WFP Indonesia Food Insecurity and Food Aid in Urban Context

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FOOD INSECURITY

AND FOOD AID IN THE URBAN CONTEXT

Bishow Parajuli

Deputy Country Director, WFP Indonesia

Abstract

With increasing urban populations and concerns over malnutrition and social problems,

more attention is now being paid to assist the poor in urban centres. A major challenge for

the urban poor is securing an adequate quantity of staple food with the necessary daily

requirements of protein, calories and micro-nutrition. A major portion of their income isspent on food. These issues also impact upon education and health. Any support to the urban

poor should therefore aim at increasing total family income to help them escape the cycle of

poverty.

Food security for the urban poor is seldom seen as a priority. This needs changing, and food

aid via donors and multilateral agencies such as WFP can play an important role in this

respect. The choice of activities will depend on the situation, the target population and the

resources available. Civil society can also play an important role in targeting and delivery. .

Effective targeting needs planning from the early stages. Women and children are likely to

be those most affected and therefore providing food assistance to these groups should be a

priority.

Various options exist for channelling food assistance to the urban poor. These include: food-

for-work involving individual and community efforts or public works; school feeding (on-site

feeding as well as take-home rations) to provide incentives for school attendance as well as

nutritional support; and "Vulnerable Groups Development" to provide food as an incentive

to support human development, enhancing opportunities for the poor to increase their

income through self-employment and external job opportunities. Access to food at reduced

prices would encourage increased consumption, complement income and assist in the

provision of basic necessities including health and education.

The Indonesian experience has been very positive. It has helped to increase consumption,

reduce malnutrition and support people in times of hardship. WFP's partnership with NGOs

has been highly successful in supporting targeting and ensuring accountability and efficient

management.

Introduction

The general trend in food aid has been to limit food assistance to the rural sector, in thebelief that the urban poor are better off than those in rural areas. Conventional wisdom heldthat assisting the urban poor would increase rural-to-urban migration; that only a limited

number of the poor live in urban areas; that they are widely dispersed, making targeting

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difficult; and that urban inhabitants are often better privileged with access to governmentsupport. Some of these notions may have had some truth but the present situation is differentand rapidly evolving. With increasing urban poverty, high levels of malnutrition, increasingsocial problems and growing urban populations estimated to represent 60% of the global

population in the next 25-30 years, the doctrine of limiting assistance to the rural poor needs

modification.

This paper highlights emerging concerns for the urban poor and discusses several key issuesin the formulation, management and implementation of food aid programmes. It elaboratesupon the merits of a specific type of food-assisted activity, making extensive use of theIndonesian example as a possible model for urban food aid programme for other countries.

Emerging concerns

Every day more than 800 million people worldwide go hungry to bed and malnutritioncontributes to the deaths of 11,000 children. With urban populations reaching one third of

the global population and a significant proportion unable to meet their minimum food needsand secure other basic services, the problem of food insecurity and the need to improve thelivelihoods of the urban poor have become a serious concern.

The lack of employment opportunities and the general hardship in rural areas, as well as themagnet of and attraction from better health and education services and favourable workopportunities in urban centres, will continue to encourage migration to urban centres.Insecurity in rural areas due to civil insurgencies may also continue to force thousands tolook for safe havens in urban centres.

As a consequence there will be further overcrowding and expansion of cities, deterioration offood security and sanitary and living conditions; provision of basic services will eventually

be beyond the normal capabilities of any city and generally out of reach of the poor.

It is estimated that nearly 98% of global population growth over the next two decades willoccur in developing countries, with the urban population of these countries doubling over thenext 30 years. By 2007, the proportion of urban inhabitants worldwide will surpass those inrural areas. Given their dependency on employment, their limited alternative livelihoodstrategies and reduced links with their rural kin, the urban poor will be highly vulnerable toeconomic shocks and subsequent changes in prices of basic foods and services. For poorfamilies, entire incomes will be spent on meeting the cost of basic food needs and they will

be required to use all their earning power, including that of their children, to raise householdincome for food. Illness, loss of employment and any unforeseen misfortune would bringlong-term distress.

Seven out of ten of the world's poorest are women and young children. Ignoring the plight ofthe urban poor means ignoring the basic needs and the rights for vast number of women andchildren.

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Many of the poor in urban centres live in typically densely populated corridor areasalong riverbanks and railways. Others live in smaller clusters inside solid wastedumpsites. Many are illegal squatters who have occupied government- or private-owned land for a long period of time. Living conditions are extremely inadequate;many houses are in a pitiful condition, with limited space and no daylight. Some may

have private toilets, while many use public toilets (which often have no runningwater).

