On World Food Day, 5 reasons why cash transfers aren’t always the best option

Since the Asian Tsunami of 2004, providing cash to people in an emergency has become increasingly mainstream. larissa-pelham-picBut (babies, bath water) there is more to food response than ‘just give them the money.’ On World Food Day, Oxfam Social Protection Adviser Larissa Pelham sets out the case:

The King asked The Queen, and The Queen asked The Dairymaid: “Could we have some butter for The Royal slice of bread?”

pelham-1The Dairymaid She curtsied, And went and told The Alderney: “Don’t forget the butter for The Royal slice of bread.”

The Alderney Said sleepily: “You’d better tell His Majesty That many people nowadays Like marmalade Instead.

Children’s writer AA Milne manages to muse cheerfully on most of life’s trials and tribulations in his writing and he’s hit the nail on the head again with this one. We’ve become so incredibly partial to ‘marmalade’ – cash – to help people access food in a crisis these days, that suggesting alternatives in response to recent emergencies can face push back even from within our own organisations.

Here are five reasons why cash isn’t a panacea.

Sometimes food is what people need and it can be ‘market friendly’, last week’s Hurricane Matthew which has affected 1.4 million people, being a poignant example. Homes, store cupboards and cooking equipment are buried, roads to markets are inaccessible and where Oxfam is working, there are initial reports of near total destruction of crops and livestock. People need a good meal inside them now so they can keep going. So Oxfam is trying to set up local kitchens to provide warm meals to people run by female ‘restauratrices’, this provides food, helps the labour market to recover and targets women. It’s simple, basic and essential.

The markets for households to purchase food aren’t always there, and don’t always bounce back as quickly as we

Undernourishment, 1990-2015 (source: FAO)
Undernourishment, 1990-2015 (source: FAO)

think/hope: Our own aid practices might have stifled them entirely, government policies and politicking may be silencing them, the lack of other vital markets like transport and fuel availability can be a hindrance or it can be too risky for traders to operate, particularly in conflict settings, as the ongoing crisis in South Sudan shows. And even if they are there, that ‘invisible hand’ is not always benign for the poorest purchasers: in the Malawi crisis back in 2002 traders hoarded to artificially inflate prices.

Unsurprisingly, cash alone isn’t enough. Long term social protection programmes (i.e. welfare, for those that don’t think that’s a dirty word) in developing contexts, recognised this a number of years ago. It’s what you do with your cash – and some people are better at using their cash than others. And so they decided on ‘’cash plus’. Give people cash plus a few other things besides such as training in different skills to improve their job opportunities, or seeds and tools or business planning and then they can really ‘maximise’ what they do with the cash. Well established programmes such as Ethiopia’s Food Security Programme have been doing this for years, combining a safety net with building household assets. The humanitarian sector is just catching up with this. And as OPM’s research is exploring, we humanitarians must get better at using existing schemes, rather than building costly, unsustainable systems from scratch.

And of course, prevention is better than cure – we all know that but the humanitarian sector is the most stubborn of leopards. We should be acting early with a range of appropriate interventions instead of distributing cash to resolve the problem afterwards. This doesn’t fit with donors’ planning processes, the competing demands for media attention, or the public’s responsiveness to pictures of utter destitution, but that’s where the re-focus needs to happen, so that we have the resources to avert crises in the first place.

pelham-3And finally, like the King’s desire for butter, there’s no accounting for taste, whatever the current trend. We’re not all utility maximisers in a neat economics equation. We’re all different and not necessarily predictable. It’s what happens around the family dinner table, or underneath the makeshift tarpaulin, well behind closed ‘doors’, that is what really matters about individuals’ consumption. And that’s something we need to find out. Maybe too, some people just prefer food – particularly women: they can have more control over food and there can be less risk of abuse or assault than with cash although evidence to date is inconclusive. This means that marmalade isn’t necessarily best for us, or what we all want all of the time.

Sometimes a little bit of butter is OK.

The Queen took The butter And brought it to His Majesty; The King said, “Butter, eh?” And bounced out of bed.
“Nobody,” he said, As he kissed her Tenderly, “Nobody,” he said, As he slid down the banisters,
“Nobody, My darling, Could call me A fussy man – BUT I do like a little bit of butter to my bread!”


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3 Responses to “On World Food Day, 5 reasons why cash transfers aren’t always the best option”
  1. Abdoulaye Hamidou

    To decide to give cash to affected people, some steps must be followed and most of them are listed here. In general, cash is distributed when it can be spent. It is why a cash project designing must follow at least these steps: 1) need assessment based on the local context: it must provide information to take decision to assist or not and where ; 2) market analysis because it is the place to spent the cash: this step will give information on existence, access (infrastructure and road), goods/food availability, price,…: it will help to define the amount of cash need to cover the need of affected population in terms of food and other essential needs; at this step it must decide to distribute cash or not; 3) designing the programme/project; 4) market monitoring to insure that markets continue providing goods for affected people assisted as anticipated before designing the programme/project; otherwise, the project management should revise the response strategy. But sometime all these steps are not followed for various reasons: time limited, expertise availability, engagement with donors,…

  2. Jeremy Loveless

    Two other situations in which cash might not be the best option:
    1. When there is high inflation. Cash loses its value quickly and it may not be possible to adjust the cash distribution fast enough to cope (it may not be possible to change it at all). In-kind items (including food) retain their value.
    2. Services (health, education etc.). Providing (say) vouchers for redemption at specific quality-checked facilities (clinics, schools etc.) ensures that people get safe and effective services.

  3. Stuart Worsley

    There are no absolute rights or wrongs here. It entirely depends on the context. In Ethiopia where I currently work, cash distribution has worked well in the recent drought affected lowlands. With new infrastructure developed over the past 10 years, small traders are now able to move commodities around. In past years, distributions by NGOs has succeeded in decimating local capability by destroying existing trade channels, and has created intractable dependency. This year, we have been able to sustain local capability to bring in food and other needed items. The system (government plus donors) has been able to get the food to the country. The road and rail infrastructure has enabled this food to move to places where traders could move it. Our motto has been “support, don’t smother”. For us, it seems to have worked well. But it is not the only method. The key is to engage with the existing system, with its people and its institutions. Providing food directly seems to be more of an over ride of local competence to be used where nothing else will work. Cash welfare systems for us have helped restore resilience.

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