Thidwick in Ethiopia

Many years ago, in an early online discussion about graduation, hosted by the Centre for Social Protection, John Hoddinott memorably likened social protection to a character in his favourite children’s book, Thidwick, the Big-Hearted Moose. I would like to borrow his splendid analogy to talk about Ethiopia’s Productive Safety Net Programme (PSNP).

Dr Seuss was the nom de plume of Theodor Seuss Geisel, who wrote (and himself illustrated) a series of excellent children’s books during the 1940s and 1950s. The best know are probably The Cat in the Hat, How the Grinch Stole Christmas and Green Eggs and Ham. In total his children’s books have sold over 600 million copies.

For those of you who haven’t had the pleasure to read Dr Seuss’s books, I strongly recommend them. Thidwick, the Big-Hearted Moose, published in 1948, tells the story of a moose, who is asked for a lift by a Bingle bug:

The bug called out,

“Hey! It’s such a long road

And it’s such a hot day,

Would you mind if I rode

On your horns for a way?”

Thidwick kindly allows the Bingle bug to ride in his antlers. And the bug is soon joined by a Tree-spider, and then a Zinn-a-zu bird, who pulls out 204 of Thidwick’s hairs to make a nest…where he is immediately joined by his new wife and her uncle, a woodpecker who “started in drilling”. A family of squirrels moves in to the four holes the woodpecker has drilled in Thidwick’s antlers; then a bobcat and a turtle, and:

They asked in a fox, who jumped in from the trees,

They asked in some mice and they asked in some fleas

They asked a big bear in and then, if you please

Came a swarm of three hundred and sixty-two bees

By now the rest of the moose-herd has abandoned Thidwick, to winter on the other side of the lake, where “moose-moss” is plentiful but whither Thidwick cannot swim because of the unwanted guests on his antlers. At the dénouement, he finds himself prey to a group of hunters from the Harvard Club:

“Get that moose!

Get that moose!”

Thidwick heard a voice call

“Fire again and again,

And shoot straight, one and all!

We must get his head

For the Harvard Club wall!”

This sorry situation exactly parallels what has happened with PSNP in Ethiopia. It was conceived in 2004 as a seasonal workfare programme for the most food insecure households, paying them a small wage in return for their labour over six months of the lean season. It has become something of a flagship over the years, expanding to reach over ten million Ethiopians in a bad year. It is an international showcase of how to convert annual “emergency” response into a comprehensive multi-annual programme of support to chronically vulnerable households.

However, because it is the only significant social assistance intervention in Ethiopia, PSNP has become a victim of its own success. The seed was sown from the very outset, in 2005, when the donors insisted that it should include a component of direct support for those poor households that had no labour capacity. With the benefit of hindsight, this was PSNP’s Bingle bug: it seemed principled and sensible at the time, but it opened the door for more and more to be loaded on to PSNP. Slowly, over its four phases since 2005, PSNP has taken on more and more diverse encumbrances, just like Thidwick. First, the direct support component has expanded and diversified, to include support to the elderly, those with disabilities, pregnant and lactating women, and the mothers of acutely malnourished children. Second, it now finds itself overburdened with health insurance, gender and social development, nutrition, WaSH, child protection and livelihoods. Phase 5, currently being designed, is intended additionally to reduce child marriage, further enhance nutrition outcomes during the first 1000 days, support early childhood development and ensure school attendance! It is turning into a disability grant, an old age pension, an infant grant, a school bursary and a programme to counter acute malnutrition. Yet it is still at heart a seasonal public works programme whose objective is to improve the food security of working age adults.

There are clearly a number of fundamental incompatibilities, across a range of dimensions, between this original objective and the type of life-course assistance that is now dragging it down. PSNP’s targeting is still based on food insecure households, not vulnerable individuals. Its work requirement is mandatory for those households, but is totally incompatible – even counter-productive – in the case of the other life-course stages. It operates in only a subset of woredas (or districts) that had been most in need of earlier emergency response, whereas life-course vulnerabilities exist in all woredas nationwide. Its six-month duration is wholly inappropriate to those life-course groups requiring full-time support. Its objectives, of providing employment and creating community assets, are equally far removed from those of providing dignity and inclusion for the elderly and those with disabilities, or of providing better nutrition to mothers and infants. And its exit strategy of graduation (however over-optimistic this has proved to be) is very different from the exit strategy of life-course programmes, such as age limits or death. Finally, one of PSNP’s notable features, its scalability and ability to increase coverage in response to unpredictable annual needs, is divorced from the predictable and more inclusive approach needed for life-course social assistance.

Like Thidwick, PSNP is facing an existential crisis. What can be done? Fortunately, Thidwick provides an answer. Faced with the gang of Harvard hunters, and weighed down by his unwanted guests, Thidwick does what all moose do every year:

Finished?

Not Thidwick!

DECIDEDLY NOT!

It’s true he was in a most terrible spot,

But NOW he remembered a thing he’d forgot!

A wonderful something that happens each year

To the horns of each moose and the horns of each deer.

Today was the day,

Thidwick happened to know,

That OLD horns come off so that NEW ones can grow!

Thidwick sheds his antlers and all their unwelcome freeloaders. That is what PSNP needs to do now. It needs to be refocussed on what it was originally designed to do: to provide a seasonal (and shock-responsive) safety net for the working age poor with labour capacity. Its operations could be trimmed back to the essentials, and the focus should be on making it work well. And alongside PSNP, Ethiopia now needs to start to implement a broader range of social assistance interventions, addressing individual vulnerabilities across the rest of the life-course: for those with disabilities, for the elderly, for pregnant and lactating women, for street children, and so on. These programmes can piggy-back on the operational systems that have been developed for PSNP, and can leverage the linkages that PSNP has forged, but they can then pursue their own appropriate objectives, and be coordinated by the Ministry of Labour & Social Affairs rather than the Ministry of Agriculture (as PSNP is now).

