Transfer values – how much is ‘enough’? (Part 2)

In the second of this two-part blog, Calum McLean, Ludovico Carraro, and Simon Little  – experts from the FCDO- and GDC-funded SPACE initiative – dig deeper into the issue of discrepancies between humanitarian and social assistance transfer values. They explore why such a marked difference in values is the norm and why this can be problematic in certain contexts, before setting out some core considerations for better alignment.

As observed in part 1 of this blog, there is almost always a large gap between the level of transfers set for humanitarian assistance and social assistance (non-contributory social protection programmes). So why the disparity?

At least partly, there is a difference in the objectives of humanitarian programming and social assistance. The former is primarily intended to save lives and reduce unnecessary suffering through meeting peoples’ basic needs (food, shelter, WASH, health, nutrition etc.) whilst the latter focuses on alleviating poverty and offering vulnerable people greater household security. Secondly, at least in the way they are initially conceived, humanitarian transfers are generally short-term in nature and relatively unpredictable (though this is frequently not the case); and social assistance may be provided to individual families for several years with a high degree of predictability.

The humanitarian/social assistance transfer value divide: meeting basic needs vs complementing existing income

Transfer values for multi-purpose cash in humanitarian programmes tend to be based on a (Survival) Minimum Expenditure Basket (S/MEB) (Cissokho, 2018), calculated to cover basic needs at current market prices.  There may be differences between what is included in the calculation depending on availability, context, and the preferences of beneficiaries, but there is a basic method that is followed by most programmes. We say based, because the transfer value does not necessarily match 100% of the MEB and in these cases might better be defined as a contribution towards it.  Covering a proportion of the MEB may be justified for several reasons, such as beneficiaries’ existing capacity to meet some of their own needs, or access to other modalities such as in-kind distributions. For some contexts, such as protracted refugee crises, the transfer value may be set at a lower level to avoid social tensions between host communities and the refugees especially where the former are receiving low transfers of social assistance (e.g. Turkey).

Social protection transfers tend to follow different objectives and timeframes, addressing a specific disadvantage (such as disability or old age) or enabling target groups to escape a poverty trap. The premise is that social assistance complements efforts made by households to earn a living and transfer values can therefore be set much lower than total needs. Social assistance systems tend to base transfer values on national poverty lines or minimum wage standards (see Part 1 of this blog) rather than a quantification of minimum expenditures.

For these reasons, when we compare transfer values between humanitarian cash and social assistance programmes the differences are stark. In Somalia for example, a social protection transfer of US$20 is provided per family per month. This constitutes just 29% of the average humanitarian cash transfer (US$70) which itself represents a contribution of only 70% of the MEB. Across the Red Sea in Yemen, the social protection payment is nine times lower than humanitarian transfers designed to meet food needs only (i.e. only the food element of the MEB).

When and why does this discrepancy in transfer value become problematic?

When humanitarian cash and social protection programmes have operated independently, the issue of disparate transfer values has not been particularly significant. However:

• On one hand, social protection systems are increasingly geared towards shock-responsiveness by offering temporary support to vulnerable people affected by shocks- as we are seeing in the context of COVID-19. In this scenario, is the transfer value offered by the social protection systems sufficient? Humanitarians would argue that unless the transfer value meets the cost of basic needs (or contributes significantly towards them), then this undermines humanitarian principles and the ethos of being needs-based. Clearly, the severity of the shock will have some bearing on this argument: a person displaced by conflict, with only a few possessions and no access to their normal livelihoods, is going to need more help than someone affected by the early stages of drought for example. Another argument in favour of more generous transfer values comes from ‘Cash Plus’ research that suggests that the ‘plus’ element will have minimal impact if the transfer value is too low to meet basic needs (e.g. nutrition outcomes) (REFANI, 2017).
   
