When emergency strikes, the rich world sends food. But would it be better to send money? John Vidal explores a very topical controversy.

Over the next few months, more than 10 million people in six southern African countries will need western help to stay alive after their crops failed. A massive humanitarian effort is under way, led by the UN’s World Food programme, the Department for International Development, aid agencies and national governments. Ships full of North American grain are even now crossing the Atlantic, lorries of maize and cassava are thundering up from South Africa and countries with food surpluses, while traders are hoarding food in expectation of the price rising and people are queuing patiently for handouts.

But in southern Zambia, one of the worst-hit regions, 10,500 families received no food in December. DFID, working with Oxfam, has started handing them the equivalent of about $20 cash a month – roughly the price of a 50kg bag of maize and some beans. The idea is that they can go to their local markets and buy the food that they choose, or use it to stimulate their economies. As the food crisis inevitably grows until the next crops are harvested in March, Oxfam expects people will be given more money and the programme will be expanded to about 86,000 people.

The Zambian scheme is expected to be one of the biggest “cash transfers” ever tried in a humanitarian crisis – and the world’s food-exporting nations such as the US and Canada, the UN’s World Food Programme (WFP) and many NGOs are all watching closely to see how well it works. The idea of giving money rather than food or other commodities is politically and socially controversial.

Give people cash, say the cash sceptics, and you will increase insecurity and corruption, upset local economies, fuel conflicts and exclude the most needy. Apart from being physically risky for people handling the money, they say, cash may disadvantage women who are less able to keep control of it. Because of these and other fears, the overwhelming form of help by the West in developing world emergencies for the past 30 years has been “in kind” – food.

But, the growing band of cash advocates responds, the potential benefits are enormous. Theoretically, the money can go far further because the transport and logistics costs of taking money around are up to two-thirds lower. Giving cash lets people decide what they should spend their money on, and, they say, it can have knock-on multiplier effects for local markets. They also maintain that cash is more dignified than food in the sense that people can avoid waiting in degrading queues. Moreover, they claim, cash has the potential to help development as well as to relieve suffering.

There’s not much empirical evidence either way, but what there is so far suggests that most of the sceptics’ fears are unfounded, and – this is important – as long as there is food to be bought in the region and the market can respond, people overwhelmingly spend any money or vouchers they are given on basic essentials. Giving cash has been tried successfully after the Montserrat volcano, the Bam earthquake and the tsunami, as well as the first Iraq war and in the Palestinian territories in 2002. The Red Cross, Oxfam and Christian Aid have tried it in Afghanistan, Somalia and Ethiopia – but all on a limited scale.

Oxfam is confident that the money will get to the right people in Zambia. “We have worked out who are the poorest and most vulnerable. So far, from the limited monitoring we have done, we have found that 95 per cent of the money has been spent on productive use”, says country director Ric Goodman. “People bought mainly maize, cassava, oil, sugar, and salt. A very few spent some of it on education. There have been no reported misuses. Giving cash gives people the flexibility to pay for other things. They have a range of options.”

So why has cash not been used more by agencies and governments? According to a discussion paper by the Humanitarian policy group at the Overseas Development Institute (ODI) , the barriers to cash are institutional and organisational. The whole humanitarian system, it says, is structured around food aid and there are few local, national or international organisations with any experience in handling cash rather sacks.

Clearly, one problem is that food aid is very big business, worth $3-4 billion a year, and therefore highly political. Countries with surplus food, like the US, may tie their gifts of rice or wheat to their own strategic objectives. It has been used in the past to dump heavily susbsidised grain surpluses, to improve trade figures, to reward favoured groups of farmers and transporters. Because there are so many vested interests in subsidies – food aid plays an important part in world trade. The EC has made the link most clearly, phasing out food aid as far as possible in favour of cash grants.

But there is another, seldom-addressed cultural reason why cash is not used much for humanitarian aid. According to the ODI discussion paper, there is a sense within humanitarian agencies that cash is psychologically threatening, even dangerous. Giving people money, it says, means letting go of control and power, and it fundamentally changes the relationship between the donor and the beneficiary. Giving food may have hints of superiority, even echoes of colonialism. Giving the needy money suggests a transfer of choice.

Much is at stake. Food handouts have been the backbone of humanitarian aid for 50 years, and they are unlikely to be dropped, but as governments gain the confidence and NGOs gain the skills to handle cash and not just food, it is more than likely that cash will be used at least as an addition to food aid. This in turn means that agencies and governments will need to learn new skills and to trust their people more.

Cash is largely uncharted humanitarian territory, and much work needs to be done before it is used on a wide scale. It’s one thing to feed 86,000 people in one area of Zambia or in an earthquake-devastated city, but no-one has much of a clue what would happen if, say, $200 million cash was handed out in Zimbabwe or Malawi, or if planes were filled up with dollars instead of sacks of food and tents.

The arguments are tossed around in the West, but they are largely irrelevant to the poor in Zambia, Malawi, Zimbabwe and southern Africa. They, after all, do not much mind how the food gets to them, as long it gets there quickly.

