RHVP: RIP!

So it's official: RHVP's controversial Wahenga Comments "may occasionally have over-stepped the mark and caused offence"!

This is one of the findings of a recent assessment of RHVP, facilitated by the Overseas Development Institute (ODI), which attempted to learn lessons about the degree to which RHVP had influenced social protection policy over the six years of its lifetime.

As RHVP draws to a close, this seems an appropriate opportunity to apologise to those we may have offended; but also, as the ODI assessment does, to consider the more positive influences to which the Programme may have contributed in some small way.

First, we tender our apologies. We were perhaps too strident in some of our campaigns, but they were ones that we genuinely believed in, and where – as a small programme trying to induce major shifts in policy – we were often pitted against entrenched opinions, vested interests and a stolid status quo. We apologise to World Food Programme (WFP), an early target in the food/cash debate ... though we are still not convinced that an organisation with such global expertise in emergency response should be diversifying into the development of national social protection policies. We apologise to the World Bank and its academic associates, especially for airing Sissy Teese's choleric rants ... though we still harbour serious reservations about a number of the Bank's prescriptions in an African context, for example its advocacy of proxy means testing and its fondness for conditionality. We apologise to UNICEF for tarring them with the "ten-percent" brush ... though we still reject a poverty-targeted approach in situations of widespread poverty such as those prevailing in sub-Saharan Africa. We apologise to the International Labour Organisation (ILO) for questioning the foundations of their social protection floor ... though we continue to believe that more work is needed to burnish its credentials as a support to truly national policies and priorities. And we apologise to any others we may have offended inadvertently along the way ... though – as the saying goes – you can't make mealie-meal without milling mealies!

Second, there is evidence of more positive RHVP impacts, even arising out of such transgressions! The ODI assessment suggests that RHVP's "strong and consistent messaging was a key strength in terms of taking a strategic approach to policy influencing ". It goes on to state that "the Programme stuck to strong, clear messages on social protection and took an ‘uncompromising’ approach which sometimes involved controversial or critical stances. In many cases this drew defensive reactions, but over the course of the Programme, not only were many of those messages vindicated, but the messages delivered can be linked to a number of concrete policy changes". The report cites a number of specific examples where "RHVP identified very early on a number of key tenets around social protection, and was consistent in adhering to those tenets throughout its lifespan". These include:

·       The supremacy of cash over food aid in most cases - e.g. Wahenga Comments as early as 2006; strong advocacy for cash-based responses in Lesotho and Swaziland in 2007 and Malawi in 2009; the organisation of an influential regional workshop on cash transfers in 2006.

·       The potential for innovation in delivery systems - e.g. our "Upwardly Mobile" Brief and Comment in early-2006 (before MPESA had even started!), predicting a key role for mobile phones; and the "Lesotho Ladies" initiative and Briefs beginning in 2006 through to the end of the programme.

·       The need to move away from piloting to supporting national programmes - e.g. our "Stop Experimenting" Comment in mid-2006, when pilots were still all the rage among donors and INGOs; and our criticism of two World Bank experiments in Tanzania in 2008 and 2010.

·       The deficiencies of public works programmes as a response to chronic hunger - e.g. our "Public Works Don't" Comment in early-2007.

·       The potential for direct transfers to individual households - e.g. our "Direct Aid" Comment in early-2007 (long before the 2010 book by Joseph Hanlon et al "Just Give Money to the Poor").

·       The weaknesses of poverty targeting, especially in situations of significant poverty - e.g. our "One out of Ten" and other poverty-targeting Comments in 2008; and our Frontiers of Social Protection (FoSP) Brief in 2009.

·       The uncertain evidence on the benefits of imposing conditions (NB not "conditionalities"!), especially in Africa - e.g. our "What's Wrong with Conditionality" Comment as early as 2006; an article in the Institute of Development Studies (IDS) Journal in 2007; and the infamous "Sissy Teese" Comments in 2010 and 2011.

·       The considerable potential for South-South learning - e.g. our early contacts with International Poverty Centre in Brazil; drawing lessons from Bangladesh in 2009; and our promotion of social protection study tours within Africa.

·       The importance of promoting political buy-in whilst also building technical capacity - e.g. the "Institutional and Policy Context" Briefs in 2008; our initiation and support of the civil society Africa Platform for Social Protection from 2006; a targeted focus on the media from 2007; and our SADC Parliamentary Forum initiative and handbook aimed at parliamentarians from 2008 onwards.

As the ODI report makes clear, "many of these were controversial – even radical – ideas at the time they were first aired, and part of RHVP's visibility and impact has probably derived from its provocative (but unswerving) stance". And, even where RHVP itself may not have been directly responsible for changing policy, the report makes a compelling argument that "by taking this ‘radical’ and visible stance in the debate, RHVP opened the door for other more ‘moderate’ voices to find traction within institutions where they would otherwise have not". This in itself would represent a significant achievement of the Programme.

Finally, on this valedictory note, we would like to thank our paymasters, DFID and AusAID, who have made the Programme possible. Their staff (almost without exception!) have provided us with unstinting support and excellent guidance. They have also – more importantly – allowed us the freedom and independence to chart our own course and to fight our own battles. We are very grateful to have had these opportunities over a tumultuous six years, during which there has unquestionably been a paradigm shift in thinking around social protection. This shift cannot be arrogated to RHVP, of course; but it has been an appropriate (and exciting) time for the Programme to have been in existence, and we hope we have contributed in some small ways. Very many thanks to my fantastic colleagues on RHVP who have shared the adventure; and thanks - above all - to all of you that we have worked with along the way!

Social Protection and the Four Horsemen of the Donor Apocalypse

A version of this blog was later published in “Social Protection in Developing Countries: Reforming Systems”, eds Bender, Kaltenborn and Pfleiderer, Routledge, Oxford, UK (2013)

Social protection has come a long way in the decade since it first entered the development discourse. There is now generally a recognition that the old development paradigm ("the poor are the problem") is bankrupt. This paradigm focussed development on promoting economic growth, waited for economic growth to reduce poverty, provided residual interim safety nets to those who could not benefit immediately, and left donors to step in with expensive "emergency" assistance when necessary. This has not worked.

