K129.8 bn disbursed to 1.4 million beneficiaries in cash transfer programme

A village setting in rural  Malawi

Rigorous evaluations conducted in both 2012 and 2016 of the Social cash transfer program (SCTP) found very strong positive impacts of the initiative on beneficiaries.

Gender, community development and social welfare Minister Patricia Kaliati made the remarks when she presented an update of the programme to the National Assembly on Friday.

The programe provides regular, adequate and timely cash transfers in a manner that preserves dignity, in order to protect the poorest and most vulnerable citizens from the effects of ultra-poverty.

A total of about 1.4 million individuals living in about 8 percent of the country’s population are benefiting from the program.

The SCTP has generated strong positive impacts on the material well-being of children.

Among others, the initiative was found to increase the likelihood of possession of shoes among children aged 5 to 17.

Targeted: Children like these ones form part of beneficiaries of the programme

The proportion of children in the targeted households with a pair of shoes, access to a blanket and a change of clothes have risen from 12 percent at baseline to 50 percent at end line.

In her presentation she stated it also promotes their livelihoods, preventing further deprivation as a result of livelihood shocks and contribute to human capital development.

“In addition to this, the Fourth Integrated Household Survey (IHS4) while noting that poverty in Malawi increased from 50.7% to 51.5% between 2010 and 2017 notes that there was significant reduction in ultra-poverty during the same period. Ultra poverty rate had reduced by over four percentage points from 24.5% to 20.1%. The reduction has been attributed to investments in social protection, of which the SCTP is a significant player.

“The study showed that Social Cash transfer program has an economic multiplier effect of 1.69. This means beneficiary household have been able to translate each Kwacha received into an additional 0.69 of spending. This increased income is due to increased ability of the households to invest the little they receive in agriculture and other small businesses, thereby, multiplying their income at household level and that of the economy in general.” disclosed the Minister

Of the household beneficiaries, 69 percent are female headed while 55 percent of the individual members are female.

Female headed households are estimated at 69 percent in the programme

The SCTP program is further expected to expand coverage to reach about 15 percent of the population by 2025.

It provides monthly unconditional cash transfers of around K9, 500 ($9) per household, to the bottom 10 percent of households identified as ultra-poor and labour-constrained.

Since 2012, the program has disbursed a total of K129.8 billion across the country.

To improve payment systems and fulfill the government’s digitization agenda, the programme is in the process of moving away from manual payment to electronic payment system.

Six of the 28 districts, Thyolo, Blantyre, Balaka, Ntcheu, Nkhotakota and Karonga are currently on electronic payment system where some receive through banks while others are on mobile money platform.

Social cash transfer programme has also improved school enrollment through provision of meals as captured in this file photo

The remaining districts are expected to join by mid next year.

This system is expected to improve cash delivery in general and specifically preserve the beneficiaries’ dignity. It is further expected that electronic means of payment will encourage saving culture among beneficiaries.

Besides providing regular cash transfers to ultra-poor and labour constrained households, Kaliati stated the SCTP also responds to households faced with shocks such as flood disasters and food shortages during the lean season.

The SCTP indicates strong effects on children’s school participation across all age ranges which do not merely reflect increased enrolment, but increased regular participation in school.

Cash transfers doses not only helped with direct school costs and freed up time from ganyu, but even more importantly, allowed them to concentrate in school because they could eat breakfast in the morning.