BIG Pilot Project - Assessment Report - BIG Coalition Namibia

Making the difference!The BIG in NamibiaBasic Income Grant Pilot ProjectAssessment Report, April 2009ISBN: 978-99916-842-4-6The research of the Basic Income Grant Pilot Project is designed andcarried out jointly by the Desk for Social Development (DfSD) and theLabour Resource and Research Institute (LaRRI) on behalf of the BIGCoalition (comments to: web@bignam.org). Coalition web page:www.bignam.orgThe authors of this report are Claudia Haarmann, Dirk Haarmann, HerbertJauch, Hilma Shindondola-Mote, Nicoli Nattrass, Ingrid van Niekerk andMichael Samson.Printing of this publication is funded by the Friedrich EbertFoundation and is hereby gratefully acknowledged.

Table of ContentsTABLE OF CONTENTS................................................................IINDEX OF PHOTOGRAPHS.......................................................IIIABBREVIATIONS.......................................................................VFOREWORD ............................................................................VIREADER'S GUIDE TO THE REPORT..........................................IXACKNOWLEDGEMENTS.............................................................XEXECUTIVE SUMMARY............................................................13SECTION 1: THE BIG A SMALL PROJECT WITH A LARGE AIM. 181.1 INTRODUCTION TO THE PILOT PROJECT..............................................181.2 HOW BIG WAS PILOTED IN OTJIVERO-OMITARA...................................191.3 IMPLEMENTATION OF THE BIG........................................................211.4 METHODOLOGY .........................................................................24SECTION 2: IMPACT ASSESSMENT..........................................262.1 REALITIES OF POVERTY BEFORE THE BIG............................................262.2 EXPECTATIONS FOR THE BIG.........................................................302.3 VOICES OF CHANGE......................................................................322.4 PROFILE OF OTJIVERO-OMITARA......................................................332.5 COMMUNITY MOBILISATION............................................................372.6 ALCOHOL.................................................................................422.7 CRIME.....................................................................................442.8 LEVELS OF POVERTY.....................................................................472.9 HUNGER AND MALNUTRITION...........................................................502.10 GENERAL HEALTH.....................................................................562.11 EDUCATION.............................................................................632.12 ECONOMIC ACTIVITY, INCOME, AND EXPENDITURE.................................70SECTION 3: A NATIONAL BASIC INCOME GRANT.....................83I

3.1 AFFORDABILITY...........................................................................833.2 SUSTAINABILITY..........................................................................863.3 CASH TRANSFERS AND ECONOMIC DEVELOPMENT....................................893.4 LOCAL ECONOMIC DEVELOPMENT......................................................943.5 CONCLUDING REMARKS.................................................................96II

Index of PhotographsPhoto 1: Plastic and corrugated zinc were the main building materialsin Otjivero (April 2007).............................................................20Photo 2: The BIG as a right............................................................21Photo 3: N$ 100 - making a difference...........................................22Photo 4: BIG payout through NamPost savings accounts...............23Photo 5: Dr. Hage Geingob, the first to donate to the BIG Pilot ProjectFund.......................................................................................24Photo 6: Ms. Emilia Garises, 55, mother of 7 children, head ofhousehold. (Before the BIG)...........................................................26Photo 7: Desperation before the BIG..............................................27Photo 8: Before BIG.......................................................................28Photo 9: Housing before BIG..........................................................29Photo 10: Emilia Garises - making dresses with material she boughtfrom the BIG..................................................................................32Photo 11: Otjivero-Omitara elected its own BIG Committee...........38Photo 12: Sister Mbangu of the government clinic.........................57Photo 13: Johannes Goagoseb in prison, November 2007..............60Photo 14: Parents of Johannes Goagoseb (Nov 2007).....................61Photo 15: Johannes Goagoseb - reunited with his family (July 2008)......................................................................................................62Photo 16: The Primary School in Otjivero.......................................64Photo 17: The school's reports show a 90% payment rate of schoolfees after the introduction of the BIG.............................................66Photo 18: Proud to be at school.....................................................67Photo 19: Enrolment at the crèche increased from 13 to 52 after BIG......................................................................................................68III

Photo 20: School performance and attendance improved after theBIG................................................................................................69Photo 21: Joseph Ganeb started a brick making business.............75Photo 22: Dress making became one of the new businesses inOtjivero..........................................................................................76Photo 23: Baking bread: N$1 per roll - daughter of Frida Nembwaya......................................................................................................77Photo 24: BIG created small business opportunities......................78IV

AbbreviationsAIDSARVsBIENBIGCBNCCNDfSDELCRNHIVLaRRILWFMDGNamPostNAMTAXNANASONANGOFNHIESNUNWSTDUEMWHOAcquired Immune Deficiency SyndromeAntiretroviralsBasic Income Earth NetworkBasic Income GrantCost of Basic Needs approachCouncil of Churches in NamibiaDesk for Social Development, Evangelical LutheranChurch in the Republic of NamibiaEvangelical Lutheran Church in the Republic of NamibiaHuman Immunodeficiency VirusLabour Resource and Research InstituteLutheran Word FederationMillennium Development GoalNamibian Post OfficeThe Namibian Tax ConsortiumNamibia Network of AIDS Service OrganisationsNamibian NGO ForumNamibian Household Income and Expenditure SurveyNational Union of Namibian WorkersSexually Transmitted DiseaseUnited Evangelical MissionWorld Health OrganisationV

ForewordWhen we came to Otjivero-Omitara in July 2007, one woman withthe name of Emilia Garises told us “Some days we don't have anything[to eat] and we just go and sleep and get up again without eating.”Otjivero-Omitara before the introduction of the BIG was typical ofhow many people still live in Namibia today. On a daily basis, we arefaced with the situation of sheer hunger next to incredible wealth.But in Otjivero-Omitara something has changed dramatically, and Iwould like to put this in the context of the miracle of the feeding ofthe five thousand (Lk 9,10-17). When Jesus fed all these people withfive loaves of bread and two fish, we as modern rational, economicallyminded people always think about how one could divide up fiveloaves of bread for so many people and yet everybody could getenough? With the BIG pilot project, we have come to a completelydifferent understanding of this miracle, due to our own experience.The miracle lies in the sharing! The breaking of bread together. Jesusshared unconditionally, without saying: you look needy and youdon't, you are deserving and you are not, you need to stand in thisqueue and you must not. No, when you share bread you give toeverybody, unconditionally, without so-called targeting - exactly likethe BIG. And when you share, people open up, you create an opportunityand you create a community, and people start to give. Themiracle is not about the arithmetic of dividing five loaves of breadamong 5000 people, but the miracle is that if you break bread together,people start to open up and to share what they have. That isall: People started to contribute, and this is why you had more thanyou had before.The sense of community makes people take ownership and responsibility.Just what Hermanus Coetzee expressed to us in Otjivero-Omitara after the introduction of the BIG: In my house there aremany people. We are 28 and at pay-out we all contribute money forfood. We give the money to granddad and grandmother and we aresitting together and draw up a list of the things to buy and one of ushas to travel with the train either to Windhoek or Gobabis to go buyVI

the food in bulk. We only travel once a month and we buy enough forthe month and some of the small items we need we buy at the localshop and shebeens.I would also like to put the concerns that a BIG could create dependencyand a culture of laziness into a theological context: Beforethe pilot project started, opponents said that if you give peoplemoney, and especially poor people, they will sit down and becomelazy. If you receive Manna from heaven (Ex 16), why should peoplework? The results of the research presented here, refute this claim.Moreover, if you look in depth at Exodus 16, the people of Israel inthe long journey out of slavery, they received manna from heaven.But, it did not make them lazy, instead, it enabled them to be on themove to travel through the desert. In Namibia, we know how harshthe circumstances of the desert can be. In this context nobodywould say, the manna made the Israelites dependent. To the contrary,it enabled them to move. And one might ask, why did theLORD not give them apple trees for example? Because he wantedthem to move, you can pick up the manna and go. You can moveout of the harsh realities of slavery and dependency - just like theBIG, you can pick it up and move, not being forced to stay at a certainlocation or in a particular condition. The BIG, like the manna,is freeing people to move and take ownership of their economic affairs.This is not a trap, but a precondition on the long and hardjourney to the promised land. We have seen just that in Otjivero-Omitara. Look at Frida Nembwaya, who, when receiving the BIG,started to bake traditional rolls for just N$1. Currently she is baking200 rolls a day, seven days a week. People in Otjivero-Omitara nowhave the money to buy from her. She currently considers to extendher shack and wants to employ somebody. She also added a smallbraiding business and sells local sausages and recharge vouchersfor cellphones. The Manna works, she is moving, so much so thatshe wrote on all the sides of her newly-built zink house: “Good lifeafter struggle”.VII

I am convinced that the BIG is not only able to eradicate destitution,hunger and malnutrition, but that it lays a strong foundationfor economic empowerment, responsibility and ownership taking.The BIG, by restoring the human dignity of people, frees people tobecome active and proud members of this society. It is my sincerehope that this dream did not only become true for the people ofOtjivero-Omitara, but indeed for the whole of Namibia.Bishop Dr. Zephania Kameeta24 April 2009VIII

Reader's guide to the reportThis report is part of a series of publications on the Basic IncomeGrant in Namibia. It reflects the results of the Pilot Project inOtjivero-Omitara in particular. This one year report attempts to givean overview over the new findings, and possible lessons for nationalimplementation of a BIG in Namibia.For better usability this report summarizes, in parts repeats andonly updates sections, which have been published before. In orderto avoid cumbersome referencing to our own work, the referencesare given here in the beginning 1 :Haarmann, Claudia; Haarmann, Dirk; Jauch, Herbert; MoteHilma et al 2008. Towards a Basic Income Grant for all. BasicIncome Grant Pilot Project. First Assessment Report, September2008. Windhoek.Kameeta, Zephania; Haarmann, Claudia; Haarmann, Dirk; Jauch,Herbert 2007. Promoting employment and decent work for all -Towards a good practice model in Namibia. - Research Paper -Presentation to the United Nations Commission for Social Development.WindhoekHaarmann, Claudia; Haarmann, Dirk (ed.) 2005. The Basic IncomeGrant in Namibia. Resource Book. Windhoek.This report can be read as a comprehensive publication, without theneed to have read all earlier reports. We trust that it provides abasis for further discussions and more importantly for the implementationof a nationwide BIG in Namibia.1 All of them are available for download on the Namibian BIG Coalition web page:www.bignam.orgIX

AcknowledgementsThis study would not have been possible without the active supportof residents of Otjivero-Omitara. A special word of thanks must go tothe BIG Committee, which the community elected and whichrendered invaluable assistance in the process of facilitating the BIGpayouts and implementing this study. The committee consists of:●●●●●●●●●●●●●●●●●Director: Mr. S. S. Aigowab (Community leader)Dep. Director: Ms. R. Jeremia (Principal)Chairperson; Mrs. E. Gawaxab (Teacher)Secretary: Ms. C. B. Hambira (Constable)Under Secretary: C. Molelekeng (Health Officer)Public Relation Officer: Sgt. T. Kuutondokwa (S.C)Under Public Relation Officer: K. Kamperipa (leader)The contributing officers of the BIG committee are:Ms. P. Shiweda (Shebeen owner)Ms. M. Moliliking (Shebeen owner)Mr. J. !Ganeb (PPRC)Ms. R. Tjiho (Attending member)Mr. S. Murangy (Attending member)Ms. T Nehola (Attending member)Ms. B. //Hamases (Attending member)Mr. M. Shoombe (Attending member)Mr. H. Klaasen (Church leader)We are also grateful to all households and residents of Otjivero-Omitara, who on a continuous basis have been willing to be interviewedand to share their life stories with us. Their experiencestouched us deeply. A special word of thanks must go to all our “keyX

informants” who shared their knowledge and experiences with us.They are:●●●●●●Ms. F. Mbangu (Nurse)Ms. B. Nakanyala (Nurse)Ms. R. Jeremia (School Principal)Mr. E. Gawachab (Teacher)Mr. Thomas (Station Commander)Mr. H. Köhler (Bottle store/general dealer)We wish to thank Patrick Bock; Nicola Diergaardt; Stephane Diergaardt;Rev. Wilfred Nico Diergaardt; Asino Erastus; Maria Garises;Jafet //Garoeb; Elton Imeme; Fabian Jauch; Lionel Kamburute;Muniovina Katjimune; Rev. Petrus #Khariseb; Petrulieth #Khariseb;Elton /Khoeseb; Bennie Muroko; Lee Ngurare; Lo-Rain Shiimi; TangeniShindondola; Philip Tjerije; Israel Tobias and Cherlon Xamisesfor their commitment and dedication shown during the field interviewsand data entry. For the data entry for the baseline study, weare indebted to Heide and Gerhard Haarmann.The research is accompanied by an International Advisory Groupwhose invaluable comments, contributions and support are highlyappreciated.This pilot project and the study were only possible through the financialand administrative commitments, dedications and outstandingefforts of all members of the BIG Coalition in Namibia. In addition,the project received financial and administrative support fromBread for the World (BftW, Germany), the Evangelical Church inRhineland (EkiR, Germany), the Evangelical Church in Westfalen(EkvW, Germany), the Friedrich Ebert Foundation (FES, Namibia Office),the Lutheran World Federation (LWF, Switzerland), the LutheranCommunion in Southern Africa (LUCSA, South Africa), the KirchlicheArbeitstelle Südliches Afrika (KASA, Heidelberg) in collaborationwith the Blumhardt Congregation in Heidelberg and the UnitedEvangelical Mission (UEM, Germany). Many individuals and businessesin Namibia and around the world have contributed financiallyto the BIG pilot. The donations did not only enable the successfulimplementation of the pilot, but enough finances have beensecured for more than the anticipated two year period. Without thisoverwhelming support, the pilot project and this study would notXI

have become a reality. The BIG Coalition hereby wishes to extend aspecial thank you and acknowledgement to all who contributed.The pilot project attracts an enormous amount of attention, not onlyin Namibia, but worldwide. The pilot is broadly covered and regularlyreported about in the electronic and print media, as well as onlocal and international TV, and in major newspapers and weeklies inSouth Africa, Britain, Germany, the Netherlands, Norway, Swedenand the US. This attention has resulted in many visits by journalists,news crews, activists, students and politicians to the BIG Coalitionand the community of Otjivero-Omitara. This has placed thecommunity under great pressure and the BIG Coalition would liketo record its gratitude for the hospitality displayed by the communityduring this time.XII

EXECUTIVE SUMMARYEXECUTIVE SUMMARYIn January 2008, the Basic Income Grant (BIG) pilot projectcommenced in the Otjivero-Omitara area, about 100 kilometreseast of Windhoek. All residents below the age of 60 years receivea Basic Income Grant of N$100 per person per month, withoutany conditions being attached. The grant is being given to everyperson registered as living there in July 2007, whatever theirsocial and economic status.This BIG pilot project is designed and implemented by the NamibianBasic Income Grant Coalition (established in 2004) 2 and isthe first universal cash-transfer pilot project in the world. TheBIG Coalition aims to practically pilot the Namibian Government'sNAMTAX recommendation of a BIG for Namibia. Thus theBIG Coalition regards this project as the first step towards a BIGfor all. The BIG Coalition consists of four big umbrella bodies inNamibia, namely, Council of Churches (CCN), the NamibianUnion of Namibian Workers (NUNW), the Namibian NGO Forum(NANGOF) and the Namibian Network of AIDS Service Organisations(NANASO). Funds to start the pilot project were raisedthrough voluntary contributions from supporters of the ideafrom all sections of Namibia's society, and by support frompeople, churches, organisations and donors in other countries.The BIG pilot project will run for a period of 24 months up toDecember 2009.The effects of the BIG pilot project are evaluated on an on-goingbasis. Four complementary methods were used. First, a baselinesurvey was conducted in November 2007. Second, panel surveyswere conducted in July and November 2008. Third, informationwas gathered from key informants in the area. Fourth, a series ofdetailed case studies of individuals living in Otjivero-Omitarawas carried out.2 The Evangelical Lutheran Church in the Republic of Namibia (ELCRN) withits Desk for Social Development (DfSD) is the legal administrative and financialhome responsible for the implementation of the BIG Pilot Project onbehalf of the BIG Coalition.13

