What transformation in aid and development really looks like
Categories: Life Stories
Change may be grindingly slow, but results like Ethiopia’s self-help groups ‘multiplying like yeast’ are worth a wait. In a country where millions of people live in extreme poverty, self-help groups are a low cost solution that is proven to work. In some cases just a small payment a week, has helped them grow businesses and be better providers for their families.
From being unable to afford more than one meal a day to being able to buy a taxi, this is sustainable development. Photograph: Sean Smith for the Guardian
Over the years I’ve frequently been a source of amusement to my wife Emma, but rarely more so than when I came home from work at DfiD one day a decade ago and recounted to her a particularly mortifying interaction I’d had with the IT department. My computer had gone on the fritz during a password update, and in order to resolve it I’d had to tell the tech support guys my old password over the phone – while a senior official was in the room. Imagine my joy as I had to spell out “f-u-c-k-i-n-c-r-e-m-e-n-t-a-l-i-s-m” while my visitor attempted and failed to stifle their mirth.
Although I use slightly more discreet passwords these days, I’ve still never really drunk the Kool-aid on change that happens one step at a time, at a grindingly slow pace, measurable in decades. This can be a rather frustrating worldview when you work on global climate policy – but, now and again, a deeply satisfying one when you get out and see real development happening in real places at unreal speed.
And it turns out that it looks like this:
Ethiopia’s self-help groups offer a route out of poverty. Photograph: Alex Evans
Each row belongs to a woman who’s a member of a self-help group in a village near Nazret in Ethiopia. Each column is one of their weekly meetings. And each of those number fives is five birr that each member saves, week in, week out – about 15 pence.
Not a lot, but you’d be surprised what happens next. Right away, the women can buy their food in bulk at a big discount. More importantly, they can each start borrowing money from the self-help group and diversifying their income. At first in tiny ways – by buying sand and concrete to make fuel-efficient cook stoves and then selling them on, or by financing setting themselves up as a baker rather than a day labourer.
By the time a group’s been around for a few years – like the group I saw the following day in Adama town – it’s all kicked off. Members of the self-help group are saving 10 times as much. They’re putting money aside into a social insurance fund in case one of them gets sick or has an accident. And they’re taking out loans at a much bigger scale – to buy cows and sell the milk, or build a house extension and letting out the rooms, or buy a taxi, or (in one case) open a tiny pool hall. They talk in terms of capital adequacy, and rate of return, and business plans. They say their next step is to go into business together to set up a livestock operation. I believe them.
In every single case, these are people who were targeted in the initial outreach because they were the very poorest of the poor – the hardest to reach, the most vulnerable, the ones living on a single meal a day if that. Now they have smartphones, sofas, little houses. Some of their kids are in higher education.
But here’s the thing: they all say that the money’s not the point. They’re evangelical about the saving, don’t get me wrong. But they all say that the thing that’s really changed their lives is the relationships with each other: “We’re family now.” The trust they have in their group. The shift in their relationships with their husbands as they’ve stopped being dependent and started being income earners. Above all, the power – to make change happen, rather than have it as something that happens to them: “We used to be so timid.”
As self-help groups mature, they self-organise into clusters, and then those clusters into federations. They set up and nurture more self-help groups. They set up kids’ clubs during the holidays. Then they set up kindergartens. Then they set up schools. They arrange skills training for their members. They start sorting out water and sanitation. They plant trees in their neighbourhood to spruce the place up.
So guess how much aid it costs to run each self-help group?
A pittance. And according to one cost-benefit analysis the rates of return are £173 for every £1 spent – an almost unbelievably high multiple, among the very highest available for any development project.
To a large extent, these groups are self-financing. True, it costs money to run networks of facilitators in areas where mature clusters aren’t in place yet – but these are met primarily by local church or community groups. When I first heard about self-help groups in Ethiopia I thought they were a form of social protection. Having visited them, I realise it’s the opposite. This has nothing to do with welfare.
All this has happened in large part because of work that Tearfund, a Christian development NGO, has been doing with local churches over the past two decades. And when you talk to Tearfund’s country head, Keith Etherington, you get a strong sense that you’re still only seeing the opening act of this story.
This is some of the most impressive development work I’ve ever seen, and it’s being done on a shoestring – and with more funding, much more can be done to roll this out across the country. If you’re planning on giving money to anything any time soon, I simply cannot imagine a better rate of return than this.