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«DIREC TIONS IN DE VELOPMENT Human Development Public Disclosure Authorized The Cash Dividend The Rise of Cash Transfer Programs in Sub-Saharan Africa ...»

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These problems are compounded when considered jointly with other sources of vulnerability and poverty in the region, such as exclusion, patronage politics, insecure property rights and landlessness, environmental degradation, and conflict stemming from ethnic differences.

Finally, recent financial crises and price volatility have sharpened the interest of certain policy makers, notably Africans themselves (see box

2.1 in chapter 2), in using different methods to address persistent and often deepening vulnerabilities. Noting the success of cash transfers in other parts of the world, stakeholders have increasingly asked whether CT programs could address the complex challenges present in SubSaharan Africa. Key questions include whether CTs are appropriate in Sub-Saharan Africa and, if so, what factors increase a program’s probability of success and maximize its potential outcomes.

Cash Transfers 13 The Review of Cash Transfers, an Emerging Safety Net in Africa Growing excitement over the potential impacts of cash transfers in SubSaharan Africa needs to be balanced by a thorough understanding of the way CT programs work in different contexts throughout the continent.

The success of CTs in Asia or Latin America does not necessarily imply that CT programs would be just as successful in Sub-Saharan Africa.

Additionally, the design of programs in other regions may not be entirely appropriate when transferred to Sub-Saharan Africa. An assessment of the programs’ feasibility requires an understanding of the broader status of social protection in the region and a closer look at how well existing CTs have worked in specific contexts of different SubSaharan African countries.

Scope and Role of the Review In 2009, this growing interest in the use of cash transfers in Sub-Saharan Africa led the World Bank to initiate a desk review of all CT programs in the region. Important overviews of social protection in Africa have already been completed (for example, Ellis, Devereux, and White 2009;

Taylor 2010). Other reviews have provided excellent information about CTs (such as Andrade 2008; Barrientos and Holmes 2007; Barrientos, Niño-Zarazúa, and Maitrot 2010). However, the scope of prior reviews has not been as comprehensive as that attempted here, both in its identification of CTs and its analysis of program components. This review attempts to supply up-to-date information on countries’ experiences with CTs throughout the region, as well as to provide a comprehensive overall analysis of the region’s programs. Sub-Saharan Africa has significant experience with various types of CTs, and such experiences will be useful as other countries, both within and outside the region, continue to develop their own programs.

The initial review of the CT programs was conducted from April 2009 to June of 2009. The analysis in this book includes only those programs with official information sources that were known to have started by the end of June of 2009, unless otherwise specified. Supplementary information for the review was collected through the end of 2010, but new programs were not added to the analysis.1 The review was conducted with assistance from those working in social protection within Sub-Saharan Africa, and it is meant to benefit that group. Its intended audience is those in the development community with an interest in the past experiences and current state of cash 14 The Cash Dividend transfers within Sub-Saharan Africa. Therefore, the book assumes that the reader is familiar with the basic components of social protection and CTs. Although a cursory review of major relevant concepts is provided, throughout the text the reader is referred to other sources for further information.

Programs Covered in the Review The decision regarding which types of programs to include in the review was driven by the need to understand how cash-based programs provided by formal institutions (the state, donors, nongovernmental organizations, and so forth) have been used in Sub-Saharan Africa. Therefore, other social assistance programs that solely provide food or in-kind transfers, as well as voucher-based programs, are not covered. Because interest was based on programs that provided benefits to individuals or households only, grants given to communities or other groups were not included in the analysis. All types of CT programs were included, regardless of their focus on emergency assistance or economic development.

The parameters of the study were also driven by a wider World Bank review of social assistance programs, which divided the review of CTs from that of public works and other programs that some might include under the definition of cash transfers. For this reason, cash-based public works programs were excluded from the review. Nevertheless, some CTs are part of larger programs that provide in-kind transfers or vouchers or that have a public works component. Because these programs also provide the type of cash transfers covered by this review, they are included in the current analysis, with attention directed to their CT components.

A total of 123 CT programs were identified,2 though only a subset of these programs is described in detail in this book. The CTs uncovered in the region are diverse. They range from emergency one-time transfers to unconditional, noncontributory social pensions to conditional cash transfer programs with human capital development objectives similar to the flagship Latin American programs.