Poor households alter their eating habits by reducing consumption of more expensive foodssuch as milk, eggs, meat and vegetables or by decreasing the number of meals eaten per day.Children often bear an increasing burden, having to drop out of school and participate ingenerating household income. The poor often suffer higher levels of micronutrientdeficiencies and malnutrition, underweight childbirth and poor mental development amongchildren. There is often deterioration in personal security, with an expansion of the sex trade,child prostitution, HIV and other poverty-related illnesses.

The factors influencing urban food insecurity are often consistent with urban problemseverywhere:

A large proportion of the population is dependent on wage labour to meet food needs. As

these wage-earning opportunities disappear, huge competition is created in the informaljob sector.

Often, formal safety nets are not available for the poorest, leaving large numbers of

people without assistance.

Informal community safety nets may be weak in urban neighbourhoods.

Legal obstacles prevent the poorest from participating in the formal safety nets created

for them. Return to rural areas is not an option for many as they are from landless families;

The major food aid donors and the UN/WFP can play a crucial role in addressing emergingproblems for the urban poor by attending to food insecurity through food aid and byengaging in advocacy to raise concern for the urban hungry poor.

Policy implications

Food security of the urban poor is rooted in the political economy of the city, the socialstructure in which they live, the labour market and other factors. Poverty and food insecurityare inextricably bound together. and government spending - or lack of it - on health, nutritionand education can have major consequences .

Households increasingly depend on total family income, with women under pressure to seekemployment or participate in informal trading activities. This will also change the provisionof attention to childcare with ngatative implications for the health and nutritional status ofchildren.

External assistance is not confronting the underlying causes of poverty and food insecurity.Programmes and policies that enhance skills to match market opportunities and schemes that

create employment would be appropriate policy options in addressing urban poverty andfood insecurity issues.

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Food security interventions often receive less attention due to the fact that the underlyingcauses are complex and short-term results are scarce. Donors often prefer to concentrate onmore politicised and higher visibility programmes, frequently neglecting the fact that foodinsecurity weakens the ability of society to institute better governance practices.

Programmes supported by major donors play an important role in advocating the rights ofthe poor far beyond the net value of the programme. Government interventions throughSocial Safety Net Programmes provide important economic benefits for the poor. Whilelaudable, weak targeting and diversions/leakage mean that coverage is often inadequate andthe impact questionable.

There are several benefits in implementing food assistance programmes in urban sectors:

Food aid can provide a strong complementary support to macroeconomic reform

within government safety net programmes;

With limited resources and tremendous demand in both urban and rural areas, various

reasons such as better access to management control, cost-effective monitoring andsupervision, and control over resources offer strong arguments for concentrating foodassistance to urban areas;

Food aid can quickly help stabilise prices and counteract economic hardship; in its

absence, urban unrest and disturbances against economic reforms or development areperhaps more prone to erupt;

It is easier and more cost-effective to target and work with food aid in homogeneous

areas, which is often the case in major metropolitan slums.

Role of food aid

Food aid promotes food security: "access of all people at all times to the food needed for anactive and healthy life". Food aid can help alleviate both structural and transitory poverty. Itcan be an important resource for human development and future income-generating

potential, and can provide short-term employment. It can also be a direct source of income ora livelihood support. Simple design, appropriate choice of activity and successfulimplementation are the keys to success in targeting, coverage and efficient implementationof any food-assisted programme. Effective food-assisted activities can play a model role insupporting national social programmes.

The UNs World Food Programme, which supplies about 25% of global food aid, is thesingle largest source of project food aid worldwide. It delivered 3.4 million tons of food in1999, assisting 90 million people in some 82 countries. Of these, urban activities constitutedaround 3% of total assistance, limited to five or six countries. WFP is developing a policy toincrease support to the urban sector and expand awareness among the food aid managerswithin the organisation. With donor support and heightening awareness, increasing quantitiesof food aid are likely to be channelled to supporting the hungry poor in the urban sector.

Programming

Food assistance may be provided under different arrangements with numerous options. Thechoice of an activity should be defined by the objectives, number of people to be assisted,

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availability of complementary support and the implementing capacity.The table belowcompares various weakness and strengths of several possible activities.

Activities People

covered

Need for

comple-mentary

resourcing

Planning/

prep-aration

Design Food

supply/logistics

Targeting/

gender

Food forWork

Small Yes Long Complex Complex Easy/mostlymen

SchoolProg-ramme

Large No/limited Short Simple Simple Not easy/bothgender:children

NutritionProg-ramme

Large Yes Long Complex Complex Easy/women/children

Vuln.GroupDevl.

