Milling vouchers in Dafur to optomise food aid
By Hanna Mattinen and Loreto Palmaera
Hanna Mattinen has been Food Aid Advisor at the ACF headquarters since 2005, with a focus on food assistance and cash-based interventions. She previously spent several years working on food security programmes in Guinea, Liberia, Chechnya/Ingushetia, Nepal and Indonesia.
Loreto Palmaera is the out-going Food Security Coordinator of ACF in Darfur and incoming ACF Programme Coordinator in Soe, Indonesia. Previously, he worked as programme manager of Food Security in the Philippines, Indonesia and South Darfur, Sudan.
The authors would like to thank Emilie Crozet (ACF Food Security Expert in Darfur) who played a key role in the setting up of the project. Thanks go also to Pierre Mercier and Morris Kolubah (ACF Food Aid Officers in Darfur), Abeshaw Tadesse, Emilie Pasquet and Jean-Francois Berthier (ACF Food Security Officers in Darfur) and their teams, who have run the project and collected and analysed the data used in this article. Thanks also to Mary Traynor for proof reading.
Voucher distribution in South Dafur
Global food aid deliveries reached a record low in 2007. They declined by 15% to 5.9 million tons, the lowest level since 19611. Current soaring food prices, competition with biofuels and depleted global cereal stocks have made food a scarce resource, leaving the humanitarian community faced with the challenge of optimising the use of food as aid.
The negative impacts of food aid, when used in an inappropriate manner, have already incited some stakeholders to find innovative and needs-based responses to situations where people face problems of accessing food. These so-called cash-based interventions, which include cash transfers, cash for work programmes and voucher schemes, have already been piloted in various contexts but are yet to be rolled out on a large scale.
This article focuses on a voucher programme implemented by Action Contre la Faim (ACF) in North and South Darfur. The programme provides vouchers to cover milling expenditures for households settled in internally displaced people (IDP) camps and benefiting from general food distributions. It was piloted in 2007, and at the moment, 105,000 people in four different camps and 103 millers are included in this programme.
Context and rationale of the programme
Darfur is a semi-arid region of Sudan, devastated by conflict since 2003. Widespread looting and destruction of assets, displacement and restricted movements have had a significant impact on people's lives and livelihoods (farming, livestock herding, trade and migration)2. The region, which was formerly self-sufficient in food except in unusually bad drought years, has become a major recipient of food aid.
Sudan is now the world's third largest recipient of food aid, after the Democratic People's Republic of Korea and Ethiopia3. The World Food Programme (WFP), the largest food aid provider in the country, assists over 3 million people in Greater Darfur during the annual lean season4. The recently increased insecurity and the ongoing loss of assets leaves little hope for a decrease in the need in the near future and food aid remains the most appropriate response to cover the basic food needs of the vast majority of IDPs. Several assessments have, however, highlighted that part of the distributed ration is sold or bartered to get access to other basic items and services. An ACF study, for example, showed that on average, almost half of the camp populations use sales of food aid as one of their main sources of income to cover basic expenditures such as fresh food, firewood and milling5,6.
Given the already stretched household budgets, ACF set out to find alternatives to reduce these fixed expenditures and started a pilot project distributing milling vouchers in late 20077. This involved 21,757 households in the camps of Al Salam, Al Sereif and Otash (South Darfur) and in Shangil Tobay and Shadad (North Darfur). It was implemented in South Darfur from September 2007 to February 2008 (ECHO8 funded) and in North Darfur from October 2007 to May 2008 (DFID9 funded). The programme has currently been extended to January 2009 and October 2009, respectively. The objective of the programme is to support the registered general food distribution (GFD) beneficiaries to cover their milling needs, as well as to enable IDPs to use their cash income for other purposes (such as fresh foods).
An additional concern inciting ACF to look for alternatives was cost-efficiency: was aid being used efficiently when food transported to Darfur from as far away as the United States10 was being sold in the markets for a similar price to cereal produced locally? Rough calculations show that the real average cost of a ton of food aid in Sudan is approximately 250 USD, while food aid sorghum is sold on the local markets for only 110 USD11.