EXECUTIVE SUMMARYThis report presents the socio-economic results after the implementationof the BIG for 12 months. The key findings includethe following:➢➢➢➢➢➢Before the introduction of the BIG, Otjivero-Omitara wascharacterised by unemployment, hunger and poverty.Most residents had settled there because they hadnowhere else to go, their lives were shaped by deprivationand they had little hope for the future.The introduction of the BIG ignited hope and the communityresponded by establishing its own 18-membercommittee to mobilise the community and to advise residentson how to spend the BIG money wisely. This suggeststhat the introduction of a BIG can effectively assistwith community mobilisation and empowerment.As the BIG was only introduced in one particular location,there was a significant migration towards Otjivero-Omitara. Impoverished family members moved intoOtjivero, attracted by the BIG, even if migrants themselvesdid not receive the grant. This points to the needto introduce the BIG as a universal national grant in orderto avoid migration to particular regions, towns orhouseholds.The migration to Otjivero-Omitara affected the data obtainedfor this study. Per capita income from the BIGdropped from N$ 89 per month in January 2008 to N$ 67in November 2008. We thus analysed the impact of theBIG, taking the influence of migration into consideration.Since the introduction of the BIG, household poverty hasdropped significantly. Using the food poverty line, 76% ofresidents fell below this line in November 2007. This wasreduced to 37% within one year of the BIG. Amongsthouseholds that were not affected by in-migration, therate dropped to 16%. This shows that a national BIGwould have a dramatic impact on poverty levels in Namibia.The introduction of the BIG has led to an increase ineconomic activity. The rate of those engaged in incomegeneratingactivities (above the age of 15) increased from44% to 55%. Thus the BIG enabled recipients to increasetheir work both for pay, profit or family gain aswell as self-employment. The grant enabled recipients to14

EXECUTIVE SUMMARY➢➢➢➢➢increase their productive income earned, particularlythrough starting their own small business, includingbrick-making, baking of bread and dress-making. TheBIG contributed to the creation of a local market by increasinghouseholds' buying power. This finding contradictscritics' claims that the BIG would lead to lazinessand dependency.The BIG resulted in a huge reduction of child malnutrition.Using a WHO measurement technique, the datashows that children's weight-for-age has improved significantlyin just six months from 42% of underweightchildren in November 2007 to 17% in June 2008 and10% in November 2008.HIV positive residents' access to ARVs was hampered bypoverty and a lack of transport before the BIG was introduced.The BIG enabled them to afford nutritious foodand gain access to the medication. This was further enhancedby government's decision to make ARVs availablein Otjivero, freeing residents from the need to travel toGobabis.Before the introduction of the BIG, almost half of theschool-going children did not attend school regularly.Pass rates stood at about 40% and drop-out rates werehigh. Many parents were unable to pay the school fee.After the introduction of the BIG, more than double thenumber of parents paid school fees (90%) and most ofthe children now have school uniforms. Non-attendancedue to financial reasons dropped by 42% and this ratewould have been even higher without the effects of migrationtowards Otjivero-Omitara. Drop-out rates at theschool fell from almost 40% in November 2007 to 5% inJune 2008 and further to almost 0% in November 2008.The residents have been using the settlement's healthclinic much more regularly since the introduction of theBIG. Residents now pay the N$4 payment for each visitand the income of the clinic has increased fivefold fromN$ 250 per month to about N$ 1,300.The BIG contributed to the reduction of household debtwith the average debt falling from N$ 1,215 to N$ 772between November 2007 and November 2008. Savingsincreased during that period, which was reflected in the15

EXECUTIVE SUMMARY➢➢➢➢➢➢➢increasing ownership of large livestock, small livestockand poultry.The BIG has contributed to a significant reduction ofcrime. Overall crime rates – as reported to the local policestation – fell by 42% while stock theft fell by 43%and other theft by nearly 20%.The introduction of the Basic Income Grant has reducedthe dependency of women on men for their survival. TheBIG has given women a measure of control over theirown sexuality, freeing them to some extent from thepressure to engage in transactional sex.The criticism that the BIG is leading to increasing alcoholismis not supported by empirical evidence. The communitycommittee is trying to curb alcoholism and hasreached an agreement with local shebeen owners not tosell alcohol on the day of the pay-out of the grants.The BIG is a form of social protection, which reducespoverty and supports pro-poor economic growth. As anational policy it would greatly assist Namibia in achievingthe Millenium Development Goals to which the countryhas committed itself.The costs of a national BIG in Namibia are substantial.The net costs will be between N$ 1,2 – 1,6 billion peryear, equivalent to 2,2 – 3% of Namibia's GDP. There arevarious options to finance such a national grant. A moderateadjustment of VAT combined with an increase inincome taxes is one option. This would benefit all middleand lower income households in terms of available incomes.Other financing options include a re-prioritisationof the national budget and the introduction of a speciallevy on natural resources.An econometric analysis revealed that Namibia's tax capacityexceeds 30% of the national income. The currentcollection rate is below 25% and thus Namibia's excesscapacity to raise tax revenue significantly exceeds thenet costs of a Basic Income Grant. This makes the BIGaffordable in Namibia.A national BIG would have several medium to long-termbenefits. Based on the developments in Otjivero-Omitara,it is safe to argue that the BIG will reduce poverty16

EXECUTIVE SUMMARYand unemployment, increase economic activities andproductivity, improve educational outcomes and thehealth status of most Namibians.17

Section 1: The BIG a small project with a large aimSection 1: The BIG a small projectwith a large aimNamibia In 2002, is the acountry Namibian withone Government'sTaxof thehighestlevels Commission of income(NAMTAX) inequalityproposed in athe universal world.grant alongthe lines ofa Basic IncomeGrant(BIG).Every Namibianshouldhave a citizenshipright to aBasic IncomeGrant.1.1 Introduction to the Pilot ProjectIn 2002, the Namibian Government's Tax Commission(NAMTAX) proposed a universal grant along the lines ofa Basic Income Grant (BIG), to be financed out of a progressiveexpenditure tax on the affluent. This marked aturning point in public consideration.In 2004, concerned with the pace of poverty reduction,in spite of many good efforts, and a public commitmentto reduce it by the Government of Namibia, a cross-sectionof Namibian society, from all walks of life and allshades of political opinion, set up a Coalition to promotea BIG for all Namibians.The Coalition brought different umbrella bodies together.This includes the Churches – represented by theCouncil of Churches (CCN) - the trade unions – representedby the Namibian Union of Namibian Workers(NUNW), the Namibian NGO Forum (NANGOF) and theNamibian Network of AIDS Service Organisations (NA-NASO). The Evangelical Lutheran Church in the Republicof Namibia (ELCRN) with its Desk for Social Development(DfSD) is the legal administrative and financialhome responsible for the implementation of the BIG PilotProject on behalf of the BIG Coalition. Besides theBIG Coalition many other groups and numerous individuals,including local businesspeople, churches,donors, and international agencies gave support andencouragement. Some Government Ministers and seniorofficials have also shown interest and indicated theirwillingness to develop a more universalistic system ofsocial protection and economic empowerment.The proposal developed by the BIG Coalition – followingthe NAMTAX recommendation – is that every Namibian18

1.1 Introduction to the Pilot Projectshould have a citizenship right to a Basic Income Grantuntil she or he becomes eligible for the governmentpension at 60 years. The level of the BIG should not beless than N$ 100 per person per month. Given that theNamibian old-age pension is a universal grant for allmen and women over the age of sixty, and that thetake-up of that is nearly 100%, the BIG should be paidto all those men, women and children under the age of60. The BIG is a cash transfer, whereby the recipientcan choose how to spend the money. It is an act of empowerment,of giving people enhanced freedom andpersonal responsibility. It is not a gesture or an act ofcharity that potentially degrades. It is providing peoplewith a right.1.2 How BIG was piloted inOtjivero-OmitaraIn 2007, the BIG Coalition decided to implement a pilotproject to move the policy debate forward and to producereal evidence of the benefits of a BIG. The NamibianBIG pilot is the first universal cash transfer pilotproject in the world.The experience of other countries showed that nationalprogrammes have been successfully implemented whenpilots have proven their viability. For example, a pilotproject in Haiti, Rwanda and South Africa demonstratedthat antiretroviral treatment could be providedeffectively to poor people – even those in deep ruralareas. This helped change national and internationalpolicy, thereby paving the way for the dramatic globalroll-out of antiretrovirals (ARVs). The BIG Coalitionhoped that by operationalising a BIG pilot project, Governmentleaders and others could see how the BIGcould be transformed into a national programme.After careful examination of several villages in Namibia,the site chosen for the BIG pilot project was theOtjivero settlement and the Omitara 'town' in the OmitaraDistrict. Otjivero-Omitara was selected for its manageablesize, accessibility, and poverty situation.The NamibianBIG pilotis the firstuniversalcash transferpilot projectin theworld.19

Section 1: The BIG a small project with a large aimOtjivero was known for its bad reputation amongst thelocal farmers as a hot-bed of criminal activities.Photo 1: Plastic and corrugated zinc were the main building materialsin Otjivero (April 2007)Every residentunderthe age of60 living inOtjivero-Omitara receivesN$100 eachmonth fromJanuary2008 for twoyears, endinginDecember2009.Omitara is located some 100 kilometres east of Windhoek.People (mainly retrenched farmworkers) startedsettling in Otjivero about 5 km away from Omitara ongovernment-owned land in 1992. A feature of the areais the proximity to a large dam that supplies water toWindhoek and surrounding areas. Unusually, thepeople in Otjivero have access to free water supply, butthe area is impoverished, prone to diseases, such as TBand HIV/AIDS, and struggling to subsist as a viablecommunity. In addition, the development of the settlementhas been controversial from the beginning andthere has been persistent conflict with the surroundingcommercial farmers because of illegal hunting, trespassingand the collection of firewood. There was noreason to think that its choice as the site for the BIGpilot made it more or less likely to succeed there thanin other parts of the country.The pilot was implemented as follows: Every residentunder the age of 60 living in Otjivero-Omitara receivesN$ 100 each month from January 2008 until December20

1.2 How BIG was piloted in Otjivero-Omitara2009. Nine hundred and thirty residents got this grantof N$ 100 without any condition. The money for childrenand youths up to the age of 21 was paid out to aperson designated as their 'primary care-giver' which bydefault is usually the mother.In the period of two years, the aim was to monitor andevaluate the effects of BIG on individuals living in thearea and on the community overall. The evidence wasto be made available publicly to provide a basis for aconstructive debate based on empirical evidence.1.3 Implementation of the BIGPhoto 2: The BIG as a right21

Section 1: The BIG a small project with a large aimPhoto 3: N$ 100 - making a differenceEvery recipientof theBIG has asaving accountwithNamPostinto whichthe grant.In the first 6 months, the practical payout of the BIGfollowed the methodology and the experience of the oldage pension payout in Namibia. The recipients receiveda 'smart card' which contains the names, ID numbersand the picture of the recipients as well as a microchipcontaining the birth date, fingerprints and informationon the amount and history of receiving the grant. Thesystem also makes provision for a 'procurator', who is aperson appointed by the recipient, who can receive thegrant on his/her behalf by means of fingerprint identification,if for some reason the person cannot collect itpersonally. The company who managed the grant payoutsfor the first six months, United Africa, brought thegrants by vehicle to the designated pay-out point. Thevehicle was fitted with a cash dispenser and accompaniedby an armed security guard. The recipient placedthe card in the cash dispenser and identification wasdone via fingerprints. The date and place of payout wasthen written on the microchip for record keeping and toprevent double payment.Since July 2008, the Namibian Post Office (NamPost) isconducting the pay-out of the grant via its Post Officesmart card savings account system. Every recipient of22

1.3 Implementation of the BIGthe BIG now has a saving account with NamPost intowhich the grant is paid on the 15 th of each month. Thissystem has the advantage of getting every recipient intothe formal banking system. This enables the recipientsto decide when, where, and how much of the grantshould be withdrawn. It avoids the potentially stigmatisingqueueing for the cash pay-out.Photo 4: BIG payout through NamPost savings accountsThe BIG Coalition registered the whole community on31 July 2007. Each and every household was visited,all members of the households were identified bymeans of identification documents 3 and everybody belowthe age of 60 was registered for the BIG. The registrationwas done in one day in order to avoid in-migrationto the settlement. Anybody who moved to Otjivero-Omitara after 31 July was not eligible to receive theBIG. For children under the age of 21, the householdidentified a primary care-giver to receive the grant onthe minor's behalf.3 This included any Namibian identification document like IDs,Birth certificate, Driver's licence, Voter's Card, etc. but alsoBaptismal card as many people living in Otjivero-Omitara donot have any of the national identification documents.23

Section 1: The BIG a small project with a large aimThe project received international support from theGeneral Secretary of the Lutheran World Federation,Dr. Ishmael Noko, Archbishop Desmond Tutu, the GeneralSecretary of the United Evangelical Mission (UEM),Dr. Fidon Mwombeki, and from Senator EduardoSuplicy, (Sao Paolo, Brasil)The fund-raising campaign for the pilot was launchedin August 2007. Namibia's first Prime Minister and currentMinister of Trade and Industry, Dr. Hage Geingob,was the first person to pledge support for the BIG duringthe event and generously donated money coveringtwo grants for one year. Other committed individualsand donors followed his example and enough financeshave been secured for the anticipated two year BIG pilotproject.The BIG Coalitioncommitteditselfto carefullyevaluatingthe pilotproject inorder to assessthe impactof theBIG and toadvise nationalpolicymakers.Photo 5: Dr. Hage Geingob, the first to donate to the BIG Pilot ProjectFund1.4 MethodologyThe BIG Coalition committed itself to carefully evaluatingthe pilot project in order to assess the impact of theBIG and to advise national policy-makers. Ideally, asurvey of other areas at the same time should havebeen conducted ('control group'). However, this is notonly statistically very difficult, given the particular fea-24

1.4 Methodologytures of Otjivero-Omitara, but also ethically problematic.Therefore, a four-fold research methodology was adopted,drawing on four types of data.First, a baseline survey of the settlement area was conductedin November 2007, two months before the firstpay-out of the BIG. This survey collected retrospectiveand current data on the social and economic situationof the residents, including health and nutritional data.Second, a panel survey was conducted in July 2008,covering the same households and individuals as in thebaseline survey. The panel survey was repeated by a resurveyin November 2008.Third, information was gathered from key informantsliving in or near the settlement area such as the localnurse, the police chief, local leaders and shop keepers.Fourth, a set of case studies of particular individualswas collected in order to provide a picture of human lifein Otjivero- Omitara. These are described in the nextsection. Aspects of how BIG changed their lives are recordedand quoted throughout the report. The individualsagreed that their real names and pictures are published.This is a brave commitment towards the project.The whole community of Otjivero-Omitara has been registeredand is voluntarily participating in the pilot project.The baseline survey of November 2007, and thepanel surveys of July and December 2008 were successfullycompleted. Thus, an assessment of the variouseffects of the BIG could be made.25

Section 2: Impact AssessmentSection 2: Impact Assessment2.1 Realities of poverty before theBIGThe inhabitants of Otjivero-Omitara are diverse. Themajority of the adult population were not born inOtjivero-Omitara and many lived difficult lives. The followingstatements and quotes exemplify the experiencesof life in Otjivero-Omitara before the introductionof the BIG, painting a picture of suffering and deprivation.In November 2007, the people said the following abouttheir daily living conditions:“We arereallyhungry.”(Emilia Garises)Photo 6: Ms. Emilia Garises, 55, mother of 7 children, head ofhousehold. (Before the BIG)Unemployment, hunger and poverty are the biggestproblems. Some days we don’t have anything (to26

