What role can cash assistance play in climate change adaptation?

By Ophélie Allard, Cash Hub Intern, British Red Cross (June-August 2019)

Ophélie Allard is a master student in Contemporary International Relations, at Sciences Po Lyon

 

The month of July 2019 broke records according to the World Meteorological Organisation, making it the hottest month in history. All around the world, heatwave and extreme temperatures were felt, along with the acceleration of ice melting and the outbreaks of wildfires in the Arctic region. These abnormal events are the result of anthropogenic climate change. Climate change (or global warming) is a global phenomenon generated by the large amounts of greenhouses gas being released in the atmosphere, due to human activities. In the long run, it causes not only the melting of glaciers and the rise of sea levels, but also provokes droughts and floods. Through its multiple impacts, human-induced climate change also threatens economic activities and human well-being. Tropical and subtropical regions are particularly vulnerable to the phenomenon, which could further endanger already exposed communities, for instance by jeopardising food security in Sub-Saharan Africa. 

Climate change is thus becoming a growing challenge for humanitarian organisations, as it increases the frequency and the intensity of extreme weather events. Every single aspect of humanitarian work is connected with climate change-related events since they impact food, shelter, health and livelihoods. This is why climate change was presented as one of the “5 Global Challenges” in the International Red Cross and Red Crescent Movement’s Strategy 2030. As climate change puts more pressure on scarce resources and exacerbates threats, the demand for disaster relief is expanding and aid agencies are asked to intensify their response. Humanitarian organisations are increasingly taking into account climate adaptation, to help the process of adjustment to expected climate effects and to lower the risks posed by climate change in people’s lives. The adaptation to climate change can be sought through multiple policies, and Cash and Voucher Assistance (CVA) could be a part of the response.

CVA was already used as a tool by the International Red Cross and Red Crescent Movement during the Franco-Prussian war (1870-1871) but in the last decade, the volume and the scale of cash transfer increased. In 2017, the International Red Cross and Red Crescent Movement helped 5.57 million people in more than 80 countries through cash programming. Evidence showed that cash assists beneficiaries by providing them with rapid liquidity, flexibility, and dignity, by allowing them to choose and prioritise their own needs. These characteristics make cash assistance an appropriate tool to reduce and adapt to climate change-related risks.
CVA can increase people’s resilience in the face of climate change, which means it can increase people’s ability to anticipate, cope and recover from a climate change-related shock. Resilience is said to be increased by CVA, because cash assistance strengthens  households and local economies, and allows them to absorb the negative impacts of climate change-related shocks. The concept of resilience can be subdivided into 3 aspects: Absorptive, Anticipatory and Adaptive (called the 3As model).
“Resilience […] is understood to be the ability to anticipate, avoid, plan for, cope with, recover from and adapt to (climate related) shocks and stresses’” – Aditya Bahadur et al.

CVA has an absorptive effect, during and right after a climate change-related event, cash transfers can help absorb and cope with shocks. It leads to mitigating the immediate impact on basic needs and livelihoods, rapidly acting as a buffer.

CVA has an anticipatory effect by distributing cash to the most vulnerable groups as a proactive action, it allows people and systems to be better prepared for specific shocks. Receiving cash beforehand gives people the ability to save and to self-organise in anticipation of a weather event. This aspect of resilience is connected with other concepts such as social protection, or Forecast-based Financing which for instance was used to deliver cash grants before severe flooding by the Bangladesh Red Crescent Society in partnership with the German Red Cross in Bogura District, in northern Bangladesh.

CVA has an adaptive effect, giving people the ability to adapt to different and long-term climate risks, as well as adjusting after a shock to reduce future vulnerability. In this case, cash transfers help with asset-building and turning to economic activities less vulnerable to climate change.

The Kenya Hunger Safety Net Programme (HSNP) is a good example of the use of cash in an environment vulnerable to climate change. The HSNP provides long-term support to Kenyan households most vulnerable to food insecurity. 400,000 pastoralist households were selected to be part of the programme, of which 100,000 receive regular unconditional cash grants. During periods of droughts, the other beneficiaries can quickly receive cash assistance to mitigate the negative effects of the droughts on their economic activities. This programme integrates an anticipatory aspect, to increase resilience uphill from a weather event, as well as an absorptive effect, to provide immediate relief during droughts. This shows that social programmes such as HSNP, which aim at reducing chronic poverty and hunger through the distribution of cash, are also progressively integrating responses to climatic hazards. Similar examples within the International Red Cross and Red Crescent Movement include the response to droughts in Isiolo County, in Kenya, where cash was distributed to thousands of families relying on livestock for food, and the provision of cash assistance to people coping with the devastating impact of Hurricane Irma in the British Virgin Islands.

CVA can allow humanitarian organisations to respond to multiple causes of vulnerability, and to tailor humanitarian programmes as closely as possible to national and local needs. Without replacing other programmes, CVA can be part of the available toolbox to manage risks related to climate change. Evidently, cash should not be an automatic answer to every situation, but in a climate era which generates a more complex and uncertain environment, CVA appears as one of the key tools available for the humanitarian field to try to respond to modern challenges in a flexible and versatile way.