Executive Summary

Evaluations of social protection programs funded by the World Bank and the Egyptian government continue to focus on achievements while neglecting to calculate the impact of the programs themselves on changing poverty rates among Egyptians. Evaluations from independent think tanks may be better viewed as they discuss the achievements and outcomes of protection programs as opposed to the initial intentions of the programs.¹This paper discusses recent social protection programs for cash transfers in Egypt, after they were integrated into the “Takaful and Karama” program, and focuses on comparing the evaluations issued about “Takaful and Karama” by the World Bank as the first external partner and funder of the project at its inception, as well as local evaluations issued by independent parties, to monitor the extent of the disparity between them according to several factors, including the nature of the funding body of the evaluation, the evaluation student, the criteria adopted, and the entity implementing the evaluation. The researcher relied on a desk research of evaluations issued for the “Takaful and Karama” program during the implementation period of the program from 2015 to 2024.

Egypt adopted an economic reform program in 2014 to close the budget deficit, which resulted in an economic crisis that increased the country's need for foreign exchange. Egypt entered a cycle of successive borrowing and inflation until the time of writing this paper. The Egyptian economic program was accompanied by rising prices in general and food commodities in particular, leading to an increase in the level of inability of poor families to cope with these increases. Despite this, the Egyptian government continues to implement economic reforms that it pledged to its lenders, led by the International Monetary Fund (IMF), by reducing the size of subsidies and increasing the number of families benefiting from social protection programs.

The World Bank provided a $400 million initiative to the Egyptian government to protect the most vulnerable, and through the Ministry of Social Solidarity, the social protection program “Takaful and Karama” was launched. Throughout the years of implementing Takaful and Karama, the Egyptian government has tried to avoid the issues of previous subsidy programs, especially those related to not reaching the actual beneficiaries. After years of providing in-kind support through many programs, most notably the commodity subsidy (Tamween), in which more than 60 million people are registered, the government tried to expand the use of cash transfers through the Takaful and Karama program to ensure that the support reaches the target groups. The results of multiple evaluations conducted on social protection programs, specifically Takaful and Karama, reflect the varying extent to which the programs show success or achievement of some targets and failure in others, depending on the evaluator and the evaluation criteria adopted.

Introduction

Egypt has recorded a high rate of poverty for many years. Official statistics show that almost one-third of the population is poor, with a population of more than 100 million. The poverty rate in 2023 reached 27.3%, while in 2019 it was 29.2%, a decrease of almost 2%.²ESCWA. “Projected poverty headcount ratio in Egypt from 2018 to 2023.” Chart. Statista. January, 2022. Available at https://www.statista.com/statistics/1237041/poverty-headcount-ratio-in-egypt/

The poverty rate reaches 43% in rural governorates compared to urban governorates.³ESCWA. “Projected poverty headcount ratio in Egypt from 2018 to 2023.” Recently, as part of its attempts to obtain new funding, the Egyptian government disclosed to the World Bank that the poverty rate would reach 32.5% in 2022, but this figure has not been made public domestically. The Central Agency for Public Mobilization and Statistics (CAPMAS) Income and Expenditure Survey ( ), which was last published in 2019/2020, is still overdue,⁴Mohamed El-Kholy, “Hiding the poverty headcount. The government doesn't want to see,” Al-Mansa , March 18, 2024, available at https://manassa.news/stories/16584 providing a complete map of Egyptians' expenditures and incomes.⁵See Solutions for Alternative Policies, “Open Meeting at Solutions for Alternative Policies on ‘Poverty Numbers in Egypt’: An Increase Behind Inflation, ” accessed August 7, 2024, available at https://aps.aucegypt.edu/ar/events/110/open-panel-discussion-at-aps-on-poverty-figures-in-egypt-an-inflation-driven-increase.

It is worth noting that poverty rates increase among households with up to 10 members to 80.6% in 2019/2020, while these rates decrease among households with no more than three members.

Social protection programs in Egypt have evolved from charitable aid during the monarchy and civil society contributions to help the poor, to catering or commodity support programs and the issuance of the first Social Solidarity Law No. 119 of 1952, to the current“Takaful and Karama” cash transfer programs.⁶Naima Ahmed, “Social Protection Programs in Egypt and the Arab World,” Aswan University Journal of Humanities, 2022, 63. The 2014 Egyptian Constitution stipulates that the state is committed to providing social protection to all citizens.⁷The Egyptian Constitution, 2014, Article 17.  Poverty is at the forefront of what Egypt seeks to eliminate through social protection programs that work to help the poorest groups face social and economic conditions.

