UNICEF CASH GRANTS IN EMERGENCIES – KYRGYZSTAN CASE
EMOPS can advise on designing a cash grants programme. The modalities of support are flexible and will be
adjusted according the needs of the CO team.
Contact: Mads Oyen moyen@unicef.org and Claire Mariani cmariani@unicef.org, Humanitarian Policy Section,
EMOPS
1 /What is a cash grant programme?
• Provides cash grant to vulnerable and/or crisis-affected households with no obligation to repay.
• Creates direct purchasing power for basic needs of affected households.
• May be part of part of a Disaster Risk Reduction strategy. It has a positive impact on people’s
livelihoods and increase resilience to shocks.
2/What cash grant in emergencies can and cannot achieve? Can:
• Lead to direct expenditure on children’s nutrition, health and education
• Build social capital, promote dignity and empower vulnerable households
• Be responsive to the changing priorities of affected households
• Be at the core of Early Recovery and national capacity development approaches
• Transfer large resources directly to children and women in a short period of time with low overheads
Cannot:
• Alone cannot address the root causes of vulnerability and bring vulnerable households up to a level or
resilience where they would not require assistance in the face of a crisis, but they may increase the
resilience of households through asset creation and asset preservation. It is important for
complementary measures to be in place and appropriately funded.
3/ Key principles for Using Cash Grants
The provision of cash grants needs to be guided by UNICEF’s humanitarian principles and CCCs. In
addition, core principles for cash grant programmes include the following:
• The targeting and selection phase of the beneficiaries is the key phase of a cash grant programme:
o
Households should be targeted based on vulnerability, a focus can be done on household with
children under a certain age if needed
o
Households should be targeted and not the individual child to avoid stigmatization and to
foster a protective environment
o
Child headed households should be included, where appropriate
o
Selection process should be transparent with a strong involvement of the community leaders
• Ensure maximum simplicity in the design, especially in low capacity contexts
• Ensure programme design and implementation are assessed through participatory approaches including a
focus on the principle of “Do no harm”
• Cash grant programmes need to be accompanied by a good communication strategy to ensure clear
understanding of the programmes and achievement of outcomes
• Ensure that in the longer term, cash grant programmes are included in an integrated social protection
approach
Where possible, implementation should be done through, or in close partnership with government, and
should link with efforts to strengthen social service systems
4/ Feasibility of cash grants programmes in Kyrgyzstan
Cash grants are one option available to UNICEF to complement emergency services and supply deliveries.
For these, the following conditions should be in place:
• Access to functioning markets for beneficiaries, with sufficient quality of available goods;
• Adequate safety for implementation;
• Functioning funds distribution structure – the choice of the distribution mechanism should be locally
base. Several possibilities exist and have been used in others countries:
o Bank system (ATM cards)
o Phone operator, the money is transferred on SIM cards
o Partnership with small local traders
o Direct hand to hand distribution by a NGO – possible when no other alternative and very
short timing
Because of its versatility, cash can be an appropriate intervention in all stages of an emergency – from
pre-crisis preparedness, during relief and Early Recovery, through to recovery, and can be an effective
contributor to Disaster Risk Reduction.
4/Challenges and Opportunities
As a relatively new form of intervention for UNICEF, the provision of cash grants presents both challenges
and opportunities. Some of the challenges might include:
• Gender: Cash is often most effective when directly targeted and placed under the control of women, and
empower them within the household and community.
• Security and corruption: providing cash to affected populations may make them vulnerable to being
exploited, but might also be less visible than in-kind alternatives. When distributed directly to
beneficiaries, it may actually pose less of a risk than in-kind alternatives, which are subject to looting
and corruption.
• Transition from emergency cash grants to conditional cash grants, that are payments to positive
behaviors, like school attendance and use of specific health care services
• Cash for work is problematic as it risks excluding most vulnerable people, like single mothers, and
divert precious labor away from child care.
• Targeting cash assistance can be divisive, especially in an environment with existing tensions within
communities. Implementing a cash assistance programme needs to ensure proper public communication
and sensitizing.
5/ Monitoring & Evaluation
• Monitoring of results consistent with CCC performance monitoring and requiring ultimately outcome
level indicators;
• Process monitoring to ensure that guidelines and procedures are being applied as intended which
requires structured systematic field visits including consultation with affected populations; financial spot
checks and audits.
Given the high profile and perceived high risk of cash grant programmes, independent evaluation must be
planned
6/ How UNICEF can use this approach?
UNICEF can assume a role to play both a funding agency and an advocate for the use of cash grants. As a
funding agency, UNICEF’s primary role is to:
• Contribute to program planning and design;
• Monitor program implementation;
• Monitor adherence to best practices in financial accountability and control;
• Evaluate the outcomes and impact of the program
• Coordinate with national authorities, clusters and other agencies
7/Examples From UNICEF’s Experience
• Following the 2004 tsunami, UNICEF observed how cash transfers allowed households to make spending
decisions according to their specific circumstances, and to address the diverse needs of children in the
household.
• In Indonesia after the 2004 tsunami cash was provided with a child protection agenda of preventing
secondary separation, as families who were caring for separated or orphaned children often did not have
the economic means to continue to care for additional children.
• Cash grants were used as a response in Georgia in 2008, an example where cash was successfully used
with no prior planning.
