Confronting poverty with cash

Natalia Winder Ross
A curious phenomenon has been recorded in some parts of Africa: people are becoming happier.
The recent surge in happiness has even caught the attention of African leaders.
At an April “expert consultation” in Cape Town hosted by the South African government, the African Union and UNICEF presentations that were made included an uplifting set of findings.

In Zambia, there’s been a 45 percent increase in the number of people who say they are better off than 12 months ago; Ghana saw a 16 percent increase in the proportion of people answering “yes” to the question, “Are you happy with your life?” Malawi has seen a 20 percent increase in people who say they are “very happy” with their life, and in Kenya, there’s been a 6 percent increase on the Quality of Life index.

According to an evaluation of the impact of social cash transfers by UNICEF and its partners presented to 40 African Union member states, people in some African countries are also eating better (Malawi and Zambia, for example, saw a 30 percent increase in food consumption while Ghana recorded a 10 percent decrease in the number of children missing a meal), are going to school more, are healthier (Liberia experienced a 20 percent increase in curative care seeking, Ghana a 20 percent increase in health insurance coverage), are better nourished; and are transitioning to adulthood with greater success (Kenya saw reductions in early pregnancy and sexual debut, while South Africa saw a 63 percent decrease in teenage girls having sex with older men).

The reasons behind all this, according to the study, are simple: thousands of people in impoverished communities suddenly have a bit of cash in their pockets.
Some 20 countries across Africa have embraced what are known as “social protection floors”.

In essence, a growing number of governments are deciding to provide cash transfers to the poorest and marginalised with no strings attached. The idea is that even a small amount of cash can tip the balance in favour of a family struggling to survive.

In countries where wages are often less than US$1 a day, cash transfers of as little as US$12 a month are having a profound effect.
Giving money to the poor isn’t new. In the 1990s, Brazil began giving “conditional” cash transfers to poor households in which school-aged children were enrolled in school. Today, it is African governments which are leading the way in developing “home-grown” social protection programmes designed to suit to their contexts. That is, unconditional cash transfers are building on existing community structures and hence addressing economic and social inequality.

Amid it all, rigorous evaluations have found that households receiving the cash do better.
They eat better food, they acquire livestock, and their children go to school.

These benefits defy notions that social protection is a handout.
Rather than create dependency, cash transfers are building poor people’s capacities to stand on their own and generate even more income.

In Lesotho, the Child Grant programme is expected to cover 25 000 poor and vulnerable households, reaching 60000 children by 2014, more than doubling in two years. Zambia’s expansion of its Social Cash Transfer Programme is expected to reach 190 000 households, or one million people by the end of 2014.

Similar expansion plans are also underway in Mauritania, Mali, Malawi, Niger and Zimbabwe, among others.
UNICEF continues to advocate for social protection in Africa, is supporting governments to develop and strengthen social protection systems, and is leading an innovative research initiative examining the impact of government-sponsored social cash transfers in sub-Saharan Africa – The Transfer Project.

However, despite the growing popularity of the programmes, questions remain about how and in what contexts cash transfers are most appropriate and effective. UNICEF hopes that lessons learned from the five-year Transfer Project will support national policy makers, who might otherwise be working in isolation, so that the benefits of giving money to the poor may continue to bring smiles to many.

Natalia Winder Rossi is UNICEF’s Senior Social Policy Specialist for Eastern & Southern Africa.