Social cash transfers in Africa: conditional or unconditional?

The Latin American experience with conditional cash transfers has been generally successful, and there is some support for their introduction to low-income African countries. However, there is little evidence to suggest such programmes will work in Africa. Serious questions concerning the differences between the two continents need to be answered first.

A paper from Overseas Development Institute, UK, considers whether cash transfers to poor households in Africa should be conditional upon their accessing social services such as health and schooling facilities, as in Latin America. The author argues that the differences between Africa and Latin America, where conditional cash transfers (CCTs) have had success, mean that conditionality may be inappropriate in low-income African countries.

In the 1990s, a number of Latin American countries, including Brazil, Mexico and Nicaragua, set up schemes providing (mostly) cash to poor households. In Africa, countries such as Mozambique, Zambia, Malawi and Ethiopia have implemented similar schemes, but with a focus on achieving food security for the poorest households rather than their long-term development by, for example, increasing school attendance. None of the African schemes have introduced conditionality.

Some agencies, including the World Bank, feel that African countries should also attach conditions to social cash transfer programmes. By applying conditions, programme designers try to influence the behaviour and attitudes of target households in a way that they consider suited to poverty reduction. Conditionality also tends to be more acceptable to policymakers and taxpayers.

There are four types of concerns as to whether the Latin American experience with CCTs can be applied to low-income African countries:

• Service delivery agencies (such as health and education) may not be able to meet increased demand (in terms of quantity and quality): in Chipata, Zambia, the number of children applying for school enrolment exceeds school capacity by 20 percent.
• Low-income African countries may not have the administrative skills and resources to implement large-scale cash transfer schemes further complicated by conditionality.
• Conditionality could impose administrative costs higher than its potential benefits.
• There may be socio-cultural, ethnic and political differences between African countries and Latin America that would make conditionality inappropriate: donors may also fail to understand these differences.

In September 2006, the Zambian Social Welfare Department and CARE International started to study the costs and benefits of conditionality in Chipata. Such research is essential to establishing whether conditionality is suited to the African context.

The authors recommend the following to policymakers designing social cash transfer schemes for Africa:

• keeping the administrative costs as low as possible, taking into account the budget constraints of low-income African countries
• improving the capacity of social welfare services, and keeping the organisation for transfer schemes as simple and as undemanding as possible through a clear definition of objectives and target groups, effective targeting and reliable delivery
• further research on the pros and cons of CCTs versus unconditional schemes under different conditions, in partnership with national governments, donor agencies and social researchers.

Source(s):
‘Social Cash Transfers in Low-Income African Countries: Conditional or Unconditional?’, Development Policy Review, Vol.24, No.5, pages 571-578, by Bernd Schubert and Rachel Slater, 2006
Free online access to this article for HINARI subscribers Full document.

id21 Research Highlight: 17 March 2007

Further Information:
Rachel Slater
Overseas Development Institute
111 Westminister Bridge Road
London SE1 7JD, UK

Tel: +44 (0)207 9220300
Fax: +44 (0)207 9220399
Contact the contributor: r.slater@odi.org.uk

Overseas Development Institute, UK

Other related links:
‘Reducing poverty through cash transfers for African children’

‘Special gift: social transfers for health and education’

‘Is cash the best way to assist poor and vulnerable people?’

DFID – Social transfers and chronic poverty: emerging evidence and the > challenge ahead (PDF)

World Bank - Poverty and Social Transfers in Hungary

IFS - How effective are conditional cash transfers? Evidence from Colombia (PDF)