2.1 Realities of poverty before the BIGeat) and we just have to go and sleep and get upagain without eating. We are really hungry. (EmiliaGarises)Willemina Gawises 31, single mother of three:There is a problem of unemployment and we don’thave money to travel to Gobabis and Windhoek tolook for work. I have three children, age 10, 13 anda 7-months-old baby. Now I don’t know where theirfather is and I have no job or money to send themback to school. I and my three children depend onmy unemployed parents for food and accommodation.Sometimes I wish I was dead because I cannotstand this type of life any more. I am supposed toprovide and protect my children and parents but Iam failing to do that. Life is very difficult here, welive in poverty with no hope for the future.“SometimesI wish I wasdead becauseI cannotstandthis type oflife anymore. I amsupposed toprovide andprotect mychildrenand parentsbut I amfailing to dothat.”(WilleminaGawises)Photo 7: Desperation before the BIGMy two boys were at “Koshuis” (Hostel) GurichasSchool, but they were expelled from school 7months ago, because I failed to pay for their schoolfees. It hurts me to see my children out of school.They were very happy in school and it was difficult27

Section 2: Impact Assessment“The pain aparent hasto gothroughknowingthat youcannot sendthem backbecausethere is nomoney isunbearableand very depressing.Iwish I didnot havethem.”(WilleminaGawises)for them to adjust. I could see their pain and feel it,they used to ask me “Mama wanneer gaan ons terrugskool toe” (Mummy when are we going back toschool). The pain a parent has to go through knowingthat you cannot send them back because thereis no money is unbearable and very depressing. Iwish I did not have them.“Most of thelearners aremore interestedin thepots than inschooling”(Gawachab,teacher atthe OtjiveroPrimarySchool)Photo 8: Before BIGMs. Mbangu, nurse at the clinic of Otjivero:The biggest problem is unemployment. There is nowork. When people look for work at the farms theyare asked: where are you from? When they sayfrom the Otjivero camp, they are sent back. Theyare not given a job. Those who worked on thefarms before, are also lying around here now.People are hunting so that they can live. If you areworking on a farm and you hunt a pig, they willchase you away.Mr. Gawachab, a teacher at the Otjivero PrimarySchool:We ask N$ 50 per year for school fees but mostpeople struggle to pay that. Most of the learners aremore interested in the pots than in schooling (the28

2.1 Realities of poverty before the BIGchildren receive cooked pap at the school everyday). Many children stay away from school if theydo not receive food. Generally the interest in schoolis very low among the learners. Some childrendon’t have school uniforms at all, others have uniformsof other schools.Mr. Thomas, Police station commander at the OmitaraPolice Station:Photo 9: Housing before BIG“People livein shacksmade up ofdrums orpieces oftents.”(Thomas,Police stationcommander)There are no proper houses in the camp. People livein shacks made up of drums or pieces of tents.There are no jobs and people start some small businessto make a living. Running a shebeen is normallythe only way to make some money. Povertyand unemployment lead to all the other conditionslike crimes, alcohol abuse, mushrooming of shebeen.29

Section 2: Impact Assessment“We have aproblemwith HIV/AIDS infectionsand itis on the increasebecauseofpoverty.”(WilleminaGawises)Willemina Gawises 31, single mother of 3:We have a problem with HIV/ AIDS infections andit is on the increase because of poverty. Manypeople do not have access to ARV treatment andneither nutritional food. One cannot expect poorpeople to travel to Gobabis for treatment everymonth.2.2 Expectations for the BIGMany inhabitants of Otjivero-Omitara expressed differentexpectations for the BIG. Many made plans on howthey would resolve some of the problems they were facing.In essence, the introduction of BIG was expectedto fight extreme poverty and hunger in private householdsas well as in the community at large. The quotesbelow highlight some of the expected changes:“I havehope. […] Iwant tomake a bitextra sothat I willnot behungry. […]Life willreally improvenextyear.” (EmiliaGarises)Ms. Emilia Garises:I have hope. If I get the N$ 800 I will buy maizemeal and other food; I will pay school fees; I willperhaps buy materials and make clothes. I want tomake a bit extra so that I will not be hungry. I willpay the school and also buy new clothes for thechildren. I will also buy blankets and perhaps fixmy house. I will also try and make more vetkoeksto sell and make some extra money. I want to put alittle money aside so that I don’t have to struggle somuch if we have a death in the family. Perhaps Ican take out a funeral cover; they say it costs N$20 per month. Life will really improve next year.30

2.2 Expectations for the BIGMs. Willemina Gawises:With the BIG grant, there will be hope for us, atleast I will be able to buy my children food andsend them back to school. The money will mostlybe spent on food and school fees and uniforms.Maybe I will be able to travel to Windhoek to lookfor domestic work, because now I cannot look forwork. There is no money to travel there. Life willchange in Otjivero with BIG. Many people will havefood.Mr. Gawachab, Schoolteacher at the Otjivero PrimarySchool:The BIG will make it possible for families to payschool fees and to buy school uniforms for the children.Children will also have food and perhaps wecan even build a hostel.“With theBIG grant,there willbe hope forus, at leastI will beable to buymy childrenfood andsend themback toschool. ”(WilleminaGawises)Mr. Thomas, Station Commander:I believe that through the BIG, poverty will be reduced.The standard of living will be upgraded alittle but there are zero chances for people to findjobs.Ms. Mbangu, the nurse at the clinic explained howpoverty hinders access to health services and the fightagainst HIV and AIDS. She was hopeful that the BIGwould facilitate access to the clinic and to anti-retroviraldrugs:Most don't come to the clinic, because they do nothave N$ 4,-. They are sick, but they stay at home.Not all people who are HIV positive are on ARVs becausethey can’t get transport to Gobabis. It costthem about N$ 100 to take taxis from Otjivero toGobabis and back. Then they are hungry but havenothing to eat. The BIG will be good for the peoplehere and will help them to pay N$ 4,- and also topay for transport to get the ARVs in Gobabis.“The BIGwill be goodfor thepeople hereand willhelp themto pay N$4,- and alsoto pay fortransport toget theARVs inGobabis.”(Mbangu,nurse at theclinic)31

“I have a lotof plans. Iwas alsoable to buymore foodand have aphoto showingwhen wewere shoppingin theshop. I alsobought a 2-plate stovebecause wehave electricityin thehouse.”(Emilia Garises)Section 2: Impact Assessment2.3 Voices of changeMany positive changes were observed in Otjivero-Omitaraimmediately after the introduction of BIG. The impactwas visible on different levels, on individuals,households, institutions and on the community. Mostpeople noted that their expectations as expressed inthe quotes above were met. The following quotes exemplifythe impact of the BIG on the people of Otjivero-Omitara:In June 2008, Ms. Emilia Garises explained how sheused the BIG money:Photo 10: Emilia Garises - making dresses with material shebought from the BIGSince we get the BIG I bought materials and I ammaking 3 dresses that I will sell. When I finish withthis one (shows an almost completed dress), I willstart with new ones. I sell a dress for N$ 150. I alsopaid a deposit for new zinc sheets for my house. Iam paying them off. When you come again, you willsee the changes. I have a lot of plans. I was alsoable to buy more food and have a photo showingwhen we were shopping in the shop. We boughtmealie meal, tomato sauce, cooking oil and all that.32

2.3 Voices of changeWe bought from the shop in Omitara. I also boughta 2-plate stove because we have electricity in thehouse.Willemina Gawises also spoke about the changes in herlife:Things are really fine unlike before when I wasreally suffering and struggling very hard. Last yearI used to be very depressed because I had to begall the time, now I have enough to eat. I am still unemployedbut at least I do not depend on my parentsany more for food and other things now I havemy own money. My children are back in school andI am saving some money to be able to send them toboarding school when they complete their primaryeducation here. The BIG has helped me and mychildren a lot. I can now also travel to Windhoek insearch for work.In June 2008, Ms. Mbangu the clinic nurse shared herobservations about the impact of the BIG on living conditionsin Otjivero-Omitara:I ask people how they are living and they are eatingmuch better now. They tell me that things aregoing a bit better. Some people have started sellingthings like food, tobacco, clothing, cell phones, as asource of income. One HIV positive woman nowbuys materials and makes Nama dresses. We arethinking of holding a competition to see what peopledid with the BIG money. We want to give a prizeand this can motivate others.“Things arereally fineunlike beforewhen Iwas reallysufferingand strugglingveryhard. […]The BIG hashelped meand my childrena lot. Ican nowalso travelto Windhoekinsearch forwork.”(WilleminaGawises)2.4 Profile of Otjivero-OmitaraThe evaluation study is based on a random sample ofabout a quarter of Otjivero-Omitara's 200 or so households.The baseline survey of November 2007 covered asample of 398 individuals in 52 households. Thesample consisted of slightly more females (51%) thanThe samplefor the evaluationstudywas randomlydrawn, coveringabout50 out of200 households.33

Section 2: Impact Assessmentmales (which is roughly similar to the pattern in thecountry (53% female). Likewise, the age distribution inthe sample was similar to that found in the countryoverall, with a preponderance of young people. Thesample showed that the largest language group inOtjivero-Omitara are those speaking Damara/Nama(73%), followed by Afrikaans (10%), Otjiherero (8%),Oshiwambo (6%), Rukwangali and Setswana (2%).MigrationThe total number of individuals in the sampled householdsincreased substantially over the period of thestudy. The table below sheds some light on thosetrends of in- as well as out-migration during 2008.baseline Jul 08 Nov 08In-migrants(and as a % ofbase-line populationforhouseholdspresent at thebeginning andafter a yearOut-migrants as% of base-linepopulation*0% 17% 27%0% 7% 16%Total numbersmoving as % of 0% 24% 43%baselineTable 1: In- and out-migration over 12 monthsThere hasbeen an inmigrationof27% intoOtjivero-Omitara.Some in- and out- migration is typical for a rural Namibiancommunity. Children come and go, depending onfamily arrangements to take care of them and the availabilityof schooling in the area. As the school in Otjiveroonly caters for children up to Grade 7, some outmigrationof older children was to be expected. One also expectedsome outmigration by adults looking for workelsewhere. However, a 43 % in- and out- migration issurprising.34

2.4 Profile of Otjivero-OmitaraThe out-migration (16%) has been considerably smallerthan the in-migration (27%). Of those who left, the majoritywere unemployed (33%) followed by children whowere full-time students (24%) and thirdly a group ofpeople, who were in employment (18%).It is noteworthy that the people who left, were also takingthe BIG with them and thereby reduced the totalamount of the BIG spent in Otjivero-Omitara.An in-migration of 27% into Otjivero-Omitara points tothe attraction of a community receiving the BIG, evenwhen the in-migrants themselves do not receive theBIG. It seems many people came to Otjivero-Omitaraout of destitution and in order to somehow benefit fromthe BIG paid to family members. This is remarkable,since Otjivero-Omitara as an isolated rural area haslittle attraction. The actual in-migration is likely to beeven higher than 27%, which only captures existinghouseholds and not any new households that were establishedduring 2008.Ninety-four percent of in-migrating children were below15 years old and hence were eligible to attend theOtjivero Primary School. Whether these children cameto the area to take advantage of the BIG-induced increasein household income, or whether it was to takeadvantage of the school (which is widely believed tohave improved as a consequence of greater school feerecollection), the result was to put greater, and unexpectedpressure on the school.It most cases, the extra people in the households putan additional strain on household budgets. The followingtable calculates the average per capita BIG in thehouseholds over time, both with and without an inflationadjustment:An in-migrationof 27%intoOtjivero-Omitarapoints to theattraction ofa communityreceivingtheBIG.The extrapeople inthe householdsput anadditionalstrain onhouseholdbudgets.35

Section 2: Impact AssessmentJan 08 4 Jul 08 Nov 08Nominal N$ 89 N$ 75 N$ 67Real (inflationas per CPItaken into account)N$ 89 N$ 70 N$ 61Table 2: Average per capita BIGThe migrationpatternsshowthat a BIGneeds to beintroduceduniversally,since otherwisebenefitsto intendedbeneficiariesareerodedthrough inmigrationofother poorpeople.When the BIG was introduced in January 2008 at N$100 per person, this resulted in an average per capitaincrease of income of N$ 89 (as not everyone, namelythe pensioners qualified for the grant). This was reducedthrough in-migration to N$ 75 within 6 monthsand to N$ 67 within a year. Adjusted by overall CPI inflation5 , the per capita value of the BIG in the householdshas been reduced to a mere N$ 62.The migration patterns hold crucial lessons for the universalimplementation of a BIG in Namibia. The impactof a targeted grant to only a certain section of the populationwill be eroded since living arrangements are sofluid that many unemployed and other dependent extendedfamily members may simply move to where themoney is. This is a well documented effect, already happeningwith old-age pensions, where one or two old-agepensions support entire households rather than justthe needs of elderly and retired people.For the evaluation, however, the spending and impactof the BIG in Otjivero-Omitara will increasingly becomeharder to trace since the direct intended benefit percapita is substantially diluted and reduced. A nationalBIG would not suffer from these repercussions.4 Note that the baseline study was conducted before the BIG waspaid out5 Note the inflation on basic food items was drastically higherthan the overall CPI.36

2.5 Community Mobilisation2.5 Community MobilisationWhen the BIG pilot project was still under discussion,the Otjivero-Omitara community demonstrated ahealthy suspicion towards development aid and outside'assistance', which they saw as short-term gestures andill-conceived projects. However, after speaking to thecommunity on the day of registration, the Bishop of theEvangelical Lutheran Church in the Republic of Namibia(ELCRN), Dr. Zephania Kameeta, was able to allaysome of their fears. As the chairperson of the BIG Coalitionin Namibia, his presence was important in helpinginstil trust and enhance the credibility of the pilot project.With registration for the BIG pilot, the community ofOtjivero-Omitara embarked on a process of mobilisation,conscientisation and self-empowerment. It is importantto stress that this was an entirely organic processinitiated and developed by the community withoutoutside interference. The community decided to elect a'BIG Committee' to guide the pilot project within thecommunity and assist the community and the BIG Coalitionwherever needed. In September 2007, an 18member committee was elected at a community meeting.It comprised the local teachers, the nurse, the policeas well as business people such as shebeen ownersand community members. Representation of languageand age groups was ensured.The community felt that, unlike other projects, the BIGpilot project gave them ownership of the process andresponsibility for the outcome. They felt that they hadbeen entrusted with the project and wanted it to havethe best possible impact on the lives of individuals andthe wider community. By definition an unconditionaluniversal cash transfer gives the recipient the choice ofwhat to do with the money. The community realised atthe outset that they had been given the opportunity tomake it work. It was clear to all BIG recipients that thesuccess or failure of the pilot project depended onthem.According to the guiding principles of the BIG committee,they were participating in a “little project with aWith registrationforthe BIG pilot,the communityofOtjivero-Omitara embarkedon aprocess ofmobilisation,conscientisationandself-empowerment.37

Section 2: Impact Assessmentlarge aim. The aim is to UPLIFT the 'life' of Omitara, thenNamibia, then Africa and at last the world” (BIG Committee,2007)Photo 11: Otjivero-Omitara elected its own BIG CommitteeIn September 2007, this BIG committee set itself a highstandard by developing a strict code of conduct andoutlining a number of tasks for the committee and itsindividual members. The committee elected a numberof so-called 'control officers'. The name 'control officer'may appear, at first glance, to have a rather negativeconnotation. However, the committee explained thatthe name should support the seriousness of their tasksin contrast to weaker labels like 'advisor' which, theysaid, are known to be ineffective. 'Control officers' weretasked with educating, conscientising and empoweringpeople in the community to make the best use of theirBIG payments. The 'control officers' are not there toforce people to spend the money in certain ways, butrather to raise awareness and provide advice.The committee was well aware of the widespread problemof alcohol abuse and knew that this would receivespecial attention during the pilot project. Accordingly,shebeen owners were represented on the committeeand were asked to assist with their advice and coopera-38

