Perceptions of informal safety nets: A case study from a South African informal settlement

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Perceptions of informal safety nets:A case study from a South Africaninformal settlementAlexander Arnall , Jose Furtado , Jaboury Ghazoul & Cobus deSwardtPublished online: 01 Jul 2010.

To cite this article: Alexander Arnall , Jose Furtado , Jaboury Ghazoul & Cobus de Swardt (2004)Perceptions of informal safety nets: A case study from a South African informal settlement,Development Southern Africa, 21:3, 443-460, DOI: 10.1080/0376835042000265432

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Development Southern Africa Vol. 21, No. 3, September 2004

Perceptions of informal safety nets:A case study from a South Africaninformal settlement

Alexander Arnall, Jose Furtado, Jaboury Ghazoul &Cobus de Swardt1

The relevance and importance of informal safety nets that buffer poor households from livelihoodhardships have been given little attention in South Africa’s development programmes to date.This article contributes to the understanding of informal safety nets by investigating localperceptions in a South African informal settlement. The main findings of the study are thatfamilies perform an important safety net function, but that these sources of assistance can besusceptible to social isolation. Immediate neighbours and friends also play an important safetynet role, but these reciprocal-based sources of assistance may be difficult to secure. Community-wide threats can have a severe impact on people’s ability to engage in safety net transfers. Manyof these difficulties stem from South Africa’s structural unemployment crisis. This factor is thegreatest danger to the future of the informal safety net system in the informal settlement.

1. INTRODUCTION

Risk and vulnerability, which are significant features of rural livelihoods and poverty,are currently a focus of policy attention (Devereux, 2001). Anti-poverty interventionsavailable to policy makers include safety nets such as direct transfers, interventions torestore productivity, or consumption-smoothing microfinance, and are considered keytools for combating vulnerability (Devereux, 2002). While formal or publicly providedsafety nets in South Africa have recently received much attention (Smith, 2002; Taylor,2002; Breslin et al., 1997), the issue of informal safety nets – such as socialorganisation, social capital and the support of the extended family – has been neglectedin development programmes (Fakir, 2002).

Informal safety nets or informal transfers are defined as a “subset of coping strategiesthat draw on support from other households or individuals during periods of particularlivelihood hardship” (Devereux, 1999). Until the early 1990s, there was relatively littleinterest in informal safety nets within the development community. However, a greaterawareness of their importance has arisen in recent years, primarily because informaltransfer systems appear crucial to the planning of interventions and designing of policy.More specifically, informal safety nets serve a variety of social and economic functionsthat impinge on the objectives and functions of public programmes (Cox & Jimenez,1990).

1Respectively, Research Associate, Environmental Policy and Management Group (EPMG),Imperial College, London; Visiting Professor, EPMG, Imperial College, London; Senior Lec-turer, Renewable Resources Assessment Group, Imperial College, London; and Senior Lecturer,Programme for Land and Agrarian Studies, School of Government, University of Western Cape,Bellville, South Africa. Many thanks to Dr EJ Milner-Gulland, Sonali Senaratna and GavenHilson of the Imperial College, London for their helpful comments and/or review. I am gratefulto Mfundo Mancayi and the other people of Mooiblom in South Africa for their patience andtime.

ISSN 0376-835X print/ISSN 1470-3637 online/04/030443-18 © 2004 Development Bank of Southern AfricaDOI: 10.1080/0376835042000265432

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444 A. Arnall et al.

The main aim of this article is to contribute to the understanding of informal safety netsper se by investigating local perceptions in a case study, rather than focusing on therelationship between formal and informal transfers. Results are generated through aseries of in-depth interviews in a South African informal settlement, and respondents’quotes are added throughout the text to provide further insight into, and understandingof local experiences. This approach is in accordance with the widely accepted principleof placing the ideas and aspirations of local people at the centre of developmentinterventions (Chambers, 1989).

The specific objectives of the article are to:

• Demonstrate the kinds of livelihood hardships that people face;• Examine the types of informal safety nets that exist in reaction to these hardships,

including:—Sources of support available within the study community—People’s motives to engage in inter-household transfers—People’s ideas about the success or otherwise of the informal safety net system.• Given the above findings, the article aims to draw out the limits to, and constraints

on informal safety nets within the study community.