A baseline study, assessing the feasibility of the programme, found that the majority of households used milling machines. Only very few families resorted to time-consuming traditional milling means. Payment for milling was made mainly in cash, sometimes using shortterm, no-interest loans. Bartering was used as a last resort as it is very expensive. The rates vary according to cereal supply and go as high as one unit paid for one unit milled. The baseline also concluded that while most of the population were not previously familiar with voucher schemes, it was easily understood as people conceptualised vouchers as 'money'. A detailed study was undertaken among the millers, to assess the existing milling infrastructure, its capacity to tackle a likely increase in demand and the willingness of the millers to participate in the voucher scheme. A key issue was to study the current milling price and the milling market dynamics, in order to minimise the potential impact of the programme on these.
Design of the programme
A milling machine in Shadad camp, North Dafur
Milling vouchers are distributed monthly, in line with the general food distribution. Each voucher is valid for a month after its distribution and has a face value of milling 2 rubbo (local weight measurement in North Darfur) or 4 malwa (local weight measurement in South Darfur). Both represent 13.5 kg of sorghum, equalling the theoretical monthly cereal ration per person, which can be milled at any participating milling shop. The quantity of commodity covered by the voucher is defined instead of the cost-value of the milling service, in order to be more flexible in case the price needs to be adjusted. The cost-value of the milling service is 2 SDG12, which equals approximately 1 USD. Large-scale sensitisation and awareness-raising campaigns were organised with the help of traditional leaders and ACF food security community technicians prior to the launch of the project.
Millers are currently paid in ACF offices in Nyala and in Shangil Tobay 2-3 times per week, due to security risks involved in bringing cash to the IDP camps. This modus operandi also ensures open and continuous communication between ACF and the millers. However, with the volatile security situation in Shangil Tobay, the payment period has been erratic. ACF is currently exploring the possibility of paying the millers through the existing banking systems. This option was discarded in the beginning due to weak services and the security risk perceived by the millers in moving between the town and the camp with large amounts of money.
Impact
The programme has shown positive results and been very popular among the beneficiaries and the millers13. Overall, 96% of the vouchers were used for their intended purpose (milling and cleaning of cereal), while only 2% was sold or exchanged14. In the vast majority of cases, vouchers were sold for their real value i.e. 2 SDG.
The first post distribution monitoring (PDM), conducted in November 2007, showed that after two months of operations, the percentage of households selling the GFD cereal decreased significantly with a 55% decrease in South Darfur and a 70% decrease in North Darfur (see Figure 1). The share of households bartering the GFD cereals also plummeted to almost 0% (96% decrease in South Darfur and 89% decrease in North Darfur). The use of cash for milling purposes also dropped (74% decrease in South Darfur and 78% decrease in North Darfur)15. In terms of economic impact, the vouchers covered approximately 20% of household expenditures. With an average expenditure of 60 SDG per household and per month16, the vouchers, with a costvalue of 2 SDG per voucher, contributed 12 SDG per month for a family of six members.
PDM: Post distribution monitoring
The PDM conducted in February 2008 confirmed the significant decrease in the proportion of GFD rations sold or bartered to cover milling costs, although the reduction in overall sales was less drastic than in the first PDM. In February 2007, 9% of the GFD ration was sold and/or bartered to cover the milling cost in South Darfur. One year later, it had dropped to 1%.
On the other hand, about 20% of the cereal ration continues to be sold in both North and South Darfur. It is interesting to note, however, that the use of the income derived from the sales is now used increasingly for the purchase of fresh foods and firewood as well as to cover for health and education related expenses, and that the overall quantities sold by the households have decreased17.