2.5 Community Mobilisationtion. This bore fruit when the shebeens agreed not toopen on the days the BIG was paid out. The challengeof alcoholism was openly discussed from the outset andaddressed through a process of community mobilisation.It was encouraging to see the powerful community mobilisationhappening in Otjivero-Omitara even beforethe implementation of the BIG. The successful start inJanuary confirmed the sense of trust between the communityand the BIG Coalition. Due to the excellent organisationand work of the committee, the BIG Coalitionhas so far not experienced any problems in the cooperationand communication with the community ofOtjivero-Omitara.It should be mentioned that the BIG Coalition and theresearch teams tried to make contact with the surroundingcommercial farmers in order to learn abouttheir views on the pilot project and the developments inOtjivero-Omitara. However, the farmers have so farbeen reluctant to engage with the process.2.6 Dependency or dignity?The BIG Coalition and the community of Otjivero-Omitarahas also had to deal with criticisms from those opposedin principle to the BIG. One had hoped that theresults presented in the 6 months report could informthe discussion, and in some cases it has. However,there is a level of debate that occurs at a purely ideologicaland emotive level which seems impervious to thedata.These criticisms revolve around two core beliefs: that acash transfer is bad for people because it gives themrights without responsibility; and that poor people arenot capable of spending the money wisely. On the eveof a press conference, the BIG Coalition received anemail providing a typical example of such argumentation(2 nd November 2008). The person asked that theemail should be read as a contribution to the discussionat the press conference, and we reproduce it here:39

Section 2: Impact AssessmentThe criticismsrevolvearound twocore beliefs:that a cashtransfer isbad forpeople becauseitgives themrightswithout responsibility;and thatpoor peopleare not capableofspending themoneywisely.The BIG pilotprojectshows thatthere isgood reasonto trust thepoor tomake theright decisionsforthemselvesrather thanto writethem off!“To All involved in the "BIG Project" (...)The basic idea of the "Basic Income Grant" is commendable,as we strive to alleviate poverty and createa better future for the disadvantaged people inour country. But how can you expect people to takeresponsibility, exert discipline and respect, if theyhave - some for generations! -not experienced ANYof this in their upbringing since childhood? Youknow, like the rest of us , what is going on inpoverty-stricken communities abusing women andchildren under the influence of drugs and alcohol!There is no place to sleep, no food, no love, no basicliving requirements - and now you expect peopleto responsibly handle money they are getting fornothing, no 'favour' or action asked in return? Evenin history, trading amongst the native peoplemeant: 'I give you something, you give mesomething in return. (...)”Besides the implicit racist (but all too common) assumptionswhich underpin the above claims, the argumentboils down to two prejudicial assertions: Firstly,that poor people in Namibia are so poor and damagedthat they are incapable of making rational spending decisionsto improve their lives. The results of the researchin Otjivero-Omitara speak directly to the firstclaim: Poor people have spent the money wisely, childmalnutrition has fallen dramatically, school fees andclinic fees are paid, houses have improved and incomeearningactivities have increased, helping to uplift othersthrough these 'second round' economic effects. Itwas also found that the community organised itself tohelp make the BIG project a success. In other words,the BIG pilot project shows that there is good reason totrust the poor to make the right decisions for themselvesrather than to write them off! They certainlyknow what their priorities are.As regards the second claim, i.e. that a BIG is a badidea because it gives people 'something for nothing', weaccept that a BIG is innovative in this respect, but arguethat its individual and social benefits are immense.40

2.5 Community MobilisationTrusting poor people to spend an unconditional grantwisely restores dignity, is empowering in ways whichgovernment-administered alternatives are not, andsaves a great deal of money by cutting out the layers ofbureaucrats and paper work which typically absorb alarge proportion of the funds allocated to targeted andconditional programmes. Indeed, there is a strong casefor assuming that providing people with a BIG not onlyimproves their material circumstances, but promotesdignity and socially responsible behaviour. As Otjiveroresident Jonas Damaseb told us:“Generally, the BIG has brought life to our place.Everyone can afford food and one does not seeany more people coming to beg for food as in thepast. What I can say is that people have gainedtheir human dignity and have become responsible.”There is astrong casefor assumingthatprovidingpeople witha BIG notonly improvestheirmaterial circumstances,but promotesdignityand sociallyresponsiblebehaviour.The observation of one of researchers, Rev. P. #Khariseb,during the first 6 months research echoes thisview :During the case study interviews I generally observedthat in the people of Otjivero have regainedtheir human dignity during the first 6 months of theBIG. Through regaining their human dignity, peopleact more responsible: Their environment is cleanand from small to the elderly everyone is dressedneatly. What a positive change!The experience of the BIG pilot suggests that the universalcash grant liberated people and the communityfrom the individually and collectively draining and devastatingimpact of poverty. Many people living inOtjivero-Omitara said that they had only survived previouslyby asking and begging for food. This was profoundlyembarrassing and undermined their capacity tohave normal social interactions and the development ofconstructive community relations and real communityspirit. The payment of the BIG has dramaticallychanged this. Begging has basically stopped and peoplereported that they can now visit and speak freely toeach other now, without the fear of being seen as a potentialbeggar. Judging from the observations of com-The BIG liberatedpeople andthe communityfromthe individuallyandcollectivelydraining anddevastatingimpact ofpoverty41

Section 2: Impact Assessmentmunity members, researchers and members of the BIGCoalition, it would appear that a stronger communityspirit developed over the period of the first year of theBIG.Similarly, we would suggest that a spirit of pride andresponsibility was evident when the school fees werepaid at the beginning of the year. One example is thecase of a single father who was able, for the first time,to pay his daughter's school fees. When he came to theschool, the teacher did not even know him, because hehad always avoided contact with the school because hecould not pay the school fees. When he paid, he saidproudly:Now I want to pay for my child and because I havepaid for the school, I will ensure that she performswell.Note how he said that he, rather than the BIG, waspaying for the school fees. Precisely because it was hischoice to use the money that way, he got the benefit ofenhanced dignity and took on the responsibility ofmaking sure that his daughter justifies the expenditureby working hard. If, instead of paying out a BIG, theproject had adopted a more targeted and paternalisticapproach of simply paying the school fees, then wewould have seen neither benefit. This is yet another exampleof the individually and socially transformativepower of an unconditional cash transfer.2.6 AlcoholOne of the variants of argument against a BIG claimsthat a BIG is a bad idea because it will be spent on alcohol.As is the case elsewhere in Namibia, there is analcohol problem in Otjivero-Omitara. Mr. Köhler, thebottle store/general dealer in Omitara, claims that theproblem got worse because of the BIG:“My experience with BIG is that people buy somefood and then there is money left over and theybuy liquor...On BIG pay day people buy bread from42

2.6 Alcoholthe shop and then they go over the liquor store andbuy Club Zorba – that is the killing petrol aroundhere. If I don't sell it to them, they will go to the shebeenand buy it for 20% more... Before the BIGthere were 8 shebeens of which one had a license.Now there are 16 shebeens in the camp. After theBIG pay day, some people buy boxes of liquorthere. They later sell that liquor back door.”Mr Köhler, however, mistakes the increase in his ownsales of alcohol on pay day for a general increase in alcoholsales. The fact of the matter is that the other liquoroutlets had been persuaded by the communityleaders to close on BIG pay-days. Mr Köhler was theonly shop not to comply with this request. The small increasein liquor sales he experienced was simply becausehe was picking up a small fraction of the demandthat was typically met by his competitors.The research also found no evidence of an increase inthe numbers of shebeens nor an increase in theturnover of existing shebeens. According to a shebeenowner:“The number of shebeens did not increase, in factthere were 8 shebeens before and now there are 7.We know there are many reports that the peopleare spending the money on alcohol instead of buyingfood but that is not true at all. We had a fewcases when things went out of control but that onlyhappened during the first pay-out. I would say,some people got excited about the money. Afterthat, the [BIG] committee sat and had a meetingwith the community and after that nothing serioushappened again”. (Adam Tjatinda, July 2008)There wasno evidenceof an increasein alcoholismasa result ofthe BIG.Likewise,there is noevidence ofan increasein the numberof shebeens.This was confirmed by the local police station, whichindicated that problems experienced after the first payoutday did not recur. 6 However, the police expressed a6 There was a report about fighting on the day of the first payout,which turned out to be a conflict between people who didnot reside in Otjivero-Omitara. The police indicated that therehas been no repeat.43

Section 2: Impact Assessmentconcern about the possibility of alcohol abuse inOtjivero-Omitara. This was supported by one of the residents:“There are still people who are drinking and theydon't want to stop drinking like I did but a lot haschanged [since BIG]. Everybody can at least affordto have food. When it is payout here we all travel toGobabis to go buy food in bulk and the train is alwaysfull with people from Otjivero”. (HermanusCoetzee, July 2008)Alcohol abuse exists in Otjivero-Omitara as in any othercommunity in Namibia. The BIG is not able to solvethe problem, but there is also no evidence that it aggravatesit. However, the establishment of the BIG committeeand the discussion about the potential misuse ofBIG money for alcohol has triggered a conscientisationprocess within the community. Shebeen owners are onthe BIG Committee and there are open discussionsabout alcohol abuse. This should be regarded as a positivedevelopment and a step into the right direction totackle the problem.2.7 CrimeAn important indicator of social conditions is the levelof crime. Some crimes are economic in nature. Theserange from desperate actions in search of food, such asillegal hunting (as described in Johannes Goagoseb'sstory 7 ), to theft and fraud. Other crimes, such as assault,criminal injuria, reckless driving, malicious damageto property and perjury are more general in natureand not obviously or necessarily related to economicconditions.There has always been a history of crime in the area.When interviewed in November 2007, the police stationcommander commented on the crimes that typically occurredin the area:7 See 2.10 p. 6044

2.7 Crime“The criminal activities are mostly poaching, assaultand housebreakings. Poaching is the most commonone. Poverty and unemployment are the reasonsfor these criminal activities. Otjivero is a tiny placeand there is no source of income there. Most peoplehunt or poach just for survival… Poverty and unemploymentlead to all the other conditions like crimes,alcohol abuse, mushrooming of shebeens. As youcan see, there are no proper houses in the camp.People live in shacks made up of drums or piecesof tents.There are no jobs and people start some small businessto make a living. Running a shebeen is normallythe only way to make some money. However,there is also the Namwater dam and some communitymembers catch some fish there that theysell. Some people look for jobs in the farms but thelocal farmers don’t want people from the Otjiverocamp because they always accuse them of poachingon their farms.”This problem was confirmed by the clinic’s nurse:“There are no jobs, no food or any activities for theyouth. They have to go hunting or stealing atnearby farms to sustain themselves. When lookingfor jobs at nearby farms, they don’t get jobs because[the farmers think they are] thieves. It seemsthat all the farms surrounding Otjivero belong to thesame relatives. They are hostile to the Otjivero communityand have decided not to give anybody fromOtjivero employment.”The Big Coalition hoped that the introduction of theBIG would reduce economic crime as people wereprovided with a minimum standard of living. This, indeed,has taken place.According to official information provided by the Omitarapolice station, 54 crimes were reported between 15January 2008 (when the BIG was introduced) to end ofOctober 2008 while during the same period a year earli-Reportedcrimes tothe local policestationwere 36,5%lower in the10 monthsafter theBIG was introducedthan duringthe sameperiod thepreviousyear. Themost dramaticdropin crime wasin illegalhunting andtrespassing.45

Section 2: Impact Assessmenter (15 January to 31 October 2007) 85 crimes were reported.The Police statistics therefore reflect a 36.5%drop in overall crime since the introduction of the BIG.It should be borne in mind that this is so despite a considerablein-migration of 27% into the area and an increasein the number of people living there. This couldrather have led to an increase in overall crime.As shown in the figure below, all categories of economiccrime fell substantially. The most dramatic fall was inillegal hunting and trespassing, which fell by 95% from20 reported cases to 1. Stock theft fell by 43% and othertheft fell by nearly 20% over the same period.Change in other (non economic crimes) 8 was statisticallyinsignificant over the period, but still decreasedfrom 28 to 27 cases. The new acting Police Commanderwho came to Omitara in April 2008 confirmed thistrend.Comparision of Crime Cases - Omitara Police Station15 Jan - 31 Oct 07(before BIG)15 Jan - 31 Oct 08(w ith BIG)90 858070605054403020100Total reported crime16Stock Theft921 2017Other TheftIllegal Hunting & Trespassing128Other Crimes27This dramatic decrease and change in economic andtotal crime was borne out in a number of statementsmade by key informants. In the base line survey (i.e.before the BIG), four out of five residents in Otjivero-8 Non economic crimes comprise: assault, criminal injuria, recklessdriving, using a vehicle without permission, illegal possessionof a fire-arm, perjury.46

2.7 CrimeOmitara reported that they had personally sufferedfrom a crime in the previous year – most of which wereeconomic crimes such as theft. Six months after the introductionof the BIG, this had dropped to 60%, withmost crimes mentioned related to conflicts betweenpeople rather than economic crimes. One year after theBIG was introduced, the percentage of respondents experiencingcrimes had dropped even further to 47%.Most (75%) survey respondents reported noticing achange in the crime situation since the introduction ofthe BIG. Reflecting the majority view on the subject,two residents told us that economic related crimes hadfallen significantly.“We don't hear any more people complaining ofhunger or asking for food. The theft cases havealso declined a lot. Many people bought corrugatedzinks and repaired their houses. We buy woodmost of the time and don't have many cases ofpeople stealing wood any more. Fighting and drinkinghave also reduced and we don't hear of peoplefighting any more” (Johannes !Goagoseb and Adolfine!Goagoses, July 2008)The BIG did not, of course, eliminate all crime. Assaultremains a problem and economic crimes such as theftcontinue to occur, though on a lower level. The point,however, is that BIG has significantly reduced crimesrelating to desperation (poaching, trespassing, pettytheft) and thus appears also to have improved the generalquality of life in the community.2.8 Levels of povertyEveryday life is a struggle to provide food for thechildren. It hurts me to see my children out ofschool. The pain a parent has to go through knowingthat you cannot send them back because thereis no money is unbearable and very depressing.(Willemina Gawises Nov 2007)Crime wassignificantlylower in theten monthsafter the introductionof the BIGcomparedwith the tenmonths precedingit.47

Section 2: Impact AssessmentVoices like Willemina Gawises bear witness to thedepth of poverty in Otjivero-Omitara before the BIG wasintroduced. This section tries to depict the depth andthe width of poverty before the BIG and the changethereof, after its introduction.The Namibian Government through its National PlanningCommission has introduced a national povertyline in its latest publication called A review of Povertyand Inequality in Namibia. (NPC, 2008:2-3) Governmentneeds to be commended for adopting an absolutepoverty line based on a Cost of Basic Needs (CBN) approachguaranteeing comparability throughout Namibia.The poverty line has been set at three differentmonetary levels 9 :1. A food poverty line at N$ 152 per capita permonth2. A lower bound poverty line called the “severelypoor” at N$ 220 per capita per month3. An upper bound poverty line called “poor” at N$316 per capita per month.The following two graphs show the food poverty line aswell as the lower bound line, defining the severely poorfor the people in Otjivero-Omitara. The first graph (blue)reflects all households, while the second one (red) excludesthose households which were affected by substantialmigration 10 . )9 The poverty lines are given by the NPC in 2003/4 monetaryterms and have been updated using the CPI for inflation. The2003/4 values as given by NPC are 1. N$ 127; 2. N$185, 3.N$262.10 See above 33 Migration p. 3448

2.8 Levels of poverty“Severelypoor”Foodpoverty lineGraph 2.8-1National poverty line(all)Nov 07 Jul 08 Nov 08100%90%80%70%60%50%40%30%20%10%86% 65% 68%76% 42% 37%0%Nov 07 Jul 08 Nov 08In Nov 0786% of allpeople inOtjivero-Omitarawere belowthe lowerbound nationalpoverty line(blue line)and therebyconsidered“severelypoor”.Graph 2.8-1 shows that in November 2007, before theintroduction of the BIG, 86% of all people in Otjivero-Omitara were below the lower bound national povertyline (blue line) and thereby considered “severely poor”.This poverty level is much higher than the national average,which the NPC calculates based on the NHIES2003/04 at 13.8%. A massive 76% of people inOtjivero-Omitara fell below the food poverty line(redline), explaining the high incidents of child malnutrition11 . Through the Basic Income Grant and its economiceffects 12 severe poverty has been reduced to 68%and food poverty to 37% after one year. While foodpoverty continuously declined over the study period,gains on the lower bound poverty rate were slightly reversedby 3% from July to November 2008. The followinggraph shows the underlying reason to be the migration.11 see below 50 Child malnutrition p. 5312 see section 70 Income p.7149