The rest of the article is organised as follows: Section 2 provides a broad-rangingliterature review of informal safety nets, focusing on both theoretical and empiricalissues. Section 3 describes the study site and the methodology employed. Section 4presents the results for the livelihood hardships faced by the study community and theinformal safety net reactions to these difficulties. Finally, Section 5 discusses theimplications of the results for the limitations of the informal safety nets system withinthe study community. Limitations focus on the consequences of social isolation withinfamily-based exchanges; issues surrounding the role of reciprocity in communityexchanges; and the impact of community-wide threats.

2. INFORMAL SAFETY NETS IN THEORY AND PRACTICE

Informal safety nets have been conceptualised by Devereux (1999) as the “subset ofcoping strategies that involve drawing on support from other households during periodsof particular livelihood hardship”. Whilst the work concerning coping strategies hasbeen ongoing for some time (cf. Corbett, 1988), particularly in relation to householdand community food crises, there appears to be little empirical work examining thetheory of informal safety nets in their own right. Informal safety nets are commonlyreferred to as private transfers, although a wide range of other terminology exists,including informal support networks, informal risk sharing and informal insurancearrangements. Informal safety nets have also been regarded as manifestations of oneaspect of the moral economy (Swift, 1989; Adams, 1993), social capital (Moser, 1998),and an underlying component of the operation of local institutions (Marsh, 2002).

Informal safety nets refer to either the transfer of non-market commodities (whererecipients gain items of use, such as cash or clothing), or services (where recipientsgain the benefit of someone’s skills, work or knowledge, such as childcare orhome-help). Previous research has tended to concentrate on the material rather thanservice-based aspects of inter-household exchanges (Dersham & Gzirishvili, 1998; Cox& Jimenez, 1990). According to Devereux (1999), many inter-household transfersdisplay two-way horizontal relationships, where goods are exchanged between peopleof similar social and economic status depending on their particular needs at the time.

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Perceptions of informal safety nets 445

People’s willingness to enter into this kind of reciprocal relationship may be based ontheir kinship with, or geographical proximity to the second party. In contrast, verticaldistribution is a one-way transfer of goods, where individuals of higher social andeconomic status extend patronage towards individuals in need. It is important to notethat even in materially impoverished communities, the apparent neat differentiationbetween horizontal and vertical transfers is a simplification, as there usually existssubstantial differentiation between residents according to wealth, influence, and thenumber and strength of social linkages.

Informal safety nets perform a range of functions, such as providing insurance againstshortfalls in income, support for the elderly in retirement, loans for education, helpduring illness, and funds for rural-urban migration (Cox & Jimenez, 1990). However,the most significant of these revolve around the functions of poverty and vulnerabilityreduction. For example, Cox et al. (1994) show how poverty would increase by 25 percent in a sample of private transfer recipients in Kyrgyzstan if their private transferswere removed. Dersham & Gzirishvili (1998) find that informal safety nets significantlydecrease the likelihood of respondents defining themselves as vulnerable with regard totheir household food, economic and housing conditions.

The everyday importance of informal transfers in the developing world varies consid-erably between locations, as can be highlighted by examining the percentage ofhouseholds regularly engaged in private transfer practices. Cox & Jimenez (1990)provide a summary of empirical studies in nine countries in Asia, Africa and SouthAmerica between 1974 and 1989. Results show how the percentage of householdsreceiving goods ranged from 19 to 93 per cent, and those donating goods throughprivate transfers varied from 23 to 89 per cent. From their study in Russia, Cox et al.(1997) conclude that informal safety nets are ‘widespread and large’ and ‘havepersisted over time’. However, even where inter-household transfers are not wide-spread, informal safety nets have been found to comprise a very large component oftotal household income.