The implementation of the economic reform program led to increased foreign borrowing and pressure on foreign currency in order to repay foreign debts, which reached $165 billion by the end of 2023, accounting formore than 96% of GDP.⁸Amr Adly, “Features of the ‘Debt State’ Completed in Egypt,” Al-Mansa, June 16, 2024, available at https://manassa.news/stories/17971 This was followed by reducing subsidies for electricity, fuel, bread, education and health.⁹See Solutions for Alternative Policies, “Loans for the Government. Debt for Citizens, ” accessed August 4, 2024, available at https://aps.aucegypt.edu/ar/articles/1412/egypts-world-of-loans-indebt-citizens The exchange rate has been liberalized more than once since November 2016, until the Egyptian pound lost more than 400% of its value against the dollar. As a result of these decisions, inflation rates rose to 35.2% by the end of 2023.¹⁰Middle East News Agency, “Annual inflation rate falls to 35.2% in December 2023,” January 10, 2024, available at https://www.mena.org.eg/ar/news/dbcall/table/textnews/id/10527042#:~:text=القاهرة%20في%2010%20يناير%2Fأ,مقابل%2036.4%25%20لشهر%20نوفمبر%202023 With the first floatation of the pound in 2016, the government began implementing a social protection program based on direct cash transfers or “Takaful and Karama” in cooperation with international organizations to increase the ability of the poorest groups to cope with inflation and price fluctuations.

The United Nations Organization considers ending global poverty by 2030 to be an important focus of the Sustainable Development Agenda.¹¹United Nations, “Goal 1 - Poverty Eradication - Sustainable Development, ” accessed August 1, 2024, available at https://www.un.org/sustainabledevelopment/ar/poverty/ and ending poverty is the first goal of this agenda. Resolution 202 of the International Labor Organization (ILO) made social protection one of the pathways to “achieving social justiceand achieving the Sustainable Development Goals.”¹²Huwaida Adly, “Strengthening the role of social protection in achieving the Sustainable Development Goals,” Presidency of the Council of Ministers, Information andDecision Support Center, February 2023. Social protection programs have become part of achieving the SDGs in Egypt as part of the National Agenda for Sustainable Development.¹³See National Agenda for Sustainable Development, “Egypt's Updated Vision 2030,” 2022, available at https://mped.gov.eg/files/egypt2030.pdf

This paper discusses the evaluations of the Takaful and Karama program in Egypt, explaining the purpose of these evaluations, the extent to which the funding body of the evaluation influenced its accuracy and results, and whether or not these results actually reflect the reality of the program's impact.

I- How does the Takaful and Karama program work?

The social protection program “Takaful and Karama” started in Egypt in 2015, to mitigate the effects of economic reforms on the poorest.¹⁴Rabab Hoteit, “Takaful and Karama cash transfer programs for marginalized groups,” ESCWA - Economic and Social Commission for Western Asia - Pathfinders, June 2023, available at https://www.sdg16.plus/ar/policies/برنامجا-تكافل-وكرامة-للتحويلات-النقد/ In general, the two programs can be defined as follows:

Takaful: Cash support targeting the poorest families with children, with conditions related to health and education for women and children (conditions were added in the second phase of the program).

Karama: Unconditional cash support targeting poor people over the age of 65, or those with a disability or impairment that prevents them from working.

The government added conditions to the program in 2018 that require families receiving cash transfers to send their children to school with an 80% attendance rate per month, and to attend health consultations at health units three times a year for women (conditions added in the second phase of the program). The number of direct and indirect beneficiaries of the program in 2024 reached 21 million citizens after registering 5.2 million households.¹⁵See Ministry of Social Solidarity, Dr. Maya Morsi, “Adding 73,000 new families to the Takaful and Karama program, ” July 15, 2024, available at https://www.moss.gov.eg/ar-eg/Pages/news-details.aspx?nid=3390 In return, 51% of registered households are committed to visiting health units, and 63% of households have 80% school attendance as a target for human capital development.

