There’s a growing recognition of how providing direct humanitarian assistance in the form of cash or electronic vouchers, instead of physical goods, pays off. It can be cheaper to deliver and also offers people greater freedom to tailor their spending.
Since 2011, the World Food Program has dramatically shifted its focus to cash-based transfers. While 5 percent of its entire assistance was comprised of CBT in 2011, more than 25 percent of its funding was devoted to this type of aid last year, according to Arif Husain, the Rome-based organization’s chief economist and head of food security analysis.
“It is the right thing to do, essentially it gives people the flexibility in what they want to buy. If you have meat, you give them meat, if you have rice, you give them rice,” Husain explained. “With vouchers or cash, you give people the ability to make their own choices, which is obviously much more significant and empowering. For us, it is really important to move from food aid to food assistance, which is more than physical aid.”
It’s also important to have a good idea of how, and where, those vouchers are being spent, as a way to analyze and predict trends — and that’s where data analysis comes in. Husain spoke with Devex in New York in advance of the U.N. World Data Forum, the inaugural conference that is convening more than 1,500 data experts from the public and private sectors. The Cape Town, South Africa forum, organized by the U.N. and the South African government, began on Jan. 15., and runs through today.
“When you give somebody a benefit, especially cash or vouchers, particularly electronic vouchers, how does that work?” Husain said. “It allows us to see how people spend money in different stores, what do they buy, where do they buy and over time we are able to establish many different things in seasonality in terms of how they spend money.”
The forum was not created as a platform for donors to make specific funding pledges, but rather, in part, to gather around a new global action plan for sustainable development data. The plan targets coordination and leadership; dissemination of data on sustainable development; partnerships; strengthening of national statistics systems; and mobilization of resources.
“There are a lots of numbers floating around and sometimes they make things worse,” said Stefan Schweinfest, director of the U.N. Statistics Division, in a phone interview shortly before the launch of the forum. “We are coming back also a little bit to the realization of how quality data helps us to manage development policy and we are also in that process of bring that information together.”
“We should not miss the boat. If we invest in good data now there will be innumerable returns.”
For WFP, that means sorting through an overwhelming flow of bank transactions — 6 million of them over an 18 month period from 2014 through 2016 alone — to better understand the spending habits of the refugees they support with CBT, according to Jean-Martin Baeur, a senior analyst at WFP.
Recipients of electronic vouchers can go and redeem them in stores that are connected with the WFP, and other U.N. agencies, authorizing a transaction the same way a credit card is typically processed. Banks then share these transactions with the WFP, allowing them to see who spent money, what the person purchased, and where they bought the goods.
The organization is working with a year-old software system it developed, in conjunction with Leiden University’s Center for Innovation in the Hague, to track results. But more support in the form of staff, and sophisticated data management systems is still needed to better understand the spending patterns and local movements of refugees. This could help inform a range of policy and operations decisions, ranging from what types of food WFP should ask stores to stock, to how much money they should offer people in need of assistance.
In Lebanon alone, there are 700 stores connected with this program, offering the potential to ease the strain on a country of less than 5 million, that hosts 1.5 Syrian refugees, said Husain.
CBT has its limitations — in time of drought or following a natural disaster, for example, it cannot replace physical food aid and other forms of support. On a broader level, CBT only comprises six percent of global humanitarian assistance overall — and the WFP’s contributions make up about 60 percent of this total percentage, said Husain.
Yet a strengthening platform of data analysis is helping to inform this work of WFP as it progresses in more than 54 countries.
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