Cash Transfers Offer Security, ‘Resilience’ for Zambia’s Poor, As Country Expands Reach of Grant Programs, AIR Studies Find

Washington, D.C. – Three years into a program offering cash grants to some of rural Zambia’s poorest families, the program continues to reduce poverty and increase economic security, but one critical need is still unmet because so few services are offered in the region: improving the nutrition and health of young children.

The findings come as Zambia is expanding the reach of the cash transfer concept, aiming a new variation of the program at poor households that have fewer able-bodied people to farm. Both programs are the subjects of new studies based on randomized control trials conducted by the American Institutes of Research (AIR).

“After many false starts and hard battles, this region is finally on a positive trajectory,” said Stanfield Michelo, director of social welfare at Zambia’s Ministry of Community Development, Mother and Child Health. “Without a doubt, this would not have been possible without AIR’s rigorous evaluations.”

The studies are likely to be closely watched as African nations turn to cash transfers to address the continent’s cycle of poverty. South Africa’s program is the largest, with roughly 16.1 million people—about a third of its population—receiving some kind of social grant.

AIR’s evaluation of Zambia’s initial effort, known as the Child Grant cash transfer program (CGP), offers evidence that small-scale cash transfers to poor rural households with young children—in this case, the transfers began at 60 kwacha a month or $12 U.S.—can stimulate economic activity while alleviating poverty.

Begun in 2010 in three of the country’s poorest districts, the program is open to all households with at least one child beneath the age of five. No strings were attached to how the money could be spent. In these districts, researchers interviewed the heads of more than 2,500 households, about half of whom were randomly assigned to receive the cash transfers, comparing their experiences with those not in the program. UNICEF Zambia hired AIR to evaluate the program and named the initial 2013 report one of its best research studies of the year.

“Three years in, families that received cash transfers are significantly more secure in terms of their finances and food supply, and are more resilient so they can withstand surprise setbacks,” said David Seidenfeld, AIR principal researcher and lead author of the study. “At the same time, the report’s big takeaway for the government, donors and policymakers is that cash alone can’t accomplish everything. The region needs to invest in health and education services to fully realize the potential of the cash transfers.”

As for the nutritional and educational needs of children, the latest report on the CGP concludes that “there may be a limit to what demand-side intervention can accomplish for children in a situation with a low supply of services.” For example, only 30 percent of communities that participated in the study are within three kilometers of a health facility, and more than half of these lack oral rehydration salts, a critical drug for addressing diarrhea in young children. Further, only 13 percent of these communities have a primary school and even fewer have a secondary school.

Besides the three-year report, UNICEF released a 30-month follow-up study focusing on Zambia’s harvest season, allowing researchers to address the critical issue of whether households receiving the cash transfers change their habits during a time of relative abundance. Both reports homed in on the program’s vital role in reducing debt and allowing households to make critical investments, making “resilience”—or the ability to withstand setbacks—a key impact of the program.

The findings on resilience were echoed in the evaluation of Zambia’s newest cash-transfer program—the Multiple Category Targeting Grant or MCTG. Retaining several features of the Child Grant program—recipient households in two of the country’s poorest districts received the equivalent of $12 a month, with no restrictions on spending—the MCTG was aimed at households that tended to have a “missing generation” of parents in their 30s and 40s and lots of adolescents and orphans cared for by widows and grandparents. With fewer able-bodied people to farm, such households face unique challenges.

A randomized control trial of the program after 24 months found:

• Greater food security, with 11 percent more households eating two or more meals a day.
• An increase in assets, especially goats and chickens, and a strengthening of existing sources of income such as farming. This resulted in greater self-reliance, decreasing dependence on friends and relatives and reducing debt.
• Greater enrollment in primary school for boys (a 9 percent increase) and a particularly large (19 percent) boost in enrollment in secondary school for girls.
• No impact on adolescent’s HIV-related sexual behavior, early marriage, pregnancy or mental health (possibly because it is “too soon” to observe such impacts).

“Experience from the MCTG and CGP evaluations together provides useful lessons for cash transfer programs across Africa,” according to the report. “First and foremost, they demonstrate the undisputable conclusion that small, predictable sums of money placed in the hands of the poor are used effectively to achieve results that are in the best interests of society as a whole.”

Find the three-year study on Zambia’s Child Grant cash transfer program, as well as the 30-month report and the initial, 24-month study of Zambia’s Multiple Category Targeting Grant at www.air.org.

About AIR
Established in 1946, with headquarters in Washington, D.C., the American Institutes for Research (AIR) is a nonpartisan, not-for-profit organization that conducts behavioral and social science research and delivers technical assistance both domestically and internationally in the areas of health, education and workforce productivity. For more information, visit www.air.org.

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