The monitoring findings were confirmed during an external evaluation in February 2008. The beneficiaries said that they now consume more of their food ration than they did before the voucher programme. Some said that they have increased their number of daily meals from two to three. All said that they still sell some of their food rations but that the amount sold is less than before and the income has been spent on other basic needs rather than milling18. The evaluation concluded that the voucher programme is relevant and appropriate as it provides a clear response to the economic needs of the displaced people.
The programme has also boosted the local economy by giving local millers more income generation opportunities, and as a consequence the number of millers has increased. The scheme used existing miller networks in order to respect the existing commercial organisation and set the price with them without impacting the going market price.
Constraints
One of the constraints ACF has faced during the implementation of the programme is the unpredictability in the price of fuel. Fuel prices in Darfur increased just before the start of the programme in 2007, leading to a 40-60% increase in milling costs. This was supposed to be temporary (fuel tanker movements were stopped on the road from Khartoum to South Darfur due to insecurity), but how temporary was difficult to evaluate. Eventually, after a month, the price of fuel went back to normal. In June 2008, the same situation was experienced when insecurity escalated, leading to a readjustment in the price of the vouchers. ACF paid higher prices to millers, while the beneficiaries' entitlement remained unchanged. As the price of the fuel decreased, the cost-value of the voucher also went back to normal.
Food pipeline problems were experienced at the same time as fuel prices increased, and the GFD cereal ration was halved. ACF could therefore increase the amount paid to millers without decreasing the proportional coverage of the monthly cereal ration and without changing the overall budget of the project - as the cereal ration was halved, it could be completely covered by the milling vouchers even if the price of the milling service had increased. Project budget flexibility, however, remains an issue for vouchers for services or commodities whose prices may fluctuate during the project period.
Millers review their memorandum of understanding
Another key issue, although not exclusive to vouchers, concerned targeting. Given that the project was set up on a pilot basis, ACF was reluctant to implement a large-scale operation and opted for targeting in some camps, despite the seemingly homogenous socio-economic situation19. The criteria, which were defined through wealth-ranking with the population, largely resembled social criteria used in other projects around the world and showed no Darfur specificities. During subsequent monitoring, beneficiaries often complained about inaccuracy and lack of logic in the targeting. The external evaluation of the project indicated complex webs of social interaction between people, within which people help each other out when they are in need. It suggested further that it was unlikely that any meaningful and measurable vulnerability indicators, essential for targeting, could be developed for this type of population. ACF stopped targeting and is now covering all GFD beneficiaries in the selected camps. The GFD lists, however, are not always accurate and for example, the PDM from North Darfur indicates that on average, only 70% of the actual household members are covered by the distributions. Relevant actors are currently working on improving the quality of the GFD lists.
The verification of the authenticity of the vouchers before the actual payment to the millers has been, as expected, very time consuming, especially when several millers expect their payment at the same time. This control mechanism, however, has been valuable in identifying fake vouchers. In June 2008, fake vouchers were mixed with the authentic vouchers but they were recognised due to the unique design and the security features, including serial number, of the real vouchers.
Other constraints relate to the use of the vouchers by households, but have not overall represented substantial problems. Some beneficiaries found the face value of the voucher (13.5 kg/voucher) too high. They directly negotiated with millers the possibility to mill smaller quantities at one time, leaving a 'credit' with the millers for up-coming visits. Millers did not claim any extra fee for this service. A small minority of the beneficiaries also used the vouchers to buy other items, such as fresh foods. In some cases, local fresh food traders accepted the vouchers as a form of payment and then sought the help of millers to cash the vouchers from ACF. At the moment, only a few isolated cases have occurred, but the situation requires thorough monitoring and follow up.
Conclusion and outstanding questions
This Darfur milling voucher scheme shows an easily duplicable and practical way of coupling traditional food aid with an innovative approach to promote effective use of aid and beneficiary satisfaction. It also demonstrates a successful example of scaling up cash-based interventions. Overall, the vouchers-for-milling programme has given IDPs short-term benefits from the saved income through improved diet (consumption of the GFD ration and purchase of fresh foods) as well as an opportunity to invest in activities that bring long-term benefits, such as education of children. In addition, it has boosted the local economy by giving local millers more income generation opportunities20.