There is already an evident recognition of the need for such genuine unconditional social protection across the life-course. The evolution and considerable expansion of what is now called permanent direct support (for the elderly and people with disabilities), and the more recent addition of temporary direct support (for pregnant and lactating women and mothers of malnourished children) are a clear demonstration. And Ethiopia now has a National Social Protection Policy and Strategy, both of which adopt a life-course lens: “Protection from deprivation is particularly critical at key stages in the life cycle, notably during pregnancy, early childhood, and adolescence. At times, individuals need protection because they are unable to work and generate income due to old age and/or disability”. Both documents also identify the vulnerable groups in Ethiopia exclusively in terms of individual vulnerabilities, not in terms of household food insecurity. Furthermore, responsibility for coordination of life-course social assistance is explicitly allocated to the Ministry of Labour & Social Affairs.

Will PSNP be able, like Thidwick, to jettison its extraneous baggage and return to the intervention for the working age poor that it was always meant to be, thereby leaving the space for Ethiopia to develop a comprehensive life-course social assistance package around it? Ironically, this should represent a win:win option: the workfare purists should welcome a return to simple labour-based transfers, while the welfare purists should be delighted to drop the labour requirement and move towards unconditional social assistance for vulnerable individuals. Unfortunately, it is by no means certain this will happen. PSNP has acquired its own momentum: it is like a hugely cumbersome ocean liner, steered by the Government and eleven different donors, each with its own agenda and priorities. Even deviating its course slightly is a major task: turning it around is near impossible. Thidwick himself had faced the same problem when he wanted to swim across the lake:

“We’re fair,” said the bug.

“We’ll decide this by vote.

All those in favor of going, say ‘AYE,’

All those in favor of staying say ‘NAY’.”

“AYE!” shouted Thidwick, but when he was done…

“NAY!” they all yelled.

He lost ’leven to one.

At a time when most countries are trying hard to make their social protection shock-responsive, Ethiopia is facing the challenge of making its shock response socially-protective. To succeed, it will need a more radical approach than just a fifth phase of PSNP. It needs to realise the life-course aspirations enshrined in its National Social Protection Strategy. To achieve this, it should separate PSNP’s permanent direct support into a disability and old age pension. It should transition its temporary direct support into an inclusive first 1000-day grant. And it needs to retain PSNP as a scalable component of the Strategy targeted at the working age poor. Together with free primary and secondary education and with the Community-Based Health Initiative, this would provide a social protection floor of comprehensive coverage through the life-course.

Poor targeting: a response to Development Pathways’ paper on how best to reach those in poverty

The original version of this blog appeared on Development Pathways

Sometimes in life there are things that you know, instinctively, to be true; but you lack the proof with which to convince others. It is then particularly gratifying when the necessary proof emerges.

I have experienced just such a moment of gratification with the appearance of the Development Pathways’ paper on Targeting Effectiveness, "Hit and Miss"! I have always felt that poverty-targeting, in all its forms, is a fundamentally flawed approach to deliver social protection – see my other blogs on this site. The new paper provides incontrovertible proof.

In an ideal world, poverty-targeting would be sensible, which is why it intuitively appeals to those who are new to social protection, or who don’t understand the true complexities of poverty. I would even go so far as to accept that, if all of five conditions were met, there are circumstances in which poverty-targeting might be the optimal choice. But we don’t live in an ideal world, and the Development Pathways’ paper clearly demonstrates how very unlikely it is – in the real world – to fulfil each one of those five conditions, let alone to meet all five simultaneously!

For poverty-targeting to be the best option, all of the following five assumptions need to hold true:

• The poor represent a small residual group
• The poor will remain poor (and the non-poor will remain non-poor)
• Inequitable outcomes are acceptable
• The resource envelope is fixed
• You can accurately identify the poor

Let’s look at each of these in turn, in the light of the evidence presented in the Development Pathways’ paper.

1) The poor represent a small residual group

It only makes sense to undertake the expensive and complicated attempt to target the poor if they represent a relatively small portion of the population. And yet, paradoxically, it is in exactly these circumstances that poverty-targeting is most difficult, as the paper shows. In any case, it is absolutely clear from the paper that in all lower- and most middle-income countries, the number of those who can be considered poor by any comprehensive metric is high: usually in the region of 80 percent. It illustrates this with graphs of the wealth distribution in Brazil and South Africa, and with a telling figure showing incomes in purchasing power parity for five such countries:

In the USA, anyone living on less that US$10 a day would be considered extremely poor. If some 80 percent of the population is poor, it makes no sense to waste money on targeting: the cost of doing so would probably exceed the cost of including the extra 20 percent in the programme, and you would lose many of the political economy benefits of an inclusive universal approach. Conversely, if a much smaller proportion of the overall population is poor, then you still have a serious problem, because the paper shows clearly that poverty-targeting is less and less accurate the lower the coverage – see point 5 below.

2) The poor will remain poor (and the non-poor will remain non-poor)

Poverty is extremely dynamic. The paper gives two examples of such churn in and out of poverty, from Uganda and Indonesia:

These graphs show that in Uganda, only 46 percent of households that were in the poorest quintile in 2013 had been in the poorest quintile in 2011; and, in Indonesia, 38 percent of households in the poorest quintile in 2015 had not been in that quintile just one year earlier. As the paper makes clear, all forms of poverty-targeting would miss this: even the very best such programmes only undertake retargeting every three or four years, and in the vast majority the interval is between five and ten years (for instance, neither Pakistan nor the Philippines has updated its PMT since 2009). There is simply no extant example of a poverty-targeted approach that could capture such volatility in wealth.

