It is a very exciting time to be a humanitarian. Last year awoke a sense of innovation and change that has permeated every area of our work. Working to transform the sector by working better with local actors, mainstreaming between development and humanitarian, exploring ways of working with the private sector, identifying innovative models of financing. Cash transfers and other market interventions are usually part of the conversation.
The call for more cash comes with an understanding that using this modality is effective for meeting people’s needs. The call for more cash is also driven by the concept of efficiency - we can reach more people using cash modalities. In a world of growing needs and decreasing funding, financial responsibility should be everyone’s priority. If effectiveness is part of our mandate, efficiency should not be a choice.
Perspective is everything. Are we doing enough to understand efficiency from the perspective of the people we aim to serve?
We constantly talk about putting people at the centre without any concrete actions to make that intent operational. I suggest we go low tech to understand the problem by changing perspectives. Children as young as two understand the power of walking in others shoes to see or experience something from someone else’s point of view. Shoe-shifting is a proven technique used in psychology to generate empathy. How does efficiency look from the view of affected populations?
The tools and policies we have regarding efficiency for cash emphasise efficiency with respect to costs to the provider for delivering cash to the beneficiary. But receiving a cash grant also produces costs for beneficiaries. Costs that can be readily monetised like return transport to the distribution site, return transport to markets for purchases, the cost of utilisation, lost income and bank charges. As well as other costs which are harder to monetise like increased risk of violence.
While the evidence to support the use of cash programming is strong there are few studies documenting the costs incurred by beneficiaries or that have incorporated these costs into measures of cost-efficiency and cost-effectiveness. Operational agencies agree and recognise the need to evaluate efficiency from both the agency and the aid recipients’ perspective but as usually happens in this sector if you don’t measure it, it doesn’t matter. What we need is specific ways of understanding these costs and including them in our program design.
Why does putting people at the centre matter when understanding efficiency?
Putting people at the centre of cash programme design and implementation matters both from a technical and strategic perspective.
In general, there appears to be a trade-off between costs for the implementer and those for beneficiaries: as payment or distribution points get closer to beneficiaries, costs for the implementer get higher, while the transaction costs for beneficiaries dwindle. On the flip side, programmes that seem less expensive could be because the cost of accessing transfers had been shifted from the implementer to the beneficiary. If we do not measure these costs then how can we recognise and find the technical solutions to mitigate the associated risks?
Also, if we continue to conceptualise efficiency from the perspective of donors and agencies, cash transfers risk losing effectiveness. If we don’t use our capacities to understand, from the beneficiary point of view, the real effects of receiving a cash grant, then we won’t be able to understand if it is actually the best way to assist them. If a beneficiary has to cover external costs resulting in a reduction of the available money they have to cover their needs, the outcomes of the programme are compromised.
In this regard understanding efficiency from the point of view of the beneficiary becomes crucial to the global push to scale up cash programming. NGOs, in particular NGOs who operate locally, have an extremely value role to play to ensure beneficiary perspectives are known and central to programme design. Understanding local context through community engagement ensures the choice of utilising cash and the design of the program is efficient for both beneficiaries and donors. World Vision is in the process of exploring this issue to improve our programme design and evaluation through the operational footprint of the whole Partnership.
As any two-year-old or any doctor in psychology will tell you – the most important thing you need to be able to do to walk in another’s shoes is get out of your own. When we are exploring different funding models for the future of cash programming we need to understand that there are other ways of looking at efficiency. We need to develop inclusive efficiency indicators incorporating both aid provider and beneficiary perspectives.
It’s time to cut through all the rhetoric of putting people at the centre that surrounds the Agenda For Humanity, the New Ways of Working and the Grand Bargain. Understanding what efficiency means from the view of affected communities is not only practical, it should be at the core of bringing cash to scale.
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