The emerging development paradigm ("the poor are the solution") is predicated on the provision of comprehensive social protection which will allow the poor themselves to participate in the generation of economic growth; this in turn will reduce poverty and the cost of providing social protection, and will also reduce the need for emergency assistance, thus freeing donor resources to help fund further development.

Over the last decade, donors and their international development partners have indeed done a lot to promote and support these significant advances. But they could have done better. There is a serious, and continuing, problem that donors and IDPs fall into four competing camps, which this paper characterises as the "Four Horsemen of the Donor Apocalypse": the Productivists, the Ten-Percenters, the Instrumentalists and the Universalists.

The White Horse

I watched as the Lamb opened the first of the seven seals. Then I heard one of the four living creatures say in a voice like thunder, "Come and see!" I looked, and there before me was a white horse! Its rider held a bow, and he was given a crown, and he rode out as a conqueror bent on conquest.

The Productivists are led by the World Bank and the IMF. The characteristics of their vision of social protection are that it must be targeted at the poorest; that the poorest should preferably be identified through "proxy means testing"; and that no-one should be given "something for nothing". This means that they favour public works programmes, social action funds and conditional cash transfers (for all of which it is of course much easier to persuade Governments to take substantial loans, since such programmes are also demonstrably producing physical, social and human assets). Examples of Productivist programmes abound, for example in Latin America, in the Philippines, and in Ethiopia, Rwanda and Tanzania.

There are some concerns with this "poor relief" approach, however. The first is that the incremental benefits of conditionality, pushed hard by the Bank, are unproven (or at best controversial) . The second is that proxy means testing is, by the Bank's own admission, "most appropriately used where a country has reasonably high administrative capacity", and it has been shown elsewhere to be highly inaccurate (watch this Wahenga space). And the third is that, while the Bank has (belatedly) adopted the "3 Ps" framework for social protection, it has bizarrely dropped the concept of "provision". Its "3 Ps" are promotion, prevention and protection, with the latter introducing a worrying semantic circularity. But the more fundamental problem is that, the way it is defined, "protection" (ie protection " from destitution and catastrophic losses of human capital ") is little different from "prevention" (ie protection "against drops in well-being from income and expenditure shocks") - in that both presuppose that people have something to start with, which needs to be "protected" or its disposal "prevented". And what we have lost from the original "3Ps" is any concept of "provision" - the idea that there are groups of people (who many would argue should be the core target groups for social protection) who have virtually nothing to "protect" or "prevent", and who rely on social protection just to survive. This might include the elderly, the disabled, street-children, marginalised groups. The worry is that by excluding this "provision" function, the Bank is inching SP away from the poorest and most vulnerable, and towards those with economic growth potential ... and therefore better prospects for their "lending operations".

The Red Horse

When the Lamb opened the second seal, I heard the second living creature say, "Come and see!" Then another horse came out, a fiery red one.

The Ten-Percenters are led by UNICEF (though - in fairness - not all of UNICEF). The principal characteristic of their vision of social protection is that it should use community-based targeting to identify the most labour-constrained households among the "ultra-poor", which - somewhat mysteriously - appears to equate ubiquitously to ten percent of the total population. The identified beneficiaries are then given unconditional cash transfers, sometimes with additional incentives if they have school-going children. This approach began with the tiny, but much-feted, Kalomo pilot in Zambia, and it has since been rolled out, with little modification to adapt to differing national circumstances, in Malawi and Liberia. More recently, Zimbabwe and Uganda have escaped with variants on the original.

Here the concern, rather than being with the "3 Ps", is that it has "no Ps": no practical basis, no political support, and no potential! On the contrary, there are multiple problems, many of which have been discussed in earlier RHVP Comments and Briefs. First, it is almost impossible to identify the poorest and most-labour constrained ten percent, especially in countries where over seventy percent of the population are churning in and out of poverty. It is difficult enough even on a pilot scale with extensive external resources and additional "project" funding: it is totally impractical on a national scale. This can lead to problems of moral hazard and even social conflict. Second, even if it were possible, the income from the transfer to the poorest households will result in them rapidly "leap-frogging" up the wealth distribution, so that they will very soon no longer be the poorest. This can lead to problems of equity and the need to retarget frequently. Third, the arbitrary choice of ten percent - essentially a budget rationing tool - cannot be applied universally with any semblance of fairness: there are huge variations in the extent of poverty between, and even within, different districts and communities. As a result, none of the cited examples has been successfully scaled up: and in Zambia, showcase of the Ten-Percenters, the Government has recently expressed its clear preference for a categorical child benefit over the ten percent model that has been pushed so hard and for so long.

The Black Horse

When the Lamb opened the third seal, I heard the third living creature say, "Come and see!" I looked, and there before me was a black horse! Its rider was holding a pair of scales in his hand.

The Instrumentalists are led by ILO, which has rallied an impressive array of UN and other agencies behind its Social Protection Floor(SPF) initiative. Emerging from an employment and "decent work" perspective, the SPF comprises four main components: access to health services; child or family support; income support for the unemployed; and income security for elderly and disabled persons. If you believe the propaganda, examples of the successful implementation of the SPF are everywhere, even in countries where social protection has been evolving at its own pace and in its own way for many years before the term SPF was even coined: these include Mexico, Brazil, Argentina, South Africa, Bolivia, Sri Lanka, Ghana, Haiti, East Timor, etc, etc, etc.

