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Dependency and Graduation

A recent research brief, written by Stephen Devereux for the Regional Hunger and Vulnerability Programme (RHVP), looks at two issues that keep cropping up in debates about social protection:  ‘dependency’ and ‘graduation’. Both issues are commonly raised by governments and donors that are sceptical about making firm, long-term commitments to social transfer programmes.

Often, skeptics talk about ‘dependency syndrome’ – a tendency for recipients of regular social transfers to become permanently reliant on these ‘handouts’, and to lose any incentive to improve their circumstances using their own initiative and resources.

‘Graduation’ is often presented as an antidote to dependency. The argument is that financial assistance to poor individuals and families in distress should be limited in scale and time in order to avoid the ‘dependency trap’, and complementary programmes should be put in place to ensure that beneficiaries are able to ‘graduate’ from ‘handouts’ and become self-reliant.

In his paper, Devereux argues that these concerns about the risks of social transfers are based on generalisations and flawed thinking. He provides evidence from several studies and real-life examples of social protection programmes to support his view.

Dependency

Firstly, all societies accept that certain members must be supported – young children, older persons, the chronically ill and severely disabled. So ‘dependency’ must differentiate between those who are genuinely unable to care for themselves, and those who need temporary support but can be assisted to become self-reliant in the future.

Secondly, the concern to avoid dependency confuses two quite separate roles for social protection:

  • temporary support for economically active people who become vulnerable due to a livelihood shock or humanitarian emergency (e.g. unemployment insurance for workers who are retrenched, or famine relief for drought-affected farmers); and
  • continual support to those people who are not able to work to provide for themselves (e.g. infirm elderly widows living alone with no support).

While people in the first category clearly have the potential to ‘graduate’ once their circumstances improve (e.g. if they find a job, or when the next harvest comes in), people in the second category have much lower prospects of graduating – and should not be expected to do so.

Several social protection programmes in Africa do recognise this fundamental distinction, by combining different types of support:

  • cash or food transfers with a labour requirement for eligible people who are able to work; and
  • unconditional cash or food transfers for eligible people who are unable to work.

It is important also to emphasise that while many social protection programmes may seem to create dependency on the state in the short-term, they may actually reduce dependency on the state in the long-term.

For example, child benefits, school feeding and conditional cash transfers, all provide immediate relief to poor households, but they also enhance children’s health, nutrition and access to education. This provides big potential returns to the national economy in the next generation.

Food aid and dependency

It is widely believed that food aid damages African agriculture because it removes incentives for production. The argument is that large imports of free or subsidised food aid depress local food prices and create disincentives to farmers to produce for the market, so that production falls and dependence on further food imports increases. The distribution of food aid also stifles the development of a competitive commercial grain marketing sector.

Recently, a panel survey in Ethiopia tested this version of the dependency argument across 1,470 households. A comparison of food aid recipients and non-recipients found that recipients pursued a more diversified portfolio of livelihood activities, and were more likely to provide assistance to others.

The survey found no significant differences in social and economic behaviour between households who receive food relief and those who do not.

Even more striking, a cross-country analysis found that food aid was associated with an increase, rather than a decline in national food production.

Cash transfers and dependency

Economic theory suggests that people who receive regular free transfers will be discouraged from seeking work, especially if the value of the transfer is close to the income that the recipient could expect to earn from paid employment.

The ‘dependency trap’ refers to a situation where transfer recipients have no incentive to take steps to stop receiving these transfers (such as finding work) – or even worse, when employed people leave work and ‘choose leisure’ instead, preferring to survive on state benefits.

These fears about ‘dependency syndrome’ are common in affluent northern welfare states. But is there evidence of similar behaviour by poor recipients of social transfers in African countries?

On the contrary, Devereux says there is intriguing evidence from southern Africa that social grants have precisely the opposite effect.

In South Africa, a study of the Child Support Grant and Old Age Pension found that adults living in recipient households were more likely to seek work, and more likely to find work, than people in similarly poor households that do not receive these grants.

The authors of that study speculate that this is because social grants give beneficiaries the resources and economic security they need to invest more in job searching – by spending some of this cash on transport costs, child care, and so on.

Similar findings have been reported from large-scale conditional cash transfer programmes in Latin America.

In Namibia, sceptics greeted the introduction of a pilot Basic Income Grant in one community with assertions that this would convert the local population into idle drunkards. What actually happened was strikingly different (for details, see: Cash Transfers Reduce Dependency in Namibia).

Graduation

The concept of ‘graduation’ describes a process whereby recipients of cash or food transfers ‘graduate’ from depending on external assistance, to a condition where they no longer need these transfers, and can therefore exit the programme.

