1. An Introduction to Household Economic Strengthening

2. HES Examples

3. ES Benefits: Practical Examples ES for OVC Caregivers in Uganda: Caregivers who joined savings groups with literacy training increased household assets and improvements among OVCs in # of meals eaten and living conditions over non-participants. © Paul Rippey

4. ES Benefits: Practical Examples Guaranteed labor program in India: Children of a safety net program offering guaranteed work to the impoverished were less likely to engage in child labor, had greater school attendance and improved health outcomes. © BBC

5. ES Benefits: Practical Examples Savings Groups in Burundi: Providing social messaging through savings groups was found to improve financial decision making authority for women, reduce exposure to violence, reduce acceptance of violence, and increase consumption of household goods relative to luxury goods. © SAWSO

6. ES Benefits: Practical Examples FONKOZE in Haiti: By offering a continuum of provision, protection and promotion services, FONKOZE provides integrated programming to move people along the economic strengthening pathway http://www.fonkoze.org/ab outfonkoze/whoweare/how works.html http://www.fonkoze.org/ab outfonkoze/whoweare/how works.html Savings and loans (village) JummaiModu AbdulBolakall

7. Provision Food Transfers Cash Transfers Asset Transfers Labor Schemes Objective: Recover assets and stabilize household consumption (food, healthcare, shelter, clothing, etc.)

8. Provision – Food Transfers Can avoid sale of productive assets. Allows income to be used for other purposes May improve nutritional status, enabling productive activities. Hording food Sale of food items Intra-household utilization Market impact (both locally and non-locally sourced) Administration and handling costs Potential Benefits Potential Concerns

9. Provision – Cash Transfers Unconditional or conditional transfers Potential benefits: Can support consumption and investment Low administration fees (if ongoing) Potential concerns: Unconditional transfers may be misused Cash safety Difficult to monitor spending Lump sums may be overwhelming for beneficiaries Few suppliers who accept vouchers

10. Provision – Cash Transfers: Conditional and Unconditional Can support consumption and investment Low administration fees (if ongoing) Unconditional transfers may be misused Cash safety Difficult to monitor spending Lump sums may be overwhelming for beneficiaries Few suppliers who accept vouchers Potential Benefits Potential Concerns

11. Provision – Physical Asset Transfers Common asset transfers: Livestock and poultry Seeds / seedlings Tools / machines Typically requires a holistic look at the sectors related to the assets Can generate income Significant training or prior experience is needed Potential Benefits Potential Concerns

12. IGAs, skills training, vocational skills

13. Exercise: Discuss which provision strategy you would use in each of the following scenarios: 1.Marginal, remote area is hit poor weather for consecutive years and agricultural households have little to eat. They are selling off agricultural equipment and livestock. There is limited availability of nutritious food in local markets for them to purchase. 2.Households in urban areas have plenty of food options but no income to purchase it owing to the sickness or death of their primary wage earner.

14. Protection Financial safety nets (savings, microinsurance) Social safety nets (social capital, supporting institutions) Financial literacy Extending legal services (protecting assets and inheritances) Objectives: Build lasting self-insurance methods and protect key assets; Smooth household consumption and manage household cash flow.

15. Protection – Financial Safety Nets Financial safety nets help households smooth consumption to purchase goods and services, such as food and healthcare. Examples of financial safety nets include: Savings Microinsurance By accessing savings or insurance households are better able to protect their productive assets following a shock and therefore maintain current and future earning potential.

16. Protection – Savings Groups Savings enable the poor to self-ensure Cash based savings provide liquid assets to smooth consumption. Savings groups are informal where small amounts can be saved and lent to members

17. Protection – Savings Groups Increases capital available for smoothing consumption Interest paid on savings provides a return on investment Improves social capital; collective bargaining and marketing Group managed; they determine savings and lending rates Requires income stream to ensure that households have money to save Retro-fitting savings and loans to existing groups may be problematic Potential Benefits Potential Concerns

18. Protection – Microinsurance The vulnerable self-insure, which means they assume all the risk of a shock. Microinsurance spreads the risk of a shock between the vulnerable and less vulnerable. Lessons learned: Preferred practice is to link to a formal insurance provider, who can spread the risk and reduce the cost of premiums.

19. Protection – Microinsurance Provides access to finance for healthcare provision Increases income for healthcare providers Difficulty affording the premium Potential Benefits Potential Concerns

20. Protection – Strengthening Social Safety Nets Support increased access to existing social safety net programs that people can fall back on in times of need. Safety nets can be provided by government agencies, CBOs, and other community groups. Examples of social safety nets include several previously mentioned provision activities: Transfers, cash and in-kind transfers such as school supplies and uniforms Food-based programs such as supplementary feeding programs and food stamps, vouchers, and coupons Fee waivers and exemptions for health care, schooling

21. Protection - Extend Legal Protection Facilitating access to legal services helps protect control and access to protective assets. Work with legal service providers to: Help enforce inheritance laws Protect asset ownership (e.g. land, housing)

22. Protection – Financial Literacy The vulnerable often have inconsistent and variable income streams Financial literacy can be provided by external parties or directly by the NGO Enables better management of household cash flows, understanding profit and loss, and effective use of financial goods and services. Training must be of adequate quality and duration to be effective Potential Benefits Potential Concerns

23. Promotion Objectives: Smooth household income and promote asset growth; Expand household income and consumption Linkages to formal credit and savings Enterprise development / value chain development Workforce development (vocational and skills training)

24. Promotion – Formal Savings and Credit Microfinance is the delivery of appropriate financial products and services for the poor. It includes, savings, insurance and credit. Can support the development of viable livelihoods Risks creating asset loss and indebtedness Potential Benefits Potential Concerns

25. Formal savings and credit, continued Lessons learned: Ongoing access to finance is critical. Borrowers will generally want rising amounts and easy access. It is very difficult for NGOs to manage microfinance. Partnering with specialized agencies is advisable. Borrowers will often assume NGOs are providing loans as grants. Working with a formal credit provider increases the chances that loans will be repaid. Vulnerable households are often not attractive to lenders. Borrowers who are late on payments you provide often will not attend your other activities (such as trainings) Rather than providing finance, consider: Providing loan fund and operating costs to the MFI Creating a loan guarantee fund to share the risk Revenue sharing with MFI and CSO

26. Promotion – Enterprise Development Enterprise development includes linkages of microenterprises to business development services and technical services Examples: -Identifying products, pricing, mapping -Marketing -Business registration and legal support Can support the growth of new businesses New services are not always economically viable Potential Benefits Potential Concerns

27. Examples of Promotion – Value Chain Development Value chain development addresses the constraints that prevent pro-poor growth of an industry Example interventions: -Supporting linkages of firms to markets -Supporting improved technical capacity Can create large-scale and sustainable benefits Can be costly Requires significant technical expertise Potential Benefits Potential Concerns

28. Examples of Promotion – Workforce Development Most prefer employment to entrepreneurship. Access to employment can offer reliable livelihoods. Workforce development interventions could include: Apprenticeships and internships Vocational skills training Workforce readiness; preparing resumes, appropriate attire, tools and resources, skills training Lessons learned: Ensure there are job opportunities before training Link trainees to employers from the beginning Ensure the quality of the training