Section 2: Impact AssessmentControlledfor migration,foodpovertywasreduced to16% in oneyear by theBIG.“Severelypoor”Foodpoverty lineGraph 2.8-2National poverty line(controlled for migration)Nov 07 Jul 08 Nov 08100%90%80%70%60%50%40%30%20%10%97% 76% 43%72% 24% 16%0%Nov 07 Jul 08 Nov 08In November2007, 73%of householdsindicatedthatthey did notalways havesufficientfood.Graph 2.8-2 pointedly shows that if households withsubstantial migration are controlled for, the povertyrate both in the lower bound as well as food povertyhave been declining over time. With the BIG, foodpoverty in the household without substantial migrationwas reduced to 16% and the percentage of severelypoor dropped to 43% If a Basic Income Grant was to beintroduced universally in Namibia, this is the graph adequatelyshowing the effect, as migration to a 'BIG area”would not occur. A reduction of food poverty from over70% to 16% speaks for itself and the voices of the casestudies express what a national BIG would mean topoor people in Namibia.2.9 Hunger and malnutritionIn November 2007, the nutritional situation of peopleliving in Otjivero-Omitara was bleak: 73% of house-50

2.9 Hunger and malnutritionholds indicated that they did not always have sufficientfood. Thirty percent reported a lack of sufficient food ona daily basis, and 39% said this happened at least oncea week. Only 20% reported that they never experiencedfood shortages.When asked how they coped, almost half (48%) of therespondents indicated that in times of food shortagesthey went to friends and relatives in Otjivero-Omitaraasking for food, while 18% went to friends and relativesoutside Otjivero-Omitara. The nurse at the clinic observed:“People borrow from each other to survive. Everyoneborrows from everybody else. That’s how it is.When people see that someone bought sugar, theothers come to ask for some of it. That’s why itdoes not last, because it has to be shared with theother houses in the neighbourhood.”Another resident of Otjivero-Omitara described the dayto-daystruggle for food:I live with my aunt and her family and we are 15 inone household and no one earns a decent income,we “zula” ['struggle'] to get food. We have nothing toeat at all.Good nutrition is essential for human well-being – especiallyfor children. When describing the situation inNovember 2007, the local clinic nurse, Ms Mbangu,highlighted their suffering:“I have one case where a baby who is HIV positivereceived sugar water instead of food. This baby isjust one month old. The mother can’t breastfeed butshe also does not have food. This morning shewalked to the farm where her sister stays, just toget some maize meal. Such a baby will have a lowweight and then we must send the baby to Gobabis…Low weight is especially a problem with childrenwho are HIV positive although some othersare also under-weight. Some have relatives whowork elsewhere and send them some money ormaize meal. Many others go to sleep without eating51

Section 2: Impact Assessmentand the children are so hungry. That’s when youdon’t know what to do and where to find food forthem.”This dire situation was illustrated in the shocking statisticsregarding weight-for-age (see below). The BIG hashelped improve the situation dramatically. This is,without doubt, one of our most important findings.In November2007, 42%of the childrenwereundernourished.Child Malnutrition (Weight for Age)The World Health Organisation (WHO) provides informationon the distribution of 'weight for age' ratios weshould expect to see in an adequately nourished population.Using this information as a benchmark, we cancompare the distribution of children in Otjivero-Omitarawith the WHO reference data to see how manywould be regarded as under- or over-weight for theirage.Some children are naturally heavier or lighter than others,so the WHO regards a range of weight for age ratiosas 'normal'. Only those children who fall significantlybelow the median (mid-point) of the WHO's range of valuesare classified as 'malnourished' and only those whofall significantly above the median are classified as'overweight'. The WHO uses 'standard deviation units'or 'z-scores (which standardize the deviation from theaverage normal distribution) to classify children as under-or overweight for their age. In terms of thisscheme, a child with a z-score of 0 weighs exactly whatthe WHO would expect, given his or her age. Childrenwith z-scores of between 1 and -1 are above and belowthe median weight for age, but this difference is not regardedas a problem, as it falls within the healthy distributionof weight for age values. However, children,who fall below -1 are seen as heading towards seriousmalnutrition, and those below -2 are regarded as malnourished.Likewise, children, who score above 2, areregarded as unhealthily overweight for their age.52

2.9 Hunger and malnutritionIn Otjivero-Omitara, 42% of the children measured 13 inNovember 2007 were malnourished (they had a z-scoreof below -2). This was significantly worse than the averagein Namibia (where 24-30% of children under fiveare reportedly malnourished). 14 It is also well above the30% mark, which the WHO regards as a very high prevalenceof malnutrition and which is the worst classificationin the WHO categories. Most (82%) of these childrenwere between the ages of 2 and 3.In short, the weight for age, and height for age measuresindicated that the situation for Otjivero's-Omitara'schildren was dire indeed. This is a human tragedybecause the damage caused to children by poor nutritionunder the age of five is irreversible. It is also aneconomic and developmental disaster as poor childhoodnutrition undermines human capital development andeconomic growth in the future.In analysing the changes in the nutritional status it isimportant to take the effect of migration into account.This is because those children living in householdswith substantial migration (e.g. between 3 and 11 in-migrants)are likely to experience a drop in living standardsover the period, since the BIG is not paid universally.Thus we first analysed the changes for children inhouseholds without significant migration, followed byhouseholds with 3 or more migrants.Child malnutritionJust six months after the introduction of the BIG, themalnutrition situation of children under five years ofage had improved dramatically. The percentage of childrenmalnourished had dropped from 42% to 17%!After one year, looking at the same age cohort in house-13 The collection of biometric children's data was done on a voluntarybasis. It is noteworthy that all of the sampled childrencame to the clinic and the trained nurse weighed them.14 The 2007/8 Human Development Report states that 24% ofNamibian children are malnourished. see: http://hdrstats.undp.org/countries/data_sheets/cty_ds_NAM.html).More recentfigures, not yet publicly released, suggest that the number for2006 may be as high as 30% (quoted in The Namibian, 28.2.08)53

Section 2: Impact Assessmentholds that were present at all three stages of our study,no child had a z-score of below two. This implies nomalnutrition at all. However, this result must betreated with some caution because the number of children,which can be traced throughout the whole yearhas shrunk due to migration. This necessarily increasesthe standard error, when we compare distributionsacross time. However, the clinic collected data forall children below the age of 7 years from 2007 onwards,so we have been able to extend our initial calculations(based on children under 5 only) to includethese older children as well (see below). The graph belowshows how the distribution of weight for age hasbecome more 'normal' over time as the proportion ofmalnourished children fell. The two-sampleKolgmogorov-Smirnov test (to test for significant differencesbetween the distributions of z-scores) confirmsthat the shift across the first six months and over theentire year was statistically significant (at the 95%level) 15 .15 The p-value for the test for differences between waves 1 and 2,and 1 and 3 were 0.019 and 0.015 respectively.54

2.9 Hunger and malnutrition0 .1 .2 .3 .4 .5-4 -2 0 2 4xNov 2007 Jun 2008Nov 2008WHO normalGraph 2.9-1: Weight for age z-sores according to WHO standard -before and after BIG (for children in households without significantin-migration)The dotted green line represents the WHO expectednormal distribution of weight for age. The red line depictsthe nutritional status of the children before theintroduction of the BIG, with 42% malnutrition. Thedashed-dotted blue line confirms the direct and dramaticimpact the introduction of the BIG had on malnutritiondropping to 17% within just six months. Thesolid blue line represents the nutritional status of childrenby November 2008 with malnutrition droppingeven further to 10%. It is clear that the major shift indistribution happened in the first six months after theBIG was introduced. The one year results confirm andreinforce this hugely positive trend. To reiterate, withthe BIG, the malnutrition rate decreased from 42% inNovember 2007 to only 10% a year later. This is an extraordinarydevelopmental achievement; to see thatchild nutrition is directly and dramatically improved bygiving this small universal cash grant to poor families.With theBIG, themalnutritionrate decreasedfrom 42% inNovember2007 to17% withinsix months,down to only10% after ayear later!55

Section 2: Impact AssessmentHouseholds with substantial migrationIt is worthwhile to also look at children living in householdswhich experienced substantial migration duringthe second six months of the study. In these householdsthe child malnutrition rate was reduced to 22%in July 2008 but some of these gains were unfortunatelyreversed by November 2008 as the rate climbedback up to 27%. This is a worrying trend and confirmsthe direct interdependence between the total householdbudget available and the child nutrition rate. In asituation such as the Otjivero-Omitara pilot project,where the BIG is not paid universally, because it doesnot cater for in-migration, the benefits to intended beneficiariesare dramatically diluted. Other poor people–usually from the extended family – move due to desperationto where the cash is. A similar pattern is well documented,with the usage of the old age pensions. Whilethe money is intended for the well being of the elderly,often whole families depend and live on the old agepension as their only income, leaving no choice to theelderly but to share the little they have with childrenand grandchildren.Note however, that even if the analysis includes all thechildren, there is still a large and significant improvementbetween the baseline in 2007 and the end of yearone of the BIG.After the introductionof the BIG in2008, theclinic reporteda fivefoldincomeincreasefrom N$ 250per monthto nearly N$1300,- permonth.2.10 General HealthA community such as Otjivero-Omitara suffers from avicious circle of malnutrition, poverty, ill-health andlack of human development. All these factors are interconnected.An intervention such as BIG is likely tobreak this vicious cycle.The situation in 2007 was desperate. Poverty preventedmany residents of Otjivero-Omitara from seeking treatmentfor illnesses. The nurse explained that many wereunable to pay the clinic fees of N$ 4. She explained thatshe would still treat people 'on credit', but many apparentlyfelt too ashamed to go to the clinic without pay-56

2.10 General Healthing. As a result they tended to go to the clinic onlywhen they became very sick. She thus expected theBIG to have a major impact on clinic attendance – andon the capacity of people to pay the clinic fees.Photo 12: Sister Mbangu of the government clinicShe was subsequently proved right when she reportedin June 2008:The big change that I noticed was payment for theclinic’s services. People are paying now and thestatistics look good. Our administration (the Ministryof Health and Social Services) is now happywith the money that comes in.The clinic records of 2008 show that whereas in a typicalmonth in early 2007, the clinic had an income ofabout N$ 250 per month, after the introduction of theBIG in 2008, the clinic reported a fivefold income increaseto nearly N$ 1,300 per month. This is becausemore residents came for treatment because they couldpay the $ 4, and felt comfortable exercising their rights.The increase in clinic attendance was not caused by an“The bigchange thatI noticedwas paymentfor theclinic’s services.People arepaying nowand the statisticslookgood.”(Mbangu,nurse at theclinic)57

Section 2: Impact AssessmentSince theBIG,Otjivero-Omitara hasbenefitedfrom betternutritionand betterhealth careunusual spate of illnesses or a sudden epidemic 16 , butrather by people seeking medical attention for commoncomplaints, which they had suffered without the benefitsof health care in the past. Importantly, the nursesaid that since the introduction of the BIG, she had observeda reduction in the cases of severe diarrhoea,while the people coming to the clinic in 2008 weremostly treated for more common sicknesses like flu andcoughs. In short, it can be observed that since the BIG,Otjivero-Omitara has benefited from better nutritionand better health care – and hence that the quality oflife has improved. This supports the results of the previoussection on the improvement of the nutritionalstatus of adults and children which, in combinationwith a better access to ARVs, led to improvements ingeneral health of the population in Otjivero-Omitara.HIV and AIDSThe nurse has been actively involved in the government'sHIV prevention and treatment program. She haseducated the community about HIV prevention and theneed for safe sex. She said:Access toARVs wasoftenhampered bypoverty andlack oftransport.“HIV/Aids is the biggest health challenge inOtjivero. People here don’t work and the peoplewho work on the farms come to Otjivero to drink.That’s when the people who don’t have food intheir houses come to sell their bodies. However,things have improved since the clinic was openedin January 2002. There is a very big differencebetween the situation in 2002 and 2007. We areproviding education about AIDS and how peoplecan get HIV… At the beginning we had to explainwhat AIDS is because people still lived in the olddays… Today people use a lot of condoms andcome to the clinic to collect them We also give themhealth education. There are not so many STDs anylonger… We have a support group for HIV patientsand people are now openly talking about their HIVstatus.”16 There was also no increase in incidents of ill-health in oursample between November 2007 and July 2008.58

2.10 General HealthIn spite of progress, HIV/AIDS was still affecting mosthouseholds in Otjivero-Omitara. For example, 78% ofhouseholds that had experienced a death in the pasttwo years indicated that it was AIDS-related.Access to ARVs was often hampered by poverty andlack of transport. Interviewed in November 2007, thenurse explained:“HIV positive people have dates at which they mustcollect their ARVs. They must go every month butthey don’t have work, they don’t have income; theydon’t have people who can help them. The onlything I can do is to ask the ambulance to take themto Gobabis. Not all people who are HIV positive areon ARVs because they can’t get transport to Gobabis.It costs them about N$ 100 to take taxis fromOtjivero to Gobabis and back. Then they arehungry but have nothing to eat…The nurse expected that the main impact of the BIG onthe lives of HIV-positive people would be to give themthe means to travel to Gobabis to collect their ARVs. Asit turned out, however, this proved unnecessary becausethe doctor in Gobabis was persuaded by thenurse in March 2008 to come to Otjivero to deliver theARVs to the growing group of ARV patients there:“The situation of people in Otjivero on ARVs has improved.The doctor is now coming to Otjivero andpeople don't have to spend N$ 70 for a trip to Gobabis.How must they come back? ARVs are free ofcharge but transport is expensive and so we talkedto the doctor [in Gobabis]. He is coming here everymonth to bring ARVs and to take measurements”.The BIGgreatly assistspeopleliving withAIDS.The number of people receiving ARVs increased fromthree in late 2007 to 36 in July 2008 – a twelvefold increase.This, of course, took place in the context of theNamibian Ministry of Health's proactive national ARVrollout. However, some people in Otjivero-Omitara haveexpressed the view that the ARV rollout only came toOtjivero-Omitara because of the public attention focusedon the area as a result of the BIG pilot project.59

Section 2: Impact AssessmentWhatever the relationship between the BIG and theARV roll-out, it is nevertheless fair to say that the BIGgreatly assists people living with AIDS. People on ARVsneed to be well nourished to benefit fully from theirtreatment. The BIG provides them with the opportunityto improve their diet The BIG can benefit HIV positivepeople in other ways too, as was the case for JohannesGoagosebThe case of Johannes GoagosebJohannes lives in Otjiveroand has been living withHIV for about 3 years now.In 2007 he lost first hisdaughter and then his girlfriendwho both died as aresult of AIDS. He is unemployedand struggled to gethis ARVs from Gobabis. Asa result, he went huntingthe day before he had totravel to Gobabis to get hisARVs from the Gobabis hospital.The next day, onwhich he was supposed toPhoto 13: Johannes Goagosebtravel to Gobabis, he was in prison, November 2007arrested for illegal hunting.This is his story as told in November 2007:I came to Otjivero long before my parents came toOtjivero. I am 43 years old and worked at the Omitarahotel. Before I came to Otjivero, I worked at afarm called Hummels in the vicinity of Omitara. Ilost my work after I fought with my colleague atwork after which my employer chased me away. SoI came to Otjivero and after some time I got employedat the Omitara hotel. Ever since my employerssold the hotel two years ago, I am jobless. In2004 my parents came to Otjivero and since then Ilive with them.60

