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Poverty and social transfers in Zambia

RHVP recently hosted a SADC parliamentary forum workshop on poverty and social transfers. Gelson Tembo, of the department of Agricultural Economics and Extension Education at the University of Zambia, presented a paper that gives an excellent overview of poverty and social transfers in Zambia.  Here is a summary of his presentation:

Extent of Poverty in Zambia

Zambia has a population of 11.5 million people. Of these, 64 percent are classified as poor, and 54 percent as extremely poor. But this is split unevenly between rural and urban areas. In rural areas, 80 of people are poor, while the figure is 35 percent in cities and towns.

In urban areas unemployment is the biggest problem, while people in rural areas depend on agriculture – and when this does not deliver, people generally have little else to fall back on.

Agriculture and poverty

Most smallholder farmers have small pieces of land, and so can’t generally earn a sustainable income from their farms. Only a tiny proportion of smallholder farmers produce more maize than they need for themselves and their families, and many don’t even produce enough for their own families, so need to buy extra maize.

According to Tembo, the government often fails to take this into account and so its policies can add to poverty and hunger. For example, the Food Reserve Agency (FRA) as well as private business, usually tries to buy up all the surplus maize from rural areas. This goes to urban areas where it’s sold to millers who sell the maize meal at high prices. So nothing is left for rural people to buy. Also, this practice creates problems for poor people in the cities, who would prefer to buy grain and take it themselves to small, cheaper mills for grinding.

Two categories of poor households

In Zambia, vulnerable households are grouped into two categories:

Low Capacity Households: Low capacity households are those that are just managing to get by and support themselves. But their situation is risky and they could easily fall further into poverty, especially if they experience a shock such as drought or flood, or the loss of a breadwinner.

Incapacitated Households: Incapacitated households are those that are incapable of supporting their own needs. They tend to be headed by elderly people, who care for many dependents; or they are child-headed.

In Zambia, about 200,000 households (or 10 percent of the population) have been classified as being critically poor and incapacitated. Sixty (60) percent of critically poor and incapacitated households are caring for orphans and vulnerable children (OVC), and around 20 000 households are child-headed.

Low-Capacity Households

It is the job of the Department of Community Development (DCD) of the Ministry of Community Development and Social Services (MCDSS), to implement social protection programmes aimed at low-capacity households.  These include: the Food Security Pack, the Micro-bankers Trust, and the Public Works Programme.

Food security pack

The targeted food security pack (FSP) was established in 2000 and has nation-wide coverage. The main aim of the FSP is to reduce poverty and malnutrition by improving crop production and household food security.

It does this by, among other things, promoting crop and enterprise diversification, promoting farming methods that help to restore soil fertility and productivity, and training NGOs, farmers and traders in business-related skills.

The FSP is meant to benefit a group of smallholder agricultural households considered to be vulnerable but viable. The FSP is implemented by a local NGO, the Programme Against Malnutrition (PAM), under a broader umbrella of the Community Welfare Assistance Committees (CWACs).

The planned target group for the FSP is 200,000 households per year for three to five years. But because of poor funding, the target has never been met – both in terms of what’s provided as part of the pack, and the number of beneficiaries covered.

The largest number of beneficiaries the programme has ever reached in a single year was 150,000 (in 2003/4) and this has fallen much lower in recent years (to around 40 000 beneficiaries in 2005/6, for example).

The Micro-Bankers’ Trust

The Micro Bankers Trust (MBT) operates in 25 of the country’s 72 districts. It gives low-capacity households access to micro-credit facilities.

Public Works Programme

The Public Works Programme (PWP) gives work to the unemployed poor households until they are able to find employment.

Critically poor, incapacitated households

The Department of Social Welfare (DSW) is charged with reducing hunger, extreme poverty and destitution among incapacitated households. Major initiatives under the DSW include the Public Welfare Assistance Scheme (PWAS) and social cash transfers (SCTs).

The Public Welfare Assistance Scheme

The PWAS is a nation-wide programme and is one of the government’s major Social Safety Net initiatives.  The PWAS assists the most vulnerable households through educational support, health care support, social support and repatriation of stranded persons.  Community committees called the Community Welfare Assistance Committees (CWACs) are responsible for identifying vulnerable households and allocating resources to them.