The primary concern with the SPF is to know "which P?": is it a process or is it a prescription? The correct answer is that it is a process. But - for one reason or another - it has been mis-sold, and now suffers from an image problem. Many stakeholders, including some countries and some key donors, perceive it as being too prescriptive, with a mandate to roll out a social protection carpet of standard instruments: health insurance/fee waivers, child grants, unemployment benefits and old-age/disability pensions. To some extent, this misperception in understandable: the ILO has itself recently made a number of presentations describing the SPF as "four essential social transfers" and "four essential social security guarantees", in both cases specifically citing the instruments of "family/child benefits", "social assistance", and "pensions". The ILO public relations machine will have to work hard to retrieve the situation and demonstrate convincingly that the SPF is what it says it is: a recognition that "each country has different social needs, development objectives and fiscal capacity to achieve them, and will choose a different set of policies"; and that the role of the SPF "through a coordinated country response [is to] facilitate and accelerate the introduction or strengthening of sustainable context-specific social protection systems".

The Pale Horse

When the Lamb opened the fourth seal, I heard the voice of the fourth living creature say, "Come and see!" I looked and there before me was a pale horse!

The Universalists are a diverse (and fluid) crowd: they include a number of the big international NGOs, a handful of bilateral donors including the Nordics and DFID ... and - let us be honest - RHVP. The characteristics of their vision of social protection are that it should be rights-based, that it should use predominantly universal approaches and categorical targeting, that it should favour demand-led employment guarantee schemes over supply-led discretionary public works projects, and that it should deliver unconditional cash transfers with no strings attached. Examples can be found in many OECD countries, but also in South Africa, Botswana and Nambia, and (at least partially or incipiently) in lower income countries such as Lesotho, Nepal, Uganda and Zambia.

The primary concern here is again with "3 Ps": how do we pay, pay, pay? There is no doubt that such universal schemes will cost more to implement, and this is often raised as an impossible hurdle. Yet experience has shown that when such schemes are introduced, they are more sustainable: more people benefit from them, understand them, and accept them as fair; so more people vote for them; so they become more popular politically; so they attract a greater share of the national budget. And so, ultimately, it can be argued that the poorest get more benefit from universal schemes than from programmes targeted more narrowly at them. One option to defray the costs is to introduce such schemes progressively: in other words, to set eligibility for a social pension at a relatively high age such as 70 and reduce it gradually, or to start a child benefit at a young age such as 2 and then increase it over time (like South Africa has done), as the evidence of beneficial impacts generates increased public and political support. Experience shows that governments will devote much more substantial shares of their budgets to universal programmes than to poverty-targeted ones. For example, the universal social pensions in Mauritius, Lesotho and Nepal command more than double the resources as a share of GDP than the means-tested pensions in Cape Verde, Argentina and India; and it is often overlooked that the budget of the vaunted poverty-targeted Bolsa Familia in Brazil is dwarfed by that of the country's near-universal rural and urban pension programmes.

Angels and Demons

They were given power over a fourth of the earth to kill by sword, famine and plague, and by the wild beasts of the earth.

The funny thing about the Four Horsemen of the Apocalypse is that no-one really knows what they mean. The popular, more dramatic view is that they symbolise tribulation, and are the harbingers, respectively, of conquest, war, famine and death. But there is another school of thought that equates them with the angels of the four winds (Michael, Gabriel, Raphael and Uriel), who are often associated with the four cardinal directions. And this seems more appropriate in terms of our Four donor Horsemen: the danger is that, whatever the strengths and weaknesses of their competing visions, they are pulling in four opposite directions. And this can have disastrous consequences at national level. Let us look at how this has played out in one poor country: Malawi.

Malawi has been trying, since 2007, to develop a comprehensive national social suport policy. During that time:

1) The Productivists (aka the World Bank) have been (a) pursuing their investments in public works through the Malawi Social Action Fund (MASAF), and (b) experimenting with a pilot Conditional Cash Transfer in Zomba;

2) UNICEF has been pushing its Ten-Percent model, with a pilot first in Mchinji, and then expanding  to a handful of other districts;

3) ILO and its Instrumentalist partners have been assiduously fixing the joists for their Social Protection Floor;

4) DFID has commissioned some like-minded Universalists - HelpAge, EPRI and (it must be admitted) RHVP - to argue the case for a universal social pension.

The result: stalemate. No wonder Malawi's Cabinet has still not approved the policy, five years on!

In the meantime, the Government has shown very clearly where its own "social support" policy priority lies: in its agricultural input subsidy programme. So what should the donors have done? Instead of  declaring that they didn't approve of subsidies, instead of insisting that the national social support policy be approved before they did anything, and instead of pursuing their opposing policy agendas, they should rather have:

·       jointly supported the Government;

·       explored integrated ways to extend social transfers to the poor with no land or labour (as in the direct welfare support components of Ethiopia's PSNP and Rwanda's VUP);

·       explored options for cash transfers to those who routinely sell their agricultural input vouchers, on the basis that there must be cheaper and more efficient ways to provide them with the cash they need;

·       facilitated the inclusion of civil society and of beneficiaries in the national social protection debate;

·       invested in necessary upfront expenditure, such as national identity systems;

·       helped to build capacity at national and sub-national levels;

·       promoted the institution of independent grievance and appeals procedures, and of social audits;

·       explored innovative delivery systems;

·       leveraged maximum private sector participation in the programme;

·       funded a futures option on maize imports (as DFID and the World Bank had done successfully in 2005) to provide insurance against the next year when (not if) the harvest fails;

·       invested in monitoring and evaluation to learn lessons and inform the evolution of the programme.

What a missed opportunity!

In conclusion, social protection still has a huge role to play in development; but it will only achieve its full potential if the Four Horsemen of the Donor Apocalypse reconcile their differences and unite to ride in the same direction as individual national Governments. 

And now for something completely different: Contraceptional Cash Transfers

This blog first appeared on the Wahenga website, under the pseudonym of Sissy Teese

The World Bank can only be doing this to provoke me! Just when I had vowed never to take up my pen in anger again (and when Wahenga had vowed never to air my pseudonymical rants) … they do this!!