The motives for entering into informal transfer arrangements have also been the subjectof inquiry. Becker (1974) proposes that households donate goods based on altruism,whereas Lucas & Stark (1985) posit that households form mutually beneficial insurancecontracts. Portes (1998) identifies two underlying motivations: ‘consummatory’ motiv-ation, deriving from socialisation processes in families, kin networks, class andoccupational groups, and ‘instrumental’ motivation, entailing purposive exchangesbased on expectations of reciprocity. Perhaps the most thorough study in this area hasbeen conducted by De Weerdt (2002), who identifies a number of determinants for theformation of risk-sharing networks. These include, most importantly, kinship andgeographical proximity, but also the number of common friends, clan membership,religious affiliation and wealth. Morduch & Sharma (2002) examine the remittancearrangement in developing countries and state that, as this arrangement between themigrant and the family is voluntary, it must be self-reinforcing. In this case, altruismis the most obvious incentive to remit, but a sense of debt and a means for layingclaims to the inheritance of family assets could also be underlying factors.

The tensions inherent in informal safety net systems have been subjected to extensivetheoretical examination, in particular the potential causes of breakdown. Limitations ofinformal safety net systems include: the difficulties of contract enforcement; moralhazard resulting from the cost of obtaining reliable information on recipient behaviour;and the inconsistency with which household incomes grow within communities,

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resulting in the likelihood that richer households will opt out of borrowing arrange-ments (Morduch & Sharma, 2002; Morduch, 1999). Based on their study in SouthernGhana, Goldstein et al. (2002) predict that inclusion and exclusion of individuals in andfrom informal safety net arrangements relate to individual characteristics, such asmembership in a major lineage, participation in secular organisations, the individual’sfostering history, and anticipated land inheritance. Beall (1995) examines socialnetworks among the urban poor in Pakistan and concludes that systems of transferarrangements are not always harmonious, while others can be oppressive and exploita-tive.

In general, there is broad agreement that informal community arrangements work wellunder certain circumstances, but can begin to break down under periods of prolongedor widespread stress. Moser (1998) shows how the pressures of economic crisis canexert opposing forces on local transfer relationships, both strengthening them throughincreasing reciprocity networks, and eroding them, as households’ ability to copedeteriorates and community trust breaks down. Subbarao (1996) reviews options forreform in Namibia’s social safety net system, pointing out that informal safety nets arenot robust in times of drought. The durability of informal safety nets may also bedistributed differently across society. Calvin et al. (1999) discuss income distributionand social expenditure in Uganda, and find that while informal safety nets appear towork for middle-class families, a lack of mutual insurance amongst poor productionworkers and farmers appears to accentuate the inequality trends.

Much of the interest surrounding informal safety nets in general – and their limitationsin particular – revolves around implications for public policy. It has been argued that,if household coping mechanisms contribute significantly to a reduction in economicinsecurity, then introducing public transfers may reduce or ‘crowd out’ the amount ofprivate transfers poor households receive (Ezemenari, 1997). It has been suggested thatrecommendations for public intervention should focus on encouraging distributionallyprogressive informal mechanisms and providing formal alternatives as substitutes fordistributionally regressive informal mechanisms (Collier, 1998). This issue, however, isbeyond the scope of this article. Instead, it will be assumed that the introduction offormal safety net arrangements will usually be beneficial, provided the interveningagent succeeds in working alongside and building upon local informal arrangements(Marsh, 2002).

3. CASE STUDY

3.1 The study site

Ceres is an agricultural district 130 km north-east of Cape Town, South Africa. Theregion is renowned for its prosperous fruit industry and is generally considered anaffluent area with a well-developed infrastructure. A number of settlements existaround the former white town of Ceres, amongst them the settlement of Nduli, asemi-rural former African group area or township, approximately 2 km outside Ceres.

Two squatter camps or informal settlements, Mooiblom and Pollocross, lie adjacent toNduli. This study focuses on Mooiblom, which consists of approximately 80 self-builtshacks, typically constructed from wooden walls and corrugated-iron roofing.

Nearly all of Mooiblom’s residents originate from the Eastern Cape region of SouthAfrica and are Xhosa-speaking, although a quarter of adults (i.e. those 18 years of ageor over) also speak Afrikaans and/or English. Mooiblom has grown rapidly in size

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Figure 1. Map of the Western Cape, South Africa, showing the position of Ceres

during the last few years; 15 per cent of adults have lived in the settlement for undera year. It appears that the search for employment is the dominant driving force behindthis migration. However, a significant number of people have also left Mooiblom fora variety of reasons, including the acquisition of a nearby formal house or a desire toreturn to the Eastern Cape. These movements suggest a high transition rate of residencyin the study community.

