Rory Stewart: Cash is 'the most radical form of localization'

Unconditional cash transfers are “the most radical form of localization,” former U.K. development minister Rory Stewart said Wednesday. But right now, he said, little development money is given away in cash — largely because those who hold power in the sector feel threatened by it. Stewart is currently a special adviser to GiveDirectly, an NGO that advocates for unconditional cash transfers, and previously served as its president. He said that only around 3% of development spending is currently in the form of cash assistance. The figure is higher for humanitarian spending, however — the new State of the World’s Cash report, which Stewart was helping to launch, shows that cash now makes up 21% of humanitarian spending. Stewart questioned why the use of cash was so much lower in development. “It’s really important to accept that there are very strong vested interests against cash,” he said. “If you are in the U.S. for instance, Congressmen want to make sure that farmers in Idaho are getting grants to grow maize.” He suggested lawmakers would be reluctant to give people cash, rather than shipping that maize abroad as part of a food program. “There is a huge agricultural lobby that is not very amused by the idea,” he said. Similarly, he said that people employed in international development might feel that giving cash would put them out of a job. “I was the secretary of state at DFID, the Department for International Development, and I was very conscious that we had many, many thousands of staff, and it was very threatening to staff to suggest that in many cases, it is better to simply give cash and to sweep aside the traditional development structures,” he said. Stewart also questioned whether the proposed localization agenda went far enough, and said that if it was implemented as NGOs wanted, it would still provide jobs for experts from the global north. “NGOs are very excited about the localization agenda because it means money going to their staff,” he said. “Localization often means large numbers of professionals to study context, to consult, to do needs assessments, to listen. But the really radical thing would be to say there’s no need to listen. If you give unconditional cash to people, they can do what they want with the money rather than you wasting a lot of that money asking them, listening to them, writing strategies, and then giving them what you think they need.” In order to address the reluctance to use cash, he said, its advocates needed to advance two main arguments. One of those was the ethical argument that cash showed trust and provided people with dignity and choice. And the other was an evidence-based argument that cash was simply more effective. “I promise you literally I have seen programs that I oversaw at DFID where cash would be able to have the same impact on 20 villages compared to one village with a traditional program,” he said.