2.10 General HealthDuring the illness of my girlfriend I also went for aHIV test on the advice of the clinic nurse. Althoughit was hard for me to believe it, I found out that Iam also positive. I was very much disappointed butcould not do anything else but had to accept thereality. From the beginning of this year, I becamevery sick, and since then I received Anti-Retroviral(ARV) treatment. The Omitara clinic does notprovide ARVs but only pre-treatment. When thedrugs finish, I have to struggle to get money totravel to the Gobabis hospital to get my medication.It is always a struggle to get money for transport toGobabis. One cannot take these drugs on an emptystomach, but the main problem here is hunger.Photo 14: Parents of Johannes Goagoseb (Nov 2007)It is because of hunger and especially to get transportmoney to travel to Gobabis for my ARVs that Iam imprisoned today. On the previous day, I wentinto Mr. Held’s farm and hunted one warthog in orderto sell the meat and get some income. But onthe next day, on which I had to travel to Gobabis toget my ARVs, I was arrested after the police followedmy footprints to our house. I tried to explainmy situation to the police, but they arrested me.Since the week I was arrested and put in the61

Section 2: Impact AssessmentWitvlei prison until now that I am in Gobabis mainprison, I have not received the ARVs. Due to thisbreak … I am now receiving TB treatment in prison.In July 2008, we visited Johannes again, this time athis house in Otjivero. Both Johannes and Adolfine, hissister, who is also HIV positive, were looking far healthierthan they were before the introduction of the BIG.Johannes was released from jail on 11 th March 2008after paying his fine with the money he received fromthe BIG and he explains how his life has changed dueto the introduction of the BIG:His storybears testimonytohow thehealthstatus aswell as theliving conditionsofpeople livingwith HIV improvedwiththe introductionofthe BIG.Photo 15: Johannes Goagoseb - reunited with his family (July2008)Our expectations are definitely met with the introductionof the BIG and we feel good and reallyhappy that Otjivero was chosen for the BIG. Thehundred N$ we receive seems small but it is ablessed money. Many things have changed in ourlives. We have bought blankets, clothes, schoolclothes, paid school fees and a strong plastic to puton the roof of our house. We do not any more sufferfrom the severe hunger we were in before westarted getting the BIG. We don’t any more buyonly maize meal but also different kinds of food.Sometimes we also buy vegetables. We have still62

2.10 General Healthlots of things to buy but the money is not alwaysenough so we plan carefully. One good thing is thatwe don’t spend any more money for transport toGobabis to get our pills (Antiretrovirals), but thedoctor himself comes to Otjivero every month. Sowe get our treatment on time that's why we look sogood and well. The people of Otjivero have changeda lot. We don’t any more hear of people complainingof hunger or asking food around. The theftcases have also reduced tremendously. Manypeople bought corrugated zincs and repaired theirhouses. We buy most of the time wood, thus wedon’t have any more many cases of people stealingwood. Fightings and strong alcohol use have reallybeen reduced. We don’t any more hear of peoplefighting. (Johannes and Adolfine Goagoses, July2008)His story bears testimony to how the health status aswell as the living conditions of people living with HIVimproved since the introduction of the BIG. It showshow the BIG can complement and strengthen the Government'sefforts to provide ARVs to all who need them.2.11 EducationOtjivero-Omitara has had a primary school, which islocated in the centre of the settlement since 1996. Ithas the potential to improve the prospects of Otjivero'schildren, but at the time of the baseline survey inNovember 2007, financial problems were keeping manychildren out of school. In addition, the school reportedthat the lack of adequate nutrition of many childrenhad a negative impact on the performance. Due to thelack of payments of school fees, the school had verylimited financial resources and leverage to improve thequality of education.63

Section 2: Impact AssessmentPhoto 16: The Primary School in OtjiveroAlmost half(49%) of thehouseholdswith childrenofschool-goingage indicatedthattheir childrendid notattendschool regularly.Some 77% of the respondents reported that they couldread and write in at least one language, while 23% saidthey were illiterate.Almost half (49%) of the households with children ofschool-going age indicated that their children did notattend school regularly. Nearly half of them said thiswas due to financial reasons, while 21% cited ill healthor the lack of an adequate school feeding scheme as themain reasons.Schooling opportunities are limited for the children ofOtjivero-Omitara. As of November 2007, the primaryschool catered for about 250 children in grades 1-7.The teachers reported that only about 20-30% of thechildren did well, while the others were struggling. Passrates stood at about 40% and drop out rates were high.Only few children managed to complete grade 7 and tofurther their schooling in Gobabis, Windhoek or Gunichas.This state of affairs was directly linked to thewidespread poverty, as the teachers explained:“Most learners are more interested in pots than inschooling… Many children stay away from school ifthey don’t receive food. Our school is part of the64

2.11 Educationschool feeding scheme but sometimes there is nopap. Sometimes they get some meat, about once aweek, but there are no vegetables or fruit.”Another problem was the parents’ inability to pay theschool fees of N$ 50 per year, due to their poverty.Teachers also pointed out the difficulty of enforcingchildren to wear school uniforms:“Some children don’t have school uniforms at all,others have uniforms of other schools. We tried tosolve this problem in 2005 but we could not.”Teachers were aware of the many problems that theirlearnerss had to confront, including the difficulty offinding a place to study and read after school. Thereforethey introduced study time at school in the afternoonswhich helped some of the students. However, the rootcause of the problem was identified by the school'steachers:“Unemployment and poverty are the causes of mostproblems. For the young people, grade 7 at ourschool has become like their matric. Some go forfurther schooling but some return after just oneterm. They lack the discipline, or the money, ordon’t find a place in the hostel. Some also struggleto adjust to life in bigger places. Because of unemployment,the parents can’t afford to send their childrenfor further schooling.”“Some childrendon'thave schooluniforms atall, othershave uniformsofotherschools. Wetried tosolve thisproblem in2005, butwe couldnot”. (BeforeBIG)The BIG has a very positive influence on the educationalcircumstances of children in Otjivero-Omitara.The school teacher described the changes as follows:There are changes at the school even though nothundred percent changes. Some of the changescannot happen overnight. (...) Most of them are havingschool uniforms, blue shirts, their grey shortsand shirts. They even have shoes. (...) The parentsare even giving the teachers some N$ 50 sayingbuy my child some shoes when you go to town. (...)Even when you look at them [the children] they are“Most of[the children]arehavingschool uniforms,blueshirts, theirgrey shortsand shirts.They evenhaveshoes.”.(Teacher -with BIG)65

Section 2: Impact Assessmentclean which was not like that before. You can seethis one has been washed, soap has been boughtso that the uniforms can be cleaned, the hair isplaited.With theBasic IncomeGrant,the OtjiveroPrimarySchool hasachieved a90% paymentrate ofschool fees.The primary school's principal noted that payment ofschool fees had improved significantly since the introductionof the BIG and substantiated by the receiptsprovided by the school, in 2008, 250 children have paidtheir school fees in full and 2 paid half the amount.With the Basic Income Grant, the Otjivero PrimarySchool has achieved a 90% payment rate of school fees,which constitutes an enormous and unprecedentedachievement for that school.Photo 17: The school's reports show a 90% payment rate of schoolfees after the introduction of the BIG66

2.11 EducationSince the introductionof the BIG,the numberof childrennot attendingschooldue to financialreasonsdropped by42%.Photo 18: Proud to be at schoolGraph 2.11-1 shows the non-attendance due to financialreasons. In spite of the impact of substantial in-migrationof children to Otjivero, the number of childrennot attending school due to financial reasons droppedby 42% from 12 to 7 in November 2008. Six of the sevennot attending school came from households that haddrawn migrants who were not receiving the BIG.Children not attending school due to financial problemsin households including in-migration in the last 6 monthsNumber of children0 5 10 151267Nov 07 Jul 08Nov 08Graph 2.11-1Source: DfSD & LaRRi Survey Jul 2008BIG Pilot Project Study67

Section 2: Impact AssessmentThe principal further reported that drop-out rates ather school were 30-40% before the introduction of theBIG. By July 2008, these rates were reduced to a mere5% and by November 2008 to 0%.At the beginning of 2009, the principal of the schoolalso reported a further improvement for those learnerswho finished at the Otjivero School, as for the first timea group of 9 learners, who passed grade 7, left Otjiveroand are able to attend Secondary School.It was not only in the primary school where changeshave taken place. School staff and parents alike notedthe improved use of pre-primary school facilities.Photo 19: Enrolment at the crèche increased from 13 to 52 afterBIG“We had a crèche with only 13 children last yearand this year the number increased to 52 childrenbecause many parents now have the money to payfor the children. If you go to the primary school youwill notice that most of the children have school uniformsand they are clean and happy”. (Adam Tjatinda)The kindergarten teacher, Mathilde Ganas, added:68

2.11 Education“There is a tremendous change [since the introductionof the BIG]. The children come to school clean,on time and well fed. When it is break time wesend the children back home to eat and they nowcome back on time. In the past, when we sent themhome, most of them never returned...because theparents did not have food to give them and thereforethey could not return back. Before the Basic IncomeGrant things were really bad and it was difficultto teach the children. Now they concentratemore and pay more attention in class. They aregenerally happy because they have enough to eatat home.”Likewise, the teachers at the primary school pointedout that:“Learners used to come to school with empty stomachsbut now this is no longer the case. Before[BIG] the learners did not concentrate in class dueto hunger but now they are more energetic and concentratemore, thus there are better results now.”“Learnersused tocome toschool withempty stomachsbutnow this isno longerthe case. Before(BIG)the learnersdid not concentrateinclass due tohunger butnow theyare more energeticandconcentratemore, thusthere arebetter results.”Photo 20: School performance and attendance improved after theBIG69

Section 2: Impact AssessmentThus, the BIG has significantly contributed to an improvedenvironment as far as schooling and child developmentare concerned. This happened without any outsidepressure or attachment of conditionality to thecash transfer. People themselves decided what wasgood for their children. All they needed was the incometo do so.2.12 Economic activity, income,and expenditureEmploymentThe pilot project aimed to investigate whether the introductionof the BIG would result in people choosing notto work, (i.e. withdraw from the labour-force), or whetherit would help them find work (by financing their jobsearch), or enable them to start their own businesses(by providing start up money and by increasing thebuying power of others in the community). This sectiontherefore explores trends in economic activity over a 12months period.Graph 2.12-1 looks at the unemployment rate amongthe potential labour force (adults aged 15 and above)who were present in the data throughout all three surveysand is hence able to show the impact of BIG oneconomic behaviour.70

2.12 Economic activity, income, and expenditure70%Unemployment rate(people present throughout panel)60%50%40%30%20%10%60%52%45%0%Graph 2.12-1Nov 07 Jul 08 Nov 08The graph shows a decrease of the number of unemployedpeople from 60% to 45%. To put it differently:since the introduction of the the BIG, employment rosefrom 44% to 55% of those aged 15 and above. It is importantto note that the actual labour force increasedslightly while the labour force participation rate increasedas well. The data thus provides evidence thatthe BIG did not result in people deciding not to work,.On the contrary, the BIG facilitated greater labour-marketparticipation and employment.Unemploymentdroppedfrom 60% to45%.IncomeThe positive employment trends were accompanied byan increase in income. The following graph depicts theaverage monthly per capita income:71

Section 2: Impact AssessmentAverage monthly per capita income in N$N$ 250(all)N$ 20067N$ 150N$ 10075Income BIGIncome(wage, selfemployment,farming)N$ 50118134152N$Nov 07 Jul 08 Nov 08Graph 2.12-2The stimuluscreatedby the BIGresulted in asustainedpersonal incomeincreasebeyondthemoney spentfrom theoutside. Themean income– excludingincomefromthe BIG – increasedonaverage by29% in justone year.Graph 2.12-2 shows that the BIG had a major and directimpact on income growth and that personal incomesrose substantially more than the actual grantpaid out. This is despite the impact of in-migration intothe area. The BIG has hence had positive direct as wellas indirect effects on income generation. By providingthe BIG as a small source of secure income, peoplewere able to increase their productive income earned.Again, this refutes the notion that people would withdrawfrom productive work. This is an important findingespecially in times when countries struggle to positivelystimulate their local economic development. The stimuluscreated by the BIG resulted in a sustained personalincome increase beyond the money given from the outside.The mean income – excluding income from theBIG – increased on average by 29% in just one year.72

2.12 Economic activity, income, and expenditureThe following sections analyse in greater detail the economicimpact by looking at the household income ofthe panel broken down into the sources of income.Sources of Household IncomeMeanhouseholdincome bysource excludingBIG(panel) Nov 07 Nov 08Increase /Decrease in%Wages N$ 581 N$ 692 19%Self-employmentN$ 170 N$ 681 301%Farming N$ 42 N$ 57 36%Remittances N$ 103 N$ 82 -21%GovernmentgrantsTable 3: Household incomeN$ 199 N$ 285 44%The main source of household income growth was inself-employment. As can be seen from the table above,income from all sources (except remittances) rose overthe year of the study. The fall in remittances (typicallyremittances are contributions by extended family memberssupporting poor rural households through cash orin kind transfers) no doubt reflects the reduced need inOtjivero-Omitara to be supported by relatives elsewhere.The sharp rise in contributions from self-employmentspeaks for the improved earnings from selfemploymentafter incomes were boosted in the area bythe BIG, as well as the growth of new self-employmentactivities. Self-employment has grown to the same levelas wages.Most small enterprises which emerged following the introductionof the BIG were in retailing, brick-makingand the manufacture of clothing. According to the respondents,the BIG was central in providing start-upcapital and external demand. This is supported by thefollowing remarks from residents of Otjivero:The sharprise in contributionsfrom selfemploymentspeaks forthe improvedearningsfromself-employmentafterincomeswere boostedin thearea by theBIG.73

Section 2: Impact Assessment“Since we get the BIG I bought materials and I ammaking three dresses that I sell for N$ 150” (EmiliaGarises).“I started my business of making ice lollies rightafter the BIG started.... The demand for ice lollies Is big because I make the biggest ice lollies in thesettlement. I sell one ice lolly for 50 cents and Imake 50 a day... With the BIG, people have moneyto spend, that is why I make the ice lollies” (BelindaBeukes).“I started my tuck-shop in August this year (2008)after the introduction of the BIG. The BIG came toour place like a miracle, and I will constantly thankGod for his grace. The BIG made it possible for meto start a business I never dreamed of. Now I amable to sell food, soft drinks and a bit of alcohol. Myprofit per month is about 800.00 to 1000.00. I believe,by giving this money to all Namibians willalso force the young people like me to start usingtheir skills and talents” (April Isaacs)74

2.12 Economic activity, income, and expenditurePhoto 21: Joseph Ganeb started a brick makingbusiness“I started the brick-making business in 2006 buthad to stop it due to a lack of finances. After theBIG was introduced... I started again with it. Fromone cement bag I make 250 bricks. The bricks arestandard and I sell them for one dollar. I get thesand for the bricks from the river. It is still a familybusiness which I plan to expand in the future if Iget more finances. Bricks are in demand so I willneed more manpower in order to serve the interestsof the people here at Otjivero. I am very optimisticthat this project will expand with the BIG and employmore people” (Joseph Ganeb)75

Section 2: Impact AssessmentPhoto 22: Dress making became one of the new businesses inOtjivero“We started the project last year but we had to stopdue to a lack of funds and materials. We resumedfull force in January 2008 after we received theBIG money. We are six women who are involved inthe project... We make dresses, especially Namacultural dresses because most of our clients arelooking for them. We have clients from as far asGobabis, Witvlei, Windhoek and from the surroundingfarms. When there are occasions like weddingsand funerals, we make good sales... One dress isabout N$ 150 and we make about N$1,500 – 2,000per month. We have opened a bank account inWindhoek where we do our savings” (RudolfineAigowas).76