Large Yes Long Complex Simple Easy/women

Vuln.GroupFeeding

Large No Short Simple Simple Easy/women/children

MarketOperation

Large No Short Simple Simple Easy/family

Choice of implementing partners

In many instances, the choice of implementing partners and the cost-sharingmechanism play a key role in determining the mode of implementation, the setting-upof project objectives and the ultimate success of the programme. Ongoing experiencessuggest that food aid programmes are often more successful if implemented with

NGOs. The main reasons for such successes are:

NGOs are better informed about the local situations and therefore better placed to

ensure both effective targeting and operational neutrality;

Working through NGOs provides added opportunity to combine food aid with

complementary programmes; NGOs provide increased level of transparency and accountability in the delivery of

resources;

Governments often lack human resources support and are administratively

handicapped for a quick response;

International NGOs can often bring complementary resources to support

programme implementation.

Initially, local NGOs generally lack experience and resources; they require on the jobtraining and administrative support. Such training is a good investment in capacity

building.

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Targeting

Targeting is important to avoid the misappropriation of assistance by non-targetbeneficiaries. It is almost impossible to limit assistance to only the target groups, andone should have an acceptable error of inclusion of non-targeted beneficiaries in the

programme. There should be adequate funds to support targeting and extensiveplanning from the very early stages. Socialisation can support and enhance targeting.Often, programmes implemented by the government encounter difficulties in targetingdue to higher expectations among the population (entitlement mentality) and politicalinterference.The most common approach in targeting food aid in the urban context is a combinationof geographical and household selection. In the case of a homogeneous communityoccupied exclusively by the poor, there would be no need for household targeting.However, there are other communities where the poor live interspersed among the

better off; targeting in these cases is difficult and costly, and in such a situation the

choice of activity or commodity/services for assistance should be clearly defined.Physical verification or pre-assessment and surveys of beneficiaries, though these may

be expensive, are often the best method of identifying communities for targeting.Vulnerability mapping with the combination of several food security indicators such asincome, expenditure, education level, incidences of disasters, unemployment rate,female literacy and malnutrition among children are the most effective means tosupport this task. The major concern is that often such data are not available in theurban context, since people reside illegally and the city authorities do not recognise orsupport censuses of such settlers.

Gender considerations

Household food security is better addressed by targeting food to women. In times offood shortages, it is often the women who reduce their own food consumptionalthough, if pregnant or lactating, they may in fact require the best diet. During timesof decreased income, women make choices in allocating their food budget, oftenreducing their own frequency of consumption, reducing purchases of essential non-food items and reducing protein-rich foods, thus becoming the first victims of reducedmicronutrient and protein intake.

The choice of food-assisted activities often plays a determining factor in their extent of

involvement in the programme and the additional burden it puts on women. Whilethere are obvious advantages in targeting food aid to women, due attention must bepaid to the social milieu and the availability of free time, so that food aid programmesdo not burden them further. In urban settings, women often have limited support whenlooking after children. The availability of women's free time depends on the period ofthe day and may differ with children's ages. Depending on the country, many womenare forced to participate in supporting family income, often through informal tradesuch as establishing a mobile shop, selling cooked food, or preparing and sellinghandicrafts.

Project activities

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Food-assisted projects commonly supported under food aid include: Food for Work;School Programme; Vulnerable Group Feeding; Nutrition Programme; MarketOperations; Micro Projects; and Vulnerable Group Development:

Food for Work (FFW)

FFW programmes often focus on creating community assets or public workssuch as the development of roads, embankments and walkways and the clearingof drainage ditches. The availability of non-food technical and financial inputsare a prerequisite for starting a successful FFW programme. This activity oftenrequires considerable supervision and technical support as well ascomplementary non-food inputs.

FFW is often compared with cash for work and critics downplay its value.FFW can be a massive source of employment and a means to supplement foodfor the poor. The FFW programme in Bangladesh employed nearly half a

million people during the lean period and helped increase food availability tohouseholds.It also played a major role in stabilising prices for staple foods. In ahighly inflationary situation, such as in Indonesia and Zambia, people often

prefer food or a combination of food and cash as their wages, rather than cashonly. Cash for work could be another option, possibly easier to handle thanfood aid but not entirely free from problems. With the flexibility that cash

brings, it may paradoxically encourage lower expenditure of earnings on food,thus negatively affecting family nutrition. In addition, cash for work oftenincreases leakage. The fact remains that cash aid is seldom a good substitutefor food aid. While the ideal option would be a combination of food and cash,experience from Bangladesh and other countries suggest that it is difficult torelease food and cash at the same time due to administrative difficulties;implementation of such a programme therefore becomes ineffective.

There are also potentially valid arguments that FFW discourages participationby women because of work difficulties, social taboo and security concerns. Theultimate mix of beneficiaries would depend on the labour market,unemployment, opportunity costs for labour, social taboos, food prices and theoverall country situation. In Zambia and Mozambique, women dominated theFFW programme whereas in Indonesia the proportion of women participants ismuch less; and in Bangladesh men dominated the FFW programme.