Though it might seem a simple idea, graduation is extremely difficult to define and implement. Graduation is not only about attaining a certain level of food consumption or cash income. Sustainable graduation means that recipients must be able to:

  • generate enough future food and income;
  • be resilient against future shocks.

How does one then assess whether and when a household is self-reliant and resilient, and no longer needs social assistance? This requires defining graduation criteria and setting thresholds that participating households must reach.

The notion of graduation suggests steady progression up an income scale – but livelihoods in rural Africa are often unpredictable and uncertain. Farming communities and pastoralists face unpredictable weather and other threats to crop harvests and livestock herds.

Even if a household appears to have passed an income or asset threshold at a point in time, it is impossible to predict whether the household is about to suffer a major crisis (e.g. a drought or disease outbreak) that will decimate its harvest or livestock herd, leaving the household acutely vulnerable to hunger, destitution and even death.

Evidence on graduation

Two ongoing social protection programmes in Africa that have grappled with defining and implementing graduation operationally are the Productive Safety Net Programme (PSNP) in Ethiopia, and the Vision 2020 Umurenge Programme (VUP) in Rwanda.

Both case studies reveal the complexity of graduation: the difficulty of establishing realistic graduation criteria (especially incorporating indicators of resilience), the incentives that programme managers face to graduate participants prematurely (and the risks of doing so), and above all, the necessity to acknowledge that many recipients of social transfers have no prospect of graduating, and will need permanent assistance.

Conclusion

Evidence from many African countries challenges the notion that social transfers induce ‘dependency syndrome’.

First, the social protection that does exist in much of Africa provides very limited benefits, and is often unreliable – so that recipients cannot rely on it to predictably cover all their food and income needs.

Second, even when social transfers are more predictable, continual and generous, the overwhelming evidence is that recipients will use the grants they receive to buy more assets, invest in small businesses, or enter the job market. This in itself could be enough to lift social transfer recipients out of extreme poverty and towards self-reliance.

‘Graduation’ is a concern for social protection programming, because policy-makers strive to avoid ‘dependency’ and because financial constraints and donor funding cycles mean that social transfer programmes often have limited budgets and timeframes.

Experts have struggled to work out what graduation might mean in practice, and many eligible households have little prospect of sustainable graduation, either because of their own circumstances or because of the challenging environment in which they struggle to make a livelihood.

Devereux believes then, that social protection policymakers should perhaps worry less about minimising dependency and maximising graduation, and focus their attention more on building effective social assistance and social insurance systems.

You can download the full brief in PDF form here:


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Call for child-sensitive social protection

A number of donors and organisations are currently working together to try to persuade governments in southern Africa to adopt social protection programmes, aimed at assisting the most vulnerable members of our society. In particular, these organisations would like to see child-sensitive social protection policies being adopted.

The arguments in favour of child-sensitive social protection can be found in a joint statement, produced in mid-2009. This statement was produced and is still being actively used by, DFID, HelpAge International, Hope & Homes for Children, the Institute of Development Studies, the International Labour Organisation, the Overseas Development Institute, Save the Children UK, UNDP, UNICEF and the World Bank.

The statement argues that social protection is important, as it supports progress towards many of the Millennium Development Goals, can boost the effectiveness of investments in health, education, and water and sanitation, and can help the poorest and most marginalised in society attain a decent standard of living.

The statement says that social protection measures should be child-sensitive as children have particular needs, are particularly vulnerable, and that investment in their development can have long term benefits for them, as well as for society as a whole.

So what should child-sensitive social protection do?  It should focus on aspects of well-being that include:

  • providing adequate child and maternal nutrition
  • access to quality basic services
  • supporting families and caregivers in their childcare role,
  • addressing gender inequality
  • preventing discrimination and child abuse
  • reducing child labour
  • increasing caregivers’ access to employment or income generation
  • preparing adolescents for their own livelihoods.

These aims can be achieved using a range of social protection measures such as:

  • Social transfers (regular, predictable payments in cash or kind)
  • Social insurance (supporting access to healthcare and other services)
  • Social services and
  • Policies, laws and regulations that protect families’ access to resources, promote employment and support them in their child-care role.

The document calls on governments and other role players to set priorities and begin taking steps to progressively realize a “basic social protection package that is accessible to all those in need and is fully child-sensitive.”

You can download the full document by clicking on the picture above, or from here. You can also find more information and resources here:

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Electronic delivery of social cash transfers

As social cash transfers grow in popularity relative to other kinds of social transfers (such as food aid), there’s now an effort to investigate innovative ways of delivering cash to recipients effectively and efficiently. A number of public (government to person) cash transfer projects and programmes have experimented with the use of electronic delivery systems.

