Social protection for sustainable food systems
Social protection programs aimed at helping farmers become more resilient are not just safety nets, but can help them invest and engage meaningfully in markets, says the Alliance for a Green Revolution in Africa.
Over the past 20 years, Sub-Saharan Africa (SSA) has experienced 4.3% growth in annual agricultural production, the highest of any region in the world.
Most of this growth has come from expanding acreage, not from intensifying inputs or increasing productivity. Despite this growth, 73 million people remain acutely food insecure.
There is an urgent need to support sustainable agricultural intensification among a large segment of the rural farming population, while allowing people in rural areas to leave farming if it is not a viable livelihood option.
Studies of structural transformations in Asia show how the adoption of new agricultural practices and technologies has helped boost agricultural labor productivity. This, in turn, provided farming households with higher disposable income, which they tended to spend on local consumables.
As a result, new employment opportunities in the non-agricultural sector have been created. This has helped pull marginal farm households out of farming and into more remunerative off-farm enterprises.
However, this vision of rural transformation is complicated by the severe resource constraints faced by many people in rural SSA and the fact that insurance and credit markets are often absent or unavailable to poor households.
Livelihood and investment decisions are intertwined with food security concerns for many farming households in SSA. This tends to push them towards production choices that minimize short-term consumption risks but are often low-return and subsistence-aligned.
One approach is to merge agricultural sector interventions with social protection. While the latter, particularly non-contributory social assistance, is generally seen as a tool to help the extremely poor maintain sufficient levels of consumption, evidence demonstrates its transformative power in rural areas.
Social protection interventions are public or private initiatives that aim to reduce poverty. The most common types of social protection are:
- Social assistance/safety nets. Provided by the government, they transfer resources to individuals or households to reduce poverty and inequality.
- Social assurance. These are contributory programs, like health insurance, that protect against financial instability.
- Labor market interventions. These include vocational training and services such as placement assistance to promote employment. They also include unemployment insurance.
Currently in SSA, 1.5% of GDP is spent on social policy programs. However, there are substantial differences at the country level. In 2015, nearly 36% of vulnerable populations in South Africa received non-contributory cash benefits, while Cameroon and Nigeria only reached 0.2%. Only 18% of the African population is covered by at least one social protection benefit, excluding health protection.
To improve the productivity of agricultural labor and enable marginal farm households to exit agriculture profitably, they need to be able to bear the risks and costs of new investments.
While social protection programs are rarely designed to explicitly influence the economic activities of their beneficiaries, they can contribute to changes in economic behavior through various means:
Rural households in poor countries generally have limited access to formal credit markets. Social protection and cash transfers provide a constant flow of cash that changes the current and future economic prospects of recipient households.
By improving liquidity conditions, cash transfers also create opportunities for improved savings, with implications for farmers’ ability to manage income shocks and access credit.
Transfers through social assistance programs also provide an important source of investment capital to engage in off-farm activities.
Risk and uncertainty are ubiquitous features of rural life. The variability of prices and weather conditions leads to strong fluctuations in agricultural production.
In many rural areas of SSA, the absence of insurance and credit markets, which can contribute to trapping households in the poverty trap, aggravates these risks.
Addressing high levels of risk adversity in economic decision-making is key to fostering food system changes. By providing beneficiaries with a regular source of income or food, social protection programs help to reduce consumption risks associated with new and uncertain investments on and off the farm.
Data on cash transfers indicate positive effects on the psychological well-being of recipients and reinforce their propensity to engage in future-oriented economic behavior.
By enabling farming households to better allocate their labor to urgent agricultural activities such as planting, social protection programs enable beneficiaries to improve agricultural productivity.
In addition, farmers may be undernourished during agricultural seasons, and cash transfers may give them access to more and better food, which will improve their labor productivity and ultimately their productive income.
In addition, transfers can contribute to a decrease in family labor dedicated to agricultural activities and increase the use of hired labour. This then allows households to free up labor to devote themselves to non-agricultural activities and to diversify away from agriculture.
These social protection programs are not simply handouts to prevent misery and hunger. In the absence of credit and insurance markets, they allow households to make investments, take risks and engage in markets.
From a political economy perspective, government budgets and program development are typically carried out in designated ministries with limited coordination between them.
Consequently, the planning and implementation of social protection programs rarely take into account the activities developed by the ministries of agriculture, and vice versa.
Cooperation between relevant ministries and joint work programs in rural areas is an important starting point for strengthening this coherence.
Improving the coordination and implementation of social protection with rural development interventions requires increased capacity to monitor and target interventions.
In recent years, some countries have started investing in digital farm and welfare registers. However, none of them have harmonized registers to facilitate more integrated actions. Investments to create and harmonize household registries that track information on agricultural and social protection interventions can enable better consistency in implementation.
Additionally, these systems can enable governments to respond more quickly to crises by increasing and expanding disaster support.
Finally, there is the question of the financing of social protection programs in SSA. Among other things, governments can consider reallocating a larger share of current public spending to social protection.
The emergence of climate finance also creates opportunities to increase resources for social protection. In rural SSA, these funding projects typically aim to promote the adoption of new land and resource management practices by farmers and incentivize them to allocate their land and labor to public investments in ecosystem restoration.
These activities entail private costs and risks for farmers while primarily generating public goods.
Paying for these services through cash transfers or public works is a potential way to increase social protection coverage, at least in the short term.
Improving integration between social protection and rural development initiatives holds promise for addressing the failures of standard sectoral development models and could be the missing link for transforming food systems in Africa.
The opinions expressed in our weekly opinion piece do not necessarily reflect those of Farmer’s Weekly.
This article is an edited extract from the report of the Alliance for a Green Revolution in Africa titled “Africa Agriculture Status Report 2021. A Decade of Action: Building Sustainable and Resilient Food Systems in Africa”. To download the full report, visit agra.org