We already know, because the Bank has told us, that Conditional Cash Transfers (CCT) can do everything! First we had Conspirational Cash Transfers. Then we had Connubial Cash Transfers. And now we have Contraceptional Cash Transfers. A paper just launched describes an experiment - “Rewarding STI Prevention and Control in Tanzania” (with the horrendously contrived acronym of RESPECT, no less!), which provides quarterly cash transfers, each equivalent to nearly one-tenth of average annual income, to those who avoid unsafe sex!

We hear that the study “has three separate arms [all the better to hold you with, my dear!!] – a control arm and two intervention arms (low-value cash rewards and high-value cash rewards).  Study participants were randomly allocated across the three study arms. All participants have been monitored on a regular basis (every 4 months over a 12 month period) for the presence of common sexually-transmitted infections (STIs) that are transmitted through unprotected sexual contact and therefore serve as a proxy for risky sexual behavior and vulnerability to HIV infection.  A small payment has been provided to all participants (regardless of arm assignment) to minimize attrition from the study.  Anyone testing positive for an STI (again, regardless of arm) received free STI treatment and counseling. Individual pre-test and post-test counseling was provided to study enrollees [the word “enrollees” has a wonderful ring to it in this context!!] at each testing interval, and monthly group counseling sessions were also made available to all study participants in all villages.”

And it works! And, what is more, it seems that the more you pay, the better it works!

By the end of one year, “study participants who were randomly selected to be eligible for a $20 payment every 4 months if they tested negative for a set of curable STIs, experienced a 25% reduction in the incidence of those STIs. After one year, 9% of individuals in the group that received the $20 quarterly payment were positive for one of the STIs, compared to 12% in the control group”.

We also learn that “the two year study cost $1.8m”, which must surely make it the most expensive condom in African history. And maybe this is where the reality check comes in: the finances. Let us look at this from two different perspectives.

First, the experiment. We have a sample of 2399 (why not 2400?). Of these, let’s assume one-third (remember the three arms?) received the higher transfer value - i.e. 800 people. Of these, 3% (i.e. the difference between 9% and 12%) avoided STIs as a result of the transfer - that is 24 individuals. So it cost probably 800 x $60 in transfers, plus all the costs of testing and administration - let’s say conservatively $100,000 in total annually - to prevent 24 individuals from getting an STI. That is over $4,000 each. Condoms would have been a cheaper option.

Second, consider this programme scaled up, nationally, to cover the whole of Tanzania. To be effective, it would need to be targeted universally, at all who were sexually active, so between the ages of 12 and 60. That is more than 22 million people. The pilot cost $750 per person, but we can assume some economies of scale, so let’s say $500 per person. That is a total programme cost of $11 billion, equivalent to 50% of GDP at official exchange rates. By way of comparison, the ILO calculated that Tanzania could afford a full “basic social protection package”, comprising a universal pension for all over-65s and all persons with disabilities, a universal child benefit to all under-15s and universal access to basic health care … all for 17% of GDP. Alternatively, $11 billion could buy you 110 billion condoms, more than five times the number currently produced worldwide annually!

But - since money is no object - what next for the World Bank? How else might they influence people’s behaviour for the better? My vote is for some form of Conflagrational Cash Transfer, providing nicotine vouchers to all who refrain from smoking cigarettes … or maybe Congregational Cash Transfers, distributing multiples of the collection plate to all who faithfully attend church every Sunday … or a Consumptional Transfer of unlimited maize meal to all who eschew junk food for the month … or a Convivial Cash Transfer to those who moderate their alcohol intake … or perhaps Constipational Cash Transfers, providing monthly supplies of suppositories to all those performing their ablutions regularly on a daily basis.

Maybe my writing days aren’t over yet …

An appeal against "Conditionalities"

As RHVP - and perhaps Wahenga - draw to a close, I would like to use our pages to make a personal and heartfelt appeal to the social transfers community: please can we stop using the horrible word “conditionalities”?

I would like to stress that this plea has nothing to do with the debate about the relative merits of conditional and unconditional cash transfers that has been raging on Wahenga’s pages recently (Sissy Teese v World Bank): it is aimed squarely at writers at both ends of that seemingly unbridgeable spectrum. But let me at least draw on those Wahenga exchanges to quote a couple of examples:

“why bother with the moral hazard, additional cost and complexity of imposing, monitoring and enforcing conditionalities, when unconditional programmes appear to have the same effects?” (Ms Teese) 

“[CCTs] combine three key mechanisms: grants that increase the income of poor households, awareness promotion that emphasises the importance of human capital, and conditionalities that link the two” (EPRI “Designing and Implementing Social Cash Transfers” [2006], quoted by Ms Teese)

The danger is that this ugly terminology is becoming firmly entrenched in the literature: it is used over 200 times in the EPRI manual cited above[i], it has sneaked into the World Bank’s seminal “tome” on “Conditional Cash Transfers” (2009), and it is being replicated in countless papers, articles and journals.

What is wrong with the word “conditionalities”? First, it is not a word; second, if it were, it would mean something quite different; and third, it is wholly unnecessary, since we already have a perfectly good word that we can use in its place.

1)    It is not a word because it does not appear in any dictionaries, and because the irreproachable Microsoft Word gives it a red squiggly underline, in whatever language you are using.

2)    Even if were to be coined as a neologism, it would be meaningless: we can apply a “condition”, or multiple “conditions”. We can thereby make things “conditional” (ie “dependent on the fulfilment of one or more conditions”); and we can therefore have a system that is based on the concept of “conditionality” (ie the “state of being conditional”). But we cannot have multiple “conditionalities” - and, if we could, it could only mean “multiple states of being conditional”.

3)    So, if we can’t use the word “conditionalities”, what can we use instead? We need a word that has the definition of “actions stipulated as requirements before the performance or fulfilment of other actions”. Does such a word exist? Miraculously, it does: the word is … “conditions”! Try it for yourself in each of the examples cited above: you must agree that it improves them!

So this is my plea: let us have no more “conditionalities” in social transfers! But - lest this sounds as if I am aligning myself with the sassy Sissy - let us equally have no hesitation in applying “conditions” to cash transfers wherever they are agreed to be appropriate!

