The Ethiopia Graduation Pilot builds on the government of Ethiopia’s food for work program.
A few months ago my colleague Aude de Montesquiouwrote on the launch of the Ethiopia Graduation Pilot. We were both in Mekelle in the North of Ethiopia with the Relief Society of Tigray (REST) last week, where the pilot has just got underway. Tigray has a population of over 4.3 million people of which 80% reside in rural areas. The region is characterized by endemic food insecurity and an estimated 90% of the population earns less than two dollars a day.
The 500 participants in this graduation pilot have been selected in 10 communities that are particularly poor, ecologically diverse (both dry and dry-wet zones) and relatively accessible for REST staff. Participants in the program have been selected based on their food insecurity, their vulnerability to shocks, their household’s irregular income, landlessness and the fact that they own no large livestock such as oxen.
Building on the recommendations from the market analysis conducted last year combined with REST’s experience, participants have been encouraged to choose among the following livelihood options: sheep and goats, cattle fattening, honey production, petty trade, and an “open” option. All have already been trained in these activities and the asset transfers have just started.
The government public works stipend (15kg of grain or 150 birr per household member) will provide five months’ of in-kind support and one month of cash support paid out over the seasonal lean period—this is when participants particularly need the extra “breathing space” provided by the support. Savings are mandatory, and 80% of participants have already opened individual savings accounts at Debit Credit & Savings Institute.
On the research side, Innovations for Poverty Action has already completed the baseline survey with the participants and 500 randomly-selected control households. BRAC Development Institute has started its first round of in-depth interviews to understand the process of change in participant’s lives.
Fonkoze started Chemin Levi Miyo, or Pathway to a Better Life in Haitian Creole, in 2008 to tackle rural Haiti’s extreme poverty in a holistic manner. The program is one of the nine pilots in the CGAP-Ford Foundation Graduation Program, a global effort to understand how safety nets, livelihoods, and microfinance can be sequenced to create pathways for the poorest out of extreme poverty, adapting a methodology developed by BRAC in Bangladesh.
The face of extreme poverty in Haiti is multifaceted, and this reality holds strong for the rural poor in Haiti. Macro-level constraints such as limited access to markets, a dearth of employment opportunities, absence in social safety nets, and virtually no social accountability at the local level contributes to the complexity of Haiti’s deprivation. Fonkoze’s graduation program provides five main areas of support: a cash stipend and provision of productive assets to help build sustainable livelihoods and food security; access to health services and savings to reduce vulnerability, close support of program staff who provide enterprise training, advice, and most important, moral support to help participants build skills, confidence and “agency”; provision of housing renovations, water filters, and school uniforms to improve social conditions; social links with village elites to help build up social networks for the poorest.
Our final evaluation of the program six months after its end shows that poverty levels of members has reduced, and this is directly attributable to increased ownership of livestock (which went up by from 5% to 39%), improved housing conditions, and greater land cultivation. A very promising result is that the percentage of members suffering from food insecurity with hunger has declined by over 50% since the program start. In addition, health seeking behaviour (going to a health clinic in case of illness) has improved for over 40% of members. The number of participants reporting that all or most of their children are regularly attending school increased from 27% to 70%. In depth qualitative interviews also show that most members gained self-confidence, and say they have greater status within the household.
At the pilot stage, the program has demonstrated significant positive impact upon the lives of its members with 97% per cent of the 150 women that participated “graduating” out of the program. Seventy-five percent of them have continued on into TiKredi, a small loan program. In one site, all of the program members who graduated into TiKredi have already successfully moved on into Fonkoze’s larger loan product. However, things aren’t so bright for those who didn’t move into microcredit: we saw a slight decline in indicators for the 25% of participants who did not join TiKredi since our mid-term evaluation. This could well mean that, in the absence of other options, self-employment is the only real exit gate out of poverty in rural Haitian context.
Although the program’s achievements have been remarkable, the challenge of sustaining improvements is stark. When it scales up the programme, Fonkoze will have to address other challenges such as identifying more sustainable livelihoods for participants; for example, the most viable strategy pursued by many program participants in one site is charcoal production in an already heavily deforested land. For those who are not ready to integrate into microcredit, finding alternative graduation pathways poses another challenge. Given the intense vulnerability of the population, there is always a demand for Fonkoze to do and provide more. While most graduation programs rely on the government to deliver health, education and welfare benefits, Fonkoze does not have this luxury. One can only hope that the silver lining amidst the tragic earthquake is an opportunity to re-build Haiti and provide the country’s most vulnerable with basic entitlements.
Six months after “graduation,” Trickle Up estimates that 94% of the participants in the initial pilot are maintaining their assets and still participating in the Self Help Groups. Trickle Up and its partner, Human Development Centre, are now helping the groups to link up with banks so that participants can access larger loans.