3) Inequitable outcomes are acceptable

Even if it could, that would create another challenge. The main reason for such volatility is that, in most low- and middle-income countries, there is very little difference in the income (or consumption) of the poorest 80 percent of the population[1], so even a small change in income, caused by only a minor shock, can knock a household a long way down the wealth distribution. Conversely – and this is where the next challenge comes – making a cash grant to a selected poor household will inevitably propel it far up the wealth distribution, leap-frogging a number of almost equally poor households who are now poorer than the beneficiary household. And yet the beneficiary household is likely to go on receiving the same benefit for a number of years, while the now-poorer households get nothing. This is inequitable, and frequently causes the resentment, jealousy and social tension that are the inevitable by-products of poverty-targeting.

4) The resource envelope is fixed

If you assume that the fiscal space for social protection is fixed and immutable, then there is some justification in arguing that the limited resources should be focussed on the poor. As Devereux[2] argues when presenting the case for targeting, “Given the reality of budget constraints, scarce public resources must be used optimally and allocated efficiently, where they can achieve the maximum impact. If poverty reduction is an objective of public policy, social spending should be directed towards the poor who need income support, not spread thinly over the entire population including to those who do not need it”. But it is wrong to assume that poverty reduction is the only – or even the main – objective of social assistance, and it is naïve to think that budgets are immutable: investment in social protection is a political choice. If politicians spy electoral benefit, the funding will inevitably follow. As a result, the value of transfers is likely to be much higher with universal programmes than with poverty-targeted ones, meaning – ironically – that the poorest do better out of such inclusive programmes than they do when they are specifically targeted.

5) You can accurately identify the poor

Finally, we come to what the Development Pathways’ paper demonstrates to be the killer assumption: that you can accurately identify the poor. It is abundantly clear that you cannot…or at least that current approaches cannot. The paper systematically analyses national household survey datasets from 23 countries, and examines the targeting accuracy of 38 social protection schemes or targeting registries in those countries. It does this using two metrics of targeting effectiveness: (i) the proportion of households incorrectly excluded, when measured against the scheme’s intended coverage; and (ii) the degree of exclusion of the poorest 20 percent of households from the scheme. Both give results that can only be described as lamentable, especially when considering schemes that aim to reach 25 percent of the population or less (representing two-thirds of the programmes studied). In terms of exclusion against intended coverage, the very best performer amongst these has errors of 47 percent, while 12 such schemes have exclusion errors above 70 percent, 8 above 80 percent and 5 above 90 percent (meaning that fewer than one in ten of intended beneficiaries is actually selected). In terms of exclusion of the poorest 20 percent of households (which should logically all be included in a programme aimed at 25 percent of the population), the results are similar: the very best programme excludes 46 percent of the poorest quintile of households, while 12 schemes exclude more that 70 percent of the poorest wealth quintile, 9 exclude more than 80 percent and 4 exclude more than 90 percent – indeed, the worst-performing manages to correctly identify fewer than one in twenty of these poorest households!

The purpose of the paper is not to shame the worst performers, but to demonstrate that the whole approach is fatally flawed. Yet there is a remedy: to increase programme coverage and – ultimately – move to universality. The paper summarises this on a very instructive chart, showing the relationship between coverage and exclusion error:

The best-targeted programmes, using both metrics applied in the paper, are those which have higher coverage of their target populations. Thus, the best results using a PMT, though still not very good, are for the two such programmes where coverage exceeds 40 percent of the intended population: the old age component of Ecuador’s Bono Desarrollo Humano and Uruguay’s Asignaciones Familiares, both of which exclude “only” some 30 percent of their intended recipients and 17 percent of the poorest quintile of households. Similarly, the best example of community targeting, admittedly out of an alarmingly poor set of results, is Rwanda’s Ubudehe classification, covering 30 percent of the population, although this still excludes over half of those intended and half of the poorest quintile of households.

As coverage increases further, exclusion error decreases. South Africa’s Child Support and Old Age Grant, which are means-tested to exclude the most affluent, have over 70 percent coverage of their target populations: exclusion of the intended beneficiaries is only 13 percent and 8 percent respectively; and exclusion of the poorest quintile of households is zero in both cases – in other words every household in the poorest quintile is included, a remarkable achievement. As we move to the four universal programmes analysed in the paper, this finding is further reinforced. Bolivia’s Renta Dignidad and Bono Juacinto Pinto, Georgia’s Old Age Pension and Mongolia’s Child Money Programme all exclude fewer than one in ten of their intended beneficiaries and fewer than one in ten of the poorest households.

The bottom line is that poverty-targeting does not work. The best way to help the poor is not to target them, but to move to higher-coverage programmes, and ideally to universal life-course approaches! I know I have said this before…but now I feel I have the evidence to prove it! Thank you, Development Pathways!

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[1] It is much easier to distinguish the wealthiest 20 percent in such cases, which is probably why the high-coverage, affluence-tested programmes studied in the paper – in particular South Africa’s Old Age and Child Support Grants – perform so well.

[2] Devereux, Stephen, 2016. Is targeting ethical? Global Social Policy, I-16.

What a bunch of Oxymorons in international social protection!

The original version of this blog appeared on Development Pathways

Let me begin by clarifying that an oxymoron is not some kind of bovine nincompoop. An oxymoron defines a phrase that is inherently self-contradictory. The word itself is a good example, deriving as it does from two contradictory Greek words: ὀξύς (oxys), which means sharp or clever, and μῶρος (moros), which means slow or foolish (as in our modern-day “moron”).