Activities in the Review The review comprised several activities. Initially, public documentation related to Sub-Saharan African CT programs that existed since 2000 was reviewed. (The list of countries included in the desk review is provided in box 1.1.) This portion of the study included examining documents that discussed program components, execution, and evaluation; loan agreements; and the political economy. It is believed that almost all of the Cash Transfers 15

–  –  –

major relevant public documentation available at that time was accessed and reviewed. Additional supporting documentation was also examined in an effort to understand the state of social protection in Sub-Saharan Africa and to ascertain the interest of countries and development partners in certain types of CTs.

In an effort to supplement the review of program-related documentation, key individuals working in the identified CT programs were contacted via e-mail to solicit additional information on the programs. These 16 The Cash Dividend individuals were informed of the nature of the project and asked if they had additional information or documentation regarding the program of interest or pertaining more generally to CTs throughout the region. The individuals contacted were those listed on public documentation, as well as others known to play a role in CTs in Sub-Saharan Africa. They included high- and mid-level officials in relevant programs and their lead ministries, members of the donor community, and other researchers.3 More than 200 individuals were contacted during this process, with a response rate of approximately 50 percent. Many individuals provided supplemental program documentation that had not been accessed already, complemented by their written insights into the relevant programs. More than 25 individuals agreed to and completed telephone interviews, which typically lasted between 30 minutes and one hour.

Several others were interviewed in person. Interviews covered additional details about the programs and how they functioned, as well as issues related to political will and program perception, which were more difficult to obtain from the program literature.

Limitations of the Review Support and insight from African policy makers were invaluable to the review. However, in general, responses were more readily elicited from the donor community than from individuals within specific programs on the ground. Difficulties associated with contacting and communicating with some policy makers and program implementers within countries have led some discussion in this book to be driven relatively more by the perspectives of the supporting community of donors and academics than by the perspectives of Africans themselves (particularly those in lower-level positions). This potential bias has been kept in mind, and every attempt has been made to fairly represent programs in light of this limitation.

Obviously, more information was available on programs that have existed for several years or that are larger in scale. Also, documentation was more easily obtained for programs that have received strong external support. Any tendency to focus on programs that have greater ties to the donor community is driven by the comparatively greater availability of information on those programs rather than any sort of preference for them.

Likewise, documentation and information on emergency one-off or short-lived transfers were more difficult to obtain, and it is not clear that every single program of this type from 2000 or later has been identified.

These short-term programs often lack the documentation that larger, long-term programs have. In some cases, very little information was Cash Transfers 17 obtained about these programs, which limited the extent to which they could be included in the analysis in chapter 3. Despite this limitation, a major effort was made to ensure that all of these programs were identified. Whenever relevant information was uncovered, it was used in the analysis. However, these programs are often not discussed at length, and detailed information provided in the appendixes does not cover most of these CT programs because of their small size, their short duration, and the dearth of official information about them.

Charts and descriptions in chapters 2 and 3 may also be biased by the availability of information on specific program characteristics. To the extent that programs without available information differed systematically from those with data, the analysis will be biased. In light of these limitations, the analysis presented is intended to provide a general look at the state of CTs in the region rather than to provide a definitive breakdown on all programs in Sub-Saharan Africa.

The insights this book provides are primarily in the general analysis of program characteristics in chapters 2 and 3. Because information on some program aspects, particularly those related to softer issues, was sometimes limited, the discussion in these chapters varies between numerical analysis of program components and more general descriptions and anecdotal evidence. This variation in approach was driven by the availability of information on each topic.

An additional weakness of the review was its inability to incorporate many details of how the political economy affected the programs.

Although this limitation caused the analysis to focus on many of the more easily quantified program features, readers should be aware that soft issues also played a role in the programs’ success in the region. Context is of utmost importance, and CTs should be designed with that in mind.

Politics—at both the local and national levels—remain key to the success of all programs. The analysis presented here should be interpreted with the understanding that these softer political issues are paramount and that simply getting program basics right (that is, targeting, monitoring, payment systems, and so forth) may not be sufficient if these other issues are not fully addressed.

Finally, this review of country experiences with CTs in Sub-Saharan Africa provides a useful starting point for readers who want to understand the scope and design of CT programming in the region. It claims only to broadly summarize experiences and provide data and insights that may shed light on cross-cutting and cross-country issues of program design and implementation. Although useful in itself, it cannot take the 18 The Cash Dividend place of more in-depth assessments generated by those extremely familiar with the dynamics of each program’s unique environment.

What Are Cash Transfer Programs?

Before moving on, readers will find it important to clarify what the term cash transfer program refers to throughout the remainder of the book. For the purposes of the review, such programs provide noncontributory cash grants to selected beneficiaries to satisfy minimum consumption needs.

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