Policy Instrument:
Defintion:
Economic inclusion programs are defined as a bundle of sequenced, multidimensional interventions, such as such as cash transfers, productive grants, skills training, coaching, and access to financial services, that support extreme poor and vulnerable households and communities to sustainably increase their incomes and assets. With the overarching goal of reducing poverty, building resilience, and creating employment opportunities, economic inclusion programs are solid policy instruments that can be tailored to address the different needs of target groups.
Rationale:
Economic inclusion programs have a proven track record in improving food and nutrition security through multiple pathways. Short-term interventions such as cash transfers enable households to meet their immediate consumption needs while productive grants, agricultural inputs, and training enable them to sustain food and nutrition security in the long term. Programs that support the development of climate-resilient livelihoods along the food value chain and agrifood systems demonstrate high potential for sustainably improving food and nutrition security and reducing poverty.
Key features:
Program interventions typically include productive grants and a combination of cash transfers, skills training, coaching, and access to financial services.
The main features of economic inclusion programs are:
- Aligned vision: Economic inclusion programs empower individuals and communities to build sustainable livelihoods and achieve human capital gains and social inclusion.
- Multidimensional: They address multiple constraints through a comprehensive set of interventions.
- Tailored to target groups: Interventions are tailored to the needs of vulnerable groups including women, youth, people with disabilities, marginalized communities, and climate-affected groups.
Extreme poor and vulnerable people including:
- Women,
- Youth,
- People with disabilities,
- Marginalized communities, and
- Climate-affected groups
Robust evidence suggests that investing in economic inclusion programs pays off in the long run, with the benefits significantly outweighing the initial costs. Programs have shown positive returns and high benefit-cost ratios, demonstrating that these programs can be considered effective tools for poverty alleviation that lead to broader social and economic development.
Lack of coordination: Economic inclusion programs rely on integration of multiple interventions that are often provided by different government entities. Lack of coordination between these entities can lead to inefficiencies in implementation and duplication of efforts. This can be mitigated by fostering dialogue with relevant stakeholders at the outset to secure government ownership and ensure coordination.
Resource constraints: While governments are partially financing economic inclusion programs, external financing remains essential, especially in low-income settings with fiscal constraints. This reliance on financing may increase due to ongoing crises and can be mitigated by establishing clear communication with governments and donors to highlight the high returns and benefits of investing in economic inclusion programs.
Low implementation capacity: Low government capacity can hinder implementation of quality economic inclusion programs, particularly when they are scaled up. Effective program delivery at scale requires well-structured institutional arrangements and organizational frameworks that engage NGOs and the private sector to fill capacity gaps.
Exclusion of extreme poor and vulnerable populations: The absence of an inclusive social registry can lead to extreme poor and vulnerable households being excluded from safety nets, which often form the foundation of economic inclusion programs. Strengthening registries and targeting mechanisms are key to increasing coverage of extreme poor and vulnerable people.
Data and monitoring: The lack of a comprehensive data system can prevent programs from incorporating real-time monitoring and beneficiary feedback, and systematizing operational learning during the implementation cycle. This can be addressed by investing in a robust monitoring platform that can be easily customized to track progress across a range of economic and social indicators.
SDG 5 – Gender Equality
- Target 5.4: Recognize and value unpaid care and domestic work through the provision of public services, infrastructure and social protection policies and the promotion of shared responsibility within the household and the family as nationally appropriate.
- Target 5.a: Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws.
SDG 8 – Decent Work and Economic Growth
- Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services.
SDG 13 – Climate Action
- Target 13.1: Strengthen resilience and adaptive capacity to climate-related hazards and natural disasters in all countries.
- Target 13.2: Integrate climate change measures into national policies, strategies and planning.
ILO - Social Protection Floors Recommendation, 2012 (No. 202)
Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW)
UN Women’s Recommendations on Women’s Economic Empowerment
ILO Convention 111 (Discrimination in Employment and Occupation)
CFS Policy Recommendations Promoting youth engagement and employment in agriculture and food systems
CFS Policy Recommendations on Social Protection for Food Security and Nutrition