New research proves efficacy of graduation approach

Ultra-poor woman in Naogaon with her cattle

New research proves efficacy of graduation approach

The BRAC ‘Targeting the Ultra-Poor’ programme – sometimes referred to as the ‘graduation’ approach, which has benefited 1.6 million households in Bangladesh, has been proven to be effective at helping households on their way out of extreme poverty.

Research led by the International Growth Centre (IGC), based at the London School of Economics and Political Science (LSE) compared the employment opportunities and choices of the women who participated in the BRAC programme with women across different wealth classes. They tracked over 21,000 households over seven years, including 6,700 ultra-poor households and 15,100 from other wealth classes. Findings show that four years after taking part in the programme, the women increase their annual earnings by 37 per cent.

Women’s spending on non-durable goods, such as food, is 2.5 times larger after the programme and their access to land increases. At the start of the programme, only 10 per cent of beneficiaries have access to renting or owning land – seven years later, this figure is nearly 40 per cent.

For every £1 invested in the programme there was a return of £5.40. The women who participate shift their working hours from casual wage labour towards rearing livestock and, in doing so, significantly increase the number of hours they work and their earnings.

Benefits for the ultra-poor do not come at the expense of other households. Within programme villages, households that did not receive transfers maintained consumption and savings and increased their business assets.

BRAC founder Sir Fazle Hasan Abed said,“It is our aim to meet the first sustainable development goal and end extreme poverty by 2030. Through this programme and the results of our ongoing research, we know this approach works to move the ultra-poor into sustainable livelihoods and help them increase their incomes. We are working this way in Pakistan and South Sudan as well as Bangladesh. Other organisations are also replicating this model, which is encouraging. I believe ultra-poor graduation approaches can make a major contribution to ending extreme poverty.”

Oriana Bandiera, Professor of Economics at LSE and one of the authors of the study, said: “Our study is significant because it is one of the most extensive and long term evaluations of these types of anti-poverty livelihood programmes. This allows us to see that that the transformative effects of BRAC’s approach are sustainable and therefore life changing for the ultra-poor households who take part. When you trust the poor with assets and train them with the necessary skills, they do better and better, year after year.”

The research also highlights a new finding about the nature of poverty – the poorest are neither unwilling nor unfit to engage in the same jobs as more prosperous women in their communities, but face barriers which prevent them from doing so. Before having access to BRAC’s programme, it was predominantly higher earning women who could access more stable and productive work such as rearing livestock. This work generates on average more than double the hourly earnings of the irregular and poorly paid jobs that the ‘ultra-poor’ are limited to such as casual agricultural work or domestic service.

Aspects of BRAC’s ‘Targeting the Ultra-Poor’ programme have been replicated by other organisations across Africa, Asia and Latin America and have had very positive results in increasing consumption for the extreme poor.

BRAC has a strategic partnership with UK Aid and Australia in Bangladesh, providing large scale funding to BRAC’s ‘Ultra-Poor’ programme for many years. International Development Minister Desmond Swayne said: “The UK is proud of our partnership with BRAC and the Australian Government in Bangladesh. Over the last 5 years UK support has so far enabled BRAC to lift 580,000 people out of extreme poverty and delivered health, education, water and sanitation to the poorest and most marginalised. Earlier this year I saw first-hand the difference this work is making to people across Bangladesh. BRAC’s programme targeting the ‘ultra-poor’ is of great significance to development worldwide and the global goal of ending extreme poverty by 2030.”

Click here to download the IGC’s growth brief and click here if you want more information about the programme.

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