Through the two programs, the government is measuring the actual income level to bring the cash benefits provided by the state under one umbrella. In this context, the program collects more analytical data on citizens as they apply for the program, which helps in other activities and programs designed from Takaful and Karama, such as the financial inclusion program Forsa, which provides job opportunities for the needy and has reached 26,312 beneficiaries.

Figure 1: “Takaful” program (family benefit) - Cabinet Decision 540 of 2015

Household	Monthly amount (in pounds)	Monthly amount (in pounds)
Eligible Household Amount	325	41.6
Primary school student	60	7.6
Middle school student	80	10.2
Secondary school student	100	12.8

“Karama” Program (Individual Benefit) - Cabinet Decision 540 of 2015

Elderly over 65/disabled unable to work	Elderly over 65/disabled unable to work	Elderly over 65/disabled unable to work
one person	350	44.8
two people	700	89.7
Three (maximum)	1050	134.6

Source: Official Gazette, March 11, 2015, No. 10 bis (d).

*Dollar value calculated according to the official exchange rate at the end of 2015, when the dollar was equal to 7.8 pounds.

1- Stages of the “Takaful and Dignity” project

Since its inception, the Takaful and Dignity project has been divided into three phases:

The first phase (2015-2018): The project was officially launched with the aim of helping the most needy families to face economic challenges, the beginning of the implementation of the cash subsidy disbursement system and the establishment of the program's infrastructure.

Second phase (2018-2021): Due to the issues encountered in the first phase in identifying those eligible for subsidies, the second phase saw an update of the criteria for identifying eligible households in line with economic developments, as well as administrative measures to improve the subsidy disbursement process.

The third phase (2021-2024): The third phase aimed to expand the program's services to include vocational training and link it to other development programs such as Forsa and A Decent Life. It also aimed to achieve financial sustainability for the program.

2- Criteria for receiving the Takaful and Karama pension

The Ministry of Social Solidarity set several criteria for receiving cash transfers from Takaful and Karama. Some conditions related to health and education were ignored in the first phase and then implemented in the second phase of the program in 2018. The ministry's conditions were that the person must not be employed in the government or private sector with an insurance wage of more than 400 pounds ($7.50), or receive an insurance pension, and that the family must have children from newborns to 18 years old and be enrolled in the different stages of education for those between the ages of 6 and 18. The ministry also stipulated that individuals applying for the Karama program must be elderly (over 65 years old) or sick and unable to work. One of the conditions included many criteria that would prevent the disbursement of cash subsidies, such as: Owning half an acre of agricultural land, owning a car or tuktuk, or paying school fees of more than 3,000 pounds ($62.5) per child per year.¹⁶See Ministry of Social Solidarity, “Program Details - Takaful and Karama,” accessed August 2, available at https://www.moss.gov.eg/ar-eg/Pages/program-details.aspx?pid=10 The Takaful pension is paid to families with a maximum of three children.

The Takaful and Karama database is provided to the Ministry of Supply, which provides commodity subsidies or ration cards to beneficiary families, to the Ministry of Health under the “Two is Enough” program to educate families with two children to be content with two children, to the Ministry of Education under the “No Illiteracy with Takaful” program to eradicate illiteracy among women benefiting from the program, to the Ministry of Housing's “Decent Housing” program to improve housing conditions for extremely poor families, and to the Ministry of Social Solidarity - the project's which implemented the project, the “First Thousand Days of a Child's Life” program to take care of children and their health and nutritional status during their early years, as well as the “Fursa” economic empowerment program, which was launched by the Ministry of Solidarity in 2022.

All cash transfer programs were unified under the Takaful and Karama program, and the state issued the Unified Cash Transfer Law to integrate beneficiaries from the old social security program into Takaful and Karama, allowing financial coverage for nearly 1.2 million people. As a supportive measure for the program, a new Social Insurance Law No. 148 of 2019 and the Comprehensive Health Insurance Law No. 2 of 2018 were passed. This made the program the only cash transfer in the country, through which the government aims to improve social protection programs in general using the data registry managed by the Egyptian Administrative Control Authority (EACA).