It is important to nip this awful usage in the bud now, because the use of conditions in social transfers is clearly a ubiquitous and fast-growing phenomenon, both in the World Bank’s portfolio and elsewhere. Or to put it another way: without wishing to cause confrontationalities, in order to have confirmationalities of the proliferationalities of the utilisationalities of conditionalities in social transfers, in both connurbationalities and rural locationalities, you need only to make random observationalities in the World Bank’s “Manual of Operationalities”!

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[i] The otherwise excellent EPRI manual is to be republished soon. Please can we ensure that it drops the use of the term “conditionalities” in its second edition?

Connubial Cash Transfers

This blog first appeared on the Wahenga website, under the pseudonym of Sissy Teese

With some reluctance, I take up the cudgel again!

I have recently had the good fortune to read the Bank’s latest Policy Research Working Paper (No 5259)[i]. This is another fascinating, meticulously researched and well-argued paper about the same cash transfer programme in southern Malawi that was cited in our earlier wahenga exchanges about the impact of conditionality on schooling - the Zomba Cash Transfer Program (ZCTP). Entitled “Cash or Condition”, the Paper’s specific objective is to disentangle the impact of the condition from the impact of the cash transfer by reporting on the first “ideal experiment to answer this question – i.e. a randomized controlled trial with one treatment arm receiving conditional cash transfers, another receiving unconditional transfers, and a control group receiving no transfers” [emphasis in original].

Not even I could fail to be impressed by the refreshing candour of the Abstract, which states unequivocally that:

 “the authors find that the program reduced the dropout rate by more than 40 percent and substantially increased regular school attendance among the target population of adolescent girls. However, they do not detect a higher impact in the conditional treatment group” [emphasis added].

After such an admirable display of openness, it might seem churlish to complain! But there are a couple of more worrying findings which emerge from the Working Paper that shed further significant light on the debate between CCTs and UCTs. One of these is clearly recognised in the paper (although, noticeably, it doesn’t make it into the Abstract!), while the other is tucked away unobtrusively in a footnote.

The first is that UCTs dramatically reduce the probability of early marriage, while CCTs do not:

 “the unconditional treatment reduced the probability of marriage by 2.7 percentage points (or by 56%), whereas the marriage rate in the conditional group was identical to that in the control group”.

The paper suggests a dispassionate economic argument to evoke “the possibility that a CCT offer could actually trigger marriage by presenting the girl with an untenable schooling alternative and forcing the household into a decision [of early marriage] at the time of the offer” [emphasis added]. But might there not be another, more human, explanation: that beneficiaries of unconditional transfers feel more empowered, and more independent, and more confident of making sensible life-choices than recipients of conditional transfers from an intrusively paternalistic nanny-state? This would after all, conform to standard economic theory, helpfully reiterated in this Working Paper, that “in the absence of externalities, conditional cash transfers are worse than distributing an equivalent amount of unconditional cash”. 

The second, perhaps even more serious, concern is tucked away in a footnote:

 “the program led to substantially elevated stress and psychological morbidity among adolescent girls in the conditional group relative to the unconditional arm”.

Again, the implication is clear. The imposition of conditionality places additional stress on the recipient, and creates tensions within the household between those that must adhere to the conditions (in this case, the school-age girls) and those that benefit from the transfer (siblings, parents, carers, grandparents). What is worse, the authors “also find that the mental health of the CCT recipients worsen [sic] when the transfer amount offered to the parents is larger, while the mental health of UCT recipients is uncorrelated with the transfers offered to the parents”. In other words, the higher the value of the transfer that rests on fulfilling the conditions, the greater the stress for CCT recipients.

Surely these are serious concerns, and a reason to argue more forcefully in favour of unconditional transfers? What this impressive study tells us is not only the already important message contained in the conclusion that: 

“given that the marginal impact of imposing a schooling conditionality is at best low [it is in fact absent!], and that monitoring school attendance to enforce the conditionality is costly, it seems that policymakers can consider unconditional cash transfers as a viable alternative”.

It also raises two potentially damaging criticisms of conditionality, and therefore two significant advantages of UCTs, which - at the very least - merit critical attention and further research. These are:

1)    That, “while unconditional cash transfers nearly eliminate marriage in our study population, the conditional cash transfers have no effect on it”. Early marriage is seriously detrimental to girls’ education (in Latin America and elsewhere, as well as in Malawi), so reducing it, through whatever mechanism, would be a highly desirable outcome in building human capital and reducing the inter-generational transmission of poverty.

2)    That - as might indeed rationally be expected - imposing conditions can inflict psychological damage and create intra-household tensions. Instead of feeling empowered and independent, recipients may feel bullied, pressured and ultimately overwhelmed by the conflicting demands imposed on them, forced into making behavioural choices (like early marriage) that they would otherwise eschew.

Should these two issues not have been given greater prominence in a truly balanced Working Paper, intended as it is to “inform policymakers as to which combination of contract parameters might allow cash transfer programs to deliver the largest impacts per dollar spent”? Should policymakers not be told, upfront, that, on the evidence emerging from Malawi, unconditional transfers have identical benefits in terms of school enrolment and attendance to conditional transfers, while being far less complex and less expensive to implement; and that they appear to be much more effective in reducing disruptive early marriage and minimising psychological stress?

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[i] Baird, S., McIntosh, C. and Özler, B., ‘Cash or Condition? Evidence from a Randomized Cash Transfer Program’, World Bank, March 2010

Conspirational Cash Transfers

This blog first appeared on the Wahenga website, under the pseudonym of Sissy Teese

Is there a conspiracy afoot? Practitioners of social protection have long debated the relative merits of conditional and unconditional cash transfers. Now the World Bank appears to have introduced a third category. We label these conspirational cash transfers: cash transfer programmes about which the evidence is either suppressed or massaged in a conspiracy to support the case for conditional cash transfers!