Fieldwork was conducted with the cooperation of the Programme for Land andAgrarian Studies project on chronic poverty and development policy. The research wasled by the Institute of Development Policy and Management at the University ofManchester in the United Kingdom, coordinated through the Chronic Poverty ResearchCentre and funded by the UK Department for International Development.

More than 70 per cent of Mooiblom households (with 4 people per household onaverage) are living below the poverty line, i.e. R352 per adult equivalent per month(May et al., 2000; Bhorat et al., 2001). At the time of the baseline survey (March2002), the main sources of income were seasonal and temporary work (46 per cent),regular wages (34 per cent) and social grants (12 per cent). Only 14 per cent of adults

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had regular wage labour, 27 per cent had seasonal employment, and 19 per cent hadoccasional employment. Some 7 per cent of adults and 10 per cent of children receivedsocial grants. Household incomes varied considerably over the year. For example, 31per cent of households did not receive an income between April 2001 and December2002, compared with 7 per cent between January and March 2002. This variabilitycorresponds to the agricultural on- and off-season. On average, households spend 44per cent of their monthly income on food, which is the highest source of expenditure.The poorest one third of households spends 66 per cent on food, compared with the topthird income group, which uses 29 per cent of income for food. The four other highestaverage expenses include furniture and clothing (15 per cent), household energyexpenses (9 per cent), insurance payments (7 per cent) and maintenance of others (5per cent).

Mooiblom residents have relatively low educational levels, with 13 per cent of adultsbeing illiterate and 18 per cent never having attended school. Only 2 per cent of adultshave a tertiary qualification. There is no significant relationship between educationallevel and the ability to obtain paid work (Cramer’s V � 0,414, p � 0,152). In otherwords, employment does not depend on the number of years a person went to school,and additional education does not improve residents’ chances to secure paid work.

3.2 Methodology

The household forms the unit of analysis for this study, defined here as a person or agroup of persons who eat together and who share resources. Data collection focused oninformal, inter-household social interactions that had a safety net-related functionwithin the boundaries of the study community. In addition, the significance ofremittances passing to and from the study community was also discussed. As thecentral aim of the study was to examine people’s perceptions, detailed quantitativeanalysis of the size and frequency of transfers was not necessary in this case. Rather,a general sense of the nature and characteristics of transfers was sought in order tofacilitate more constructive discussion with respondents. Time constraints did not allowfor examining potentially important intra-household responses. For the purposes of thisstudy, an act of vertical distribution was only deemed to have occurred when therespondents explicitly acknowledged their source of assistance as being significantlyand permanently higher than themselves in terms of socio-economic status.

In total, 36 individuals (50 per cent of whom were women) were interviewed inMooiblom between 25 June and 17 July 2002. Each individual came from a differentrandomly selected household (43 per cent of households represented by the sample)and 80 per cent of these individuals described themselves as the ‘head of thehousehold’, i.e. the person considered to make the majority of decisions affecting thehousehold’s overall well-being and security. Each interview took approximately 90minutes to complete, and was conducted with the aid of a research assistant whonegotiated access to households and interpreted. It was decided that the interviewsshould be qualitative and an informal conversational approach was adopted, with eachresponse determining the next question. This was deemed more suitable to theinvestigation of perceptions and deeper-seated social characteristics. A number ofthemes were covered, including the respondents’ ideas about well-being, deprivationand threats; responses to these threats; attitudes towards household exchanges ingeneral; and knowledge of and attitudes towards community-based responses. As thefocus of the interviews lay in eliciting respondents’ opinions of informal safety nets,

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Table 1. Typology of threats, showing percentage response rate

Type of threat Level of threat (%)

Micro-level Meso-level

Unemployment (90)Unemployment (90)Financial

Lack of social assistance (10) Rising prices (15)

Lack of social assistance (10)

Leaking shack (85) Poor sanitation (10)Physical

Hunger (40) Refuse/pollution (5)

Lack of electricity (20)Shack not windproof (35)

Shack fires (15)

Poor clothing (10)

Shack too small (10)

Crime (20)Social Concern over dependants (30)

Excessive drinking (10)Crime (20)

Excessive drinking (10)

Human loss (10)

Lack of community assistance (5)

Weather too cold (20)Natural –

Storm damage (20)

Bad water facilities (5)

Human Poor health (20) Poor health (20)

Lack of education (5)

Note: The percentage response rate is equal to the proportion of respondents who reported the respective

threat.

only a basic understanding of activity with regard to social safety nets was required ineach case.

