Cash for work pays dividends in Ethiopia's drought-prone areas

Hungry Ethiopians are being handed cash rather than food under a new scheme launched by a leading aid agency. Instead of relying on food handouts that are often sold to raise money, poor families have been able to buy the things they really need under the innovative project launched by Save the Children UK. The project has won plaudits countrywide and proved a big hit with the recipients. Farmer Alebe Begashaw was one of the first recipients of the scheme, being paid 75 Ethiopian Birr, around US $10 dollars a month. “The money has been very useful. This year has been a good crop year so we can get a lot with our money – more than if we were being given food.” In return for the cash, Alebe had to work for 15 days of the month, building stone walls that stop the leaching of nutrients from the ground by stopping water pouring off the hills or building terraces which prevents erosion and helps increase crop yields. “I have been able to use the money to buy things that we need and if some goods in the market are cheap I can buy those,” said Alebe. “I have been able to buy my children some pens for school and salt. The advantage is we can go to different markets where things are cheaper to spend our money as well.” Alebe lives in North Wollo, the region hit by the infamous 1984/5 famine that claimed a million lives and where around 40 per cent of the population still depend on food aid. “This pilot has been a great success,” said Stephen Blight, the Emergency Director of Save the Children UK. “We were worried about two main things – whether giving cash would increase the price of food in the local markets so that it would be inaccessible, and whether the households would use the cash for basic necessities like food or not. On both counts our experience this year has been very positive,” he added. The scheme – which saw £140,000 (nearly US$200,000) handed out over eight months - had a number of advantages over traditional food handouts. Families no longer had to walk miles to receive food aid from distribution centres, as the cash is far easier to transport. They also complained that once they had the food they would have to pay for a donkey to help them carry the food back to their villages. In a review of the scheme Save the Children found that the price of food in the markets stayed low or if it increased families looked for other goods to buy. The recipients also would travel further afield to buy their food if prices were cheaper. Traditionally families receiving food assistance would also sell part of the handout to help buy other necessities but would only receive a small amount of money because it had been handed out for free – driving down its price. Although Save the Children UK believes the project has been a great success they played down the benefits and warned that the scheme could not be used every year. “We would not try this in a very bad crop year, however, and we still feel that food aid continues to have a vital role in years of serious harvest failure,” Mr Blight added. “But perhaps the most important point is that people were empowered by having a choice about how to use the support, and they used it wisely.” The scheme was a success because it plays on market forces. Although there are desperate food shortages in some areas others have had large surpluses. In Gojam in northwest Ethiopia for example grain prices have plummeted because of the good harvest and in Bale in the south prices have also fallen. But in areas where the rains have failed, like the Somali Region, almost a million people remain dependent on food aid. It means that those who need food have too little money to buy it while those who produce a surplus cannot make any money because prices plummet. Bringing in large supplies of food aid from outside the country distorts the market further because farmers in surplus areas are unable to compete with food being given away for free. John Graham, Director of Save the Children UK admits the ‘Cash for Relief’ scheme may sound controversial but said the results speak for themselves. In their study around 94 per cent of the money handed out to families was spent on food. The scheme has been funded by the British Government’s aid arm, The Department for International Development (DFID). Peter Kirby, their food security specialist in Ethiopia, said he was extremely impressed with the pilot project. “One of my concerns,” he added, “was what happens to the cash when it is handed to the male head of household – is it still used for food and other basic necessities or does he use it to go off and buy beer. “I asked women in the households receiving the cash what they thought and they said that all the households discussed the use of the money and it was used for the most urgent household needs.” “We had one funny incident with a woman who said her husband was no good and would spend the cash on beer and other things. She said she went to the local officials to complain that her husband should not get the cash given to him. The officials agreed and the money was given directly to the woman instead of her husband.” Save the Children launched workshops on the findings of the project and now plan to expand the scheme next year. They hope to work alongside donors and the Ethiopian Government.