The program is based on a methodology in which applicants for cash transfers are given specific points according to a statistical mechanism related to the income and expenditure survey announced in Egypt in 2019/2020, known as Proxy Means Testing, and then verified through the unified social registry linked to the national number.¹⁷See “Project to Expand Cash Transfer Coverage for the Takaful and Karama Program and Build Related Systems” (P179665), World Bank, November 2022, available at https://documents1.worldbank.org/curated/en/099613512202220775/pdf/IDU093f63d41016060488f08afe094467095e1cc.pdf

The World Bank has provided $900 million in support to the program during its first and second phases since 2015 for 3.7 million households, or about 12.8 million individuals, until the end of June 2023.¹⁸Ministry of International Cooperation, “The House of Representatives approves the 0 million Takaful and Karama expansion project agreement with the World Bank,” October 16, 2023, available at https://moic.gov.eg/ar/news/1192

Figure 2: Amount of government support for the “Takaful” and “Karama” program

Fiscal year	Government support for the Takaful and Karama program (EGP billion)	Dollar value at the end of the fiscal year	Increase %
2022/2023	23.4	0.759	23.1
2021/2022	19	1.016	0
2020/2021	19	1.217	2.7
2019/2020	18.5	1.156	5.7
2018/2019	17.51	1.054	-0.11
2017/2018	17.53*	0.98	135
2016/2017	7.45	0.41	338
2015/2016	1.700	0.19	Beginning of program implementation

 

“Takaful and Karama” subsidies were merged with the Social Solidarity Pension

Source: Ministry of Finance, General Budget Financial Statements, various years, Central Bank of Egypt, historical exchange rate data.

II- Evaluations of social protection programs

This paper assumes that the evaluation of the “Takaful and Karama” program should be independent, in order to produce an accurate analysis of the effectiveness of the program as a whole and identify its strengths and weaknesses in order to reach a true assessment of the program's ability to fight poverty and bring its beneficiaries out of poverty as the program's stated intentions assume when it was launched. If the evaluations are independent, recommendations can be made to improve performance and make the program more capable of achieving its goals.

Evaluations of the program have come from local actors in Egypt and from other international institutions associated with the program, such as the World Bank:

• Measuring impact: Determine the impact of the program on the lives of its beneficiaries and whether or not it is helping to alleviate poverty.
• Identifying weaknesses: Identify specific areas where the program is weak and needs to be improved.
• Transparency: Providing documented information about the effectiveness of the program and how it can be improved.

This paper provides a summary of the World Bank's evaluation of Takaful and Karama, as well as local evaluations by independent bodies such as the American University in Cairo, independent researchers, or local official data evaluating the project.

1- World Bank Reviews

We can go back to what the World Bank announced about the program at its inception in 2015, when the bank provided $400 million in support to the Egyptian government to start the “Takaful and Karama” project. At the time, the bank emphasized that Egypt had achieved advanced human development indicators over the past 20 years (1995-2015) and considered that the education and health sectors needed more attention. The Bank's data showed that 21 percent of Egyptian four-year-olds were stunted due to malnutrition, and the data estimated that the enrollment rate among the poorest 20 percent was less than 50 percent. At the time, Takaful and Karama aimed to provide better and more sustainable access to education and health services for the poor.

1.1 Evaluation of the first phase

The World Bank's Phase I evaluation in 2019 reported that the Takaful and Karama program mitigated several policy and governance risks, reducing them from high to medium. It also mitigated the risks of “deterministic strategies and policies” from high to medium, as well as the project's technical design risks related to optimizing its design and targeting efficiency.

In its first phase, the World Bank evaluation said the project benefited one million poor households, including vulnerable women, children and people with disabilities. The program's enrollment method and conditions improved school attendance, reduced the likelihood of dropping out of school, and increased educational outcomes to a greater extent than before receiving Takaful and Karama transfers.

According to the World Bank, the program is statistically significant, with consumption levels in targeted households increasing from 7.3% to 8.4%, and per capita food expenditure for adults in the same household increasing from 8.3% to 8.9%. These estimates came in the context of the Egyptian government's agreement with the World Bank to provide $900 million to support the program, including $400 million at the beginning of the project and $500 million after the first phase.¹⁹See International Bank for Reconstruction and Development (IBRD), Project Document for the proposed additional loan of 0 million to the Arab Republic of Egypt for the Strengthening Social Safety Nets Project, June 2019. Available at https://documents1.worldbank.org/curated/en/124161566846055498/pdf/Egypt-Strengthening-Social-Safety-Net-Project-Additional-Financing.pdf

One of the main points of the Bank's evaluation of the Takaful and Karama program was that it did the following:

• Reduced the likelihood of poverty for beneficiary households by 11.4 points compared to non-beneficiaries.
• Helped increase beneficiaries' expenditures on school, transportation to and from school, and the purchase of school supplies.
• Beneficiary households increased their spending on food by 8.3-8.9% compared to non-beneficiaries.
• The first round did not record any impact on enrollment rates due to the lack of implementation of the program's conditions by beneficiaries regarding education.
• Reduced odds of being treated for malnutrition.
• The program has no impact on stunting rates.
• “Small and insignificant” impacts on gender norms and increased gender equality in participating households.

