Social funds are the most visible example of recent enthusiasm for ‘community-driven development’ as an alternative to traditional ‘top-down’ development projects. Many advocates of social funds have found them to be highly participatory, but critics suggest that their projects are vulnerable to mismanagement and increase opportunities for elites to exploit development aid.

Typically, social funds are semi-independent government agencies, distributing grants to fund new community facilities. They expect project beneficiaries to contribute a percentage of the costs – in cash, labour or equipment. They encourage participation from project selection to implementation, aim to be demand-driven (projects designed according to community demands), to empower poor people, and to improve community capacity for collective action.

The Jamaican Social Investment Fund was launched in 1996. Its goal is ‘improving living standards for the poor and vulnerable’. Using radio and television, the fund invites communities to send in grant proposals, and claims that project selection and facility construction are participatory. Community divisions in Jamaica are huge obstacles to this participatory ideal. An impact assessment conducted by the World Bank’s Development Research Group claims that though Jamaican elites control the project, the majority of beneficiaries still end up happy with the results.

Few reliable impact assessments exist on the success of social funds. World Bank research attempts to fill this gap by measuring the impact of Jamaica’s Social Investment Fund on the social, political and economic life of 50 randomly selected individuals in each of the five selected communities that received the project. The research then compared them to similarly chosen individuals from five closely matched communities that did not receive the project.

Key findings include:

• Projects have not targeted majority interests (only two communities received their top priority project; the others had low priority projects funded).
• Smaller, better-off families were more likely to have their priorities addressed.
• Following project completion, 82 percent of respondents said they would not have preferred a different project.
• Participation was limited: it was more common amongst those connected to community leaders.
• Projects have increased trust amongst community members, and enhanced the capacity for collective action (but again, mainly amongst the better-off).
• Projects strengthened the power of community leaders and did not enhance democratic decision-making processes.

This research shows that communities tend to be reasonably well-informed about projects but not very involved in choosing them. Influential individuals have tended to control projects. Fortunately these individuals have, to date, been interested in benefiting the community, and they have persuaded communities to be more involved during project implementation. Policymakers should be aware, however, that social funds remain open to control by elites less concerned with the good of the community. They need to ask who demands and who drives these supposedly demand-driven projects. Possibilities for improving the project selection process include:

• replacing community-driven participation with good social analysis
• conducting a community needs assessment
• selecting projects for the community by secret ballot.

Source(s):
‘The social impact of social funds in Jamaica: a “participatory econometric” analysis of targeting, collective action, and participation in community-driven development’, Journal of Development Studies, 41 (5) pages 788 - 838, by Vijayendra Rao and Ana María Ibáñez, July 2005

Funded by: The World Bank, Dutch and Norwegian Trust Funds

id21 Research Highlight: 22 December 2005

Further Information:
Vijayendra Rao
Development Research Group
The World Bank
1818 H. Street, N.W.
Washington, DC 20433 USA.

Tel: +1 (202) 4588034
Fax: +1 (202) 522 1153
Contact the contributor: vrao@worldbank.org

The World Bank

Other related links:
'Social funds contribute to poverty reduction in Malawi'

'Participation or local politics? The illusion of development projects'

'International NGOs get serious about participatory evaluation'

The World Bank and Social Funds

The Jamaica Social Investment Fund