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Cash grants and cash for work in Sri Lanka (Special Supplement 3)

Sophia Dunn, Oxfam GB

Coir mill

Following the devastating tsunami in the Indian Ocean on 26th December 2005, Oxfam GB scaled up its activities in Sri Lanka and opened an office in the southern province of the country. Outside The Liberation Tigers of Tamil Eelam (LTTE) controlled areas, some parts of the Southern Province are amongst the poorest in Sri Lanka, and thus most eligible for assistance.

Oxfam GB had no existing partners in this area and therefore no relationship with the community. Immediate needs were being met through assistance from WFP (food) and the government (cash vouchers and cash grants), and were provided to all households directly affected by the tsunami for seven months, beginning in February 2005. Oxfam thus set up a programme of both cash grants and CFW, with a view to enabling people to purchase their own food and basic needs when government assistance ceased.

Why cash grants for some people and cash for work for others?

Coir yarn machine

The local government authority was responsible for coordinating livelihood activities. Oxfam GB requested to assist the coir, lace and agricultural sectors as these groups are considered to be poor livelihood groups. Furthermore, Oxfam wanted to prioritise women's activities as many organizations were concentrating on the (male dominated) fisheries sector. Also, at that time, coir and lace industries were tsunami affected but not being assisted by other agencies.

Most of the households preferred to return to their original means of income generation so that they could earn money faster than if they had to undergo training first. By providing a grant, people were able to purchase the materials and equipments they needed quickly and locally to re-start income generation activities and without logistics or any other additional complications for Oxfam GB.

End Product - door mats

CFW was used in villages where communal work was identified as being relevant for the beneficiary community, or for specific livelihood groups who, for various reasons, were unable to start their original income generating activities.

Who received grants?

Cash grants were provided to:

Who received CFW income?

The groups of people who received CFW income were:

Making lace

By the end of July, the livelihoods team had distributed more than 3000 cash grants to re-start coir yarn making and other small businesses.

Lessons learned from cash grant programme

Cash grants place responsibility with beneficiaries and allow them to choose items they need. Cash grants have enabled Oxfam GB to assist a large number of beneficiaries with a minimal input. Equivalent grants should be given to people undertaking the same work so that there is equity.

Lessons learned from CFW programme

Due to the large number of beneficiary households, the amounts of money paid out on a weekly basis exceeded the amount allowed by the Oxfam GB cash carrying guidelines. As a result, money was transferred to a bank less than an hour away reducing the distance between bank and payment site.

Lace support in a camp

At the beginning of the project there was major confusion/ corruption, e.g. some households sent different people to collect the cash. Now each household has one named representative who is the only individual allowed to collect the cash.

The high demand for work meant that tasks were finished quickly so that there were constant discussions with the community and their leaders to come up with new ideas for CFW projects.

The chena farmers are earning more from CFW than in a normal year activity.

Some people who were casual fishing labour did not return to fishing even after receiving boats. They preferred to stay involved in CFW.

A lot of paper work is required (five extra finance officers were employed in Hambantota and Matara).

The finished product

Corruption can occur in a number of ways, e.g. supervisors were putting down names of people who were not working and also more than one name per household.


Assistance to each household was determined by the households themselves, both in terms of the amount and the items to be bought. All of the households used money for restarting IGA.

Provision of cash allowed rapid provision of materials to the affected households, as people were able to purchase for themselves from local suppliers.

CFW provided a source of income for households unable to access government assistance.

Use of cash transfer minimises the need for logistics and increases use of local procurement, therefore having a knock-on effect on the community. However, close monitoring of the labour market is essential to ensure that it is not being distorted by CFW.

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Reference this page

Sophia Dunn (). Cash grants and cash for work in Sri Lanka (Special Supplement 3). Supplement 3: From food crisis to fair trade, March 2006. p31.



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