Lessons learned from the implementation of the FFW activities in suchcountries highlight that:

FFW is a good option to support rehabilitation of community

infrastructures. However, it requires a substantial amount of complementaryresources in the form of cash and technical support. NGOs are often the keyimplementing partner in launching these activities. International NGOswould generally be the implementing partners, and they also often see FFWas a good entry point to undertake other support programmes.

In the urban context, due to the limited scope of activities, only asmall-scale operation can be implemented, thus limiting the scale of

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assistance. If the demand for employment is high, providing food assistancethrough FFW is not the right choice.

The quality of work is highly dependent on close technical supervision

and availability of skilled human resources, which are often costly and

unattractive for FFW employment. The programme may also exclude thosewho are not able to work but who may be in urgent need of food.

During an emergency, there is often little time between planning and

execution and therefore the work output trends to be of low quality and notcompetitive with investments. FFW thus becomes an alternative to freedistributions rather than a means to asset creation.

There are also complexities in defining work norms and related wages in

food and the ILO norms for wage payments in kind. Detailed analysis

sometimes makes FFW an unattractive economical alternative to cash, if oneis to choose between food and cash, as payment of wages.

School programmes

Under the School Programme, food is provided to students at schools as cooked(wet) meals or distributed as dry rations to take home as family support. Wetfeeding at school requires logistic planning for the supply of cooking pots and

pans, and the regular supply of firewood or other sources of energy, and istherefore often difficult and cumbersome to launch in the short term. However,wet feeding could be an effective way to support poor children in slums or

other improvised communities, either to provide additional nourishment or asan incentive to support increased enrolment or attendance. It should be notedthat schools in poor communities are usually overcrowded and lacking inadequate teaching materials, and therefore the operation has limited educational

benefits. There are also different reasons (money for uniforms and books or theneed to earn additional household income) for which children do not attendschools, and therefore the programme may not sufficiently attract those fromthe poorest families. Often a more effective way to deliver higher incentivesand greater levels of income transfer is to provide take-home rations that assistthe whole family. The choice of strategy depends on the objective of the

programme and the prevailing conditions.

The School Programme in Botswana was a good magnet for children to attendschools and increase their learning potential. The School Programme inMozambique helped mothers support children's entry to preschools, thusfacilitating maternal employment. The School Programme in Yemen andPakistan attracted higher female attendance rates. In Indonesia, the SchoolProgramme provided a major incentive for parents to continue sending theirchildren to school and higher attendance at schools.

Using primary schools in urban areas to distribute take-home rations is aneffective way to keep children in schools and deliver assistance to poor andaffected families. However, care must be taken in the targeting of the schoolsand of poor students within the schools.

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Vulnerable Group Development

The aim of the VGD operations is to support target groups in order to developskills and improve their technical knowledge, so that the participants can

enhance their employment prospects and participation in various income-generating activities. Food aid compensates for the lost income of the

beneficiaries while they participate in learning, and contributes to inducingbeneficiaries to participate in credit or loan schemes. The availability of micro-credit, the quality of training, and an out-going attitude of beneficiaries areoften the keys to the success of VGD Programme.Beneficiaries usually get nodirect financial assistance to participate in the economic activity. The VGDneeds long-term planning and a coordinated approach that integrates food aidwith financial and technical assistance and about 18 to 24 months forgraduation. The VGD programme in Bangladesh is a typical success storywhere a combination of food aid, income-generation training and micro-credit

is helping women escape the vicious cycle of poverty. One constraint that mustbe recognised is that VGD operations, by their very nature, often exclude theelderly.

Vulnerable Group Feeding

The focus of VGF is to provide vulnerable groups with food for a specificduration to prevent them from starvation or to provent a deterioratingnutritional situation. The operation provides temporary access to food due toloss of agriculture, income or displacement or financial constraints andaddresses nutrition concern for the vulnerable poor. Several countries in Africaand Asia where civil unrest or war has displaced people have been runningVGF programmes.

Micro Projects

Under these arrangements, numerous small-scale activities are assisted throughfood aid. These could include school feeding, vulnerable group feeding,drinking water provision, irrigation schemes, assistance to street children ordirect nutrition intervention. The programme in Mozambique is a typical caseof this type within WFP.The operation covers a limited number of

beneficiaries but provides ample flexibility in supporting a variety of initiatives.

