Feasibility study on a capital-based income generation scheme for ...

A CAPITAL-BASED INCOME GENERATING PROJECT FOR EXTREMELY POOR AND LABOUR-SCARCE TSUNAMI-AFFECTED HOUSEHOLDS
cheapest and quickest method of cash transfer, though agencies seldom used this method for
cash transfers.”
4.4. Political feasibility
The Government Agent of Trincomalee District, Mr K. G. Leelananda, who is the highest
ranking government representative at district level, has been consulted by the survey team.
He welcomes the project without any reservations and pledged his full support.
The Chief Secretary North-East Provincial Council, Mr Rangaraja, supports the project in
principle, but raised equity concerns. He emphasised that due to many years of war and
multiple deportations, many people in areas not affected by the tsunami are in similar distress
as the tsunami-affected population. He also emphasised that – if the project succeeds in
Trincomalee – there should be donor commitment to extend it to other districts.
On a national level, the project was first discussed in detail with the Director Livelihood of
TAFREN, Mr Indra Kaushal Rajapakse, and the TAFREN National Programme Advisor for
the IRP Livelihood Programme, Mr S. Rahubadda. Both support the project concept. After
that, the official government approval for the project was given as a result of a meeting with
the following officials from the Ministry of Finance: The Deputy Secretary to the Treasury,
Mr R. A. Jayatissa, the Director General of External Resources, Ms Sujatha Cooray, the
Director General of the Department of National Planning, Mr Abeygunawardena. The
approval was confirmed by a letter to the Director of Save the Children in Sri Lanka.
In summary, government representatives at all levels agree that extremely poor and labourscarce
households are in need of assistance. They also agree that the assistance provided by a
capital-based income generating scheme is an appropriate response to that need. They
especially welcome the fact that the interest generated by the invested capital will, for a long
period of time, provide a secure source of income for the beneficiary households.
4.5. Risks and risk mitigation strategies
4.5.1. Inclusion and exclusion errors
As the benefits provided to the target group are attractive, the project will face attempts to
include households that do not meet the eligibility criteria. At the same time there is the
danger of deserving households being excluded because of ethnic, religious, caste or political
reasons, or just because extremely poor households keep a low profile and are easily
overlooked.
To mitigate this risk, a transparent and rigorous targeting mechanism has to be designed and
thoroughly tested until its effectiveness is ensured (see Section 4.1). Community members as
well as social protection agencies have to be involved in the targeting. However, Save the
Children will have to maintain full responsibility and accountability for the results. The head
of the project will have to able to resolve conflicts and to resist political pressure. If these
precautions are taken, effective targeting is feasible.
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