Modern usage of the English language is peppered with examples of oxymorons, such as “same difference”, “awfully good”, “deafening silence”, “painfully beautiful”, “open secret”, “oddly normal”, “old news” or “bittersweet”. There are also some splendid examples from the literature, such as Lamb’s “[a smuggler] is the only honest thief”, Shakespeare’s “parting is such sweet sorrow”, Andy Warhol’s “I am a deeply superficial person”, or Tennyson’s double-whammy of “faith unfaithful kept him falsely true”.

Another strand of so-called rhetorical oxymorons can be interpreted more cynically: these would include “Government organisation”, “American history”, “military intelligence” and “Microsoft Works” (or perhaps “public works”). Some might add “Merry Christmas” and “happily married” to this list!).

Unfortunately, the kind of social protection that is commonly peddled by international practitioners is similarly riddled with oxymorons. Some have been around for a while:

•  “Productive safety nets” – such safety nets, traditionally in the form of enforced public works programmes, are not the slightest bit productive when they compel malnourished women to abandon their children to toil for a meagre wage that barely compensates the energy they have to expend.
•  “Conditional social protection” – social protection is not social protection if it can be arbitrarily retracted as a result of a failure to comply with conditions, thereby throwing families into extreme poverty.
• “Graduation from poverty” – a bizarre concept that suggests people can definitively emerge from poverty, as if with a university degree, and no longer require access to social protection.

Probably the most enduring example of an oxymoron in the social protection lexicon is the concept of “poverty-targeting”, which Stephen Kidd has highlighted in a couple of recent blogs (see here). This is inherently self-contradictory at two levels. First, it is linguistically conflictual, apposing a verb that implies high precision (“to target”) to a concept that is totally amorphous (“poverty”). You can no more “target poverty” than you can “measure clouds” or “match waves”. Second it is conceptually deceitful, because – as Stephen has pointed out – it is actually a smokescreen to disguise the fact that its primary objective is to diminish expenditure on social protection, to the detriment of those living in “poverty” who it is ostensibly “targeting”.

Now a new example seems to be creeping into the lexicon: “progressive universalism” – see for example the 2019 World Development Report, which states “A guiding principle for strengthening social assistance is progressive universalism.”. This is slightly moronic, as well as oxymoronic, because “universalism” is usually reserved for the belief, in Christian theology, that all humankind will ultimately be saved through divine grace. Rather than “universalism”, the more common term for something that is “shared by all people or things in the world or in a particular group” is “universality”. But, in either case, the crucial defining component of something that is “universal” is that it is shared by all. It cannot therefore be progressive, which implies that – at least for some time – it will only be shared by some. “Progressive universality” is a bit like talking about “partial infinity”, “the larger half”, “slightly unique” or “nearly whole”. There is a danger that advocates of such “progressive universality” (as it should be) in social protection do not actually want to “progress” at all: they want to continue with their minimalist poverty-targeted approaches, while paying token lip-service to the concept of “universality” that they have in fact signed up to.

The idiot savants who practice such verbal dexterity are clearly confused, so, before this gets us into another fine mess, we should all agree to stand down from the use of oxymorons in social protection.

Happy New Year…and let’s universally resolve not to make that oxymoronic for those in need of effective social protection!

Social Protection through the Looking Glass: Lewis Carroll’s parable for the unwary

The original version of this blog appeared on Development Pathways

What can a 19th Century work of literary nonsense teach us about global social protection debates? To mark April Fools’ Day, I would suggest that Lewis Carroll’s work The Walrus and the Carpenter can tell us more more about prevailing dogmas in the sector than you might imagine!

Lewis Carroll (aka Charles Lutwidge Dodgson) was a master of the art of literary nonsense. His major works include Alice in Wonderland and its sequel, Through the Looking Glass. One of the highlights of the latter work is a splendid poem, recounted to Alice by the tubby twins Tweedledum and Tweedledee, called The Walrus and the Carpenter. The poem tells the story of the two eponymous characters walking along a beach, finding a bed of oysters and persuading the younger oysters to follow them. It ends with the Walrus and the Carpenter eating all the oysters!

Critics have struggled to understand the deeper meaning of the poem ever since it was published in 1871. Many explanations have been offered. Some have suggested that the Carpenter is a caricature of Jesus Christ and the Walrus a caricature of Peter (or Buddha in another version), with the oysters as their disciples. Others have argued that the narrative is a critique of colonialisation, with the two protagonists representing the Empire and the oysters its colonies. Even J.B. Priestley has weighed into the debate, suggesting that the Walrus and the Carpenter were instead archetypes of two different types of British politician.

But I would like to suggest a new thesis: that it is an allegory of today’s social protection debates. On this basis, the Walrus and the Carpenter are the World Bank and the IMF respectively, the beach signifies the problem of global poverty, and the oysters represent national initiatives towards inclusive social protection. Let’s look at this in detail through some key verses. After three stanzas of scene-setting, we are introduced to the main characters:

“The Walrus and the Carpenter
Were walking close at hand;
They wept like anything to see
Such quantities of sand:
If this were only cleared away,’
They said, it would be grand!”

Here we see the two institutions surveying the extent of the problem of global poverty and wishing that it could be reduced. Presumably the Walrus has been used to denote the World Bank because of the consonance between their initial syllables; the Carpenter (i.e. a wood-worker) is clearly linked to the fact that the IMF was created at Bretton Woods (and the two organisations indeed continue to be known as the Bretton Woods Institutions).

Next, having expressed their desire to reduce poverty, we come to a crucial stanza where they opine how this might be achieved:

“If seven maids with seven mops
Swept it for half a year,
Do you suppose,’ the Walrus said,
That they could get it clear?’
I doubt it,’ said the Carpenter,
And shed a bitter tear.”