Before looking at two examples of such schemes (or schemings), let us take stock. Conditional cash transfers (CCT) require beneficiaries to meet one or more conditions before they receive their transfer: for example, to ensure their children are enrolled in, or attend, school, or to have their children inoculated or regularly visit health clinics. Unconditional cash transfers (UCT) do not: they provide the transfer to everyone eligible, regardless of their behaviour.

CCTs fit much better with the World Bank’s philosophy of seeing social protection in dispassionate, purely economic terms. As a recent publication by the Brooks World Poverty Institute puts it: 

The World Bank conceptualizes social protection as social risk management and proposes policies that seek ‘to assist individuals, households and communities in better managing income risks’ (Holzmann and Jorgensen, 1999: 4). It moves beyond what it sees as ‘traditional’ social protection by adding the goals of macroeconomic stability and financial market development. The emphasis on risk assumes that vulnerability to hazards is a significant constraint on economic and human development, and that efforts to reduce the likelihood of hazards, or to ameliorate their effects on living standards, are essential for economic growth and development [emphasis added]

So the World Bank has been promoting CCTs all over the world, and has recently published a 383-page eulogy on CCTs. There can be no doubt in the reader’s mind after perusing this (or even its 28-page “Overview”) that CCTs have been remarkably successful in achieving their objectives of better education, nutrition and health outcomes for their recipients.

But - and this is the nub of the problem - UCTs have done exactly the same. Unconditional programmes, for example in South Africa, Namibia and Malawi, have been every bit as successful in improving health and education indicators among their beneficiaries as CCTs. So there is a legitimate question to be asked of the World Bank: why bother with the moral hazard, additional cost and complexity of imposing, monitoring and enforcing conditionalities, when unconditional programmes appear to have the same effects?

Answering this question is difficult, because it is almost impossible to unpick the reasons why a CCT programme works: is it because of the conditionality, because of the attendant awareness-raising, or simply because of the cash transfer itself. As Samson et al put it when discussing Mexico’s Oportunidades programme: 

[CCTs] combine three key mechanisms: grants that increase the income of poor households, awareness promotion that emphasises the importance of human capital, and conditionalities that link the two – making the grants conditional on behaviours that reinforce human capital development. The evaluations have successfully demonstrated that all three of these ingredients together can generate very positive results. However, the studies so far have been unable to identify which is most important – the income, the awareness or the conditionality[i]

But, just occasionally, the opportunity arises for the Bank to try to demonstrate that it is the impact of conditionality that determines the beneficial impact. And we document here two example of the lengths to which it will go to take full advantage of these opportunities - two Conspirational Cash Transfer schemes in Ecuador and Malawi.

The first, less flagrant but still revealing, comes from an evaluation of the impact of Ecuador’s Bono de Desarrollo Humano (BDH) cash transfer program on school enrolment and child work among poor children. The unusual thing about this programme was that (unlike most other such programmes in Latin America) it was not in fact conditional … though a number of its beneficiaries were under the impression that it was. This allowed a comparison of impact between recipients who were “conditioned” (i.e. who thought there were conditions attached) and those who were “unconditioned” (i.e. who thought there were no such conditions), which is discussed in a paper by Schady and Araujo[ii].

What is interesting here is the marked difference in the conclusions between a first version of the report dated November 27, 2005 (now virtually unobtainable), and the version published officially as World Bank Policy Research Working Paper 3930 in June 2006. The respective abstracts are already instructive. The earlier version reads as follows: 

We conclude that the program had positive effects on enrolment, and negative effects on child work. Enrollment effects are concentrated among the poorest children in our sample. We also show that the impact of the BDH program was largest among households who believed that transfers were conditional on school enrolment, although the effect of the (unenforced) condition appears to have interacted in important ways with baseline socioeconomic status [emphasis added]

The published version reads very differently:

The main results in the paper are two. First, the BDH program had a large, positive impact on school enrollment, about 10 percentage points, and a large, negative impact on child work, about 17 percentage points. Second, the fact that some households believed that there was a school enrollment requirement attached to the transfers, even though such a requirement was never enforced or monitored in Ecuador, helps explain the magnitude of program effects.

What has happened to the caveat about “interaction with baseline socio-economic status”? In the body of the first report, it is clear that - even at baseline - there are marked, observable differences between the “conditioned” and “unconditioned” samples: 

Conditioned households had significantly higher levels of both paternal and maternal education, children in these households were significantly more likely to be enrolled in school, and conditioned households were significantly more likely to have a television.

Such differences may well explain any differences in subsequent impact between the two groups. [There is also the obvious consideration, that, since the evaluation was based on self-reported school attendance and not on objective evidence such as school records, it is far more likely that respondents who believed the transfer to be conditional upon school enrolment would lie about it, compared with those who knew that telling the truth would have no impact on their entitlement. This would greatly inflate the apparent impact on enrolment for “conditioned” households.]

Overall, the findings in the earlier version are hedged around with provisos, recognising that: 

… enrolment regressions at baseline suggest that observable rather than unobservable differences between conditioned and unconditioned households explain differences in their enrolment decisions. We do not have the data to conclusively rule out this possibility [emphasis added] 

… we believe that it is most likely that the perceived, although unenforced conditions played some causal role explaining the large program effects among better-off, conditioned households [emphasis added]

And the conclusion is correspondingly circumspect: 

It would not be wise to conclude from our results that simply announcing that households have to comply with certain conditions, without enforcing them, will substantially affect household behavior in the long run, in Ecuador or elsewhere

In the published Working Paper (only six months later) such doubts are swept away: 

Although the comparison of lottery effects for conditioned and unconditioned is not experimental, we conclude that the general pattern of results is most consistent with the (unenforced) BDH schooling requirement having a causal effect on outcomes

 and the same paper ends now with a ringing endorsement of conditionality: 

In Ecuador, significant program effects on enrollment are only found among households who believed that there was an enrollment requirement associated with the program; this suggests that this unenforced condition was important

Interestingly, another contemporary study of the same programme in Ecuador[iii] finds “no significant impact of the program on school enrolment” and concludes that “the enforcement of conditionality has not any significant effect on school enrolment among the less poor”. This further underlines the need to retain the important caveats of the first version of the World Bank report.