From the pilot phase, Trickle Up has learned many lessons, above all, that larger grant sizes help people go much further—the amount of the asset transfer will more than double in the next phase. In India, Trickle Up has now increased from its traditional USD 100 grants to an estimated average amount of USD235. Janet Heisey, Trickle’s Up’s Program Officer for Asia says: “This pilot has allowed us to gain greater knowledge of the level of support that’s needed to help get a micro-business off the ground.” Interestingly, this change is influencing all of Trickle Up’s activities. Bill Abrams, Trickle Up’s President, explains: “Over the past three decades, Trickle Up has supported approximately 10,000 businesses annually, typically through USD 100 grants. Our commitment to serving the very poorest is stronger than ever and, in order to refine our program for maximum impact, we are bringing the lessons from our Graduation Pilot into the mainstream of our work. Among those refinements are larger and more flexible seed capital grants, as well as a three-year program instead of one.”
Some other changes in program design include an increased emphasis on savings, with systematic financial management training and a consumption support adapted to food cycles. In addition, the livelihood strategy design will include a greater focus on training participants in planning their livelihood activities, keeping in mind the local market‘s absorption capacity and working to ensure the participants link to available government services—both those that support the livelihood and those that support other aspects of the family’s well-being.
The Yemen Graduation Pilot is located in the governorates of Aden, Lahij, and Taiz.
Yemen is the poorest country in the Middle East with an estimated 43% of its population below the poverty line. Currently about 1.5 to 2 million households receive support from a government safety net program. The government is interested in trying to link its existing cash support program with livelihoods training and savings services in order to help the poorest become self-sufficient over two years.
The Social Funds have already identified very poor localities. Last week, CGAP met with the implementing team in Yemen to guide the selection of the poorest households in these communities.
Like other pilot sites, the Yemen Graduation Pilot has a sophisticated targeting process: the team first selects the poorest communities based local knowledge and gets a list of the government safety net recipients in the area. The Yemen Progress out of Poverty Index is then used to rank the poorest recipients of the safety net within these poor communities. Through household visits, field workers further narrow the list of potential beneficiaries to make sure only the poorest are included. Finally, supervisors visit all the households on the shortlist in order to minimize targeting errors. A consultant from BRAC has also cross-checked a sub-sample of targeted households.
This pilot in the Kiltie-Awlaelo district of Tigray will target 500 households who are among the poorest beneficiaries of the government’s Productive Safety Net Programme (PSNP). Consumption support will come from the PSNP stipend. This will be the first graduation pilot where savings (at DECSI) is entirely mandatory.
Based on market and sub-sector analyses, members can do beekeeping or raise sheep and goats. Or they can choose another activity, in collaboration with program staff. REST will train participants in May. Assets will be transferred in June, the best time of year to transfer the honey bees. REST will monitor the project, Innovations for Poverty Action will do a randomized impact assessment, and BRAC Development Institute will conduct qualitative research.
In late November 2009, the nine partners in the CGAP-Ford Foundation Graduation Program met in Bangladesh, during a workshop hosted by BRAC Development Institute. The first part of the meeting was kept to pilot implementers only—it proved to be an incredible forum for candid discussions about the challenges of implementing such a demanding model.
There was a particularly lively discussion on targeting. The graduation model is intended for the poorest—food insecure households, those at the bottom of the economic ladder, and often excluded from regular microfinance. Targeting, to ensure both that the poorest are reached and that better off households are excluded, is therefore an extremely important element of the program. And because the program is based on household-level economic activities, only people who are physically or mentally able to manage enterprises can join.
Anne Hastings, director of Fonkoze, wrote to our colleagues at BRAC on Tuesday saying “Am ok but bodies everywhere. Destruction massive. Very little communication gets through even in-country. Headquarters demolished. Need to figure out how to get operational again.” You can read more excerpts from her distressed email on BRAC’s blog.
Gauthier Dieudonné, the program manager for Chemen Lavi Miyo, sent a text message to his colleagues saying he is safe. Fonkoze is also reporting that both Fonkoze and Sèvis Finansye Fonkoze staff in the HQ in Port au Prince are secure. However, the building cannot be used, the wall surrounding the property is demolished, and apparently securing the property is a concern. Fonkoze doesn’t yet know the status of the Port au Prince Branch, the status of other branches, the safety of their staff, families, and borrowers. They also don’t know when they will be able to get more information. You can read their frequent updates on their earthquake news page.
Fonkoze staff in Haiti is establishing an emergency operations center—their “Earthquake Relief and Rehabilitation Fund” is soliciting donations. In addition Fonkoze suggests that anyone interested in going to Haiti as a volunteer or that has assets that “would be usable in Haiti,” describe their skills or assets here. Fonkoze’s Haiti staff will determine what is needed and match the needs with the offer.