John Vidal is environment editor of the Guardian

Cash is the best way to support the most vulnerable people in the developing world says CARE’s Robby Mwiinga.

Zambia is the 12th poorest country in the world. Ongoing cycles of poverty and a deepening food crisis already threaten the security of able-bodied people who are fit to work. Imagine, then, just how harsh life is for those living in extreme poverty – the elderly, widows and widowers, chronically ill people and families caring for orphans. Often with no able-bodied person, these households rarely participate in traditional development programmes. Typically they are also socially excluded from community affairs and considered unable to contribute to their communities’ welfare. 

Money – what we call “social cash transfers” – provides precisely the kind of financial safety net these highly vulnerable households desperately need. 
CARE’s programme, run in partnership with Zambia’s Department for Social Welfare, gives $10 a month to the 10 per cent most destitute households in the two districts where it operates. When it is fully rolled out, it will provide support for over 3,000 households. 

It may not sound like much, but it is enough to give destitute households a level of security they have not enjoyed before, enabling them to eat two meals a day and to access social services such as health and education. It also creates opportunities for them to gain some sense of worth and a voice in their communities. And for the many households looking after children, such regular and sustained financial support will go a long way towards reducing inter-generational poverty. Crucially there are no conditions on how the money is used – households are free to spend it on whatever they need most. 

Some officials in the Zambian capital of Lusaka have expressed misgivings about giving money directly to the poor, and fear the money will be misused. This has proved to be unfounded. In a CARE pilot in Kalomo district, households used their money for food, medicine, soap and investing in livestock such as chicken and goats. 

Good targeting is critical to the programme’s success. Decisions about who to target are made by the communities themselves. They complete a questionnaire for each household, including details like household structure, socio-economic profile, livelihood strategies and causes of destitution. A committee meeting is held to identify the 10 per cent most destitute, before the group presents its recommendations to the whole community to approve. Such targeting ensures transparency and takes into account locally defined dimensions of destitution.
 
In Zambia, providing a regular cash income for the most destitute is an idea that is yet to take hold – which is why CARE is working closely with the Zambian Government’s Department for Social Welfare. Our ultimate goal is for the Government to take this on as part of its social protection responsibilities with yearly budgetary support. This is the only sustainable future for this kind of programme. CARE believes this is the right response for dealing with extreme poverty and the only effective safety net for the most destitute households.

More information at: 
www.care.org

Providing food is still the best way to help most of the hungriest of the hungry, says World Food Programme’s Gregory Barrow.

For the past four decades, the World Food Programme (WFP) has carried food aid into countries where malnourished populations need assistance and, wherever possible, purchased food locally to support indigenous farmers in the very countries where the hungry live. In fact, the WFP is currently the largest single purchaser of goods and services on the African continent, spending some £800 million in Sub Saharan Africa last year.

Food has proved to be a powerful tool in reaching not just the hungry, but also the most vulnerable among the hungry. Food given to women and children tends to be consumed by women and children. Bags of maize cannot be easily swapped for cigarettes or beer and the stories of food being turned into fleets of Mercedes Benz, are few and far between.

Food is also traceable, bulky and difficult to hide. When Mobutu Sese Seko was President of Zaire, there were no stories written about the grain mountain or lake of vegetable oil he had stashed away in some quiet corner of his country. By contrast, the stories of Swiss bank accounts stuffed with ill-begotten gains were legion.

Despite the obvious advantages of food aid, WFP has an open mind when it comes to the alternative possibilities offered by cash and voucher schemes. In an effort to determine the best tool to alleviate hunger, WFP has taken part in, and will continue to participate in, pilot schemes where cash or vouchers are introduced as part of an overall relief package.

However, when populations are facing food shortages, food aid may well be the most appropriate intervention in areas that are remote from markets. Conversely, cash aid that can be monitored may have an advantage in situations where food is plentiful but inaccessible to the poorest sections of society – such as areas close to urban markets or at times close to the harvest of crops.

But cash would have little value to the Sudanese refugees who fled Darfur last year and ended up living in camps in one of the remotest regions of Chad. Neither would it have been much use to Pakistanis trapped high in the mountain ranges of Kashmir after last month’s earthquake.

While concern has often been expressed about the distorting effect of food aid on local markets, these kinds of reservations could equally be applied to cash or voucher schemes. These may in some cases lead more directly to rampant inflation, thereby excluding greater numbers of people from access to basic food items.

Finally, one part of the debate about “cash versus food” highlights the relative cost of food aid interventions in comparison to cash or voucher interventions. Of course it is going to cost more to transport food rather than banknotes or vouchers to remote parts of the African continent. But it is far easier to ensure the food gets where it belongs.

Sadly, in the real world, public and government donors are often slower to disburse cash than they are to provide food aid in kind. History has shown that food aid has been a saviour on countless occasions when cash donations have been slow, or don’t appear at all. This has made a real difference to those on the receiving end, ensuring that they get assistance quickly, effectively and precisely when they need it.

More information at:
www.wfp.org