Market Operations: subsidised sale of staple food

Under market operations, the target groups are provided with access topurchase staple food commodities at subsidised prices, thus helping thebeneficiaries with income transfers. Many countries choose a food safety netintervention to support poor consumers by integrating it with a farmers support

programme. The Market Operation in Indonesia is a typical example of suchinterventions. The sale price of the basic staple in relation to its market pricewill decide on the amount of subsidy being provided. The operation can be

messy and ineffective if it is not well targeted. It can provide multipleadvantages and help the poor most under a highly inflationary economy.

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Indonesian experiences

Jabotabek (Jakarta and surroundings cities) and several other main cities within Indonesia

are highly overcrowded (Jakarta 12,000 inhabitants/km), particularly in illegal settlementsand slums. Out of the 12 million inhabitants, over 30% reportedly live below the povertyline, with miserable living conditions and much undernourishment. The fast economicgrowth of cities in the last two decades, the difficulty of finding work in rural areas and thehopes of access to various services and jobs have attracted millions to move to the majorcities in Indonesia. However, the provision of basic services and welfare support has not kept

pace. After the economic crisis began in mid 1997, the price of rice and other essentialcommodities increased by more than 200%. The number of Indonesians with an income

below the poverty level rose from 22.5 million in February 1996 to 49.5 million by mid1999. Consumption of basic food commodities and protein-rich food (such as eggs and meat)as well as micro-nutrients such as iron, vitamin A and zinc decreased significantly,

particularly in urban areas, where the poorest households have been hit hardest. The averageper capita daily calorie intake was reduced to below 1,600 kcal, against a dailyrecommended minimum of 2,100 kcal. More than 50% of young children in Jakarta andother key urban centres were reported to be underweight. The prevalence of anaemia amongchildren in Jakarta increased from 41% in 1995 to 85% during the crisis. There has been aserious concern about a future drop in intellectual development caused by inadequate feedingduring the early years, leading to a fear that Indonesia will enter the 21st century with a lostgeneration.

To deal with the food crisis, the Government of Indonesia developed a number of socialsafety net programmes with financial aid from the World Bank, IMF and other donors. Oneof the more successful programmes was the Special Market Operation (OPK). This operationhas used 53.1% of the total government budget of US$400 million allocated for the SocialSafety Net Programme. The activity provided subsidised rice to poor households throughoutthe country. Nearly 50 million people received OPK rice in 1999/2000: an indirect transferof 10 to 15 % of monthly income for the pooreset food-insecure households. However, theoperation excluded many urban poor, particularly unregistered settlers, due to severallegalities.

With the emerging concern of food insecurity among the urban poor, WFP shifted itsemphasis from rural emergency food assistance to families affected by drought to the urban

poor, and launched four food-assisted activities: Special Market Operations, SchoolProgramme, Nutrition Programme and FFW. All these activities made a successfulcontribution to addressing concerns over malnutrition, micro-nutrient related problems anddropout among primary school children. However, WFP's most significant contribution incoverage and impact is the Special Market Operation (OPSM). The subsequent paragraphswill briefly touch on the three other activities, then elaborate on the OPSM programme.

Food for Work: FFW was run in collaboration with an international NGO in two urbancentres. The community-identified activities were rehabilitation of roads and drainage, andimprovement in community sanitation in several localities with very poor sanitation andinfrastructure. About 7,000 beneficiaries participated in the programme, of which 30% were

women. The programme assisted people with 3 kg of rice for six hours of work, equivalentto a minimum daily wage. WFP also allocated food and tried to encourage local NGOs to

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participate in the FFW initiatives. However, due to lack of supplementary resources, no localNGO participated in the operation and only half of the allocated resources were utilised.

The School Programme: This was implemented in collaboration with the Ministry ofReligious Affairs (MORA), Ministry of Home Affairs (MOHA), the National Development

Planning Agency (Bappenas) and the National Logistics Agency (BULOG). The programmeassisted 186,000 students in 2,900 schools and received 14.8% of programme resources. The

project provided 10 kg of rice to every student with a monthly income transfer of Rp20,000(approx US$2.10) or about 10 to 15% of monthly wages to the families receiving rice. Theoperation was marked by the problem of inadequate and late release of funds from thegovernment for deliveries and poor coordination among government institutions.Consequently, only 50% of the allocated resources were utilised. However, the activity wasan outstanding success in assisting poor families with additional income and in supportingchildren's continued attendance at the schools.

The Nutrition Programme: Under this initiative, fortified food is provided for children at

one-tenth of production price and free nutritional education is provided for mothers. Theproject is implemented in cooperation with local NGOs and depends on WFP formanagement support, supervision and technical back-up. Implementation of this programmewas delayed by the need for considerable preparation but it is expected to contribute greatlyto addressing malnutrition concerns among the urban poor in Indonesia.

The table below compares various activities being implemented in Indonesia based on theircoverage, gender focus, need for complementary resources, constraints faced and impact.