1.2. Phase II Evaluation

In the World Bank's Phase II evaluation of the Takaful and Karama cash transfer coverage expansion project and related systems building prior to the disbursement of the second $500 million for the project, the Bank considered Takaful and Karama an important component of Egypt's social protection system that has already helped families withstand the losses caused by the recurring economic crises. The bank noted that the project works to help the Egyptian government expand and further modernize social safety nets. It has been able to promote human capital formation so that those who are eligible can graduate out of poverty later on.

The World Bank's evaluation of the first phase of the project did not differ from the second phase, as it was general and focused on Takaful and Karama's achievement of its poverty targets without specifying them. Despite the celebration and the subsequent $500 million, the assessment emphasized that Egypt spends 0.3% of GDP on cash transfers, while the global average is 0.9% and the regional average is 0.42%, which is “insufficient and could be increased,” according to the assessment. “86% of Takaful and Karama beneficiaries are among the poorest 40% of households,” the World Bank's assessment noted.

The World Bank's assessment concluded:

• Takaful and Karama's impact in increasing the total assets of the targeted households, to increase investment in productive assets.
• The program was unable to protect households from the effects of the COVID-19 pandemic.
• Reduced debt rates of beneficiary households.
• Participation of beneficiary households in the informal labor market (against the program's wishes).²⁰See International Bank for Reconstruction and Development, Project Appraisal Document for a proposed 0 million loan to the Arab Republic of Egypt to implement a project to expand the coverage of cash transfers for the Takaful and Karama program and build related systems, November 2022. Available at: https://documents1.worldbank.org/curated/en/099423504172337084/pdf/IDU06cf912bc0fecb04b160b6c504da2de20b47d.pdf

On May 28, 2024, the World Bank published a summary of the results of the “Takaful and Karama” programs in Egypt, from which we extract the Bank's vision that “Takaful and Karama” is “the largest cash transfer program in the Middle East and North Africa” as it reaches 4.67 million households (an average of 4 members per household) according to World Bank data, and an additional 600,000 households receive cash transfers by civil society organizations in coordination with the government, and women constitute 75% of the beneficiaries. The evaluation considers that other economic programs such as Forsa relied on Takaful and Karama's social registry to create job opportunities for unemployed people.²¹World Bank Group, “Promoting Inclusive Human Capital Development and Building Resilience in Egypt through Cash Transfer Programs,” May 28, 2024, available at https://www.albankaldawli.org/ar/results/2024/05/28/promoting-inclusive-human-capital-development-and-building-resilience-in-egypt-through-cash-transfer-programs#:~:text=وتظهر%20التقييمات%20المستقلة%20لبرنامج%20تكافل,بالمدارس%20الابتدائية%20(9%20points%20percent)

The World Bank's second evaluation quoted conversations from female cash transfer beneficiaries about what they are doing with their social and health lives as a result of receiving Takaful and Karama pensions. They summarized that they now pay their children's school fees, buy meat, and have access to medical treatment. The evaluation also confirms that the program uses an appropriate mechanism for communicating support, grievances, and coping and responding to shocks. The 11.3 million households (40.5 million people) enrolled in the program contradicts the 5.2 million households reported by the Ministry of Social Solidarity. The Egyptian government and the World Bank seem to be conflicting in the way they calculate the beneficiaries of the programs, but neither party has made public the method of calculation that led to the discrepancy.

The evaluation shows that Takaful and Karama, through the beneficiary data, is working on other measures such as:

• Combating illiteracy.
• Reducing fertility rates.
• Facilitating access to family planning services.
• Helping to improve housing conditions.
• Attention to child nutrition.
• Empowering women.
• Fighting early marriage.
• Raising awareness of social issues.

