How Ghana’s Cash Transfer Scheme is Reducing Poverty and Hunger 

Ghana’s Livelihood Empowerment Against Poverty (LEAP) Programme, a cash transfer scheme for the poorest households, has been praised by the International Monetary Fund (IMF) as one of the most effective social interventions in the country. The program, launched in 2008, aims to improve the living standards and access to essential services and opportunities of the extremely poor and vulnerable, such as the elderly, the disabled, and orphaned children.

Stéphane Roudet, the IMF Mission Chief for Ghana, told Citi TV that the LEAP program had significantly impacted poverty reduction in Ghana. He said that the IMF has discussed with the authorities how to allocate more resources to increase the level of benefits for the program. “In the 2023 budget, there was a substantial increase in the level of benefits for the LEAP program. We consider this program to be a very effective one, and so we discussed with the authorities how to make sure that we reserve in the context of the budget the resources needed to increase the level of benefits,” Mr. Roudet said.

According to data from the Ministry of Gender, Children, and Social Protection, which oversees the LEAP program, more than 344,000 beneficiary households received bi-monthly cash grants in 2023. The amount of cash transferred depends on the number of eligible members in each household, ranging from 64 to 106 Ghanaian cedis (about 11 to 18 US dollars) per cycle. The beneficiaries also enroll in the National Health Insurance Scheme for free health care services.

The LEAP program is part of Ghana’s efforts to achieve the Sustainable Development Goals (SDGs), especially Goal 1 on ending poverty and Goal 2 on ending hunger. A recent study by UNDP and Oxford University showed that Ghana has made progress on multidimensional poverty reduction, which measures deprivations in health, education, and living standards. The study found that Ghana’s multidimensional poverty rate declined from 55 percent in 2011 to 46 percent in 2017.

However, challenges remain as Ghana still faces high levels of inequality, food insecurity, and malnutrition. The COVID-19 pandemic has also worsened the situation for many poor and vulnerable people who have lost their livelihoods and incomes. The World Bank has projected that Ghana’s economic growth will slow to 1.5 percent in 2023 and remain depressed in 2024 before recovering to its potential by 2025.

Various development partners, including UNICEF, DFID, USAID, and the World Bank, support the LEAP program. The World Bank has provided a total of $175 million in financing for the program since 2010. The Bank’s latest project, approved in June 2023, aims to strengthen the delivery systems and institutional capacity of the LEAP program and expand its coverage to reach more poor and vulnerable people.

The LEAP program exemplifies how Ghana uses social protection to reduce poverty and hunger and promote inclusive growth. By providing cash transfers to the poorest households, the program helps them meet their basic needs and empowers them to access education, health care, and economic opportunities. As Ghana continues its journey toward becoming a middle-income country, the LEAP program will play a vital role in ensuring no one is left behind.

Source: GhanaWeb