Activity Direct

benef-

iciary

(HH)

Female

recipient

of WFP

food (%)

Major

constraint

Sources of

comple-

mentary

resources

Govern-

ment role

in imple-

mentation

Impact

SchoolProg-ramme

186,000 52 Untimelyavailabilityof govt.inputs/irregulardistribution

Govt. Foodlogistics

Additionalincome;increasedconsumption;

part of savingsused to supporteducation

OPSM 580,000 85 Poor NGOcapacity

Notapplicable

Limited Increasedconsumptionand reducedmalnutrition/micro-nutrientdeficiency

problems;increased HHexpenditures foreducation

NutritionProg-

40,000 75 Slow start;non

Salesproceed

None (Not yetassessed)

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ramme availabilityof localfortifiedfood; poor

NGO

capacity

from WFPproject

Food forWork

7,000 30 Poor qualityof outputs;

poor returnon invest-ment

INGO None Increasedconsumption;development ofcommunityassets

Special Market Operation (OPSM): an appropriate response to urban food security

The Special Market Operation (OPSM) is one of the largest WFP-assisted urbanprogrammes and supports urban poor households affected by the economic crisis inIndonesia. Monthly, the operation provides access to 20 kg of rice (roughly half of thefamily requirement) in four instalments at a subsidised price of Rp1,000/kg (about50% of the market price) to poor households who do not receive other food assistancefrom the government. OPSMwas introduced to fill the gap in the government

programme, particularly to assist food-insecure households left out of the governmenturban safety net programme because, as unregistered residents of their cities, they wereineligible to participate. OPSM has covered 580,000 households and assisted 2.9

million people with a quick response time. The choice of the activity was prompted bythe fact that the government had a similar programme and that the target beneficiariesstill had purchasing power but needed some support to adjust to the inflated price offood (often coupled with the loss of formal sector income as factories laid off labourdue to the economic crisis).

The OPSM activity is implemented by several local NGOs, covering 800 urban andperi-urban villages in four key urban centres: Jabotabek (Jakarta and surroundings),Bandung, Surabaya and Semarang. The NGOs are involved in the selection of

beneficiaries, delivery and sale of rice, reporting and the transfer of sales proceeds tothe WFP-managed trust-fund account.

To ensure that the programme reached the intended group, WFP developed acomprehensive and inter-linked monitoring/reporting and resources tracking system.Every beneficiary receiving assistance is registered. Sales, losses and money transfersare counter-checked with the bank receipt/invoice and document at warehouse levelsand are reported on a weekly basis.

WFP identifies and selects NGOs which in turn identify and register beneficiaries andrequest WFP for the release of rice. WFP authorises the release of rice and contributesthe NGOs costs of administration and delivery through sales proceeds. NGOs collectrice at the distribution centres, administer its sale and transfer sales proceeds to an

account managed by WFP. WFP monitors andadministers sale/receipt of funds andauthorises its disbursement in cooperation with the government.

30,00015,0003,000

Number of OPSM Phase IBeneficiaries

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The sale of rice to the urban poor through NGOs has to some extent reduced sales byvillage traders. However, the savings from the lower prices on rice provided surpluscash for people to spend on non-rice commodities such as vegetables, fish, egg andvarious other items, increasing the trading of non-rice commodities.

Lessons learned

Several key challenges emerged in the implementation of the Special MarketOperation. By deploying a strong programme management team, WFPdirected and supervised the implementation of the programme. Operationalguidelines were developed and several training sessions were arranged tosupport NGOs in implementation; continued support and supervision were putin place to facilitate efficient implementation. An extensive monitoring andreporting system was established, and distribution sites were regularly visited,covering virtually all distribution points. Regular coordination meetings were

held to facilitate sharing of common concerns and the timely addressing ofpertinent issues. Longitudinal surveys among the beneficiaries helped providea better understanding of the impact of the project on beneficiaries, as well asaddressing common concerns not usually obtained through monitoring visits.

The operation included a self-targeting feature by using medium quality rice,choosing geographically poor areas and distributing small quantities throughmore frequent distributions, discouraging those economically better off from

participating.

A delicate balance was maintained between beneficiaries' concerns regardingthe quality of rice and the need for self-targeting. Investing in socialisationand public awareness campaigns minimised social jealousy and dependency.The Food Aid Committees at each distribution centre provided a forum for

beneficiaries to raise concerns with the programme.

The NGOs desire to increase coverage and tonnage without adequatecapacity was mitigated by extensive WFP participation in the supervision of

NGO capacity and pre-assessment of target areas.

Conclusions based on the impact surveys

318 households were selected and interviewed at random from OPSMbeneficiaries in 62 villages on two occasions. The results of the surveyfindings are summarised below and reflect OPSM's successes in addressingfood security for the urban poor.

