Access to Assets Standard 1: Asset programming is conducted in a manner that facilitates long-term economic recovery, while taking into account issues of targeting, equity, transparency, and security.

Key indicators (to be read in conjunction with the guidance notes):

• Assets provision is based on an assessment of the viability of the recipient’s previous economic activity; the recipient’s skills, technical capacity, and priorities; and the potential profitability of the economic activity to be supported, as well as its environmental impact (see guidance note 1).
• The assets or resources transferred are used for productive purposes, if that is the program’s goal (see guidance note 2).
• Beneficiaries are empowered to make their own decisions regarding restart and developing their economic activity.
• Asset provision does not interfere or compete with other economic recovery activities, such as financial services (see guidance note 3).
• The impact on local markets is taken into account when procuring and distributing assets/resource transfers (see guidance note 4).
• New livelihoods, technologies, land use, and/or improved methods are introduced only where the current capacity and the implications for local markets, cultural practices and the environment are understood and accepted (see guidance note 5).
• Decisions regarding program methodology take into account asset security, local availability, speed, cost-efficiency, and beneficiary decision-making power (see guidance note 6).
• The physical security of beneficiaries, their assets, and resulting income are considered and addressed before transferring assets.

Guidance Notes:

1. Assessment for assets provision: Asset programming for productive purposes will only work if the beneficiaries are ready and able to use the replaced or provided asset, and if the use of the asset will result in a viable livelihood for the beneficiary. Additionally, programs may wish to consider the environmental impact of the asset used (whether replaced or provided for the first time) and to look at alternatives that may be more environmentally sustainable.

2. Use of assets: Some programs and donors have strict guidelines that all assets replaced or provided are used for a productive purpose. Other programs focus more on the beneficiaries’ freedom to make decisions regarding their livelihood. For the second type of program there is more leeway for beneficiaries to trade assets, hold on to cash and vouchers until a more opportune time, and make other strategic decisions. Programs should be transparent in communicating the goals, criteria, and penalties for ignoring program rules. The first type of program may require more detailed agreements with beneficiaries and a more in-depth monitoring system than the second type of program.

Example: A program uses an insurance model to replace assets lost in a crisis. Each beneficiary is given cash totaling the value of his/her lost assets up to a set ceiling. The beneficiary is allowed to use that cash based on his/her circumstances, i.e. replace the lost assets, buy different assets, or use the cash for other family needs.

3. Competition with other economic recovery initiatives: As many asset recovery and protection activities involve giving funds or items to beneficiaries, care needs to be taken to coordinate with other programs in the area that have a longer term approach and may require more commitment from beneficiaries. In certain circumstances, asset distributions can be a link to longer term recovery activities, for example by enabling microentrepreneurs to jump start their businesses so they can participate in market development activities. However, asset distributions can inadvertently interfere with recovery efforts if they use inappropriate distribution chains or targeting. For example, widespread distribution of items bought externally can weaken attempts to develop local suppliers of those products.

Example: After a fire, a program provides vouchers for construction materials to rebuild small shops and market stalls. The program then links to a local microfinance institution with a special loan fund to help replace working capital. Through this joint initiative, the affected businesses are able to restart their livelihoods and utilize a long-term source of business capital.

4. Effect on local markets: Assessments need to take into account the effect on local markets of an asset distribution, and need to consider a range of supply side issues linked to both purchasing and distributing the assets (for example, how local procurement could affect local availability of the good for other people). Programs should also consider the benefits and potential inflationary costs of purchasing assets locally or regionally (versus the higher cost and logistical difficulty of procuring assets externally), the substitution effect of beneficiaries receiving free goods or cash, and the impact on local partner enterprises and organizations, particularly on small and medium enterprises.

Example: A program buys basic agricultural equipment (hoes, wheelbarrows, etc.) from a local wholesaler and distributes it to farmers to replace their tools lost in floods. This large order gives the wholesaler the cash necessary to restock his other merchandise and increases the general availability of farm supplies in the affected area.

5. New technologies: Introducing new species, technologies, or methodologies when providing assets can be very successful in terms of saving time and energy or improving yields and incomes. However, if there is not sufficient research and follow-through in terms of assessing the fit with the current situation, there may be undesired impacts on markets, long term production, and the environment. The beneficiaries’ ability to use or to maintain the new asset or sustain new methods of production is an important consideration. It is also vital to assess the real sales/income potential resulting from the new assets both in the short and long term. Training on new technical skills or on asset maintenance may be necessary as well as linkages to markets.

Example: Farmers previously used buffalo to plough their fields, but the buffalo died in a natural disaster. Tractors are brought in to replace the buffalo, but many farmers cannot afford the fuel needed to run the tractors. So, the program must identify other alternatives or find ways of helping farmers get access to the fuel, spare parts, and maintenance support they need in a manner that is sustainable over the long term.

6. Identifying means of asset distribution: Significant discussions are ongoing regarding the use of cash-based strategies for asset replacement versus the direct provision of assets. The appropriate method depends on the working environment and the goal of the program. The use of cash transfers has become much more common in recent years due to the efficiency and speed with which these programs can be implemented, the support given to local markets, and recipients’ decision-making power regarding choosing what, when and where to buy. The use of vouchers (to purchase given products or services from a variety of suppliers) is a middle option, limiting how the money may be used but giving recipients freedom to select the source Likewise, concepts of social protection are also being applied by many practitioners and donors in post emergency recovery situations. A number of documents provide deeper explanation and analysis of these methodologies, several of which are listed in Annex 1.

Example: Beneficiaries receive a voucher worth $400 to buy needed business supplies at local shops selling equipment, tools, and machinery. Beneficiaries are allowed to choose what supplies they need based on their assessment of current market demand and are given up to six months to use the voucher.

Example of asset replacement: Households are given cash to replace livestock lost in a natural disaster.

Example of asset protection: Village households are given cash, non-food items, or food to meet basic needs and prevent the sale of productive assets.

Examples of means of delivering assets: One type of asset replacement may assess the value of assets lost and replace them accordingly. Other programs disburse one type of asset, such as livestock, to all targeted beneficiaries. Another type of program provides cash or other resources to recoup assets or to prevent the sale of productive assets. Programs may also involve market solutions to sell assets of declining productivity, such as distressed cattle, or crops in an oversupplied market.