It is worth noting that the evaluation mentioned one point about a shortcoming in the program, namely a leakage of 6.4% of the program's targets, as cash transfers reach non-poor households.

2- International Food Policy Research Institute (IFPRI) evaluation

At the request of the World Bank and the Egyptian Ministry of Social Solidarity, IFPRI conducted two evaluations of the Takaful and Karama program, the first 15 months after the start of the program in March 2015, funded by the British Foreign Office, and the second in September 2022, funded by USAID.²²

The first evaluation found that the program significantly improved household welfare, increased consumption per adult by 8.4%, and reduced the likelihood of poverty by 11.4 percentage points. The second evaluation found a decrease in non-food consumption on telecommunications, phones, and televisions among those targeted, and considered that households were investing in their ability to generate income in the future. The evaluation saw an increase in the holdings of productive assets such as livestock and agricultural technologies such as tractors and plows. The evaluation showed that beneficiary households had lower levels of debt than non-beneficiary households, after paying installments and debts to informal lenders. Families have moved from need to income improvement and asset building. The evaluation confirmed a four to five percent increase in the likelihood of children from beneficiary families enrolling in education. The evaluation acknowledged that 85% of the targeted households tend to work informally, partly because they do not want to join the Fursa program since 2021, which provides them with job opportunities, lest this lead to their exit from Takaful - a point the World Bank evaluation missed -²²Hoda El-Enbaby et al., “Impact evaluation report: Egypt's Takaful Cash Transfer Program: Second round report”. MENA RP Working Paper 40. Washington, DC: International Food Policy Research Institute (IFPR), 2022.https://doi.org/10.2499/p15738coll2.136395 and partly because households are increasingly acquiring productive assets and starting their own businesses. The evaluation notes that the program has helped positively transform beneficiary households. The evaluation concludes that the effects of the program will pay off in the future.

Others consider that the social protection program “Takaful and Karama” could not keep up with the increase in prices over the past years and that households' social spending (health, education, and social protection) decreased from 7% in 2014 to 5.1% in 2019.²³Sarah Smierciak, “Can Egypt's social safety nets cushion the impact of IMF-led reforms?”, 23 May 2023, available at https://kalam.chathamhouse.org/articles/can-egypts-social-safety-nets-cushion-the-impact-of-imf-led-reforms/

3- Local assessments

Local evaluations varied depending on the evaluator, and the more independent the evaluations were, the more clearly Takaful and Karama's issues were mentioned.

An assessment by the State Information Service (SIS), an official body affiliated with the presidency, asserted that the Takaful and Karama program achieves the “lofty goal that the state wants” to improve the conditions of poor families, reduce dropout rates from education, and “force” families to keep track of their children's health. The evaluation stated that the program integrated marginalized groups such as farmers and tenants in the targeted areas, and increased public satisfaction with the government.²⁴See SIS, “Takaful and Karama” program, November 2022, available at: https://www.sis.gov.eg/Story/246626/%D8%A8%D8%B1%D9%86%D8%A7%D9%85%D8%AC-%D8%AA%D9%83%D8%A7%D9%81%D9%84-%D9%88%D9%83%D8%B1%D8%A7%D9%85%D8%A9?lang=ar

An evaluation by Dr. Huwaida Adly Roman stated that “Takaful and Karama” is one of the programs targeting women, as about 90% of the beneficiaries are women. The evaluation also stated that the expansion of family coverage was in accordance with the conditions of the International Monetary Fund (IMF) since the beginning of 2023. Although there were conditions for the program since its inception, these conditions were only implemented in 2020. The evaluation also finds that the general trend of poverty has not changed, with 48% of the population in rural Upper Egypt still unable to provide for their daily basic needs, and the program's impact on specific groups such as women and children is increasingly limited, and linking the program to another program such as Forsa has not worked, as it was found that people who receive Takaful pensions do not want to enter Forsa because it provides a job opportunity and thus get out of Takaful and prefer informal work. Roman also argues that the pension provided does not keep up with rising prices and inflation.²⁵Huwaida Adly, “The Guide to Universal Social Protection in the Arab Region: Challenges and Opportunities,” September 20, 2023, Arab Reform Initiative, available at: https://shorturl.at/WgVea

A third AUC study/evaluation of the 2,600 committees that collect and refine information on Takaful and Karama applicants revealed poor communication between the committees and the program, and the fact that the committees do not know the exact type of families targeted and the eligibility and selection criteria for applicants, which sometimes caused issues for the committees with applicant families, and even violence when families assessed by the committees were excluded. The evaluation recommended that the program should improve communication with the local community through its leaders and increase the transfer provided to raise families above the poverty line.²⁶Abdelhafez, Mai Amr, Shimaa Adel Heikal, and Sarah Moharram. “Community Monitoring and Evaluation: A Case Study of Takaful and Karama: A Case Study of Takaful and Karama.” (2019).