Beneficiaries profile

The OPSM beneficiaries are the poorest of the poor, based on

the socioeconomic characteristics of urban poor householdsacross Indonesia, 16% of whom are female-headed households;

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The majority of OPSM beneficiaries are unemployed or working

as low-paid factory workers or construction labourers, or asstreet vendors with irregular income;

The average income of OPSM beneficiaries is Rp61,266 or (33%

under the poverty line) , spending 74% of their income on food;

The average spending on food by OPSM beneficiaries

Cities Spending on food % of income

Jakarta 48,861 74

Bandung 32,648 85Semarang 30,953 73

Surabaya 47,971 70

Average 45,577 74

Residency

Of the OPSM/WFP beneficiaries, 44% have been resident in theirneighbourhood for over 30 years while about 12% moved in aboutfive years ago. Many beneficiaries remain in their neighbourhoodsillegally- that is, they have been unable (for bureaucratic and/oreconomic reasons) to register legal changes to their address.Illegal residents have, on the whole, been excluded from thegovernment Social Safety Net Programmes.

Targeting of beneficiaries

Before OPSM, 96% were able to consume rice twice daily but at

reduced levels/quantities; after OPSM's inception, 100%consume rice at least twice a day, together with additional fooditems (side dishes).

Average daily rice intake prior to the operation was around 250 g

per person, or only 73% of established daily consumption (348g).

12% of school-age children have to stay at home due to theirparents' inability to meet school expenses.

About 95% of OPSM beneficiaries who have school-age

children send them to school. Despite a relatively high schoolattendance rate, 49% of the beneficiaries cannot pay the schoolfee regularly, with a delay of between two to six months

Severity of income drop

The survey concluded that 50% of beneficiaries have a lower

nominal income than pre-crisis levels. The decrease of nominal

income was as high as 75% of their previous earnings,

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particularly for street vendors and other daily-wage workersfaced with lower demand for their output and/or services.

About 25% of OPSM beneficiaries receive other social

assistance such as food (10%), health (8%), education (5%) andother type (2%).

Programme implementation

53% of OPSM beneficiaries were selected using house to house

surveys and the rest was selected through community self-selection (CSS)

97% of OPSM beneficiaries have a WFP food card.

67% obtain a food card without charges while 33% pay some

small price for it to community treasury as a start-up cost forprovision of cards, banners, etc;

95% of the beneficiaries purchased OPSM rice at exactlyRp1,000/kg;

OPSM beneficiaries purchase an average of 4.93 kg per week or

99% of their entitlement;

OPSM beneficiaries use an average 91% of the opportunity to

buy rice.

Frequency of purchase

68% purchase at every opportunity, 16% purchase more than

80% of the opportunities, and 16% purchase less than 80% oftime.

95% of OPSM beneficiaries were aware of their entitlement

62% of OPSM beneficiaries understand who the programme is

meant for (% increases with duration of programme) In case ofcomplaints and problems, 35% of OPSM beneficiaries went totheir community leader, 7% went to NGO staff, 14% went tofriends and relatives, 21% had no idea where to go and 23% didnot care.

Two main factors contributing to beneficiaries regular purchase

under OPSM were (1) regular weekly supplies and (2)affordability due to small increments.

Programme impact

97% of OPSM beneficiaries fully consume the rice they bought,

while just 3% have leftover rice to be used for other purpose(resell, give to relatives, etc);

OPSM assistance has increased daily rice intake from 250 g to

300 g per day, 86% of established national daily riceconsumption;

In March 2000, the price subsidy element of the OPSM

programme was 51%, which had slightly decreased from 58% inAugust 1999;

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The average monthly saving generated from OPSM is Rp20,462

per household;

The largest proportion of money saved is spent on

supplementary food, either in the form of additional rice (26%)or ingredients for side dishes (45%), as well as for the payment

of school fees (17%).

A recent Nutritional Survey by HKI [who???] suggests that over thepast few months, the problem of micro-nutrient related deficienciesand malnutrition in urban areas has declined, suggesting a positiveimpact by WFP's programme on nutrition.

Beneficiaries' use of attained savings to pay school fees implies thatthat OPSM has indirectly contributed to increased schoolenrolment.

92% of respondents are satisfied or very satisfied with the

service at their distribution centre.

91% of OPSM beneficiaries are satisfied or very satisfied with

the price of rice.

The average total weekly consumption for each family is 8.71

kg. On average OPSM rice covers about 57% of the weeklyconsumption needs.