Major target groups include aged persons, disabled people or the chronically ill, single-headed households, orphans and neglected children, displaced people or disaster victims, and others that are genuinely unable to support themselves.

Social Cash Transfers

Social cash transfers (SCTs) are seen as a priority in least-developed countries such as Zambia. In Zambia, pilot SCT schemes have been in existence since 2003. Their main aim is to reduce extreme poverty among the poorest 10 percent of households with insufficient or no labour capacity.

The first pilot scheme began in Kalomo in 2003. Pilot schemes have since spread to four other districts – Chipata, Katete, Kazungula and Monze.

Except for Katete, all other pilot SCT schemes use a community-based targeting system, facilitated by community structures of the PWAS. In Katete, the SCT scheme gives cash transfers to those aged 60 years or older. The Ministry of Labour and Social Security (MLSS) has expressed interest in implementing and scaling up the Katete old-age pension scheme.

In all these schemes, the cash transfers given to the households are not meant to lift them out of poverty, but merely to get them out of extreme poverty by allowing them to afford an extra meal each day. The specific amounts given to beneficiary households varies according to the nature and size of the household, and across pilot districts.

The MCDSS, donors and civil society have agreed on the need to scale up the pilots to the rest of the country. This will be done in phases, and so that each province will have at least one district participating in the scheme. The current plans are to scale up the scheme to 10 additional districts by 2013.

Cross-cutting issues

The social protection sector faces a number of challenges, which hamper its ability to deliver its services in an effective and efficient manner. The three kinds of challenges relate to financing, coordination, and monitoring and evaluation.

Financing

Generally, funding to the social sector in Zambia is poor, and it is usually one of the first to be downsized in case of budgetary difficulties. Within the sector, allocations towards key social protection interventions, such as the Food Security Pack, and the PWAS have been declining over time. Until 2008, the government did not provide any financial support towards the SCT schemes. While the donors provided all the funds for the schemes, their lack of clear long-term commitment further discouraged government support.

It has been the government’s view that it would be beyond its means to implement the scheme without donor support.

Coordination

Recently, the sector players formed the Social Protection Sector Advisory Group (SP-SAG) as a way to strengthen social protection coordination. This is a very high-level forum with poor links to provincial, district and community actors. This has resulted in a weak and inconsistent flow of information from the top to the grass root actors.

In October 2008 civil society organizations established a civil society social protection platform, under the auspices of the Grow Up Free From Poverty (GUFFP) coalition. This was meant to improve their bargaining power in the SP-SAG. But the mandate of the platform is not yet clear as some prominent civil society organizations have not yet subscribed to the platform. So the sector still lacks effective civil society participation.

Monitoring and Evaluation

The Zambian social protection sector lacks a coherent monitoring and evaluation system. Most of the interventions have not been evaluated to shed light on their efficiency and cost effectiveness.

Impact of Social Cash Transfers

Nevertheless, some studies have been undertaken to assess the impact of the social cash transfers. The research has found that:

The SCTs helped raise households’ consumption spending per capita, by 50-80 percent. The greatest increase has been in non-food related spending.

In Chipata, beneficiary households were 30 percent more likely to invest in micro-enterprises than they would have been had they not participated in the scheme.

In the rural areas of Kalomo and Kazungula, beneficiary households in these two districts owned three times more small livestock than they would have had they not been beneficiaries of SCTs.

When it comes to school enrolment, beneficiary households were actually worse off than if they had not benefitted from the scheme. The only exception is Kalomo, where boys in beneficiary households were 6-8 percent more likely to be enrolled than they would have been had they not belonged to beneficiary households.

School attendance rates for children who were already enrolled in school improved only in the urban scheme, which also had a benefit related to school attendance.

Conclusion

According to Tembo, given existing poverty levels, Zambia needs an effective and well-coordinated social protection system. He says that the government should give the social sector as much importance in the budgeting process as all other sectors.

Experience from the pilot SCT schemes demonstrates that it is possible to use social transfers to positively influence the lives of incapacitated households with long-term implications.

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