III- Inconsistent and inaccurate evaluations as a reflection of structural issues in social protection programs

Evaluations of various social protection programs, some of which have focused on policy intentions rather than outcomes or the main goal of poverty alleviation, can be viewed as follows:

• Neither the World Bank nor the local evaluations published the data and data collected during the research process, which would have allowed researchers to work on it to show the actual impact of the program in changing the lives of the poor through various other research and evaluations.
• The World Bank evaluations did not disclose the questions that were asked of the beneficiaries of the program, which is required by the supposed transparency of the evaluation process.
• Evaluations by the World Bank, the Food Research Institute, or evaluations conducted by government agencies in Egypt cannot be considered “independent” as the stakeholder - the Ministry of Social Solidarity - has a direct relationship with the evaluation, whether through funding or supervision, which hinders the freedom of the research group in collecting information or findings from the research.

Hence, evaluations of social protection programs need changes to be able to determine the extent to which those enrolled in Takaful and Karama are able to access the services provided by the program in education and health, whether or not the services are of good quality, and their impact on the lives of each beneficiary and thus on society as a whole in the long run.

When conducting evaluations - especially in Egypt - it is important to keep in mind that there are challenges facing those working on evaluations regarding the availability of accurate data and the independence of those providing it to the evaluator. Looking at evaluations in general, we find that they and their results are linked to three elements: “requestor,” ‘evaluation criteria,’ and ”evaluator.”

Evaluations of social protection programs need to apply advances in evaluation models or what is known as the fifth generation approach, so that evaluations measure the social, economic and ethical factors that affect the success of the program, measure the impact of programs on social welfare in the long term, and involve beneficiaries and enrollment administrators in the evaluation, making social protection programs more capable of reaching the population that is truly in need.²⁷Nagoya El Dessouky, Public Policy Evaluation Theory: From First to Fifth Generation. EPRA International Journal of Economic and Business Review. Vol-4, Issue, April 2016. On the other hand, some countries have had different experiences with evaluations of social protection programs. Brazil, for example, adopted a special evaluation model that helped it minimize issues during the implementation of these programs.

Evaluation of social protection programs in Brazil

Evaluating social protection programs has been seen as the key to their development in Brazil. The government created the Secretariat of Evaluation and Information Management (Secretariat of Evaluation and Information Management) in 2004, with 21 programs under its umbrella.

The new evaluation department felt that timeliness was crucial in the evaluation process so that policymakers could use the results to inform program work. The selection of researchers conducting evaluations and the development of a system that allows for transparency of results and feedback, as well as the fight against corruption.

The Brazilian administration developed its own model of evaluation through partnerships with independent research institutions that conducted nationwide surveys that amounted to about 140 evaluations as of 2012. The administration hired people with academic backgrounds to manage the evaluations and surveys. To ensure that the results of the evaluations do not damage the relationship between evaluators and policymakers, the evaluations department found a way to divide the process into three hierarchical phases and involve policymakers. The first stage rethinks protection program design strategies, the second stage discusses with policymakers about their responses to the first stage and the mistakes they made, and the third stage reports to the relevant minister.

The ongoing evaluation of social protection programs and the dissemination of information about the evaluations and the data obtained have helped to reduce issues with social protection programs in Brazil.²⁸Institute of Development Studies. Evaluating Social Protection Policies: Lessons from Brazil. Issue 34. April 2013. Available at https://www.gov.uk/research-for-development-outputs/evaluating-social-protection-policies-lessons-from-brazil

While social protection programs in Egypt are still limited by these disputed definitions of beneficiaries, the definition of “beneficiary” has been one of the challenges of these programs for years. Egyptian governments have consistently argued that subsidies do not reach the rightful recipients because the data on which the government relies is not up-to-date. The Takaful and Karama program came as a solution because its requirements refine who is and is not eligible for cash support from the moment of enrollment.