Because of consistently regular distributions, OPSM

beneficiaries have been able to receive most of their entitlement.This is significantly different from the similar government-run

OPK programme where, after 7 months operation, beneficiarieshave been able to receive on average only 30 kg out of 140 kgor 24% of their full entitlement. The low ratio of receipt toentitlement is due to reduced rations (on average they get only 9kg or 45% of their entitlement) and infrequent delivery (onaverage they receive rice only once every other month).

Income transfer/price subsidy element

Since August 1999, OPSM beneficiaries have been able to buy

rice at Rp1,000/kg: i.e. within a price subsidy element of around58%. Although the price subsidy element of OPSM had decreasedby 2000, in line with the nationwide decrease in rice prices, thepercentage of the subsidy is still above 50%.

The price subsidy allows beneficiaries to retain a certain amount

of money that can be used for other necessities. The averagemonthly saving attainable from OPSM is Rp20,462.

Beneficiary satisfaction with the distribution process

About 91% of beneficiaries are either satisfied or very satisfied withthe rice price. There is a strong correlation between the expressed

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degree of satisfaction and the regional market price. At the time ofthe March 2000 surveys, the highest market price of rice was inBandung and the second highest price was in Jakarta. It is notsurprising that the degree of beneficiaries' satisfaction with the rice

price is the highest in these two areas, as the beneficiaries perceived

a significant price subsidy benefit in the programme.

Key benefits

OPSM has reached the intended target group as indicated by

the living conditions, socioeconomic characteristics andincome of the beneficiaries.

OPSM has been implemented in close compliance with its

guidelines, which ensure transparency and accountability.

OPSM has significant positive direct impact on household food

consumption, and indirect positive impact on education andgeneral livelihood among the targeted group, thus fully meetingits objectives.

OPSM can be a model for a food-assisted social safety net

programme with active community participation, and could beimplemented in a mainstream programme such as OPK.

Outlook for the future

A food aid programme becomes an attractive option for beneficiaries when the proportion oftheir income spent on food is high. Projects such as OPSM, School Programmes or Nutrition

Programmes are various responses to food aid needs in both the shorter and longer term. Inthe short term, these activities will support increased consumption with considerabledevelopmental impact. In the long term, these activities can help empower the poor withskills and education, address food insecurity and poverty, and assist the development of theurban poor.

WFP Indonesia's Special Market Operation, with its ability to cover a large population andgenerate funds, provides multiple benefits and options to support long-term developmentinitiatives, and could be one of the best options in supporting food aid under both emergencyand development modes. For maximum benefits, however, urban programmes should also beaccompanied by advocacy for food security policies and social programmes on behalf of the

poor.

References:

WFP Indonesia Oct 1999, Surveys of OPSM Beneficiaries.

WFP Indonesia March 2000, Surveys of OPSM Beneficiaries.

WFP July 1998, Project Document on Emergency Operation in Indonesia.

Andrew Gardener, Sept 2000: Literature Review, Tango International, Urban Food

Security: Concept and Issues for Programming in the New Millennium, University ofArizona.

WFP March/April 2000; Food assistance to Urban Areas: Case Study Indonesia,Angola, Mozambique and Zambia.

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WFP Commitment to Women 1996/2001 from Beijing to Beijing plus five.

ADB, March 1999, Special Study on Poverty, by LPM-FEUI.

UN Indonesia November 2000, Draft Common Country Assessment Indonesia.

WFP June 2000, Food Security: An Agenda for Action, Steven Tabor.

UNDP Human Development Report 2000, Oxford University Press UNICEF, Sept 2000, Challenges for the New Generation, The Situation of Children and

Women in Indonesia, 2000.

Srikanti Wiwahari Sept 2000, Food Resilience Province of DKI Jakarta.

Various documents from the proceeding of Regional Seminar on Feeding Asian Cities;

27 to 30, FAO, CITYNET and AFMA

WFP Project Documents: Urban Basic Services in Maputo, Mozambique June 1992;

Food Security for the Urban Poor, Zambia, 1992.

The Economist, September 1990; African Cities, Lower Standards Higher Welfare

WFP Project Document on PRRO Indonesia, February 2000

WFP Project document Cambodia, June 2000

Nicholas Stern , Globalization and Poverty; Senior Vice President and Chief Economist,

The World Bank

Macro Food Policy and Nutrition Discussion Paper, Bappenas/USAID

Proceedings of Seminar on Renewing Poverty Reduction Strategy in Indonesia, National

Development Planning Agency, Bappenas, August 2000

WFP "Enabling Development", Food Aid for development, a policy document, 1999

WFP Mission Statement.

WFP Annual Report 1999/2000.

B. Parajuli, Oct 2000; Food Security in Indonesia: Paper presented at the conference

organized by the University of Indonesia on the occasion of its 50 th anniversary. Several unpublished documents on the urban projects in Mozambique, Zambia and

Indonesia