ANNUAL CONFERENCE 2005

In association with Development Policy and Practice and the International Development Centre at the Open University

Milton Keynes, UK
7th-9th September 2005

Connecting people and places: challenges and opportunities for development

SPECIAL PARALLEL SESSION: JUST GIVE $£€ TO THE POOR
OUTLINE

Session F: September 9th, 10.15-11.45

Meghnad Desai’s throwaway comment – that we give $50 billion in aid a year, there are a billion poor people in the world, so why not just give them all a dollar a week – may actually be a feasible and practical aid mechanism. There is a growing interest, and increasing experience, with targeted cash transfers as social protection and pensions, and also for emergency aid. So far, however, no one has looked at the idea of universal benefits as an aid mechanism. But pressure to increase aid to Africa comes at a time of growing concern about the inefficiency of the growing aid bureaucracy which is leading to serious absorptive capacity problems. Large scale grants to government, through budget support, are facing similar problems as they carry increasing layers of conditionality. Furthermore, concern grows that, despite expensive attempts at targeting, aid and budget support does not benefit the poorest.

In Africa, where nearly everyone is poor, a universal grant of $1 per person per week could be cheaper to administer. A higher percentage of total aid could reach the poor, with fewer rents siphoned off by corruption and bureaucracy. And it could have the added advantage of stimulating local economies. To apply this to everyone in Africa would require a transfer of about $35 billion per year – within the range of increased aid being proposed.

This panel proposes to discuss:

Is it possible to use a universal cash transfer to everyone in Africa as an aid mechanism?

The panel will be led by Joseph Hanlon, senior lecturer at the Open University, whose paper last year in Development & Change on cash transfers to the poor triggered a surprising response, both positive (from Jan Pronk) and negative (ODI calls it the 'Gadaffi syndrome'),

The other panel members will be:

• Stephen Devereux, a fellow at IDS, currently working on targeted cash transfers for Unicef, DfID and Save the Children, and who will argue that it is feasible and relatively less expensive to apply this more generally.
• Paolo de Renzio, a research fellow at ODI, who has published work on absorption capacity and has turned to this as an alternative.
• Louise Haagh, director of the MA in Conflict, Governance and Development at York, or another person from the Basic Income European Network. BIEN have done extensive research on basic income in developing countries, and the panel member will look at the implications of this for poor countries and funding the basic income though aid.