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Rural Social Protection: Economic Inclusion and Resilience

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Natalia Winder Rossi's (FAO) presentation at the South-South Cooperation Knowledge Exchange Platform on Strengthening Resilience of the Rural Poor in Nairobi (Kenya) on 18 November 2019.

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Rural Social Protection: Economic Inclusion and Resilience

  1. 1. RURAL SOCIAL PROTECTIO N: Social Protection: From Protection to Production FAO Framing Presentation Economic Inclusion and Resilience
  2. 2.  Why is Social Protection relevant for food security, nutrition, agriculture and rural development?  Social Protection and Resilience  bridging the humanitarian/development divide  What does the evidence say?  Integrated Approach Social Protection: From Protection to Production Overview
  3. 3. Social Protection: Essential component for reducing rural poverty
  4. 4. • 783 million people still live in extreme poverty – Inequalities still pervasive • 2 out of 3 people in extreme poverty live in rural areas • Most of the poor depend –at least partly- on agriculture, fishing or forest resources for their livelihoods • Women, youth, migrants, older persons, people with disabilities, indigenous people, especially those in rural areas, continue to face particular inequalities and discrimination • 59% of the poor of live in countries affected by fragility (climate or conflict-related crises). Rise in hunger largely due to climate risk and conflict. Social Protection: From Protection to Production Achieving SDG1 requires explicit focus on rural areas
  5. 5. How can we accelerate progress? Social Protection: From Protection to Production • Stimulation of macro economic growth and generating employment • But also, commitment to inclusive economic and rural transformation • Explicit focus on rural areas: 78% of the SDG targets rely on actions in rural areas (worldwide) • Enhancing social and productive capital (investing in rural areas) • Enhancing our understanding of who are the extreme poor, where are they located; addressing specific vulnerabilities and opportunities in the territories they live in • Risk dimension: global increase of hunger due to conflict and climate; majority of extreme poor in fragile contexts
  6. 6. What is the role of Social Protection in this context? Social Protection: From Protection to Production 1 • Immediate assistance for the extreme poor: food security, minimum floor of income and access to basic services • Enhancing the economic and productive capacity of poor / risk management • Resilience and climate adaptation: reducing the vulnerability of households and livelihoods
  7. 7. 1. Enhancing Food Security and Access to Basic Services Social Protection: From Protection to Production 1 • Social protection provides immediate assistance to the over 736 million living in extreme poverty and 820 million living with hunger. • In the form of social assistance, reaching the poorest, social protection provides the minimum basis of income security to ensure food security and small scale livelihood activity • Clear impacts on food security, access to more and better food, access to social services, small economic investments
  8. 8. Final aim: Comprehensive strategy of economic participation and inclusion of the poorest • Gradual integration of households into broader rural and economic development processes • Going beyond risk management and “short term graduation” • Taking advantage of social protection/social assistance reaching to link poor households to productive sectors and markets • Two pronged strategy: • Enhancing capacity of the poorest and marginalized • Making economic processes more inclusive, with a strong emphasis at identifying opportunities at the territorial level. Some principles behind the economic inclusion pathways 2. Promoting Economic Inclusion
  9. 9. 2. Promoting Economic Inclusion Social Protection: From Protection to Production 1 Addressing market failures and gaps in the rural sector/ rural economy • Volatility in generation of income due to price fluctuations, weather shocks and other • limited access to financial sector, (savings and credit), restricting ability to take risks to enhance efficiency and productivity, regarding productive investments, including new practices or modern technologies • Limited employment opportunities How can social protection support? • Long-term planning; Risk management and Liquidity • Generating additional and more productive employment opportunities • Contribute to long term effects of improved human capital • Using SP as staring point to promote linkages with other sectors – productive, agriculture, natural resource management (in addition to social) • Promoting other complementary intervention such as CASH+, collective action, social capital Social protection is an investment, not a cost, as it generates concrete and quantifiable economic returns
