Pensions in remote areas: Lessons from Tanzania
Kwa Wazee is an NGO that has been running a programme for older people in Muleba district, Tanzania since 2003. The main part of the programme is a pension targeted at older people with little family support or with care responsibilities for orphans and vulnerable children.
In June 2013, older people received a monthly pension of TZS 12,000 (US$7.50) plus a supplement of TZS 7,000 (US$4.40) for each child in their care. The scheme reached around 1,100 older people and 600 children. As one of only a few cash transfer programmes in Tanzania, and the one most directly focused on older people, Kwa Wazee can provide important insights into how a social pension could be implemented across the whole of Tanzania.
In this blog Stefan Hofmann and Mandy Heslop look at what can be learnt from the programme:
A couple of years ago, during the fieldwork for an evaluation of pensions in the Kagera Region we spent one day in Ngenge, which seemed to be the most remote and disadvantaged area we had been to. As social pensions will have to be delivered to remote locations like Ngenge, the focus of the new study was to learn about how it can be done, but also to establish what impact the pension was continuing to have.
The challenges of the research
Challenges related to doing research with older people in remote rural settings are not only the distances to cover, but also their health, mobility and the fact that the majority don't read or write.
This was partly overcome with the participation of the children who are cared for by the older people: for one month children and older people meticulously documented all the income and expenses of 182 older person headed households in Ngenge. This was an intergenerational and social process and a form of data collection which was probably unprecedented.
The impacts of the pension
The survey revealed that even a small pension of TZS 12,000 a month, which corresponds to 13% of GDP per capita, has a dramatic impact on income - increasing the average income of recipient households by almost 80%. This translated to an increased quantity and variety of food, more spending on household items and healthcare compared to households without cash transfers.
While one third of all pensioners were able to invest in day labourers to improve their farms, the households that didn‘t receive the pension or child supplements did not spent their money in this way. Some people argue that pensions reduce the support that older people are given by their family or community. However, this was not the case. Their position in the reciprocity process was actually strengthened, as they received more gifts and loans than non-pensioners.
The difficultly of targeting
While the impacts of the pension were very positive the study confirmed the difficulties of means-testing in an environment of widespread poverty.
One pensioner expressed this dilemma: "Other older people are pointing their finger at us ... if we all got it [the pension], they would stop shouting and pointing."
Delivering a pension in a rural area
Regarding the practical aspects of implementing a pension scheme, the study shows that reliable delivery is possible even under difficult conditions. But it also points to some specific considerations that need to be taken in to account in reaching older people in remote areas:
- Mobility: 40% of pensions could not be collected by older people themselves due to extremely long walking distances combined with physical disabilities. Only 5% of those who collected their money themselves stated that walking caused them no problems; two thirds found it painful.
- Eyesight: Even among the self-collectors, just over 50% reported not being able to recognise people from more than 10 metres away. One out of four could not recognise the animal pictured on the banknote.
- Identification: The vast majority of older people had either voting passes or birth certificates, but an important minority of 8% had no identification at all.
This research showed that one potential way of overcoming issues of remoteness is through the use of electronic payments. However, in the mobile phone technology in Ngenge is less advanced than in other areas of Tanzania. Only 15% of older people had a phone in their home (compared to 46% in neighbouring Nshamba) although 66% (compared to 82%) had access to a mobile phone.
While electronic payments could overcome some of the remoteness issues it is obvious that a significant number of older people would need special support - from their family or community - to access their pensions in this way.
Older people were ambivalent about the ability of the government to reliably deliver the cash transfer, referring to previous failures in the health sector and in emergencies. They therefore saw it as critical that older people are included in the design, the delivery and monitoring of a national pension scheme.
Find out more about our work on social pensions on the Pension watch microsite.
Download the research on social pensions in rural Tanzania.