The second egregious example of a Conspirational Cash Transfer is more recent, and comes from a World Bank experiment in Malawi. This was an evaluation of the impact of a randomized conditional/unconditional cash transfer intervention targeting young women in Zomba district that provides incentives (in the form of school fees and cash transfers) to current schoolgirls and young women who have recently dropped out of school to stay in or return to school. Splitting the sample - between some that received a transfer conditionally, some that received it unconditionally and some that received no transfer at all - allowed a comparison of different impacts between the three different groups.

Here again we can observe an unexpected evolution in the published results. The first set of findings is drawn from a publicly available PowerPoint presentation[iv] of the study. This concludes unequivocally that: 

We don’t find any evidence that the conditional transfers are more effective in improving schooling

And it suggests that the best way to design a cost-effective program, based on the lessons learned, would be “possibly foregoing the conditionality”!

Indeed, looking at the data presented (which unfortunately appears on slides in the PowerPoint that cannot be cited), it is clear that there is no significant difference at all between the conditioned and unconditioned groups in terms of school enrolment or literacy in English; and that it is the unconditioned group that performs better in terms of avoiding early marriage. Altogether, on this basis, the study would not appear to present a strong argument in favour of CCTs!

Yet what do we find when the same study is published as official World Bank Policy Research Working Paper 5089[v]? Miraculously the selfsame findings are used to proclaim: 

Overall, these results suggest that conditional (sic) cash transfer programs not only serve as useful tools for improving school attendance, but may also reduce sexual activity, teen pregnancy, and early marriage

 How has this come about? First of all by ignoring entirely the set of data from the unconditional sample. Tucked away in an unobtrusive footnote on page 11 is the following: 

283 of these girls resided in EAs where the offers for baseline schoolgirls were not conditional on school attendance, and, as such, are not part of the analysis for this paper

How convenient! Secondly by arrogating to conditional cash transfers all of the benefits that should rightly be ascribed to cash transfers. Another footnote on page 12 brushes this aside:

Finally, baseline schoolgirls in a randomly selected small percentage of the EAs received unconditional offers, meaning that the transfers were not conditional on school attendance, or any other behavior other than showing up to collect monthly payments, for these beneficiaries in those EAs. The analysis of the heterogeneity of the impacts with respect to each of these design features is beyond the scope of this paper. Here, we aim to establish the average effect of the conditional treatment arms, which may not equal the treatment effect of the average treatment if these impacts are nonlinear [emphasis added]

Quite so! The result is that an experiment which has actually demonstrated that unconditional transfers are every bit as effective as conditional transfers has now been manipulated to support a claim that: 

schooling CCTs (sic) for young women in the context of poor Sub-Saharan countries with high HIV rates seem like “win-win” programs, as they may not only increase schooling for young women, but also significantly reduce their risk of HIV infection.

Yes, the Zomba programme does appear to have extremely promising impacts: large increases in self-reported school enrolment, and declines in early marriage, teenage pregnancy, sexual activity, and risky sexual behaviour. But to claim that this has anything to do with conditionality per se is highly disingenuous. It is self-evidently the cash transfer and not the conditionality that is the cause.

Here we have an important debate, but it is one that should be aired openly and honestly. Policy-makers should be aware of both sides of the argument, and should not allow themselves to be pushed into Conditional - and still less into Conspirational - Cash Transfer programmes!

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[i] Samson, M., van Niekerk, I., and MacQuene, K. (2006) ‘Designing and Implementing Social Transfer Programmes’, Economic and Policy Research Institute Press, Cape Town: EPRI

[ii] Schady, N., and Araujo, M. ‘Cash transfers, conditions, school enrollment, and child work: Evidence from a randomized experiment in Ecuador’

[iii] Ponce, J., The Impact of a Conditional Cash Transfer on School Enrollment: the Bono de Desarrollo Humano of Ecuador”, FLACSO Documento de Trabajo 06/302, April 2006

[iv] Available at http://www.fundp.ac.be/eco/recherche/cred/SUMMERSCHOOL/amid/ozler2.pdf, June 2009

[v] Baird, S., Chirwa, E., McIntosh, C. and Özler, B., The Short-Term Impacts of a Schooling Conditional Cash Transfer Program on the Sexual Behavior of Young Women, World Bank, Oct 2009

One Out of Ten: Social Cash Transfer Pilots in Malawi and Zambia

An explicit objective of the current social cash transfer pilots in Malawi and Zambia is to learn lessonsⁱ. Between them, these schemes, which are now operational in over ten districts, have unquestionably provided a wealth of valuable information on how to implement cash transfer interventions in southern Africa. But they could, and should, also be providing important lessons in how not to operate such schemes: we need to have the courage to recognize this, and to broadcast the weaknesses as readily as we proclaim the strengths.

Recent studies have highlighted two major flaws in the particular model that is being tested: one practical and one conceptual. Unless and until these are resolved, it is unlikely that the pilots will receive the necessary technical and political support to scale them up to national programmes.

The practical flaw is that community-based targeting of the poorest does not work. It doesn’t work now, even in geographically-constrained pilot areas, where additional technical support and resources can be mobilized to support weak government and community institutions, so it will never work at more extended, less rigorously scrutinized national levels. A recent studyⁱⁱ in Machinga district in Malawi demonstrates this powerfully and graphically. The study undertook a random sample survey of households in Mlomba, and gathered data on each household (production, revenue, assets and other variables) to estimate that household’s “income”. Income was calculated as the “disposable” money remaining per adult equivalent after the household had met its essential food energy needs, either through purchase or own production (the 48.9% of households with negative income do not even reach this minimum acceptable nutrition threshold). The resultant income distribution of the sampled households is shown in Figure 1.