  10. 10. Comprehensive Strategy: Reminders! Social Protection: From Protection to Production 1  Biggest driver of poverty reduction will be broad based on inclusive economic growth  Ultimately all complementary programmes, depend on broader sectoral policy and rural development  Access to markets, getting prices right, animal health, extension, natural resource management, infrastructure……  Even the poorest households have productive capacity  Poorest and most vulnerable face broad and heterogeneous array of constraints  Long process; need to tailor interventions to different populations and contexts (gender sensitive, socio-cultural)  Graduation from poverty, not from SP (preventing from falling back)
  11. 11. 3. Enhancing Resilience Social Protection: From Protection to Production 1 Strategy to bridge the humanitarian-development-peace nexus by: Response • Effectively delivering aid via social protection structures while progressively absorbing some of the humanitarian case loads • Helping host communities to cope with strain on services and supporting displaced people to effective contribute to local economies • Prevention • Enhancing the capacity of households to manage risk- to anticipate, absorb and bounce back shocks • Helping poor and vulnerable households to minimize negative coping strategies • Promoting the transition to sustainable practices and livelihoods
  12. 12. Supporting transition to sustainable livelihoods Social Protection: From Protection to Production 1 • Providing a stepping stone towards climate-resilient livelihoods – contributing to reducing climate vulnerability by addressing economic barriers in order to adopt more productive and climate-resilient investments • Key gaps: access to information, targeting, costs of transition Evidence generated by FAO and partners showing that: • Adoption and transition: Addressing the economic barriers to adopting some CSA practices, including capital constraint • Sustainability: support sustaining the adoption of CSA practices for multiple years, which enhances the benefits the benefits farmers derive from these practices
  13. 13. Risk Informed and Shock responsive social protection Social Protection: From Protection to Production 1 Supporting inclusive preparedness and response • Social protection can, in contexts of recurring conflict and climate-related shocks and stresses, provide protection through ex ante vulnerability reduction, but also be effective mechanisms to deliver humanitarian aid in response to, or anticipation of, a shock.  Key components:  Scalable and flexible programming; (eg: contingency funds, price indexing, expansion in participants, transfer size, etc)  Risk-informed targeting; (a mix of socio-economic and risk related variables to inform targeting and programme design)  Connection with early warning and early action plans  Operational coordination with humanitarian system and financing mechanisms;  Policy coordination with climate change and adaptation mechanisms; humanitarian action  Conflict sensitive programming
  14. 14. What does the evidence say?
  15. 15. TP started in response to need for evidence in the SSA context NUMBER OF NEW PROGRAMMES LAUNCHED IN SSA
  16. 16. • Critical mass of evidence on the impact of social cash transfers social cash transfers remove economic barriers to access essential services, improve capacity of families to improve their livelihoods. • Visible impacts on: (programmes’ objectives) • Consumption, food security • Dietary diversity, nutrition? • School enrolment, attendance, transition? • Access to health services, morbidity AND beyond programme’s objectives: • Addressing economic and social drivers of HIV risk (among adolescent girls) • Economic and productive impacts • Social cohesion/community dynamics • Benefits that multiply to non-beneficiaries (local economy) • Addressing the transition to sustainable practices Social Protection: From Protection to Production Broad range of impacts
  17. 17. ACROSS-THE BOARD IMPACTS ON FOOD SECURITY Ethiopia SCTP Ghana LEAP Kenya CT- OVC Lesotho CGP Malawi SCTP Zambia MCTG Zambia CGP Zim HSCT Spending on food & quantities consumed Pc food expenditures (overall)         Pc expenditure (food items)       Kilocalories per capita   Frequency & diversity of food consumption Number of meals per day    Dietary diversity/Nutrient rich food       Food consumption behaviours Coping strategies adults/ children     Food insecurity access scale    Source: Hjelm 2016 (The impact of cash transfers on food security): https://transfer.cpc.unc.edu/wp- content/uploads/2015/09/The-Impact-of-Cash-Transfers-on-Food-Security.pdf  Protective impact No impact
  18. 18. Summary results • Crop production • Increase in crop production and sales (Lesotho, Zambia) • Move away from traditional to more nutritious, higher-value crops (Zimbabwe, Ethiopia, Malawi) • Significant impacts on expenditures on and use of agricultural inputs (seeds, fertilizers and pesticides) (Zambia, Lesotho, Malawi) • Increased investment in assets, though limited to ownership or use of small agricultural tools (Zambia, (Ethiopia, Malawi and Zimbabwe) • Livestock • Positive impact on livestock accumulation (Malawi, Zambia, Kenya, Lesotho, Zimbabwe) • Livestock ownership often seen as risk-coping strategy, second-best for precautionary savings Social Protection: From Protection to Production • Labor • Reduction in casual agricultural wage labor (Malawi) often offset by an increase in on-farm work (Zambia, Ghana) • Risk Management • Households diversified income sources, increasing their engagement in non-farm businesses (Zambia, Zimbabwe) • CTs contributed to debt repayments, savings and a reduction of loans and distress sales (Ghana, Malawi, Zambia) • CT beneficiaries were less likely to change eating patterns or take their children out of school and send them to work or live elsewhere • Social cohesion • Reinforced social networks by increasing informal transfers within communities and increasing participation of the poorest households