In a new paper published as part of the Regional Hunger and Vulnerability Programme’s (RHVP) Frontiers of Social Protection series, Katharine Vincent looks at some aspects of the electronic delivery of cash transfers. Below is a summary of her paper. The full paper can be downloaded here.

Why the interest in electronic delivery systems?

One of the arguments in favour of giving vulnerable people cash instead of food (aside from other benefits of cash), is that cash is less costly to deliver. But even so, the delivery costs can take up a larger-than-needed proportion of social protection budgets. While cash is clearly less bulky than food, physical delivery of cash is labour intensive. There is a need to hire security personnel when transporting large amounts of cash, and to hire staff to oversee the process of paying individuals their grants.

Delivery of cash also has costs for the recipients, who must travel to a pay point to receive their transfer – costing them money and lost time.
The solution is to deliver cash electronically. This minimises the risk of money going astray, and reduces the demands on staff time. It is also more convenient for recipients – as they can access their at a place and time of their own choosing.

The electronic delivery of cash can be done through a range of mechanisms – debit card, smart card, or cellphone – and using a range of financial infrastructure – banks, automated teller machines (ATMs) and point-of-sale (POS) devices.

Electronic delivery systems lend themselves to private sector participation, where a private sector company – typically a bank, smart card platform, or cellphone operator – partners with the programme implementer.

Rapid penetration of cellphones in Africa

By the end of 2008 there were over 246 million mobile subscriptions in Africa (out of a population of just under 700 million).

In 2008, 58.5% of the population was covered by a cellphone signal, with some countries approaching 100% coverage of inhabited areas – including South Africa, Botswana, Mauritius and the Seychelles.

Woman farmer with a cellphone round her neck in Limpopo province, South Africa (photo by K. Vincent, 2004)

The rapid growth in cellphone ownership and signal coverage has paved the way for consideration of cellphones as a mechanism for electronic delivery, partly prompted by promising evidence for their adoption in private person-to-person transfers.

Probably the best-known example of the potential for cellphones in delivering cash transfers is the M-PESA scheme in Kenya, operated by cellphone service provider, Safaricom.

Just two years after its introduction, M-PESA has over 7 million registered users and 10,000 agents, reflecting the faith that consumers place in the safety and convenience of the product.

In 2008, Concern Worldwide used the M-PESA system as a means of delivering a short-term emergency cash transfer – the Kerio Valley Cash Transfer (KVCT) project. While there were some challenges to overcome, the KHCT project successfully disbursed a total of US$53,000 to 570 households, showing the system to be secure and cost effective.

Following the success of M-PESA, other cellphone service providers have begun to offer similar schemes in other countries – some in combination with mainstream banks.

Opportunities for banks

The banking sector is an integral partner in the electronic transfer of cash, and has a key role to play in the electronic delivery of cash transfers in southern Africa.  More and more, banks are also starting to see that there are commercial opportunities for them in facilitating the electronic delivery of government cash transfers. Firstly, there is immediate income to be made, as cash transfer programmes typically pay a transaction fee per transfer.

Secondly, there are additional benefits: national cash transfer programmes start to make it viable for banks to invest in new infrastructure in previously under-served regions. The banks can use this infrastructure to provide services to a broader group of people in addition to transfer recipients.  And the recipients of cash transfers themselves often start to make use of additional financial services offered by the banks, such as micro-credit and savings.

Examples of electronic delivery

At present, most of the examples of electronic delivery of cash transfers come from pilot programmes. While these experiences have generally been positive, pilot programmes don’t really offer the chance to show how cost-effective electronic delivery really can be. This is because most of the costs are incurred at the start of a programme – in registering participants and setting up necessary infrastructure. After that, costs are minimal – so it is only in a long term, large-scale programme that the real savings and benefits will start to be seen.

So far only one government-led programme in Africa has embraced an electronic delivery mechanism from inception, and that is the recently launched Hunger Safety Net Programme (HSNP) in Kenya.  HSNP is a phased programme that is targeting 300,000 households in the first three years, with a plan to increase to 1.5 million in the second phase.  All recipients receive a biometric smart card, which they can use to access their cash through Point of Sale devices.

Future plans

A number of other national cash transfer schemes are considering following in the steps of HSNP.