The standard model of targeting in the majority of Zambian and Malawian SCT pilot districts is to use community structures to identify the most labour-constrained households from within the so-called “ultra- poor” (estimated to comprise the poorest 22% or so of the community in both Zambia and Malawiⁱⁱⁱ). By definition, therefore, beneficiary households should both (a) be labour-constrained and (b) fall in the lowest quintile (20%) of household income. In the Machinga study, however, only half met the criterion of being labour-constrained (using the pilot’s own definition), and only 24% fell into the lowest income quintile (corresponding broadly to the 22% figure for the “ultra-poor” in Malawi). The majority (29%) fell into the third (middle) income quintile, and – staggeringly – 32% of selected households fell in the two wealthiest quintiles. Selected households are shown in red on Figure 2. This means, in effect, that fewer than 12% of households selected by the community to receive the SCT met the Programme’s targeting criteria. As the study wryly notes, “the relationship between income and household selection to receive the SCT was found to be effectively random”!

This leads on to the serious conceptual flaw in the current SCT model: that it is impractical, and unethical, to target SCTs at only 10% of a population in which some 60% are poor, and a further 20% or so are highly vulnerable to poverty: the situation that prevails in most of sub-Saharan Africa. Another recent paper^iv, by RHVP’s Frank Ellis, argues the theoretical case convincingly. His paper examines the circumstances of small economic difference which gives rise to the oft-expressed sentiment that “… we are all poor here”. Using national budget survey data from Malawi, Zambia and Ethiopia, the paper demonstrates that there are only very minor differences in per capita consumption (as a rule of thumb no more than US$2 a month) between each of the lowest six income deciles. In other words, there is no more than US$9-10 a month separating an individual in the poorest decile from an individual in the sixth decile.

Current SCT models are therefore unable to meet their goals of reducing destitution, “without inevitably creating some proportion of ‘leapfrogging’ by recipients above the levels of per capita consumption of non-recipients in adjacent income deciles”. Put simply, let us imagine that it were possible to target accurately the poorest 10% of a community (which the preceding paragraphs have shown to be a pipe- dream!). If you were to provide an SCT of US$6 per month to an individual within that decile – an amount which is fully consistent with current transfer levels (e.g. to a household with school-going children in one of the Malawian or Zambian SCTs) – then that individual would thereby be catapulted four deciles to be among the middle-income members of the community. This raises complex practical issues (such as the need for frequent retargeting), and serious ethical concerns around inequity and social divisiveness – both of which may seriously erode political support for such SCT programmes.

A third study^v, also supported by RHVP, casts further light on the potential for social division created by flawed community targeting. Through a process of social mapping, targeting exercises and group discussions in six randomly-selected villages (two in each of Malawi’s three regions), this study concluded in every case that targeting was “inappropriate”. A variety of reasons was given for this: that targeting is against the sprit of umodzi (togetherness); that it creates tensions in the village and provokes reprisals (even witchcraft) from those excluded; and that non-beneficiaries withdraw from community development initiatives. Contrary to suggestions by its proponents that community-based targeting may enhance social capital, this study found that “targeting in a context of high poverty levels breeds suspicion, hatred, accusations and corruption”. Similarly, assertions that social empowerment is achieved through participation in targeting processes are flatly contradicted by the study’s findings that “in all the villages except one community based targeting does not qualify to be a democratic process, with community leaders dominating the decision-making process”. The study concludes that “asking people to select one poor family against another is tantamount to procedural injustice … In a context of high vulnerability, targeting for a precious resource … is a matter of death and life. It is not surprising that communities are unwilling to pass that judgment”.

For a practical illustration of these conceptual problems, demonstrating that inaccurate targeting merely compounds much more invidious inter-household equity issues, we need look no further than the Machinga study cited above. If we add the value of the SCT received over the course of a year by each household to its pre-transfer disposable income, we can represent the impact graphically. Figure 3 shows the effect on recipient households (in red).

If we then re-order the same graph in ascending order of disposable income per adult equivalent (Figure 4), we can see that the beneficiary households are all now (after just one year of receiving the SCT) grouped in the top half of the income distribution chart. That is inequitable.

With the justification that a stated objective of the current raft of SCT pilots in Malawi and Zambia is to learn lessons, we need to be honest enough to recognise the fatal flaw in the prevailing model: that community-based targeting of an inadequate 10% quota is an unacceptable model for national replicability in sub-Saharan Africa. New targeting approaches – such as categorical schemes (social pensions, child benefits and disability grants), or targeting for exclusion rather than inclusion – need to be tested; beneficiary numbers need to be significantly raised to reflect national levels of poverty and vulnerability; and transfer amounts need to be adjusted to levels where they do not cause some lucky beneficiaries to leapfrog the standard of living of non-beneficiaries in the same communities. Recognising this would be an important step in the key process of gaining political support for the national implementation of comprehensive social protection schemes.

ⁱ Both countries’ schemes have as their third objective: “To generate information on the feasibility, costs and benefits, and on the positive and negative impacts of a Social Cash Transfer scheme”.

ⁱⁱ John Seaman, Celia Petty and Patrick Kambewa, “The Impact on Household Income and Welfare of the pilot Social Cash Transfer and Agricultural Input Subsidy Programmes in Mlomba TA, Machinga District, Malawi” (June 2008).

ⁱⁱⁱ The use of such estimates, derived from national data, itself worsens the targeting problem: a single proportion (such as 22% in Malawi) clearly cannot be expected to apply evenly across geographical and social space, even if it can be delineated satisfactorily at a national aggregate level. It follows that it will over-capture the kind of households it seeks to target in some places (wrong inclusion) while under-capturing such households in other places (wrong exclusion).

^iv Frank Ellis, “‘We Are All Poor Here’: Economic Difference, Social Divisiveness, and Targeting Cash Transfers in Sub- Saharan Africa” (Sept 2008).

^v Overtoun Mgemezulu, “The Social Impact of Community Based Targeting Mechanisms for Safety Nets” (August 2008).