• Cash has been used in DR Congo, showing that cash can be used effectively in countries with limited
market opportunities.
• In Niger, the current experiences with NGOs partners shows that cash is a relevant alternative to food
distribution
Additional Lessons Learned
General Lessons on Cash Assistance
 In addition to the quantifiable benefits, cash can also enhance a sense of empowerment and dignity
among recipients. Cash-for-work projects can produce additional psychosocial benefits as people go back
to destroyed areas to mourn, to take stock and to think. The physical activity of clean-up can also be
welcome. (DFID, 2005, p.15). However, cash-for-work also risks excluding the most vulnerable. It was
found that 90% of respondents would have preferred cash to non-cash relief in the first three months after
the tsunami. (Scheper et al., 2006, p.96)
 Unconditional rather than conditional cash transfers can be better in states where services are
weak, including in emergencies; monitoring may be required for conditional cash transfers and may be
problematic in crises. In very low-income countries, the quality and delivery of social services are often
poor, and could be further compromised in emergencies. The potential for conditionality to work
effectively under these circumstances is weak. Reviews of unconditional cash transfers in emergencies,
such as cash-for-work programmes, show that the household is better able to meet basic consumption
needs with unconditional cash transfers.
Risks
 Risks of cash assistance undermining informal or traditional support systems are low, even when
formal social protection is lacking, and can in some cases actually aid government capacity building.
 Targeted cash assistance can be divisive and community participation in defining criteria is therefore
essential for mitigating tension. Cash targeting involves identifying a group of beneficiaries according to
specified selection criteria. (SCUK, HelpAge International & IDS, 2005)
 Misuse and corruption is no more prevalent in cash transfers than for commodities and in-kind aid.
(Gore, 2006, p.28-29)
Targeting
 A scheme does not have to target children in order to reach them or to have positive impacts on
their well-being. In these programmes, two important defining factors are: the duration of the cash
transfer and the child’s access to the cash transfer through a caregiver, i.e. the adult beneficiary. (SCUK,
HelpAge International & IDS, 2005, p. 26)
 Cash transfers targeted at women can have a stronger overall impact on development indicators,
particularly on girls. For instance, studies from Brazil and South Africa report that when a woman
received old age pension, the impact on nutritional status and school enrolments among co-resident
children was stronger, particularly for girls (Barrientos & De Jong, 2004).
 Targeting should not rely on purely technocratic or economic parameters, but rather use criteria that are in
step with local culture and norms and use methods that are participatory. (Oxfam, 2005b)
Security
 Security problems of cash transfers can be less serious than assumed and risk minimized by various
distribution mechanisms such as bank or money transfers. The concern is that staff who implement cash
programmes and the recipients of cash transfers may be exposed to increased level of threat. However,
food may not be as easy to loot as cash, but food convoys are visible and easy to attack. Cash deliveries
are less easy to see. (Creti & Jaspars, 2006)
 In some cases, where local banks or money transfer systems are functional, cash may be the more
secure alternative. In Afghanistan and Somalia, the local hawala (money transfer) system was used to
distribute cash; in Ethiopia, SCUK sought insurance coverage against losses in transporting cash to
projects in areas where there were no banks. (Harvey, 2005)
Timing
 Cash transfer is most beneficial when being applied to the transitional phase between survival and
livelihood rehabilitation. In the tsunami experience, a degree of sustainability will be ensured by
transitioning from direct cash transfers targeted to children to income (livelihood) support for the most
vulnerable households (UNICEF, 2005a), since agricultural and farming livelihoods and productive
employment were greatly affected by the tsunami. The cash transfer project represented a transitional
phase to fill the gap between a situation of survival to a more regular, normalized situation. (Gore, 2006,
p.42)
Possible impacts on local population
 In low-income countries, emergency cash assistance may only lift recipients from critical to
moderate poverty. While cash transfers do raise incomes directly, this is often not enough to lift people
above the poverty line, though it can help reduce the severity of their poverty. The pilot cash transfer
scheme in Zambia provided a monthly cash sum which translated to a second meal for the household if
the entire cash transfer is spent on maize. The transfer may not lift the households out of poverty, but
rather assists in survival. (Schubert, 2004)
 A potential result of injecting cash into the local economy is an increase in prices of goods. The cash
transfer can cause a marked and sudden increase in the demand for goods, with the result that traders are
encouraged to charge higher prices. This can hurt both beneficiaries and non-beneficiaries of cash
transfers. Beneficiaries will get less for their money and non-recipients of the cash transfer will be worse
off since they are faced with higher prices and no change in their income. In-kind alternatives do not
cause inflation, though they may distort the market in other ways; for instance, food aid may depress the
price of food, thus hurting local producers." However, the net result of cash assistance may be more food
for families. "The key point is that inflation is not unequivocally a negative effect, and that under the right
market conditions, the risk of inflation is low." (Gore, 2006, p.32)
Education Sector
 Cash incentives for facilitators and teachers can be a crucial measure for ensuring teacher
attendance in community-based schools. In Afghanistan, economic instability undermined efforts to
improve education. Many teachers stopped working because the communities could not support them as
intended. The introduction of cash incentives to teachers gave them more economic stability to perform
their job. In addition, cash given to facilitators has improved education monitoring and reporting also.
(Wirak, 2008)