Research programme on the effects of privately managed cash transfers in Africa receives 12 million DKK

Cash transfers have become an increasingly popular way of providing international development and humanitarian assistance. Giving money to people in need is not new, but over the last two decades direct cash transfers have emerged as a key aid modality.

The new research programme ‘CASH-IN: Privately managed cash transfers in Africa’ will investigate whether and to what extent privately managed cash transfers are politicized by ruling elites and how this affects inclusive sustainable growth and state-society relations.

The research programme has received 12 million DKK for five years from Danida under the Ministry of Foreign Affairs of Denmark, and the programme involves three universities: The University of Dodoma in Tanzania, Makerere University in Uganda and Roskilde University with country teams totaling 13 researchers, where five researchers will be PhDs.

The research programme is led by Associate Professor Lars Buur that presently is coordinating the Hierarchies of Rights programme.

“Many sees new forms of technology related to new ways of communication as the solution to corruption and political use. However, it is unclear how new ways of communication for money transfers are used by different regimes. We know from India where millions of people have lost their rights, when everyone was registered in a new national electronic system that would make it easier to pay taxes, establish businesses and distribute state aid, that new forms of technology are not neutral but can have both positive and negative consequences for poor people. The system was used to separate the people that the Indian government regarded as Indian citizens from the people the government regarded as non-Indian citizens, who lost their rights,” says Lars Buur.

Cash transfers may be funded by private donors, governments or as part of international aid. While publicly managed social-protection and cash-transfer programmes have been extensively scrutinized, hardly any studies exist of privately managed programmes. Research on publicly managed programmes indicates that politicization and capture by ruling elites impact on their ability to lead to sustainable inclusive economic growth and costly implementation of the programmes.

Can privately managed cash transfers avoid the types of political capture that studies of public transfers have generally uncovered and what type of state-society relations do they produce?

CASH-IN will be the first study to focus systematically on privately managed humanitarian and development cash transfers. In order to capture the political dimension of cash transfers, Uganda and Tanzania both have significant experience of the diversity of political organizations and political settlements. Tanzania is generally considered a dominant party-state system, while Uganda comes closer to being a competitive clientelist state.

Comparative analysis of these countries enables the project to examine the links between the type of political settlement and its influence, if any, on privately managed cash transfers for both humanitarian - short-term - and development-oriented - long-term - cash-transfer programmes.