Immediately, the two institutions present a possible – but in reality, totally inappropriate – social protection solution to reducing the extent of global poverty. Interestingly, their default reaction, just as it is today, is towards a public works approach. And, as in many modern-day instances (think Ethiopia, Bangladesh, Zimbabwe), the proposed works are far from productive: using unsuitable tools (in this case mops) to sweep sand on a beach. Even more damaging (and again as is often the case today), they propose that it should be women who undertake this back-breaking work, thereby adding to their domestic burdens, and jeopardising the health and education of their children. The significance of the number of maids – seven – is presumably a reference to the seven key features of the blueprint World Bank approach to social protection, involving as it does a mix of: (i) poverty-targeting, (ii) an anti-social registry, (iii) proxy means testing, (iv) conditionality, (v) public works (vi) graduation, and (vii) an exit strategy.

“O Oysters, come and walk with us!’
The Walrus did beseech.
A pleasant walk, a pleasant talk,
Along the briny beach:
We cannot do with more than four,
To give a hand to each.”

In this next verse, the World Bank issues its enticing lure to the “oysters”, in other words to developing country governments wanting to invest in social protection: accept our package, and in exchange there will be cheap loans a-plenty and we will be there to lend a hand to each of you in designing your social protection system (in just the fashion we want it)!

“The eldest Oyster looked at him,
But never a word he said:
The eldest Oyster winked his eye,
And shook his heavy head —
Meaning to say he did not choose
To leave the oyster-bed.”

In this, my favourite stanza, the wise old oyster resists the siren call of the Bretton Woods package. He knows that, given time, the nascent national solution focused on inclusive lifecycle schemes is a better option: it will generate popular appeal, political energy and fiscal space, and it might – like an oyster – even create a domestic pearl that will endure for the long haul. Think of these prudent sages as countries such as Lesotho, Nepal, Mongolia.

“But four young Oysters hurried up,
All eager for the treat:
Their coats were brushed, their faces washed,
Their shoes were clean and neat —
And this was odd, because, you know,
They hadn’t any feet.

Four other Oysters followed them,
And yet another four;
And thick and fast they came at last,
And more, and more, and more —
All hopping through the frothy waves,
And scrambling to the shore.”

In contrast to the wise old sages, we see in these next two verses that many countries cannot resist the temptation of the Bretton Woods package: think Malawi, Liberia, Mali, Zimbabwe in Africa and Indonesia, Pakistan, Bangladesh and the Philippines in Asia (since they should come in groups of four). They are “all eager for the treat”, and have no idea what is in store for them…

These ingenues unwittingly walk a mile along the beach with the predators, and sit down on a “rock, conveniently low”.

“The time has come,’ the Walrus said,
To talk of many things:
Of loans — and shocks — and safety nets —
Of conditions — and of strings —
Why PMT is worth a shot —
And whether pigs have wings.”

Okay, I admit that I have made some minor adaptations to this particular verse, to contextualise it and bring it up to date. The original is concerned with typically nineteenth-century social issues, “of shoes – and ships – and sealing wax – of cabbages – and kings”. But, whilst the overall attitude of the Bretton Woods Institutions remains firmly embedded in the nineteenth-century worldview of poor relief and workfare, the terms of the debate have inevitably evolved over time. So I have tried to reflect some of the contemporary obsessions of the World Bank in today’s social protection debate, while remaining true to the spirit of the Carrollian original.

The protagonists duly have their “chat”; then, a few stanzas later, we move to the grisly denouement:

“I weep for you,’ the Walrus said:
I deeply sympathise.’
With sobs and tears he sorted out
Those of the largest size,
Holding his pocket-handkerchief
Before his streaming eyes.

O Oysters,’ said the Carpenter,
You’ve had a pleasant run!
Shall we be trotting home again?’
But answer came there none —
And this was scarcely odd, because
They’d eaten every one.”

So, as the moral of this disturbing fable for today’s social protection debates, I borrow the warning from another presumed characterisation of the World Bank and the IMF in Through the Looking Glass: Beware the Jabberwock, my son, … and shun the frumious Bandersnatch! After their talk, the hypocritical Walrus sorts the oysters by size and devours them, all the while crying crocodile tears (to mix my animal metaphors!). At the end of the process, the only survivors are the World Bank and the IMF themselves, and no sustainable national social protection systems remain for those countries who chose to follow their advice: just like in real life!

Poverty-targeting: the social protection flaw?

The original version of this blog appeared as a Pathways Perspective on Development Pathways

As we start 2018, please may I have the temerity to suggest a common New Year’s resolution for all of us, as a social protection community: that we stop, definitively, the promotion of poverty-targeted approaches?

There are many, many disadvantages of poverty-targeting; and even its one supposed advantage – that it is cheap – is illusory, because low-cost social protection delivers few of the social, economic and political benefits that result from higher levels of investment. As with all things in life, you get what you pay for. Benjamin Franklin, a believer in egalitarian democracy, observed: “The bitterness of poor quality remains long after the sweetness of low price is forgotten”. And who really wants to be associated with something as tawdry as poverty-targeting?

Here are some of its many drawbacks:

·       It is impossible to do. First, of course, it is impossible to accurately identify the “poorest”, especially in contexts where the majority of the population live on low incomes. The charade that you can accurately measure and compare the poverty of different households is manifestly absurd, as has been frequently documented. We should all, at the very least, be open and honest that approaches to targeting on the basis of poverty (whether community-based or proxy means tested) are simply rationing mechanisms; and, in the case of the proxy means test, are as arbitrary as a lottery.

