Cash Transfer Programming in the Pacific

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Cash Transfer Programming in the Pacific CASH TRANSFER PROGRAMMING IN THE PACIFIC A FEASIBILITY SCOPING STUDY Photo: RalphPhoto: Ofuyo CHRISTINA HOBBS AND ROSIE JACKSON The Cash Learning Partnership CASH TRANSFER PROGRAMMING IN THE PACIFIC CASH TRANSFER PROGRAMMING IN THE PACIFIC A FEASIBILITY SCOPING STUDY September 2016 Christina Hobbs and Rosie Jackson CASH TRANSFER PROGRAMMING IN THE PACIFIC CONTENTS ACKNOWLEDGEMENTS 6 ABOUT THE REPORT 6 EXECUTIVE SUMMARY 7 About the Pacific 8 Key Conclusions 8 Key Recommendations 10 SECTION 1: BACKGROUND 11 1.1 What is Cash Transfer Programming? 12 1.2 Methodology 13 SECTION 2: INTRODUCTION TO THE PACIFIC ISLAND COUNTRIES 15 2.1 Comparative Analysis 15 2.2 Regional Disaster Profile 17 2.3 Regional Development 17 2.4 Regional Vulnerability and Hardship 19 2.5 Regional Conclusions 21 SECTION 3: REGIONAL CTP FEASIBILITY 22 3.1 Regional CTP Capacity and Experience 22 Informal cash-based social safety nets and the use of remittances 23 Formal cash-based social protection mechanisms 25 3.2 CTP in Disaster Risk Management and Response 28 Incorporation of CTP in humanitarian and Disaster Risk Reduction planning and coordination 30 3.3 CTP Feasibility: Conclusion 30 SECTION 4: MARKETS 32 4.1 International Markets 32 4.2 Domestic Markets 35 Production 35 Logistics and transport 35 Prices 35 4.3 Market Capacity in Emergencies 37 Potential to utilise markets in crises 37 4.4 Markets: Conclusion 38 3 CASH TRANSFER PROGRAMMING IN THE PACIFIC SECTION 5: FINANCIAL SERVICES 40 5.1 Financial Systems and Financial Inclusion 40 5.2 Formal Financial Institutions 41 Mobile money 43 5.3 Gender Differences in Access to Financial Services in the Pacific 51 5.4 Financial Services: Conclusion 53 SECTION 6: ACCEPTANCE AND APPROPRIATENESS 54 6.1 Cultural Dimensions 54 6.2 Labour Force Issues and Dependency 55 6.3 Gender 56 6.4 Acceptance: Conclusion 58 SECTION 7: KEY FINDINGS AND RECOMMENDATIONS 59 Appendix 1: Social Protection Index (SPI) by income group, 2009 64 ANNEX 1: COUNTRY SNAPSHOT: TONGA 65 Appendix 2: Monthly prices of key food items used in the Tongan national Consumer Price Index 87 ANNEX 2: COUNTRY SNAPSHOT: FIJI 90 ANNEX 3: INTERVIEW LIST 110 ANNEX 4: DATA COLLECTION MATRIX 112 BIBLIOGRAPHY 117 FIGURES AND TABLES Figure 1: Average annual loss in million USD 19 Figure 2: Total hardship rates in selected PICs, as percentage of populations 20 Figure 3: Remittances as a share of GDP in select PICs, 2014 24 Figure 4: Social Protection Index (SPI) by region, 2009 25 Figure 5: Solomon Islands in comparison with median small economies in other regions 33 Figure 6: Size and distance from markets of PICs vs. other countries 33 Figure 7: Proportion of own production in food consumption in Tonga, 2011 36 Figure 8: No. of ATMs per 100,000 people and 1,000km2 42 Figure 9: No. of commercial bank branches per 100,000 people and 1,000km2 42 Figure 10: No. of accounts with commercial banks per 1,000 adults 43 Figure 11: Regional comparison of unique mobile subscribers between 2014 and 2020 44 Figure 12: Percentage of population that are unique mobile subscribers 45 Figure 13: Tonga country map 67 Figure 14: Tonga natural hazard risks: degree of exposure/area of country affected 69 Figure 15: Tonga fresh produce domestic market map, 2010 75 Figure 16: Agricultural and non-agricultural households by type 77 4 C CASH TRANSFER PROGRAMMING IN THE PACIFIC Figure 17: ATMs in Tonga compared to other PICs 78 Figure 18: Bank branch penetration in Tonga compared to other PICs 79 Figure 19: Accounts held in Tonga compared to other PICs 80 Figure 20: Number and percentage of unique subscribers to mobile plans in Tonga compared to other PICs 81 Figure 21: Map of Fiji 91 Figure 22: Map of Fiji – Tropical Cyclone Winston, 21 February 2016 95 Figure 23: Fiji Consumer Price Index (All items index), January 2015 to April 2016 100 Figure 24: Types of financial service providers in Fiji, Samoa and Solomon Islands 104 Table 1: Population, land mass and population density in PICs 16 Table 2: Table of World Risk Index 21 Table 3: Example of major non-contributory cash-based social protection schemes in PICs ,,,,,,,, 27 Table 4: Annual income vs. exports in US$ 34 Table 5: Average monthly expenditure on different items across Tongan islands (TOP$) 74 Table 6: Tonga key import and export trading partners 73 Table 7: Labour force participation and wage rates 89 Table 8: Income sources per respondent in recent Household Income and Expenditure Surveys in Fiji (%) 93 5 C CASH TRANSFER PROGRAMMING IN THE PACIFIC ACKNOWLEDGEMENTS The Cash Transfer Programming in the Pacific: A Feasibility Scoping Study was written by Christina Hobbs and Rosie Jackson on behalf of the Cash Learning Partnership (CaLP) and the Australian Department of Foreign Affairs and Trade (DFAT). The broader study team of Ralph Ofuyo from the United Nations World Food Programme, Joanna Pickles from the Australian Department