form border guard forces (BGFs) and joined offensives against the remaining non-ceasefire groups. Some 4,000 refugees fled into Thailand. But so far there have been no major new military operations along the border and, although several deadlines have passed, the other main cease-fire groups have still refused to form BGFs. It remains to be seen whether SPDC will attempt to force the issue before the General Election, which could still precipitate a major emergency, or whether it will back away from direct confrontation, settling instead to break down ethnic resistance over the longer run. Either way, it is far more likely that there will be more refugees coming into Thailand in 2010 than any of them going home. As this report is being finalised there is much speculation about the 3,000 refugees still living in very temporary shelters in Tha Song Yang District following the June offensive. Whilst most of them express a desire to go back, the threat of landmines and ongoing conflict make this a very dangerous proposition at the present time. The Thai authorities insist that they will not send anyone back against their will, but reports of intimidation persist. Since services are difficult to sustain in the temporary locations, the United Nations High Commissioner for Refugees (UNHCR) and the Committee for Coordination of Services to Displaced Persons in Thailand (CCSDPT) have recommended that the refugees should be offered the option of moving to Mae La camp. TBBC?s new population database and ration book system which has gradually been introduced since 2007 is now fully functional, providing accurate information on refugee numbers and tight control of ration distributions. TBBC has been able to physically verify and photograph everyone eligible for assistance and the requirement for every individual to personally collect his/her ration against a photo ID has led to greatly improved efficiencies. Apart from an estimated 7,600 in Mae La, all unregistered people in the camps have now been through the verification process and the verified caseload at 31st December was 139,366 comprising 94,298 registered refugees and 45,038 unregistered people. Since some people work for short periods outside the camps, on average about 96% of the verified caseload actually show up to collect their rations, meaning that the current actual feeding figure is about 133,500. Results of the Royal RTG pilot pre-screening process in four camps have yet to be finalised and no announcement has yet been made whether, how or when this will be extended to the other camps. Hopefully this will occur during the first half of 2010 and, if successful, would mean that TBBC could then exclude ?screened out” persons from ration distributions. TBBC?s verification process has in fact already excluded some who have been pre-screened. Almost 17,000 refugees left for resettlement to third countries in 2009 bringing the total to over 53,000 since 2005. Numbers leaving are expected to start declining in 2010 and so, allowing for babies born in the camps and a ?normal? influx of new arrivals, TBBC is basing its budget for 2010 on an end of year case load of 136,000... Funding situation: 2009 was a satisfactory year financially. Expenses totalled baht 1,108 million and income was baht 1,137 million giving a small surplus of baht 29 million. This small reserve will be important in 2010 since the budget of baht 1,230 million, is 11% higher than last year, mainly due to higher commodity prices, but also because of planned new initiatives. Although some Donors have yet to confirm their funding intentions, the projected income for 2010 is baht 1,083 million, 5% lower than 2009 and this would result in a shortfall of baht 149 million for the year. TBBC?s funding position is very sensitive to exchange rates and commodity price fluctuations, both of which are going the wrong way at present. The Thai baht has strengthened 20% against Donor currencies over the last 5 years and commodity prices are rising. It is essential therefore that additional funds are raised. The TBBC programme is still remarkably efficient with the cost of supporting one refugee for a whole year just baht 8,500 (USD 250, EUR 185) and all staff, management and governance costs amount to less than 9% of the budget... Strategic planning: The struggle to sustain adequate funding for refugee support after 25 years has added pressure for a change in the current model of encampment, with refugees almost entirely aid-dependent. Following up on advocacy initiatives launched in 2005, CCSDPT and UNHCR drew up a draft five-year Strategic Plan during 2009 to promote the ideas of increasing refugee self-reliance and bringing refugee services under the RTG system where possible, with gre