Urban Social Assistance: Evidence, Challenges and the Way Forward, with Application to Ghana

Abstract

Motivation: Urban areas are growing as is urban poverty, yet few countries have developed comprehensive programmes for social assistance in urban areas. Those programmes that exist, moreover, are often extensions or duplicates of rural schemes. Urban social protection needs to reflect the distinct characteristics and vulnerabilities of the urban poor, especially that they usually work in informal activities and they face higher living costs than rural dwellers. Purpose: This article addresses two questions: what is the current evidence on effective social assistance programmes in urban areas? How can such programmes be designed and implemented in practice? The article surveys the challenges of designing social assistance programmes in urban areas, focusing on specific urban vulnerabilities, targeting the urban poor, and setting appropriate payments. Approach and methods: Existing evidence on programmes for urban social assistance, including cases from seven countries, are reviewed. Issues are examined in detail for Ghana, a rapidly urbanizing country. Findings: Ghana’s flagship social assistance programme, Livelihood Empowerment Against Poverty (LEAP), that operates largely in rural areas, can and should be adjusted to urban areas. Registration by using community leaders is less effective in urban than rural areas. Instead, advertising, (social) media, direct text messaging, and identification through local non-governmental organizations (NGOs) would be better options. Targeting can be improved by developing an urban-specific proxy means test. Cash benefits should be increased, then adjusted regularly to counter inflation. These benefits should possibly be accompanied by subsidies for utilities and services. Policy implications: Several principles to consider when designing urban social assistance emerge. Benefit levels should reflect higher living costs in urban areas and respond to inflation, especially for food and other necessities. Urban social assistance should go beyond cash transfers to focus on generating jobs (especially for young people and women), and to ensure basic services such as health care reach the urban poor, through subsidies, vouchers, or case management. Urban contexts also offer more opportunities to deliver and target social assistance through digital technologies such as mobile phones and automatic teller machines (ATM).