of Foreign Affairs and Trade and Rebecca Vo from the Cash Learning Partnership provided valuable guidance, field research support and review of the final report. A number of government officials and humanitarian practitioners shared their knowledge and experience from differing Pacific Island Countries (PICs). The authors would like to thank everyone who took the time to complete the online survey, to participate in remote interviews and to meet with the team in Fiji and Tonga. The study team would particularly like to thank the support provided by Soane Patolo the General Manager of Mainstreaming of Rural Development Innovation (MORDI) Tonga Trust and his team for supporting the logistics of the Tonga field mission and providing guidance and support in Tonga. The study team would like to thank Luke Koroisave from the Ministry of Strategic Planning, National Development and Statistics for his support in arranging key meetings in Fiji. The authors would like to thank Nichola Peach from the United Nations World Food Programme and Ruth McCormack from the Cash Learning Partnership for their guidance and review of the final report. Many others also contributed to reviewing and editing the final report including Jesse Doyle from the World Bank and Richard Bontjer, Jodie Buchanan, Joanne Choe, Bernie Pearce, Luke Simmons and Sophie Temby from DFAT. Special thanks to Kanvara Suchitta and Vincent Trousseau from the Cash Learning Partnership for editorial support. The design of this document received funding from Global Affairs Canada. Many thanks to Ralph Ofuyo and Rebecca Vo for providing photos from the field missions to Fiji and Tonga. ABOUT THE REPORT This report covers a particularly broad topic and aims to pull out the most critical themes fundamental to the analysis of Cash Transfer Programming (CTP) feasibility and appropriateness in the South Pacific islands. Due to the regional focus, the report does not provide sufficient data to allow for decision making at a country level, or for specific technical programme design. Though more than 100 people were consulted, time limited the depth and detail in which the topic could be explored. It should therefore be considered as an introduction to the necessary dialogue on CTP and be read by practitioners, implementers, policy writers and decision makers to aid further consideration. Each topic is introduced by explaining its relationship with CTP decision making and analysis, followed by underscoring key thematic points that were identified during the study and, finally, concluding with a summary of outcomes. The report considers the ‘feasibility’ and ‘appropriateness’ of CTP. For the purpose of this report, the two terms are defined as follows: Feasibility refers to the extent to which it is possible to implement efficient and effective CTP without causing harm. Appropriateness refers to the extent to which CTP is the optimum means by which needs can be met. Disclaimer: The views expressed in this publication are those of the authors and not necessarily those of CaLP or DFAT. 6 C CASH TRANSFER PROGRAMMING IN THE PACIFIC EXECUTIVE SUMMARY The use of Cash Transfer Programming (CTP) to provide humanitarian assistance so that people may access the goods and services they need before, during and following a crisis has been gaining momentum over the past decade. Despite the considerable use of cash and vouchers by government and non-state actors in major emergencies in Asia, the use of CTP in humanitarian response in the South Pacific islands has been relatively small-scale, and limited to only a few countries. As one of the most disaster-prone regions in the world, Pacific Island Countries (PICs) are under growing pressure to ensure that when disasters strike, humanitarian response is efficient, effective and helps build resilience. Four PICs (#1 Vanuatu; #2 Tonga; #5 Solomon Islands; and #9 Papua New Guinea) are amongst the top 10 countries that are most at risk worldwide.1 Earthquakes, floods, storms and droughts cause both human and capital losses throughout the region every year. The World Bank estimates that in an average year, natural disasters cost countries in the South Pacific US$284m.2 Furthermore, the dependence of many PICs on external markets for commodities and services makes the region highly vulnerable to supply volatility and price inflation. This Scoping Study sought to consider the feasibility of scaling up the use of cash transfers in emergencies in the Pacific. By assessing barriers to the uptake of CTP, both attitudinal obstacles as well as operational challenges, the study aimed to support practitioners and decision makers in identifying next steps for CTP. The study explored previous and ongoing cash transfer activities, both short- and longer-term programmes, to identify lessons and good practice. The study examined four critical questions: 1. Is there an enabling environment for cash transfers during emergency response in the Pacific islands? 2.
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