Sat, Nov 19, 2005 - Page 9 News List

Giving cash to fight hunger

As famine hits countries in southern Africa, aid organizations are at odds over a pilot scheme that is giving cash instead of food

By John Vidal  /  THE GUARDIAN , LONDON

Over the next few months, more than 10 million hungry people in six southern African countries will need Western help to stay alive after their crops failed disastrously earlier this year. A massive humanitarian effort is getting under way, led by the UN's World Food program. Ships full of American and Canadian grain will soon be crossing the Atlantic, trucks of maize will thunder up from South Africa to Malawi and Zimbabwe, and desperate people will be lining everywhere for handouts of maize, wheat and beans.

But in southern Zambia, one of the worst hit of the regions most affected by this year's unreliable rains, some families will not get food. A pilot project funded by the Department for International Development and run by Oxfam has just begun to hand out to households the equivalent of about US$20 cash a month -- roughly the price of a 50kg bag of maize and some beans.

With this they will be able to buy the food that they want from local traders, or use it to stimulate their economies. As the food crisis grows, Oxfam expects people will be given more money and the program will be expanded to about 86,000 people by the end of March. It is expected to be one of the biggest "cash transfers" ever tried in a humanitarian crisis.

The world's largest food-exporting nations such as the US and Canada, the UN's World Food program (WFP) and many non-governmental groups will be watching closely to see how well the Zambian experiment works. The idea of giving money rather than food or other commodities is still politically and socially controversial. Give people cash, say the sceptics, and you risk increasing insecurity and corruption, upsetting local economies, fuelling conflicts and excluding the most needy. Because of these and other fears, the overwhelming form of help by the West in underdeveloped world emergencies for the past 30 years has been "in kind" help with commodities.

INHERENT DANGERS

The WFP, which traditionally delivers food aid, says it is not convinced by the cash arguments.

"We're not against the transfer of cash per se, but there are inherent dangers," said Neil Gallagher, WFP communications director in Rome. "If donor agencies have a hard time controlling cash given to governments, how can they be confident they will get it to poor people? Why we like food `in kind' is that we can target the isolated and the vulnerable, especially the women."

But Oxfam, based on its own experiences and those of others handing out cash to Ethiopian, Somalian and tsunami-hit people, is pretty confident that the money will get to the most needy.

"We have worked out who are the poorest and most vulnerable and we are assuming that most people, if they're hungry, will spend money on food," said Ric Goodman, Oxfam country director in Zambia. "Giving cash gives people the flexibility to pay for other things, such as tea and oil, or they can keep their children in school, and retain their access to credit. They have a whole range of options."

Potentially, said Goodman, it is a lot cheaper. WFP food deliveries cost about US$7 per unit a month. Oxfam reckons it can get the price down to about US$4, but will be watching very closely to see if food prices rise as a result of cash injections.

"A growing body of evidence suggests that most of the sceptics' fears are myths, and that people given cash or vouchers overwhelmingly spend it on basic essentials," said Paul Harvey, a research analyst at the Overseas Development Institute in London. He said there is a growing move to give money rather than food and that it has the potential to help development as well as relieve suffering.

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