• On the other hand, lack of coordination across humanitarian and social assistance programmes can lead to undesirable (conflict-enhancing and trust-undermining) situations of people living next door to each other receiving significantly different amounts solely based on who they are being supported by – with routine social assistance recipients drawing the short straw. As a pre-COVID-19 example (O’Brien et al., 2018) in Lesotho, Child Grant Programme beneficiaries who received the routine transfer plus, an emergency top-up, still received substantially less per month than the recipients of World Food Programme separate emergency cash assistance – and not because they were any less vulnerable.

If, in a context of an emergency, larger transfers have a greater impact, then existing social protection systems need to be sufficiently ‘shock responsive’ (TRANSFORM, 2020) to adjust amounts for the period required to overcome the crisis. This has happened extensively in the COVID response – across 78 programmes in 58 countries according to the World Bank mapping (Gentilini et al., 2020) – yet the issue has been the ‘adequacy’ of these increases, as discussed in Part 1 of this blog. Temporarily increasing transfer values for government-led programmes also poses complex questions of raised expectations and long-term sustainability that humanitarian actors typically do not need to deal with (as much or as directly) – not to speak of considerable trade-offs with coverage and other objectives (see our SPACE Strategy Decision Matrix spelling these out (SPACE, 2020)). Humanitarian and social protection actors ultimately face different trade-offs and incentives that it is important to acknowledge upfront.

Narrowing the gap: harmonisation vs homogenisation

How do we address potential equity problems in the different levels of support provided by humanitarian and social assistant transfers? There are multiple dynamics and ethical dimensions to consider when seeking to align flexible humanitarian cash and social protection programmes, but no one answer. Context is clearly a major element, with basic needs, impact, coverage, equity, and last but not least, funding, all considerations that need to be fully taken into account. The arguments for harmonising humanitarian cash transfer values with social assistance payments are persuasive, but do not necessarily mean completely homogenising programming.

This blog is part of the blog series ‘Social Protection Approaches to COVID-19’ from Social Protection Approaches to COVID-19: Expert Advice (SPACE). It is funded by the UK Foreign, Commonwealth and Development Office (FCDO) and German Development Cooperation (GDC). SPACE is managed by DAI Europe Ltd contracted through the FCDO framework agreement EACDS Lot B service ‘Strengthening resilience and response to crises’, and the technical advice is provided by independent consultants contracted by FCDO, GIZ and other partners.

List of References

Barca, V. et al. (2020). SPACE Strategy Decision Matrix, SPACE, Accessible: https://socialprotection.org/discover/publications/space-strategy-decision-matrix 

Cissokho, N. (2018). Definition of minimum expenditure baskets (MEB) in West Africa, The Cash Learning Partnership (CaLP), Accessible: https://www.humanitarianresponse.info/ru/operations/asia/document/calp-minimum-expenditure-basket

Gentilini, U. et al. (2020). Social Protection and Jobs Responses to COVID-19: A Real-Time Review of Country Measures, Washington, D.C.: World Bank Group, Accessible: http://documents1.worldbank.org/curated/en/454671594649637530/pdf/Social-Protection-and-Jobs-Responses-to-COVID-19-A-Real-Time-Review-of-Country-Measures-July-10-2020.pdf

O’Brien, C. et al. (2018). Shock-Responsive Social Protection Toolkit – Appraising the use of social protection in addressing large-scale shocks, Oxford Policy Management (OPM), UK Department for International Development (DFID), Accessible: https://www.opml.co.uk/files/Publications/a0408-shock-responsive-social-protection-systems/srsp-toolkit.pdf?noredirect=1 

Seal, A. et al. (2017). REFANI: Research on food assistance for nutritional impact - Synthesis report November 2017, REFANI, Accessible: https://www.actionagainsthunger.org/refani

TRANSFORM (2020). Shock Responsive Social Protection – Manual for Leadership and Transformation Curriculum on Building and Managing Social Protection Floors in Africa, Accessible: https://socialprotection.org/discover/publications/transform-full-document-srsp