·       It adds cost and complexity. Even if a semblance of accuracy were possible at a given point in time, it is prohibitively expensive and complicated to maintain up-to-date information on comparative destitution, especially in countries where incomes are highly dynamic. In all low- and middle-income countries, a substantial proportion of the population moves in and out of poverty on a seasonal or annual basis. It is fanciful to think that a metric collected one year will have any validity in one year’s, three years’, or five years’ time.

·       It damages social cohesion. Because the outcomes are so random and unintuitive, poverty-targeting that chooses one household and excludes a nearly-identical neighbour will inevitably create jealousies and social tensions.

·       It is inequitable. In situations where many people are equally poor, to give an arbitrary selection of them a comparatively significant benefit will catapult the lucky few into a higher wealth category than the unlucky many. The “have-nots” will become the “haves” and will remain better off than the new “have-nots” until eventual re-targeting…when the iniquitous yo-yo will reverse.

·       It creates perverse incentives. As soon as people understand that they will only remain beneficiaries of a programme if they meet certain criteria of deprivation, they will be faced with the perverse choice between remaining poor and continuing to receive the benefit, or bettering themselves and losing it. Why pour a concrete floor, put a tin roof on your house, or save for your old age if, by doing so, you will be excluded from State benefits?

·       It rewards dishonesty. Again, with a growing understanding of the system, some people will be tempted to game it: they may borrow extra children from neighbours, feign disability, hide assets, or deny ownership of small livestock. The result is that dishonesty is rewarded and honesty penalised, which is damaging to the moral fabric of society.

·       It incites patronage. Giving anyone the discretion to influence the choice of beneficiaries for a programme puts that person in a position of power. This opens the door to abuse, patronage or exploitation. Even where such temptation is resisted, there may nonetheless be a perception of patronage, which again jeopardises the social compact.

·       It stigmatises. Poverty-targeting demeans programme beneficiaries, the polar opposite of the desired effect of social protection, which is to include and dignify. Posting the names of beneficiaries on walls, for example, or announcing them in public, has the effect of stigmatising vulnerable people, not empowering them.

But these defects, while egregious, are not the real issue. If you were an insensitive, extravagant, patronising bigot who didn’t care about dignity, ethics or equity, you could probably live with them. The real problem is the wider impact of such deficiencies on political support for social protection. National politicians shy away from poverty-targeted interventions. I challenge you to name one such programme that has led to an adequate – and sustainable – fiscal commitment to social protection, or has increased the real value of its transfers to beneficiaries over time.

Poverty-targeted programmes never become entitlements. As a result, they never generate popular demand (except among a voiceless minority) and, in consequence, they never gain political traction. Therefore, they never generate adequate domestic fiscal space for improved social protection.

Let’s look at a few examples: first, the much-vaunted – but poverty-targeted – Pantawid Pamilyang Pilipino Program (4Ps) in the Philippines. Figure 1 shows the evolution of the real value of the transfer since 2007: ever downwards. Worse still, as a result of this 32 per cent reduction over ten years, recent research by the World Bank has shown that some recipient children are now obliged to work to cover the costs of attending school in order to avoid being sanctioned or excluded from the programme.

Figure 1: Real value of the Philippines 4Ps transfer

Next, let’s look at a telling comparison between Malawi’s Social Cash Transfer (SCT) and Lesotho’s Old Age Pension (OAP). Both programmes started at around the same time and in response to the same problem: the ravages of HIV/AIDS. But Malawi’s was poverty-targeted, based on the (baseless) “10 per cent labour-constrained ultra-poor”, while Lesotho’s was near-universal, targeting all citizens once they reached the age of 70 years. Malawi’s has remained externally-driven, and is still – fifteen years on – more than 90 per cent funded by donors. Lesotho’s is (and has always been) fully domestically-funded and is very much part of the political landscape, with recent elections having been won and lost on competing pledges to increase the value of the transfer. As Figure 2 shows, the very different trends in the real value of the respective transfers is indicative of the difference between an inclusive “social protection floor” and a poverty-targeted “social protection flaw.”

Figure 2: Comparison between the real value of transfers in Lesotho’s OAP and Malawi’s SCT

Finally, look at the evolution in Zambia’s Social Cash Transfer scheme. Originally, like Malawi’s, this was tightly poverty-targeted at the “non-viable” poorest 10 per cent. For its first ten years it was almost exclusively donor-funded, and gained no attention from local politicians. It drifted unconvincingly, expanding from one district to five, then to eleven; from 1,000 households to 8,000, then to 24,000. But at this point (see Figure 3) it started experimenting with different categorical targeting approaches. Suddenly, politicians sat up and took notice…and domestic funding started to flow. In the five years since 2012, it has become essentially a near-universal old-age and disability pension…and it has expanded exponentially: to nearly 600,000 households in all 108 districts of the country. Donor funding has barely increased: the cost of the expansion has come from domestic resources.

Figure 3: Changes in coverage of Zambia’s Social Cash Transfer scheme

What we are striving for, as social protection practitioners, is programmes that are based on entitlement, that generate increased domestic funding, and that maintain (or even raise) the value of their benefits to the poor and vulnerable over time. We are not going to get this from poverty-targeting. So please can we make a common resolution to promote only inclusive approaches in 2018?

Will no-one rid me of this troublesome PMT?

The original version of this blog appeared on Development Pathways

Anyone who has worked in social protection knows that the thorniest issue of all is that of “targeting”. The recent polemics on these pages about the inadequacy of the Proxy Means Test (PMT) as a “targeting” mechanism have raised the more fundamental question of whether it is in fact the actual concept of “targeting” that is at the heart of the problem.

