Evidence on the comparative cost efficiency and effectiveness of various social assistance modalities (GSDRC Helpdesk Research Report 1323)
What is the evidence on the comparative cost efficiency and effectiveness of different social assistance modalities?
What is the evidence on the comparative cost efficiency and effectiveness of different social assistance modalities (particularly cash transfers, food vouchers and food distribution), taking into consideration the range of associated costs and benefits, with emphasis on conflict affected and protracted crisis settings, particularly in the MENA region?
Cost efficiency and effectiveness are critical to understand and compare when making decisions about which social assistance modalities are most appropriate to use in a given assistance programme. Humanitarian contexts such as protracted crises areas present yet additional factors to consider, such as access, security, administrative capacity, inflation, and market integration, with these likely to vary over time. Disaster relief contexts are typically dynamic and unstable, this should be expected when assessing delivery options. Cash transfers, food vouchers and in-kind food assistance are the main instruments used to provide support in humanitarian contexts.
There is limited literature that rigorously measures cost efficiency of programme modalities, or that compares modalities.
The key points raised in the literature include:
- transfer appropriateness is context-specific and determined by multiple factors including programme objectives;
- the provision of cash requires well-functioning local food markets – questions of access to markets, increase in supplies to local markets, potential price fluctuations and competitiveness should be assessed;
- modality choice requires examination of available food and access through markets (Gentilini, 2014; FAO, 2012);
- consideration should be given to transfer value and price fluctuations, particularly for cash and vouchers, as they are rarely index-linked and risk potential value loss when food prices rise – in this perspective, in-kind food transfers shield beneficiaries from inflation while cash transfers risk erosion (Cherrier, 2009);
- selecting the right choice – cash, voucher, local or overseas food procurement – is seldom a result of systematic response analyses. Priorities may compete, such as timeliness, cost-effectiveness, local market effects, recipient satisfaction, food quality, impact on smallholder suppliers, and livelihoods (Lentz et al, 2013a);
- a single modality may not be always preferable (Lentz et al, 2013a);
- intra-household preferences and intended beneficiary choices on type of modality should be assessed, as this has potentially important implications on inter-household dynamics and the ultimate effectiveness of programme goals (Bailey, 2014b).
Pozarny, P. Evidence on the comparative cost efficiency and effectiveness of various social assistance modalities (GSDRC Helpdesk Research Report 1323). Governance and Social Development Resource Centre, University of Birmingham, Birmingham, UK (2016) 10 pp.