  19. 19. • Transfer raises purchasing power of participating households • As cash spent, impacts spread to others inside the community, setting in motion income multipliers • Purchases outside village shift income effects outside the community, potentially unleashing income multipliers there • As program scaled up, transfers have direct and indirect (general equilibrium) effects throughout region Impacts beyond programme participants
  20. 20. • Social Cash transfers are not a “handout”—they do not create dependency • Influence labour choices, but do not reduce work effort • Beneficiaries work differently, not less. They create more income then they receive • No evidence of increased fertility or alcohol consumption • Potential for sustained income generation • Wide range of impacts across many domains—but depends on implementation and other factors • Programs are scalable, allow other programs to ‘layer on’ services to leverage cash depending on objectives, including livelihoods • SCTs are transformative, contributing to both protective and development outcomes and increasing resilience • Improve human capital • Provide certainty • Relieve liquidity constraints, allows households to engage more in productive activities • We cannot separate livelihoods from consumption from social objectives Key messages coming from the evidence
  21. 21. • Lesotho1: Protecting consumption and boosting farm profitability • CGP, a poverty-targeted UCT, not only protects consumption and assets but also boosts farmers’ profitability from crop and livestock activities, potentially triggering a virtuous spiral of income and production growth by profit reinvestment • Lesotho2: Combining cash with livelihood support • CGP contributed to better diets and a decline in child labor. Impacts were greater when combined with SPRINGS, especially on dietary diversity, children’s nutritional status, non-food consumption and poverty; and through financial savings groups, increased social networks and trust, reducing community tensions • Zambia: Synergistic effects from combined SP and AG interventions • When combined with social protection (HGSF), a conservation agriculture program (CASU) led to larger increases in farmers’ gross income, herd size, harvests and revenues from cash crops than when implemented alone • Ethiopia: Productive safety net, assets and income diversification (*) • The share of participating households with pregnant women or young mothers that were operating non-farm businesses, owned livestock and produced livestock by-products, as well as their average herd size increased as a result of a PSNP+ pilot • Malawi: Reducing barriers to adopt climate smart practices and technologies via public works New evidence (Africa*)
  22. 22. • Accelerating progress towards SDG 1 and 2 requires an explicit focus and effort on rural areas • Poorest households have productive capacity • Progressive move towards universality, but ensuring adequate coverage: • Identifying life-cycle vulnerabilities are key. BUT also, consideration livelihood vulnerabilities in the design of SP • Economic inclusion requires: • Integration of integrate economic, social but also multiple risks that impact economic and social development (climate, conflict)- risk informed development Social Protection: From Protection to Production Key messages
  23. 23. Two fold approach Enhancing capacities: • Social protection is a key/necessary entry point to facilitate and enable the economic inclusion of the poorest • Enabler: Allowing families to invest in both social and productive activities; Managing risks; enhance resilience capacity / risk transfer • Enhancer: A Allowing families to sustain accumulation of human capital and assets, while manage inherent risks of economic activities (in rural areas) • Inclusive and sustainable transformation • Economic inclusion requires however, the identification of economic opportunities in rural areas (including those created by the demand of urban-rural linkages) • Complementary interventions (Cash+, collective action, referrals, case management) with an explicit focus on risk (climate, conflict, economic) Social Protection: From Protection to Production Key messages
  24. 24. FAO contributes to increase the scale and the impact of national social protection programmes FAO uses its technical expertise to support the poorest and most vulnerable rural households to transform the enhance their livelihoods: from subsistence to thriving livelihoods From negative coping mechanisms to the protecting and saving of livelihoods in fragile and risk prone contexts www.fao.org/social-protection

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