2.12 Economic activity, income, and expenditurePhoto 23: Baking bread: N$1 per roll - daughterof Frida Nembwaya“After the introduction of the BIG I started my business.I bake traditional bread every day. I bake100rolls per day and sell each for one dollar... I make aprofit of about N$ 400 per month. My business isgood and I believe that it will grow. The only problemthat I have is the lack of fire wood. It is oftenhard to get wood. But I made an application for additionalhelp to the government in order to expandmy business” (Frieda Nembwaya)77

Section 2: Impact AssessmentPhoto 24: BIG created small business opportunities“The introduction of the BIG made it possible for meto start my tuck shop. It is a very small businessbut people support it a lot... I mostly sell sugar, tea,maize meal, sweets and popcorn. We make aboutN$ 800 – 1000 per month. I also sell self-made materialsfor donkey carts. I buy my stock in Gobabis,travelling on the train” (Alfred !Nuseb)“I started my project in August this year (2008)after the introduction of BIG. As you can see, Imade those dresses and one cost N$150-00-, If Imake 5 dresses then I make a profit of N$750, inthree weeks time. People are very much eager tosupport my business. …I will continue to pray thatthe Otjivero community will use the money for thereal needs so that through us, the entire Namibiawill get the BIG” (Emilia Garises).78

2.12 Economic activity, income, and expenditureThe evidence suggests that the BIG has helped peopleto become economically active and to raise their participationin economic activities. Far from discouragingwork, the BIG has empowered people to raise their incomesfurther.Expenditure and assetsThe increase in income appears to have facilitated anincrease in savings. Six months after the BIG was introduced,21% of respondents reported saving some oftheir BIG money (amounting to an average of 7.2% ofBIG money). We obtained independent confirmationthat the BIG was linked to a large increase in savingsactivity in Otjivero-Omitara. According to Laurensia !Nowases from the NamPost Post Office in Omitara:I work here for some years and before the introductionof the BIG only very few people opened thesmartcard saving account. But after the BIG was introduced,100 people opened their smartcard savingaccounts and they are still coming. There arealso parents who opened smartcard accounts fortheir children. I can also say that the pensionerswho used to spend their pension money on foodand children are now able to make savings forthemselves at the post office. The post office alsomakes good business and it stays busy nearly thewhole day. About 38 people also took out funeralpolicies of Old Mutual and pay N$ 9.99 per month.I realise that the BIG is a great help and real solutionto poverty. (Laurensia Nowases – NamPostOmitara, July 2008)Far fromdiscouragingwork, theBIG has actuallyfacilitatedeconomicactivities.“I can alsosay that thepensionerswho used tospent theirpensionmoney onfood andchildren arenow able tomake savingsforthemselvesat the postoffice.”(LaurensiaNowases –NamPostOmitara,July 2008)This increase in savings activities is in line with thestated intentions of the respondents. When asked inNovember 2007, 40% said that they intended to savesome of the money. Thirty-two percent said theywanted to use part of the money to fix their houses, 9%said to plan to invest in livestock and 11% said theywould pay back debt. These types of expenditure aregeared towards improving the quality of life and longtermsecurity. Such expenditures make perfect sense79

Section 2: Impact Assessmentgiven that the people of Otjivero-Omitara knew that theBIG pilot was only going to last for two years.Debt is not necessarily a bad thing. Used wisely, debtcan help households escape poverty by enabling themto borrow money to help start businesses, or to purchasecapital assets (like tools, or cars and houses).Low levels of indebtedness to local shops can also helpensure that the household has access to food, evenwhen monthly incomes have run out. This 'consumptionsmoothing' can help households escape the hungerand malnutrition that may otherwise be caused byshortages of cash. However, if households accumulatemore debt than they can cope with, then the debt burdenitself may become a cause of poverty – especiallywhen high interest rates result in the debt burdengrowing faster than the income of the household thatowes it.The BIG could help households reduce their existingdebts to shops, but we did not expect 'consumptionsmoothing activities' to end altogether. This is becausehouseholds may choose to allocate the BIG to largeonce off payments (such as school uniforms, schoolfees, home renovations, small business start-up costsetc) and hence may still find it useful to be able to buyon credit from the local shop.In June 2008, 41% of the respondents reported to beusing the BIG to help pay back debt, but only 9.4% oftotal BIG payments were allocated to that purpose. Thissuggests that a large number of people are paying backdebt, but that the amounts are small. This is consistentwith the picture provided by total household expenditureduring the first six months which saw an increasein the average monthly debt repayment from N$ 186 toN$ 200. Some households paid off their debts altogether– whereas others increased their debts. The datashows that 80% of the reported changes in debt werefor amounts smaller than N$ 500. Most of these debtswere owed to the local shop.According to data from the survey conducted a yearafter the BIG was introduced, average household debt(for those households reporting debt) had fallen fromN$ 1,215 to N$ 772, with over twice as many house-80

2.12 Economic activity, income, and expenditureholds reducing debt compared to those who increasedit.Analysis of the data shows that levels of debt fluctuatedduring the first six months after the BIG was introduced.Most reduced their debts while only eight increasedtheir debts, and by typically small amounts. Interestingly,16 households who were not indebted inNovember 2007 had accumulated debts by July 2008.Again, these were mostly small amounts owed to thelocal shop. Only two households experienced a large increasein debt – and these were for fixed assets (furnitureand a motor vehicle).As regards the accumulation of household assets, thereare some indications that people have purchased usefulconsumer durables. For example, the number of householdsreporting working stoves rose from 31% to 43%during the first year following the introduction of theBIG. The number of households reporting owning aworking tool box rose from 40% to 59%. However, forthe most part, the stock of household assets has notchanged dramatically. The picture is different, however,with regard to livestock.When the respondents were interviewed in November2007, 9% explicitly mentioned their intention to purchaselivestock with their BIG. At that time, only 29%of households had any large livestock. A year later, thishad risen to 39%. Similarly, the percentage of householdsreporting ownership of small livestock rose from19% to 37% and ownership of poultry rose from 42% to59% over the same period. This is a significant increasein asset accumulation as people use livestock as a formof savings (and as a form of food security). Those reportinga vegetable garden fell from 40% to 30% during thefirst six months of BIG and then rose again up to 39%.This can probably be attributed to seasonal fluctuationsin agricultural activity.In November 2007, a third of the respondents indicatedthat they would be using part of the BIG money to renovatetheir homes. There are strong and visible indicationsfrom the data and the observed changes in thecommunity that this has happened. For example, theaverage number of rooms in households rose from 2.6Large livestockincreasedfrom 29% to39%; smalllivestockfrom 19% to37% andpoultry from42% to 59%.81

Section 2: Impact Assessment(baseline) to 3.2 (six months) to 3.3 (one year). Over afifth of households indicated that they had improvedthe roof of their homes (mostly with corrugated iron,but also with plastic and canvas) and many indicatedthat they intended to renovate and expand their homeslater.82

Section 3: A national Basic Income GrantSection 3: A national BasicIncome Grant3.1 AffordabilityThe debate around a Basic Income Grant in Namibiaraises important questions about the affordability ofuniversal cash transfers and their long-term economicimpact. This section provides evidence from a microsimulationaccounting exercise that calculates thegross and net costs of the proposed intervention. Thissection also presents emerging global evidence on thelikely economic impacts.The cost of a Basic Income GrantThe first step in estimating the cost of the grant is tomodel the number of individuals eligible to receive thegrant. Since the Basic Income Grant is universal, thisnumber is the entire population. However, the universalState Old Age Pension already covers those above60 years. When a person turns 60 the person will movefrom the Basic Income Grant to the higher Old Age Pension,which would remain as it is. The cost of the universalOld Age Pension is already a public obligationand does not pose any additional cost. The populationestimate associated with Namibia’s National HouseholdIncome and Expenditure Survey (2003/2004) was 1.7million people, and the UNFPA estimates Namibia’spopulation growth rate as 2.6% per year, implying apopulation in 2009 of 2.1 million people.Assuming a grant size of N$ 100 per month, and givenan estimated 150,000 of older people receiving the OldAge Pension, an estimated 1.9 million people would receivethe Basic Income Grant (excluding those receivingthe Old Age Pension—whose grant amount would be83

Dependingon the mixof direct andindirect taxadjustments,thenet costranges fromN$1.2 toN$1.6 billion—from2.2% to3.0% ofGDP.Section 3: A national Basic Income Grantconsidered part of the existing payment). The gross costof the grant would amount to N$2.3 billion per year -calculated by multiplying the grant size by twelvemonths by the recipient population. The gross cost ofthe grant, however, is not the relevant cost measure.For many tax-paying recipients, the grant is essentiallya tax rebate. Part of the additional taxes raised to payfor the grant are simply returned to the taxpayer in theform of their own grants—similar to the stimulus taxpackages popular in many industrialised countries thatare tackling the global financial crisis. The relevant costmeasure is the amount of additional taxes raised fromtaxpayers that yield real payments to lower incomeNamibians. This amount is referred to as the net cost. Itis important to mention that only since it is a universalgrant the tax system can be employed to recuperategradually the money from those not in need and progressivelyredistribute from the higher income earnersto the poor, without risking to adversely affect certainsections of the lower income earners.The net cost is estimated using a micro-simulationmodel based on Namibia’s National Household Incomeand Expenditure Survey (2003/2004), with nominal figuresgrown to 2009 equivalents using the ConsumerPrice Index, and population estimates aged to 2009equivalents using the UNFPA population growth estimate.The net cost depends on the taxes recuperatedfrom upper income recipients, which in turn dependson the structure of the associated tax adjustments. Dependingon the mix of direct and indirect tax adjustments,the net cost ranges from N$1.2 to N$1.6 billion—from 2.2% to 3.0% of GDP. The actual net cost willdepend on how it is financed—with a VAT-financedgrant leading to a lower net cost, while greater relianceon income taxes raises both the net cost and the totalamount transferred to the poor.For example, through moderate adjustments in themarginal tax rates with a top marginal tax rate on higherincomes to 38%, and increasing the Value Added Taxrate by two percentage points, will yield an estimatedadditional tax collection of N$ 1.7 billion—of which N$1.0 billion would be returned through the Basic IncomeGrant to the very same taxpayers who are paying for it.84

3.1 AffordabilityThis reduces the net cost of the intervention to N$ 1.3billion, of which N$ 0.7 billion would be covered bythese tax adjustments. This leaves another N$0.6 billionto be covered by additional tax adjustments 17 . On ahousehold level the effect can be demonstrated throughthe following examples:1. An average household, which has no income atall would receive an additional income of N$ 498per month.2. Equally, a typical household with a low paid incomeearner of N$ 20,000 per year, would receivean additional income of N$ 498 per month.3. An average household with a middle incomeearner of N$ 46,000 per year, would no longerreceive the full benefit, but would still receive anadditional income of N$ 217 per month.4. An average household in the higher incomegroup with an income earner of N$ 300,000 peryear would pay a higher net tax of N$ 1,270. 18These examples are based on pure tax adjustments torecuperate and to finance the BIG. However, there areother options to finance the BIG as well and the finalfinancing will depend on the policy decision taken andcould be one of the options or a combination thereof.For example, if a royalty tax on fishing and mining ortourism is used to finance the BIG it would ensure thatthe total population has a stake in the national resourceof the country. Last but not least budget re-prioritisationcould be employed to finance the BIG.17 It is noteworthy that this is an overestimate of the costs, sincehousehold data underestimates the top income e.g. in the dataset available nobody indicated to earn more than N$750,000per year.18 This is based on a household with 2.7 members, which is theaverage household size in this income bracket. It is noteworthy,however, that the bigger the household is, the more the netcostto the household drops. This is so since the 'additional'members also qualify for the BIG and hence bring additional incomeinto the household. The net costs to the household herebydrop by the 'additional' number of people times the net BIG permonth.85

Section 3: A national Basic Income GrantThe second step in assessing affordability is determininghow much additional tax revenue Namibia can afford.Economists usually address this question with“tax effort” analysis, a type of econometric modellingbased on cross-country comparisons. Tax effort modelsevaluate the taxable capacity of a country based on thestructural characteristics of the economy and the country’sability to raise taxes. The graph below documentsthe growing tax capacity of the Namibian economy from2001 to 2007.Namibia has the tax capacity to finance aBasic Income Grant (2.2 - 3.8% of GDP)353025201510502001/022002/032003/042004/052005/062006/07unutilisedtax capacitytax/GDPAccording to the econometric analysis, Namibia’s taxablecapacity exceeds 30% of national income. YetNamibia’s actual tax collection and projected tax collectionover the medium term horizon has been falling.Namibia’s excess capacity to raise tax revenue significantlyexceeds the net cost of a Basic Income Grant underall the financing scenarios.3.2 SustainabilityThe preceding analysis documents the short term affordabilityof a Basic Income Grant for Namibia. Estimatesof the net cost in the first year range from 2.2% to3.0% of Gross Domestic Product, while Namibia’s excesstaxable capacity exceeds 5% of national income.More important than short term affordability, however,is the question of sustainability. What are the long term86

3.2 Sustainabilityprospects for the affordability of the Basic IncomeGrant in Namibia? The answer to this question dependson the impact of the grant on household well-being, labourproductivity and the macro economy.International experience with social grants documentsthe positive impact on household well-being. Low incomehouseholds that receive social grants spendnearly the entire amount on food, education and transportation—expendituresthat support long term householdwell-being. Children in households that receivesocial grants are more likely to attend school, and thiseffect is particularly strong for primary school-age girls,supporting gender equity effects. Social grants are associatedwith significantly greater household expenditureon food, and children in households receivinggrants have lower rates of hunger, even compared tohouseholds with similar income levels. Social grants reinforcedevelopmental household spending.The household spending effects improve labour productivity,providing a means for households to accumulatehuman capital that can help to break the povertytrap afflicting low income households. Internationalstudies document how social grants increase labourforce participation by very low income households. Inaddition, job-seekers from households receiving socialgrants are more likely to succeed in finding employmentthan comparable income job-seekers from householdsthat do not receive grants. Social grants providesecurity, and this security increases the likelihood thatunemployed potential workers will invest in job search.In the absence of the security social grants provide, jobsearch is too risky, particularly when the likelihood ofsuccess is low. Workers in households that do not haveaccess to safety nets cannot afford the risk that the fewresources they have available will be squandered in futilejob search—and this insecurity traps them intopoverty. The Basic Income Grant is not so much asafety net but rather a springboard that lifts the poor tomore sustaining livelihoods.In addition, the macroeconomic impact of social grantstends to reinforce economic growth and job creation,further supporting their affordability. Social grants shiftThe BasicIncomeGrant is notso much asafety netbut rather aspringboardthat lifts thepoor to moresustaininglivelihoods.87

The poor,however,tend tospend agreater proportionoftheir incomeon goodsproduced inNamibia—and goodsproduced ina relativelylabour-intensivemanner. Associal grantsshift spendingpower tothe poor,the demandfor goodsthat createjobs in Namibiaincreases.The BasicIncomeGrant is notan addedburden at atime of economiccrisis, butan appropriateintervention.Section 3: A national Basic Income Grantspending power from higher income groups to lower incomegroups, as taxes on the more affluent financegrants to the poorest in the country. Upper incomehouseholds spend a greater proportion of their incomeon imports and goods produced with capital-intensivetechnology. Neither of these spending patterns supportsjob creation in Namibia. The poor, however, tendto spend a greater proportion of their income on goodsproduced in Namibia—and goods produced in a relativelylabour-intensive manner. As social grants shiftspending power to the poor, the demand for goods thatcreate jobs in Namibia increases. A Basic Income Grantis also likely to increase social stability, which is a preconditionfor sustainable economic development.These economic effects increase the affordability of theBasic Income Grant over time. The improvements inhousehold well-being reinforce the poverty-reducing incomeeffects of the grant, improve labour productivityand support household human capital accumulation.In addition, the improvements in nutrition, educationand health reduce the direct expenditure obligations ofgovernment, further supporting the affordability of theBasic Income Grant. For instance, a child who attendsschool and has the resources for proper nutrition ismore likely to succeed, reducing the government’s expenditureon repeat rates. This child is more likely togrow into an adult who can find a job, contributingtaxes that further support the Basic Income Grant’s affordability.As adults, people are less likely to sufferfrom chronic and debilitating diseases if they had propernutrition as a child. Diseases that often increase theexpenditure liabilities of the government can be reducedsignificantly. In addition, the labour market andmacroeconomic impacts of the Basic Income Grant supportlong term sustainability.The Basic Income Grant is not an added burden at atime of economic crisis, but an appropriate intervention.The following section highlights some of the emergingglobal evidence on the impact of cash transfers on economicgrowth in developing countries88