4. RESULTS

4.1 Livelihood hardships faced by the study community

Creating a typology of threats is one method to understand the kinds of difficulties thatpeople within the study community face. The typology that follows (Table 1) draws ona combination of approaches adopted by the British government’s Department forInternational Development (DfID) and the World Bank towards understanding povertyand threats to the poor. In Table 1, types of threats have been categorised verticallyaccording to the kind of livelihood asset that is threatened (DfID, 2002). These assetscorrespond to the five main types of capital: financial, physical, social, natural andhuman.

The level of threat has been classified horizontally according to the level at which theytypically occur (World Bank, 2001). The World Bank developed the concepts ofmicro-, meso- and macro-threats in its 2001 World Development Report. A macro-threat is an incident that affects an entire nation or region. Micro-threats are hazardsthat largely affect households in isolation, whereas meso-threats are incidents that canstrike a number of households, or an entire village or community. In Table 1 some

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Figure 2. Sources of informal inter-household support within the study com-munityNotes: The percentages are based on the relative frequency of response. All exchangesrepresented above are two-way horizontal transfers, except for donations by patrons,which are one-way vertical transfers. ‘Immediate neighbours’ refers to donors who livein close proximity to the recipient, but whom he or she does not regard as personalfriends.

threats have impacts at both household and community levels, and are consequentlyplaced in both categories.

The most noticeable aspect of Table 1 is the precedence respondents give to financialand physical threats. Of the financial threats, unemployment is by far the largest causefor concern. This is not surprising, considering that all respondents stated incomesecurity as their primary purpose for migrating to the Western Cape, with 11respondents out of 36 saying that they were ‘unable to do anything without money’.Another five respondents believed that ‘money is the best way to get a better life’, withthree of these highlighting money as a means to securing other less tangible goods,such as respect and independence. Seven respondents felt that their lives had become‘a lot worse’ for their respective households during the last five years, and attributedthis trend to lack of employment and money.

Financial threats appear to be closely related to physical threats. Nine respondentsexclusively assigned a better life to basic material possessions, such as food, clothingand housing. Inadequate shelter and housing facilities (i.e. informal shacks or ‘squat-ters’) appeared to be the most significant physical threat. Twenty-five respondentsreported having a leaking house, with a damp floor, damaged furniture, and wet,spoiled food and blankets when it rained. Six respondents stated that leaking causedcold and fever, and prevented them from sleeping, and all residents expressed theirdistress in this regard.

4.2 Community-based informal safety nets

4.2.1 Sources of support

Figure 1 shows the sources of informal inter-household support available to the averagehousehold within the study community.

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The most striking feature of Figure 2 is the dominant source of family assistance (69per cent of all transfers) compared with other sources. Indeed, most respondents tookit for granted that family members would assist them if they could:

It is the family’s role to help each other. After the family, you go to yourcommunity.

Figure 2 also shows the importance of a household’s immediate neighbours and friends– they account for 26 per cent of transfers. This implies the significance of maintaininga good diversity of sources of assistance, for willingness to help does not necessarilyconfer an ability to help – indeed, 25 respondents stated that their family withinMooiblom had been unable to assist them at some point during the past year.Furthermore, there was evidence in some cases of strong ties developing betweenpeople on the basis of geographical proximity.

Box 1: Case study to illustrate the existence of close ties based on geographicalproximity

Josephine Mzondiki (35) was born in 1967 and brought up in the Eastern Cape. Shenever went to school. In 1997, she left home to search for work and decided to cometo Pollocross, Western Cape, to stay with family. Eventually Josephine managed tofind work as a fruit-picker and this allowed her to pay for the construction of a shackin Mooiblom. She moved into her new house in 2000. Josephine has not worked thisyear (2002) but hopes to secure an income during in-season, which starts in January2003. During this period she earns R150 (£10) a week. Josephine knows this ismeagre:

I can only buy maize-meal. The children have no clothes or shoes. I cannotafford to send them to school.