Amartya Sen began his famous and oft-cited paper on “The Political Economy of Targeting” (1995) like this:

The use of the term “targeting” in eradicating poverty is based on an analogy–a target is something fired at. It is not altogether clear whether it is an appropriate analogy. The problem is not so much that the word “target” has combative association. This it does of course have, and the relationship it implies certainly seems more adversarial than supportive.

Sen also worried that “targeting” treats the recipient as an object rather than as a human being (“The image is one of a passive receiver rather than of an active agent”). And Stephen Kidd, in his “Pathways Perspective” on “Rethinking ‘Targeting’ in International Development” (2013) argued that:

The concept of viewing recipients of public services as “targets” to be hit corresponds well with a neoliberal concept of social policy, in which people receive “assistance” as a form of government charity. It is much less appropriate within a paradigm in which public services are regarded as “entitlements” offered to “citizens”.

These are all fair points. But there is a further objection to the term. The concept of “targeting” carries with it an implicit assumption that accuracy is possible: the supposition is that we are able to hit a target. But such accuracy is, of course, impossible when we are trying to assess the comparative poverty of different households or individuals. There is no accurate way to capture the multiple facets of relative poverty: where a household lives, what it comprises, the age and capabilities of its members, what it owns, what characteristics and skills it possesses, what social bonds it has, and so on. To imagine otherwise is delusional. We need to be honest, and explain to policy-makers that PMT is not a “targeting” mechanism, it is one of several possible “rationing” mechanisms…and not necessarily the best one.

The concept of targeting should properly be reserved for the policy choice of which vulnerable group is to be the recipient of government support, for example the elderly, children, pregnant women, the working age poor. Here, at least some degree of accuracy of identification is possible. It is rather at the next stage that the problems arise: there is a subsequent choice about whether all of this group, or just some of them, should receive the benefit. Much the best solution of course is to provide the assistance universally, or at least only exclude the very wealthiest, as in South Africa’s self-declared affluence testing. But this decision is usually a function of the resources available: if they are inadequate, then some form of rationing will need to be applied to restrict them to just a subset of the group.

There exist a number of options. The major ones (in broadly decreasing order of acceptability, from best to worst) include:

• Eligibility rationing – where eligibility criteria are highly restricted, for example by setting the eligibility age of a social pension very high (e.g. over 70, as in Lesotho), or of a child grant very low (e.g. under 2 years). The advantage of this approach is that it limits the numbers, but is nonetheless universal, which makes it popular, and which allows the eligibility criteria to be gradually expanded over time (as has happened for example with the Child Support Grant in South Africa).
• Geographical rationing – where specific geographic areas are isolated for receipt of the benefit. Examples of this approach would include support to the riverine chars of Bangladesh, or to specific ethnic groups in tribal areas of Vietnam. The problem is that this is sometimes politically difficult, since it may create or exacerbate regional jealousies.
• Random rationing – where beneficiaries are selected by lottery. This is the practice in a number of instances, for example on the SWAPNO programme in Bangladesh. It may seem a bizarre way to allocate social “entitlements”; but it has the advantage that people understand its arbitrariness, and it is at least honest and transparent.
• Community rationing – where communities themselves are asked to ration the benefits of the programme. One advantage of this approach is that community members frequently opt for an inclusive approach, and simply distribute the total amount of the benefits equally among everyone in the community (as for example in Indonesia’s Raskin programme): universalism through the back door. On the other hand, there can also be significant challenges, where selection may reflect existing patterns of social exclusion within communities, or resources may be captured by the more powerful.
• Temporal rationing – where groups of beneficiaries are selected to receive benefits for a short period (often 1 to 2 years), and are then removed from the programme and replaced by a new set of temporary beneficiaries, as occurs for example in Uzbekistan. This is the approach of so-called “graduation” programmes. It may be fair in that it rotates the benefits, but impacts are seriously constrained as a result.
• PMT rationing – where a fallacious veneer of objectivity and transparency is applied to lottery rationing, permitting the selection process to be attributed to a computer rather than to pure chance. There is nothing inherently wrong with this: what is unethical – as we have seen from the evidence presented recently on these pages – is the charade that PMT results in accurate “targeting”.
• Auction rationing – where potential recipients bid against each other for inclusion on a programme, as for example in Bangladesh, where some beneficiaries of the old age allowance have had to pay up-front bribes of up to one year’s worth of benefits to be included. The most common manifestation of such auction rationing is public works programmes, where “beneficiaries” bid their opportunity costs for the privilege of expending valuable calories on hard labour in exchange for a meagre transfer.
• Patronage rationing – where community leaders or other worthies select beneficiaries based on their patronage relationships. Examples of this would include the constituency funds allocated in some Pacific Island states to Members of Parliament, for them to distribute as social assistance to selected constituents. The approach is not “fair”, but it is at least understandable, and transparent in its unfairness.

There is nothing very scientific about the list above, and the order of preference is strictly personal! But it demonstrates that there are other methods than the awful PMT to cut the cake. It may be that if the use of PMT for poverty-“targeting” is presented to policy-makers for what it really is – i.e. as one of many options for rationing limited social resources – then they will pay greater attention to alternative approaches…most of which are actually much better!

Poxy Means Testing: it’s Official!

The original version of this blog appeared on Development Pathways

“A prox on both your houses” [i]

The World Bank has recently – and some would say belatedly – undertaken a critical review of the Proxy Means Test (PMT)[ii], the approach to targeting that it has been advocating, uncritically, for the past decade.