The prerequisites for receiving cash pensions from the program reflect the continuing debate over the definition of a poor person eligible for support. Is the poor according to the poverty line, which has reached 1478 pounds (approximately $50 in 2023 prices) per month according to a study in 2023/2022, or the extreme poverty line, which is the inability to pay for the basic needs of life, which has reached 1069 pounds (approximately $35 in 2023 prices) per month. There is also no specific mechanism to assess the income of those working in agriculture or the informal sector and thus whether or not they should be included in the program.

The Ministry of Solidarity includes in the conditions for receiving the Takaful and Karama pension that an individual must not own three or more heads of livestock. This is a difficult condition to verify, as there is no mechanism in Egypt to record the number of livestock owned by a poor farmer, and owning livestock is less about money and more about a means of livelihood for poor farmers. A second condition is that applicants for the program must not own a tractor, transport vehicle, or taxi with a model year after 2000. This provision ignores the fact that before the exchange rate was liberalized more than once between 2016 and 2024, car prices in Egypt were not high, and owning a tuk-tuk is not a luxury, but a way to work and save money for spending, and the same goes for a tractor.

Another eligibility condition is that the children of Takaful beneficiaries must attend school 80% of the time, which sounds good on the surface and encourages educational regularity, but it ignores the density of classes in Egypt, which reaches 120 students in Cairo and Giza governorates, which is one of the reasons why students are reluctant to go to school, and the mechanism for recording student absences is still paper-based and cannot be relied upon or verified accurately.

Takaful and Karama citizens receive pensions ranging from LE517 ($10, according to 2024 prices) to LE920 ($18, according to 2024 prices) after the last increase approved in March 2024, which is below the government's national poverty line of LE10,300 ($203) per year or LE858 ($17) per month. The number of people receiving the program's pensions is still close to 22 million according to the latest official figures, about 8 million less than the official poverty figures, in addition to the fact that a government employee who earns the minimum wage, for example, is not eligible for cash support from the program, and faces successive inflationary shocks without help.²⁹Alternative Policy Solutions, “Wages and Food Inflation. Policies that exacerbate or solve the crisis?”, Lens Issue 55, January 2024, available at https://aps.aucegypt.edu/ar/articles/1351/wages-and-food-inflation-are-government-policies-exacerbating-or-mitigating-the-crisis

These conditions and their lack of alignment with economic conditions represented an issue for the social protection program “Takaful and Karama”. It was also characterized by the fact that it came from above, as it was designed and launched without community dialogue or parliamentary debate about it, only to reveal one loophole after another upon implementation. A World Bank assessment recognized that slightly more than 6 percent of those receiving Takaful and Karama pensions were undeserving.

On a second level, the program faced two issues. First, accepted families submitted unverified documents, such as fake rental contracts, to receive cash transfers despite living in large family homes. Second, a large percentage of the poor were not included in the program, especially those who receive other pensions that are not sufficient for them, an issue related to the lack of information on applicants for the project.

Conclusion

Since the inception of the Takaful and Karama conditional cash transfer social protection program, more than one evaluation of the program has been released. Evaluations have ranged from international ones conducted by the World Bank or other entities at the request of the World Bank to independent researchers. Government evaluations focused on the program's achievements without assessing its primary goal of lifting people out of poverty. Independent evaluations have shown that the success of social protection programs can be measured by their real impact on changing the lives of the target group, which has not happened.

The issue with evaluations lies in not knowing how they obtain information and data. They are also affected by the relationship between the evaluator and the entity requesting the evaluation, which makes the information obtained from them general and does not give a true indication of the extent of the program's impact on its beneficiaries.

Evaluations ignore the levels of inflation, which the amounts the government disburses to the target group cannot keep up with. Thus, the program must be looked at through independent evaluations, so that a specific mechanism can be put in place to develop the program and achieve the desired benefit, which is the graduation of beneficiaries from poverty. By taking advantage of the experiences of other countries in evaluating social protection programs, such as Brazil, and looking at modern evaluation methods, the program can be developed by relying on them. When evaluating Takaful and Karama, it is also possible to look at the network of alliances associated with it, whether international organizations such as the World Bank and its departments as contributors, or the Egyptian government and NGOs willing to help with the program and thus get closer to the decision makers in Egypt.