3.3 Cash transfers and economic development193.3 Cash transfers and economicdevelopment 19An emerging evidence base demonstrates that cashtransfers promote economic growth. Policy makers donot necessarily face a trade-off pitting social againstgrowth objectives – but rather have the opportunity toengineer a virtuous circle of increased equity promotinggrowth supporting further improvements in equity.There are at least nine paths through which cash transferspromote economic growth. Most of these mechanismswork by increasing overall economic efficiency—through better policies and strategies, improved resourceallocation (increasing employment, human capitaldevelopment and other investment and reducingdiscrimination), and by more effectively taking advantageof the economy’s capacity.An emergingevidencebase demonstratesthatcash transferspromoteeconomicgrowth.1. Cash transfers can generate gains for those groupswho might otherwise be disadvantaged by specific elementsof a pro-poor growth strategy, providing a balancingfunction that can enlist stakeholder support forthe reforms necessary to sustain long-term growth. Labourunions in Nepal, for example, have identified effectivecash transfers as a prerequisite for necessary labourmarket reforms, the combination of which wouldenhance both equity and growth. Cash transfer initiativeshave compensated the poor for reduced price subsidiesin Mexico and Indonesia.2. Cash transfers promote human capital development,improving worker health and education and raising labourproductivity. Studies in South Africa and LatinAmerica repeatedly document significant responses ofhealth and education outcomes, particularly in responseto both conditional and unconditional cash19 This section is based on a forthcoming paper by Samson et alfor POVNET, please refer to the POVNET publication for the referencesCash transferspromotehuman capitaldevelopment,improvingworkerhealth andeducationand raisinglabour productivity.89

Section 3: A national Basic Income Granttransfer programmes and social health initiatives. 20Child benefits (particularly cash transfers) and schoolassistance packages improve school attendance, andeducation constitutes the single most effective HIVpreventionasset. 21 Social cash transfers piloted incountries with high HIV prevalence (Zambia andMalawi) successfully reduce poverty in HIV/AIDS-affectedhouseholds. 22 The Child Support Grant in SouthAfrica promotes livelihoods, improves nutrition and facilitatesaccess to education. 23Cash transfersenablethe poor toprotectthemselvesand their assetsagainstshocks, enablingthemto defendtheir longtermincome-generatingpotential.3. Cash transfers enable the poor to protect themselvesand their assets against shocks, enabling them to defendtheir long-term income-generating potential.Droughts in Ethiopia have significantly reduced householdearning power as long as 15 years later. 24 Cashtransfers enable households to resist desperate measuresand reduce future vulnerability. Cash transferscan assist households to maintain their consumptionwithout selling productive assets.4. Cash transfers mitigate risk and encourage investment.The downside of the riskiest and yet most productiveinvestments threatens the poor with destitution.Cash transfers enable people to face these risks.For example, farmers protected by the EmploymentGuarantee Scheme in Maharashtra, India, invest inhigher yielding varieties than farmers in neighbouringstates. The risk associated with impoverishing healthexpenditures in rural China has adversely affectedwork migration and school enrolment decisions ofhouseholds. 25 Improved social risk management supportslong-term pro-poor growth.20 Adato (2007), Samson et al. (2006), Samson et al. (2004)21 Irish Aid GPN (2007)22 UNICEF ESARO (2007) cited in Irish Aid GPN (2007)23 Agűero, J.M. et al. (2006) cited in Irish Aid GPN (2007); alsoSamson et al. (2004), Samson (2007)24 Dercon (2005)25 Jalan and Ravallion 2001 cited in GTZ GPN (2007)90

3.3 Cash transfers and economic development195. Cash transfer programmes combat discriminationand unlock economic potential. In Bangladesh, Braziland South Africa, transfers provided to women have agreater positive impact on school attendance by girlscompared to boys. 26 Empowerment directly tackles discrimination,improving society’s employment of humanresources.In particular, while gender inequality exacerbates thespread of HIV and AIDS, empowering and increasing resourcesin the hands of women improves child survival,nutritional status and school attendance. 27 “When womenare healthy, educated and free to avail of life’s opportunities,children also thrive. In households wherewomen are key decision makers, the proportion of resourcesdevoted to children is far greater than in thosein which women have a less decisive role. 28 Consequently,who controls cash transfers at householdlevel is crucial in terms of AIDS and poverty mitigation,child survival and empowerment of both women andchildren.” 296. Cash transfers support the participation of the poorin labour markets, contributing to broader empowermentobjectives. Job search is often expensive andrisky. In South Africa, workers in households receivingsocial transfers put more effort into and are more successfulat finding work than those in comparablehouseholds not receiving these grants. The impact ofcash transfers on women’s labour market activity isabout twice as great as that for men. 30 Social healthprotection increases labour productivity by improvingpeople’s health status and replacing inefficient riskcopingmechanisms, which in turn promotes employ-Cash transferssupportthe participationof thepoor in labourmarkets,contributingtobroader empowermentobjectives.Job searchis often expensiveandrisky. InSouthAfrica, workersin householdsreceivingsocialtransfersput more effortinto andare moresuccessfulat findingwork thanthose incomparablehouseholdsnot receivingthesegrants.26 Samson et al. (2004, 2006)27 UNICEF, State of the World’s Children (2007) cited in Irish AidGPN (2007)28 HelpAge International (2006)29 Irish Aid GPN (2007)30 Samson et al. (2004), Samson and Williams (2007)91

Section 3: A national Basic Income Grantment and economic growth. 31 There is a need to betterunderstand how more effective cash transfers for informalsector workers might promote access to sustainabledecent employment. 32An emerging evidence base is providing evidence of howcash transfer interventions support employment andentrepreneurial activities. Participants in Zambia’s cashpilot scheme use a significant proportion of the benefitsto hire labour, for example in order to cultivate the landaround their homes and consequently multiply thevalue of the social transfers while creating employmentfor local youth. 33 Mexico’s Progresa (now Oportunidades)social transfer programme is associated with localeconomy impacts that improve consumption, asset accumulationand employment broadly within communities—forboth programme participants and non-participants.34 Participants in Progresa invest a portion oftheir social transfers in productive assets and are morelikely to engage in entrepreneurial activities, improvingtheir potential for sustainable self-sufficiency. 357. Cash transfers stimulate demand for local goods andservices, promoting short-term growth outcomes. InZambia 80% of the social transfers are spent on locallypurchased goods, supporting enterprises in rural areas.In South Africa the redistribution of spending powerfrom upper to lower income groups shifts the compositionof national expenditure from imports to localgoods, increasing savings (by improving the trade balance)and supporting economic growth. 36 A social accountmatrix analysis of the Dowa Emergency CashTransfer (DECT) programme in Malawi found multiplierimpacts from the payments broadening benefits to theentire community. 37 In Namibia, the dependable spend-31 GTZ GPN (2007)32 Lund (2007)33 Schüring et al. (2006)34 Barrientos and Sabates-Wheeler (2006)35 Gertler et al. (2005)36 Samson et al. (2004)37 See Davies and Davis (2007), which estimates multipliers rangingfrom 2.02 to 2.4592

3.3 Cash transfers and economic development19ing power created by social pensions supports the developmentof local markets and revitalises local economicactivity. 38 However, the macro-economic impact for anygiven country will depend on the patterns of demandacross income groups and the manner in which socialtransfers are financed.8. Cash transfers help create an effective and securestate, promoting growth by building social cohesionand a sense of citizenship as well as reducing conflict. 39Social health protection, for example, is grounded invalues of equity and solidarity, strengthening bonds ofco-operation and reciprocity and thereby promoting socialstability. 40 A safe and predictable environment isessential to encourage individuals, including foreign investors,to work and invest.The social pension, for example, in Mauritius contributedto the social cohesion necessary to support thetransition from a vulnerable mono-crop economy withhigh poverty rates into a high growth country with thelowest poverty rates in Africa. 41 Likewise, Botswana’ssocial pension provides the government’s most effectivemechanism for tackling poverty and supporting the socialstability that encourages the high investment ratesrequired to drive Africa’s fastest growing economy overthe past three decades.9. Cash transfer promotes empowerment and growth byimproving the negotiating power of workers, smallholderfarmers and micro-entrepreneurs in the marketplace.Workers who have a better fallback position (providedby cash transfers) can search for a job that takes moreeffective advantage of their capabilities, rather than acceptingthe first job that becomes available. This raises38 Cichon and Knop 200339 Samson et al. (2002), Bourguignon and Ravallion (2004), DFID(2005)40 GTZ GPN (2007)41 Roy and Subramanian (2001)Cash transferpromotesempowermentandgrowth byimprovingthe negotiatingpowerof workers,smallholderfarmers andmicro-entrepreneursinthe marketplace.93

Section 3: A national Basic Income Grantlabour market efficiency—by better matching workersto positions that harness greater productivity and payhigher wages, thereby reducing underemployment.Small-scale producers with access to cash transfer benefitsare less compelled to sell produce at a loss in orderto survive—such as at harvest times when temporarygluts in food markets might severely depress prices.Participants in one of Malawi’s social transfer programmeswere empowered by the resources to invest intheir own farms during the planting season rather thanrely on dead-end casual employment for their immediatesurvival. 42 Cash transfers enable the poor to engagewith the market system on a more equal footing, improvingits efficiency and legitimacy.The absenceof cash inthe localeconomypreventsbusinessesand localprojectsfrom becomingsuccessfuland sustainable.3.4 Local economic developmentUnemployment stands at close to 40% in Namibia. Themost affected by unemployment are rural people, womenand youth. Local entrepreneurship opportunitiesare also rare and often fail because of lack of cash toenable local communities to support local businesses.At present, economic growth tends to be in favour of bigbusiness. In Namibia, the major beneficiaries are someof South Africa’s major food and clothing chains suchas Shoprite, Edgards and Pep Stores who are often locatedin urban centres. The fruits of economic growthare not enjoyed by the large majority of Namibia’s poorwho have no work or who live on wages and salaries.The gap between the highly paid and the lowly paidcontinues to grow by leaps and bounds. Many Namibiansremain poor and are not able to live on their meagerincomes. The kind of economic growth we have witnessedover the years has reduced purchasing power -the ability to buy and pay for goods and services forNamibia’s poor. The current growth path therefore contributesto the sustenance of poverty rather than theelimination thereof.Formal and big business enterprises are not attractedto rural areas. In addition, the absence of cash in the42 Harnett and Cromwell (2000)94

3.4 Local economic developmentlocal economy prevents businesses and local projectsfrom becoming successful and sustainable. Small andrural enterprises do not survive because only the largerenterprises benefit from economic growth.Growth can, and must, be re-focused from the globalto the local, from the world-scale to the humanscale. Of course not everything can be localised:ship, planes and car building, as well as mining,are obvious examples. But nobody needs to choosebetween sugar and tea-shirts, tables and carpetsfrom all over the world. When production and consumptionare geographically closer, many benefitsfollow’ (New Economics Foundation, 2006).BIG supports an economic growth that puts cash incomeinto the hands of the poor. The people of Otjivero-Omitara have demonstrated that there are wider benefitsto be derived from putting cash into poor communities.The results show that poor people did notchoose to be dependent on the BIG forever, but haveused the grant to diversify their incomes. In the absenceof formal jobs, they were able to sustain livelihoodsand activate local skills.The people of Otjivero-Omitara have also shown the benefitsthat can be derived when the local and even nationaleconomy is driven by its people. BIG supportslocal economic development and promotes sustainablelivelihoods for communities such as Otjivero-Omitarathat have been facing long-term structural unemploymentand overarching dimensions of poverty. BIGmakes it possible for local people to be actors - not onlyconsumers of goods and services.Unlike most foreign businesses, local business ownershave a better sense of the needs of the people in theirown communities. The dresses that are made are thekind that the people in Otjivero-Omitara will buy, thebrick making business was inspired by the wish of residentsto improve their dwellings, and the tuck-shopsoffer the basic necessities that the people of Otjivero-Omitara need.The peopleof Otjivero-Omitarahave demonstratedthatpeople usedthe grant todiversifytheir incomes.Inthe absenceof formaljobs, theywere able tosustain livelihoodsandactivate localskills.95

Section 3: A national Basic Income Grant96The BIG promoteddiversityandchoice forpeople in accessinggoods andservices.The BasicIncomeGrant ismore thanan incomesupport programme.Itprovides securitythatreinforceshuman dignityand empowerment.It has thecapacity tobe the mostsignificantpoverty-reducingprogrammeinNamibia,while supportinghouseholddevelopment,economicgrowth andjob creation.A BIG is notan addedburden at atime of economiccrisis, butan appropriateinterventionthatwill stimulatedemand- particularlyfor basicconsumergoods.Unlike in the past when people were forced to buy fromone local dealer in Omitara, they now have a choice.The BIG promoted diversity and choice for people in accessinggoods and services.3.5 Concluding remarksThe BIG pilot project in Otjivero-Omitara has shownthe wide-ranging benefits of a universal income grant inaddressing poverty. The findings contained in this reportdocument the social and economic changes thatoccurred during the past 12 months – some of them beingnothing less than spectacular.The Basic Income Grant is more than an income supportprogramme. It provides security that reinforces humandignity and empowerment. It has the capacity tobe the most significant poverty-reducing programme inNamibia, while supporting household development,economic growth and job creation. A BIG has variousdevelopmental impacts. A grant of N$ 100 per personper month would generate a net benefit of over N$ 900million a year reaching the rural communities in Namibia.It can be argued that this would work as an enginefor local economic development. The poor would havethe ability to spend larger amounts on locally producedgoods and services. This would create more viable andsustainable opportunities for employment in the ruralareas. Furthermore, if people are constantly confrontedwith economic insecurity, they will not be able to engagein entrepreneurial activities. The BIG would thereforeprovide income security, which has the ability tofree resources for entrepreneurial risk taking. A BIG isnot an added burden at a time of economic crisis, butan appropriate intervention that will stimulate demand- particularly for basic consumer goods.The BIG is a form of social protection which reduces extremepoverty and supports pro-poor economic growth.As a national policy it would greatly assist Namibia inachieving the Millenium Development Goals to whichthe country has committed itself. These goals includethe eradication of extreme poverty and hunger, the pro-

3.5 Concluding remarksmotion of gender equality, the reduction of child mortality,combating diseases like HIV/AIDS and malaria,and ensuring environmental sustainability. The empiricalresults in Otjivero-Omitara have shown that a BIGwill have a positive impact in all these areas.While the BIG alone cannot solve all of Namibia's socialand economic problems, it will certainly make a substantialcontribution. One of our findings in Otjivero-Omitara was that the grant has reduced the dependencyof young women on men for their survival. TheBIG has given women a measure of control over theirown sexuality, freeing them to some extent from thepressure to engage in transactional sex.There is no doubt that the cost of a BIG is substantial -ranging from 2.2% to 3.0% of national income. Asshown by the calculations in this report, Namibia hasthe capacity to mobilise the necessary resourceswithout undermining financial stability. On the contrary,over time, as Namibia benefits from the long termgrowth impact, the Basic Income Grant will become increasinglymore affordable. Moderate adjustments toVAT and income tax, alternatively royalties levied onnatural resources, or a shift in budget priorities or acombination of these interventions, will make a nationalBIG an immediate option for Namibia. Its implementationis thus merely a question of political will.As shown bythe calculationsin thisreport, Namibiahas thecapacity tomobilise thenecessaryresourceswithout underminingfinancialstability. Itsimplementationis thusmerely aquestion ofpoliticalwill.97

98Section 3: A national Basic Income Grant

3.5 Concluding remarks99