The results are astonishing. Disguised beneath a splendidly econometric veneer, the raw findings that emerge demonstrate that the PMT is a wholly unsatisfactory targeting mechanism. Based on rigorous analysis of PMTs in nine sub-Saharan African countries (Burkina Faso, Ethiopia, Ghana, Malawi, Mali, Niger, Nigeria, Tanzania and Uganda), it finds the following: when using “Ordinary Least Squares results for Basic PMT” (the most common PMT approach), with a fixed poverty line of 20% of the population, “On average, the rate of inclusion errors implies that 48% of those identified as poor by the Basic PMT method are in fact non-poor”; and “The average exclusion error is sizeable, with 81% of those who are in the poorest 20% in terms of survey-based consumption being incorrectly identified as non-poor by the PMT method”.

Let’s just stop and think about this. What this means is that, if a country is encouraged to establish a poverty-targeted social assistance programme targeting the poorest 20% of its population, then its policy-makers will need to accept two facts: that almost half of the actual beneficiaries of the programme would be from outside the intended sub-group; and that fully four out of every five households intended to benefit would in reality be excluded from the programme. What kind of policy-maker would accept such lamentable targeting performance? In Mali, incidentally, not one single ultra-poor household was correctly identified by the PMT as being ultra-poor: an exclusion rate of 100%!

The paper goes on to suggest that certain refinements can improve the accuracy of econometric targeting. But the improvements are small, and the necessary refinements range from being unlikely to being wholly impractical in reality. At the unlikely end of the scale, one suggestion is to increase the coverage of such poverty-targeted programmes to 40% of the population. Yet there are practically no examples of this in Africa, and the reality is that the vast majority of PMT-based programmes target even fewer than the poorest 20%. At a more common level of 10% coverage, the targeting errors are likely to be significantly higher, especially since, as the paper states: “econometric targeting may have difficulty in identifying those who are very poor” and “PMT is missing many of the poorest households in all countries”. At the wholly impractical end of the scale, the proposal is to run an “Expanded PMT” with “far more data”. But here the paper itself accepts that: (a) “the improvement would have to be judged as modest”; and (b) “the field implementation of a PMT formula with many variables is expensive and difficult”.

Remember too that these underwhelming reported outcomes reflect only the inherent statistical inaccuracy of the PMT approach. As other papers have emphasised[iii], the overall performance of a PMT will inevitably be further compromised by a range of other factors. Many of these are touched on, but not explored, in the World Bank paper. Actually implementing the complex and unintuitive PMT approach is bound to introduce further errors (as the paper coyly admits “Field implementation may introduce idiosyncratic mistakes”, and “Most likely the methods will perform less well than our calculations suggest.”). And there are still further problems: (a) with a PMT’s perverse incentives (e.g. households not wanting to acquire assets or improve their dwelling for fear of being excluded); (b) with moral hazard (e.g. households being encouraged to lie about their situation in order to qualify); (c) with the actual costs involved in the targeting process; and (d) with the damage to social cohesion of an improperly understood and seemingly arbitrary selection procedure. As the paper acknowledges, “We present and compare the best-case results for the various methods reviewed, unaffected by potentially differential costs, ease of implementation, and susceptibility to manipulation and corruption”.

One final reason for the PMT’s inaccuracy – which the paper does explore – is that of its inability to respond to the dynamics of poverty. There is always a degree of churning in and out of poverty, and a PMT is very static: most PMTs are only re-run every five to ten years. The paper looks at the implications of this on targeting accuracy by using panel data and running the analysis with lags of one to two years. This shows that – even with such a small lag – inclusion error increases from 48% to 55%, and exclusion error from 81% to 90%. On this basis (which would become still worse over a longer time-lag), we would now need to be telling our putative policy-maker that his or her poverty-targeted social assistance will consequently include more unintended than intended beneficiaries; and that nine out of ten of the intended beneficiaries will be excluded from the programme. This is crazy: imagine trying to persuade a policy-maker to adopt a criminal justice system that resulted in more than 50% of all jail inmates being innocent, and nine out of ten criminals being found not guilty!

So what are the alternatives to PMTs? Well, the paper helpfully goes on to explore some options. It looks at various permutations of simpler, more transparent and more intuitive targeting approaches, premised on a basic income transfer either to all, or to selected categories of, the population (children, the elderly, widowed, disabled or orphaned). It assumes the same overall budget for all the options (though it doesn’t allow for the additional costs involved in running a PMT), and it looks at the comparative poverty impacts of each. The verdict: “even under seemingly ideal conditions, the ‘high-tech’ solutions to the targeting problem with imperfect information do not do much better than age-old methods using state-contingent transfers or even simpler basic income schemes. We find that an especially simple demographic ‘scorecard’ method can do almost as well as econometric targeting in terms of the impacts on poverty. Indeed, on allowing for likely lags in implementing PMT, the simpler categorical targeting methods perform better on average in bringing down the current poverty rate. This conclusion would undoubtedly be strengthened once the full costs of fine targeting are taken into account”.

The paper thus demonstrates conclusively that, in terms of poverty reduction in the real world, PMT performs worse than simpler categorical approaches or even basic income schemes…as well as being administratively costly, morally reprehensible and socially divisive.

Hurrah! But why has this taken so long? And what are the implications for those countries that the World Bank has already persuaded to sign up to such an execrable model?

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[i] To misquote Mercutio in “Romeo and Juliet” by William Shakespeare.

[ii] Brown, C, Ravallion, M and van de Walle, D (December 2016), “A Poor Means Test? Econometric Targeting in Africa”, World Bank Policy Research Working Paper 7915, Washington DC.

[iii] See for example, Kidd, S and Wylde, E (September 2011), “Targeting the Poorest: An assessment of the proxy means test methodology”, AusAID, Canberra; and Kidd, S, Gelders, B; Bailey-Athias, D (2017) Exclusion by design: An assessment of the effectiveness of the proxy means test poverty targeting mechanism, International Labour Office, Social Protection Department (SOCPRO), Geneva.