Namibia makes gains with poverty reduction - News - Gondwana Collection

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Namibia makes gains with poverty reduction

Avatar of inke inke - 25. October 2019 - Economics

The community of Omitara and Otjivero held several meetings before the introduction of the Basic Income Grant. Photo by Claudia Haarmann

Brigitte Weidlich

The signboard east of Windhoek with the name “Otjivero” written on it might just direct travellers to another small settlement one would think. But Otjivero, as well as the adjacent Omitara, attracted international attention about ten years ago, when a unique pilot project took off. The names of these two tiny settlements have become household names on an international level in the true sense of the word when it comes to the debate about poverty reduction through a universal basic income. This concept was first developed in the United Kingdom in the 1920s and piloted with adaptations later in the US, Canada, Brazil and recently in Finland (since 2017).

Back in Namibia, the approximately 1,200 Otjivero residents received a monthly basic income grant (BIG) for two years in 2008 and 2009. More precisely, residents up to the age of 59 years received N$100 (about 6.50 Euros) per person per month, even children and babies. Starting from the age of 60, the government’s social grant for pensioners kicks in.

The aim was to reduce poverty levels in Otjivero-Omitara, and to inspire the Namibian government by this private pilot project to possibly introduce a universal monthly payout for all inhabitants of the country. According to the BIG initiators, that would have cost the government around N$2 billion (about 120 million Euros) per annum. That was in 2008-09.

Otjivero and the adjacent Omitara settlement lie some 100 kilometres east of Windhoek, and has a huge dam in the vicinity.

How it all started

The BIG Coalition consisted of four prominent umbrella bodies in Namibia, namely, the Council of Churches (CCN), the National Union of Namibian Workers (NUNW), the Namibian NGO Forum (NANGOF) and the Namibian Network of AIDS Service Organisations (NANASO).

The Evangelical Lutheran Church in the Republic of Namibia’s (ELCRN) social desk under the two theologians Dirk and Claudia Haarmann spearheaded the pilot project.

Supporters of the idea from all sections of society raised funds raised , including the current Namibian president Hage Geingob, who was a Cabinet Minister at that time. Individuals, churches, organisations and donors in other countries supported Namibia’s BIG pilot project, which ran for 24 months up to December 2009.

Otjivero was chosen due to its rural setting, though in close proximity to Windhoek, and the high poverty levels. Most of its inhabitants had moved there after independence. The unique BIG pilot project was scientifically evaluated. Researchers completed a baseline survey in November 2007, subsequent panel surveys in July and November 2008, conducted continuous interviews with beneficiaries and did detailed case studies in Otjivero-Omitara. An international team of experts guided and evaluated the research throughout. Funds dried up after two years, but bridging payments continued at a lower rate between 2012 and 2013, then funds were depleted. By July 2014, new funding was secured from the Waldensian Church in Italy for another year. In the second half of 2015 the BIG payments stopped.

 

Benefits of the basic income grant

According to the published research results, the introduction of the BIG dropped household poverty significantly. About 76 percent of the Otjivero residents fell below Namibia’s food poverty line in November 2007. This was reduced to 37 percent through the basic income grant by November 2008.

“The BIG led to an increase in economic activity. The rate of those engaged in income-generating activities increased from 44 to 55 percent,” according to the recently updated booklet, published in September 2019. Thus, the BIG enabled recipients to increase their work for both pay, profit and family gain as well as self-employment. They could start their own small business, like brickmaking, running a small tuck shop, baking of bread and dressmaking.

Malnutrition among children dropped, while parents could afford to pay school fees at the local primary school resulting in more children attending school, among others. Dropout rates at the school fell from almost 40% in November 2007 to 5% in June 2008, and later to nearly zero percent.

Tough times after the BIG-pilot project

“With the BIG we never had to suffer, but now we are suffering”, says Crecia Swartbooi in an interview for the 2019 booklet called “Basic Income Grant – ten years later”. In this publication, several BIG recipients at Otjivero and Omitara were interviewed again. “The BIG must come back, it helped us tremendously”, is the general view of the residents.

“The Namibian Basic Income Grant Coalition designed and implemented this first unconditional universal cash transfer pilot project in the world”, the booklet proudly states. Ten years on and with the international debate for a universal income increasing, India, Kenya and even Finland are experimenting with varying BIG models. Otjivero and Omitara in Namibia are still mentioned in research papers and publications for the pioneering work.

Namibia to eradicate poverty by 2025

Namibia is one of few African countries paying a state pension grant to all inhabitants from the age of sixty, regardless of their income. This does not only apply to Namibian nationals but also inhabitants of other nationalities who have a permanent residence permit. The state pension was increased from N$600 (about 36 Euros) to N$1000 (about 60 Euros) in 2015. Since then it has increased annually and stands at N$1,300 (about 78 Euros) since August 2019 with 182,195 pensioners as recipients.

Registered war veterans in Namibia also receive a pension, so do disabled persons, orphans and vulnerable children.

During his inauguration as Head of State in March 2015 President Hage Geingob declared a “war” against poverty. A new Ministry was created called Ministry of Poverty Eradication, headed by Zephaniah Kameeta, former ELCRN Bishop and a strong proponent of the BIG.

In October 2015 at the first national wealth redistribution and poverty eradication conference, President Geingob vowed to completely wipe out extreme poverty in Namibia by 2025.

Assistance for families in urban centres

The migration from rural areas to urban centres is also a reality in Namibia. In June 2016, the first food bank was inaugurated in Windhoek. A consultant from Cuba assisted the Poverty Eradication Ministry with forming street committees of unemployed youth who identified families in need to receive monthly food parcels with dry rations to the value of some N$450 (about 27 Euros). By mid-October 2019, food banks were rolled out to all 14 regions, with the last recipients being Swakopmund and Karibib in the Erongo Region. To date, some 10,000 urban households countrywide are benefitting from the food banks and 383 unemployed youth found jobs through this initiative.

Some 370,000 schoolchildren in Namibia receive meals through the government school feeding programme at 1,400 schools in all 14 regions.

According to the National Statistics Agency (NSA), extreme poverty in Namibia dropped from 15.4 percent of the population to 10.7 percent from 2010 to 2015.

The best of all is that the Gini coefficient, which measures inequality, dropped from 0.58 to 0.56 during the same period. By the time of Namibia’s independence, it stood at 0.7 percent. The Gini coefficient ranges from zero to 1 with zero (“0”) representing perfect equality and 1 representing high inequality. With Namibia’s (income) equality so close to “1” in 1990, the drop to 0.56 in 2016 is significant.

By March 2020, the government intends to table a national social protection policy in Parliament with the ultimate goal to achieve a national health care and a national pension fund.

The Basic Income Grant enabled villagers to start gardening and sell their surplus (left). | A woman at Otjivero was able to use her BIG money to buy a small fridge and produce ice lollies in order to sell them to the community. Photos by Claudia Haarmann
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