  • Swaziland has already entered the second phase of its Electronic Disbursement Programme, which aims to have all 60,000 Old Age Grant recipients banked (at a bank of their choice) by the end of the third phase.
  • The government department with responsibility for Mozambique’s Programa de Subsidio de Alimentos (PSA) (which is a cash transfer), the Ministry for Women and Social Action (MMAS), is looking at the potential for electronic delivery of the PSA. Currently delivery of this grant costs up to 40% of the value of the transfer.
  • In Lesotho, the Lesotho PostBank has recently received a commitment for funds from the Millennium Challenge account to proceed with smart card-based transactions systems, which would be a potential electronic delivery mechanism for the Old Age Pension (and, potentially, the recently announced Child Grant Cash Transfer programme).
  • Ghana is also interested in looking at electronic delivery systems for its Livelihood Empowerment Against Poverty (LEAP) programme.  LEAP is a government-run and funded programme that began in March 2008, and is due to reach 164,000 households (equivalent to almost 20% of Ghana’s extremely poor households) when the national rollout period ends in 2012.

Billboard advertising the e-zwich smart card and POS system in Ghana (photo by K. Vincent, 2009)

Lessons learned

Systems of delivery, whether physical or electronic, are only as good as the registration system on which they depend.  Registration is a vital (albeit time-consuming and cumbersome) part of any cash transfer programme, with the bulk of input required prior to programme introduction.

If a private sector partner is involved, it makes sense for the recipient to undertake the procedures for both programme registration and bank account/cellphone account registration at the same time.  Close collaboration between the programme implementer and its private sector partner is vital, particularly in the integration of registration of recipients in the scheme, and the payment system(s).

It is very important for project partners to agree on terms of reference before they start work. These should outline roles and responsibilities, specify service standards and stipulate penalties for non-compliance. Such an agreement should also consider a procedure for handling grievances, so that recipients do not end up caught in a situation of not knowing who to contact in case of complaint.

If due attention is paid to these administration and implementation arrangements upfront, there is great potential for electronic delivery systems to become the norm in southern Africa.

Case studies

Swaziland’s Emergency Drought Response

In Swaziland, when Emergency Drought Response beneficiaries were issued with bank accounts they were then able to access their cash through debit cards at the ATM.  The photo below shows the scene at the start of the scheme, when understanding of, and confidence in, the banking system was low — and so recipients tended to queue to withdraw their cash on the day of disbursement. As time went on, there was growing faith in the security of their electronic cash, and they began to access it at their own convenience. This spread out the demand, and so the queues (and waiting period) became much shorter.

Emergency Drought Response recipients in Swaziland queue at the ATM to access the cash that has been disbursed into their bank accounts (photo by S. Devereux, 2008).

Biometric smart cards in Namibia

Namibia’s Basic Income Grant pilot project  provided a universal cash transfer of N$100 per month to 930 individuals under the age of 60 (at which age they are eligible for a state pension) in the settlement of Otjivero-Omitara, 100kms to the east of Windhoek.  In line with the existing state pension, delivery of the Basic Income Grant was made through the use of smart card-based savings accounts issued by the state post office, NamPost.  NamPost opened accounts for all the beneficiaries, and waived the standard N$50 smart card fee.

Beneficiary accounts were credited with the N$100 transfer on the 15th day of every month. After this date, beneficiaries could access their funds through the local NamPost by presenting their card for insertion into a Point of Sale device, and having their fingerprint verified.  Beneficiaries got one free transaction a month. Beneficiaries also had the freedom to access their transfer through any of NamPost’s 122 branches through Namibia, at a time convenient to them.

Kenya’s Hunger Safety Net Programme

In order to comply with Kenyan banking law on “Know Your Customer”, bank accounts and biometric smart cards can only be supplied to people who hold a Kenyan identification card.

However, to cater for circumstances where the beneficiary does not have an ID card, or wants someone else to collect the cash on their behalf, the private sector partner Equity Bank has set up a procedure that caters for beneficiaries (those eligible to receive the transfer) and recipients (those eligible to collect it).

When the beneficiary has an ID card and is willing to collect the cash themselves, they are also the recipient (for backup they are also required to nominate an alternate recipient who must be over 18 years of age and capable of travelling to the paypoint).  When the beneficiary either has no ID, or does not wish to collect their cash in person, they must nominate a primary recipient, who will be issued with the smart card (and an alternate who must be over 18 years of age and capable of travelling to the paypoint).

A biometric smart card – as shown in the photo – is issued to the primary recipient.  The card shows the primary recipient’s name, photo, and their household number (which becomes the account number).  The chip contains biometric data (fingerprint records) for both the primary and alternate recipients.

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Botswana journalists cover poverty

We had several entries submitted for the best article or report, following the training workshop in Gaborone in January, sponsored by RHVP and facilitated by FrayIntermedia. The workshop covered reporting on poverty, food security and social protection.