A voucher sensitisation meeting in Shangil Tobay camp, North Dafur
While the vouchers were extremely valuable and useful in addressing the needs of IDPs for milling, it should be noted that IDPs continue to sell a significant, albeit smaller, part of their food ration to cover other essential expenditures. Expanding the scope of the voucher scheme to cover other items, such as fresh foods, could be explored but would require indepth market analysis. This is of particular importance in areas such as Darfur where years of conflict have severely disrupted traditional market networks. The impact of the current programme on the market has been limited apart from the increased number of millers. As the face-value of the voucher is essentially a service (milling) that requires relatively low skills and initial capital, the service providers could get organised among themselves to ensure adequate supply. In addition, as the milling was linked to monthly food distributions, demand was predictable. Cash transfers could also be considered but may be risky in the current context and would require comprehensive security analysis.
For more information, contact Hanna Mattinen, email: hmattinen@actioncontrelafaim.org and Loreto Palmaera, email: lorspalm@yahoo.com
1WFP/Interfais (2008): Food Aid Flows. 2007.
2Buchanan-Smith M and Jaspars S (2007). Conflict, camps and coercion: the ongoing livelihoods crisis in Darfur. Disasters, 31 (s1):s57-76. Blackwell Publishers, London.
3 WFP/Interfais (2008). Food Aid Flows. 2007.
5The ration is comprised of oil, cereal, leguminous, CSB and sugar. The cereal is in grain form and hence needs to be cleaned and milled prior to consumption.
6Baseline study conducted in the camps of Al Salam (South Darfur) and Shangil Tobay and Shadad (North Darfur) in September and October 2007. Action contre la Faim (2008): Vouchers for milling programme - Impact Analysis. North and South Darfur.
7ACF also runs a programme of fuel efficient stoves to address the issue of firewood expenditure and is considering piloting fresh food vouchers.
8European Commission's Humanitarian Office
9Department for International Development
1063% of all food aid distributed in Sudan comes as an inkind donation from the United States, which is the largest single food aid donor for Sudan, followed by the EC which provides funding for 17% of the food aid. WFP/Interfais (2008): Food Aid Flows. 2007.
11The calculation for food aid includes only the price of food, and excludes costing of transport, storage and handling (LTSH) which can go up to 480 USD/Mt in Sudan for overseas consignments (source: WFP report on EMOP 2007, http://www.wfp.org/operations/current_operations/project_d ocs/105570.pdf). The market price is sourced from ACF market survey in Nyala and El Fasher in September 2007.
12Sudanese pound.
13See Action contre la Faim (2008): Post Distribution Monitoring. North and South Darfur. and ACF external evaluation 02/2008.
14For more detail, see under 'Constraints'.
15Action contre la Faim (2008): Vouchers for milling programme - Impact Analysis. North and South Darfur. Note that because the PDM was implemented at the very beginning of the voucher scheme, households may have exaggerated the positive impact of the vouchers.
16This equals approximately 30 USD. Source: ACF Food Security Surveillance Report, South Darfur, Jan 2008.
17Action contre la Faim (2008): Post Distribution Monitoring. North and South Darfur. Note that the GFD food ration has not changed between the PDM rounds.
18ACF External Evaluation, February 2008
19Due to the homogenous situation of the displaced population in the camps, the traditional or pre-displacement wealth ranking indicators have been greatly questioned and each person feels that they are entitled to support. This has been aggravated by political issues involving local leaders who demanded to be included in the process of beneficiary selection and cross-checking, creating potential tensions and/or insecurity.
20Of note is that the voucher scheme, as the vast majority of humanitarian interventions, is not highly sustainable and it is dependent on external inputs (funding, food aid). Arguably, though, its positive impacts may be longer lived given the implication for the local markets.
Imported from FEX website