SOCIAL CASH TRANSFER PROGRAM EU Call for Proposals for Alternative Delivery Mechanisms Information Session, 30 th March, 2011.

SOCIAL CASH TRANSFER PROGRAMEU Call for Proposals for Alternative Delivery Mechanisms Information Session, 30th March, 2011

Background

April 2006: Participatory process of designing and testing a cash transfer program begun

Sept 2006: Launch of SCTP pilot scheme in 4 Traditional Authorities in Mchinji District with UNICEF funding

Nov 2006: Cabinet endorses Mchinji pilot and instructs for extension to six additional districts of Chitipa, Likoma, Salima, Machinga, Phalombe and Mangochi.

Jan 2007: USD 9 million allocated from Global Fund for AIDS, Tuberculosis and Malaria (GFATM) through the National AIDS Commission (NAC) to finance the pilot phase

Feb 2007: A National Social Cash Transfer Secretariat is established in the Ministry of Gender Children and Community Development

To contribute to national efforts to reduce poverty and hunger among ultra poor and labor constrained households.

To increase school enrolment and attendance of children living in target group households

To improve health, nutrition, protection and well-being of vulnerable children in target group households.

Objectives of the Program

Target

Ultra poor: households that have few or no assets, little or no land, limited or no labour

Labour constrained: no able bodied household member in the age group 19-64 who is fit for work (are chronically ill and/or are child/female/elderly headed); or households with a dependency ratio of more than 3

At full scale (national coverage) program estimated to

reach 300,000 households

Targeting

SCTP uses Community Targeting

Targeting is conducted by Community Social Support Committees (CSSC’s): comprise of literate community members elected by the community

Lists of the targeted households are presented at a Community meeting for approval / disapproval

A final list of targeted households is presented to the District Social Support Committee for final checking and approval / disapproval

Targeting Inclusiveness

The SCTP targeted households comprise of the following groups of people: Elderly Orphaned and vulnerable children Female-headed households (with more than

3 children) Child-headed households Chronically ill and or HIV-infected persons Disabled members

Payment Modalities

Payments are made at village-cluster pay-points mapped out by the District Assembly (DA)

Payments are made every month except for Likoma where payments are bi-monthly

Payments are made by DA accountants who are

accompanied by policemen for security

This mode of payments is labour intensive and partners are

currently exploring options of using Electronic payment

systems for cash delivery

Transfer Levels

Household Amount (US$) Amount (MK)

1 person $4 MK 600

2 person $7 MK1,000

3 person $10 MK1,400

4 + person $13 MK1,800

Categories Amount (US$) / child

Amount (MK) / child

Enrolled Primary School Children

$1.3 MK200

Enrolled Secondary School Children

$2.6 MK400

Child Education Bonus

Beneficiaries access monthly transfer

payments at a pay point

Beneficiaries access monthly transfer

payments at a pay point

Listing of households based on Form 1

Listing of households based on Form 1

CSSC Training;

Collection of household data with Form 1

CSSC Training;

Collection of household data with Form 1

Community sensitization meeting:

Selection of Community Social Support Committee

(CSSC)

Community sensitization meeting:

Selection of Community Social Support Committee

(CSSC)

Village Headman signs Form 1 to verify

information is correct

Village Headman signs Form 1 to verify

information is correct

Community ranking meeting (household list discussed and approved

by community)

Community ranking meeting (household list discussed and approved

by community)

SCT Secretariat approves / disapproves

beneficiaries

SCT Secretariat approves / disapproves

beneficiaries

Extension Workers verify households

selected

Extension Workers verify households

selected

SCT Secretariat informs community on

final list

SCT Secretariat informs community on

final list

1 2 3

4 5

7 8 9

6

Flow Chart of Targeting, Approval & Payment Process

Coverage

District Mchinji Likoma

Machinga

Salima Mangochi

Chitipa

Phalombe

Total

Beneficiary Households

10761 196 4246 2686 4859 4208 3496 30452

Elderly headed

5543 132 2477 1035 3153 2187 2631 17158

Female headed

5911 142 3132 1487 3670 1956 2748 19046

Child headed

109 1 65 20 61 12 156 424

Individual Beneficiaries

35182 773 18452 7792 20260 10672 13146 106207

Children 21861 291 12975 4614 14494 6015 8075 68425

Orphans 20049 369 8831 3896 10263 4323 5884 53615

Elders 6934 162 3047 1513 3435 2479 2883 20453

Disabled 929 52 268 133 336 296 270 2284

Coverage Map

MCHINJI (10,761 hhs)

SALIMA (2,686 hhs)

MACHINGA (4,246 hhs)

PHALOMBE (3,496 hhs)

MANGOCHI (4,859 hhs)

CHITIPA (4,208 hhs)

LIKOMA (196hhs)

Funding

Government of Malawi (Human resources and transfers amounting to MK50million in the 2010/2011 fiscal year)

UNICEF (Technical and Financial assistance for design of SCT pilot and for SCT program and Secretariat)

The Global Fund(WB,DFID,CIDA,NORAD) (US$ 9 million for the pilot in all 7 districts till 2011).

Irish Aid (Funds for transfers amounting to Euro850,000: 2010/2011)

German Government (Funds for program amounting to 13 million Euros: 2011-2013)

Improved health and nutrition: over 80% of HHs reported intensified food diversity with meat and fish and 45% use of dairy products

Education: increased school enrollment from 87% - 95%, retention, improved performance; decrease in stigma

Food Security: 90% of HHs purchased livestock - ownership of livestock increased by 7 times

Economic multiplier effect: cash received by beneficiaries is used in the local community

Improved housing and living conditions

Impact (Boston University Evaluation Report)

Capacity: Manual payments demand the presence of a number of officers from different departments at the DA, including the hiring of policemen for security

Time factor: a) Timely disbursement of fundsb) Implementation time

Fiduciary Risk: Manual payments demand millions of kwacha to be withdrawn in cash and ferried by DA accountants

Monitoring: Manual payments are limited in providing accurate evidence of cash drawn / cash management (i.e. saving)

Challenges to be Addressed by E-Payment System

Communication: Manual payments demand a strong communication network for informing beneficiaries of pay day

Beneficiary freedom / choice: Manual payments demand beneficiary presence on days set by the DA

Corruption: Manual payments can easily be manipulated

Distance of Travel: Current payment system does not provide for multiple pay-points in one village cluster

Challenges to be Addressed by E-Payment System

Dignity of Beneficiaries

Provide additional financial services to beneficiaries and the surrounding community (especially in respect to mobile banking)

Provide access to improved network coverage

Encourage saving culture

Additional Benefits of an Electronic Payment System