Boboki Kayawe wrote a very nice story about some women in Gaborone who are hoping to benefit from government incentives to start a small business making school uniforms. You can read the story on Mmegi Online, or download it in PDF format here. Nchidzi Smarts’ entry looked at the same project. That story is available on PDF here, or can be found online at the Botswana Gazette.

Nicholas Mokwena wrote an article for the online magazine Change/ Mudanca, looking broadly at some of Botswana’s policies. You can find it on p4 and 5 of the online magazine, here.

Thank you too to Mapitso Sekete Ts’iu for submitting the transcript of her very nice radio reports, broadcast on Radio Lesotho. And good luck to Duncan Taolo who was still looking for someone to publish his excellent story on the government’s Ipelegeng intensive labour programme.

But sadly, the prize can only go to one person and we chose Ntibinyane Ntibinyane as the winner. His emphasis on the human story of poverty was really powerful, particularly as he also managed to link the personal stories with issues of policy or government response. His article in the Midweek Sun was the winner, but we also admired Ntibinyane’s commitment to keeping the issue on the agenda, with not one but four stories in total, published in the Midweek Sun, Ghetto Metro and Botswana Guardian.

To download the text of the articles, click on the related picture:

Well done Ntibinyane! In the next few days we will post the results of the Malawi competition, so be sure to watch this space.

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How social grants benefit children

There’s some interesting evidence of the impact of social grants, contained in an article by Kristin Palitza of IPS, looking at the recent increases in the social grants in South Africa, recently announced by Finance Minister, Pravin Gordhan. The article focuses on the impact of the extension of the Child Support Grant to children up to the age of 18, as well as small increases in the size of that grant and the Old Age Pension.

But what is interesting is research highlighted by Josee Koch of the Regional Hunger and Vulnerability Programme as well as David Neves, from the Institute for Poverty, Land and Agrarian Studies of the University of the Western Cape. Koch and Neves refer to studies that show that, contrary to what some skeptics might say:

  • Social grants are an investment, not a waste of money: “For every Rand (0.13 dollars) you pay out in social grants, you gain three Rands (0.4 dollars) in local economy,” Koch is quoted as saying.
  • Social grants are used wisely by recipients: “Although concerns about the misuse of cash transfers keeps coming up, all our evidence suggests that it’s not true,” Neves says in Palitza’s piece. This is backed up by solid data. According to Koch as quoted in the article: “Children whose parents receive the CSG are on average two centimeters taller than those who do not.” This shows money is spent on food, not on alcohol or gambling.
  • And finally, the article points to research showing that social grants do not make people idle and lazy: “households that receive a pension have a 12 percent higher work participation rate, Koch explains, which points to the fact that cash transfers free up family members to look for work.”

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Poverty and social protection in the news

Training workshops in Reporting on Poverty, Food Security and Social Protection have been held in Zambia, Tanzania, Botswana and Malawi. The workshops were organised by FrayIntermedia, and sponsored by the Regional Hunger and Vulnerability Programme (RHVP), with funding from UKAid.

FrayIntermedia and RHVP offered a prize for the best article or broadcast report produced and published within one month of each workshop. So far, prizes have been awarded for Zambia and Tanzania.

The prize winner for Zambia is Nebert Mulenga, for his article, “Social Cash Transfer: Passage out of Poverty?”, published in The Times of Zambia.

A PDF of the text of his article can be downloaded here: Mulenga social cash transfers. It’s also available online here, but the Times of Zambia website can be slow to load.

The prize winner for Tanzania is Simon Mkhina, for his article, “Agricultural revolution, a politicized campaign in Tanzania”, published on www.tanzaniasnews.net.

Unfortunately only one prize could be awarded, but special mention must also go to Chelu Matuzya, for an article in the Business Times: “The absent-present saviour for Tanzania’s economy”. You can download a scanned copy of Chelu’s article here:

Mnaku Mbani of the Business Times also entered a story — but here we would like to highlight a recent story of his, not submitted as it was published too late for entry. It is about the banking sector in Tanzania, and illustrates how a business and technology-related story can also cover and reflect issues related to poverty. You can read it online here.

On that same note, it is also worth reading another article by Chelu Matuzya, on Tanzania’s Kilimu Kwanza – agriculture first – policy. You can find it here.

Another person who submitted an entry is Lutengano Haonga. His report is on Africa News, titled Tanzania Should Revisit Agricultural Subsidy.

Congratulations to the winners and to everyone for their great stories. Watch this space over the next two weeks for more news of the winners from Malawi and Botswana, and links to some of the articles and reports submitted.

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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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