Josephine states that she lives peacefully with her neighbours and they give herfood, paraffin and money to buy things:

I have stayed in Mooiblom with the neighbours who help me. I trust myneighbours … to help me in the future.

In return she gives them food or thanks. She does not repay the money because‘these are acts of kindness’. Josephine is adamant that this is the correct way to live:

When you stay in a place, the neighbours must help. These are the firstpeople to see you are sick because your family is often very far. Withoutthis help nothing would be right. We are like sisters.

In contrast to abundant horizontal distribution, there is little vertical distribution withinthe study community. In fact, vertical transfers only account for 5 per cent of allinformal distribution, which is derived mainly from patrons, usually employers. Inorder to secure the assistance of a patron, some kind of rapport has to be establishedbetween the client and the donor:

An employer will only help you if you have been working for them for along time and you are in a lot of trouble.

You can receive help from the rich but you have to know them very well first.

Establishing rapport was reported to be a difficult task – 20 respondents highlighted thedifficulty of securing the assistance of a patron, and spoke bitterly about attitudes of therich towards the poor:

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Table 2. Summary of how the types of goods transferred differ on the basis ofkinship and geographical proximity

Kinship proximity Geographical proximity

(donor to family) (donor to neighbour)Feature of good transferred

LargerSize Smaller

Commodities; servicesType of good Cash; commodities

Frequency of transfer Frequent: Daily/weeklyInfrequent: Weekly/monthly

Preference order SecondFirst

Note: ‘Preference order’ refers to the sequence in which the majority of respondents would prefer to seek

assistance from first.

Rich people don’t help because they are very proud and don’t want to seepoor people.

During the study, only two respondents reported having established a patron-clientrelationship. In the words of one female interviewee:

During my most difficult time, I went to a rich woman who owns a shopand who used to give me temporary jobs. I told her everything about mylife and she told me to make a list of all the things I needed. Then herfamily came to visit my house. Since then, she has been teachingme … When I have no food she provides it. She is my coach in life.

The nature of the transfer also differed between households on the basis of kinship orgeographical proximity (Table 2). Most significantly, Table 2 shows that thebeneficiary will generally request a larger, more highly valued good (e.g. cash) fromtheir family and less valuable goods from their neighbours and friends. In recognitionof these advantages, respondents usually sought assistance from their family first,although the case study in Box 1, in stressing the presence of close community tiesbased on geographical proximity, does demonstrate the variability of response in thisrespect.

One important feature is the apparent lack of assistance from family members externalto Mooiblom (horizontal distribution). This is unexpected, considering that remittancesplay an important part in the informal redistribution of wealth amongst South Africa’spoor. In fact, 31 respondents reported receiving no regular remittance and only eightrespondents stated that they sent money home to relatives in the Eastern Cape whenthey were able. On average, remittances came to about R100 a week. However, therelatively low percentage of income received by Mooiblom’s residents through remit-tance might reflect the expectation to support families within the Eastern Cape. Allrespondents experienced difficulties in securing employment, and the expectation tosubmit remittances and the failure to do so appear to put substantial strain on people:

I send money and anything that won’t spoil with taxi drivers to my parentsand sisters in the Eastern Cape. I receive nothing in return. So when I’mnot working both sides suffer.

4.2.2 Motives for support

For the purposes of this study, people’s motives for engaging in horizontal transfers

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Figure 3. Motives for participating in informal transfers based on kinship andgeographical proximity within the study communityNotes: The values on the Y-axis are based on the relative frequency of response. Alldonor/recipient exchanges represented above are two-way horizontal transfers, exceptfor benevolent donations, which are one-way vertical transfers.

were divided into four categories. The first category concerns respondents who engagein mutual transfers with the same people at such a high frequency that this behaviouris taken for granted. This group is called ‘true two-way’, because reciprocity is thedefining feature of the relationship. The next category, ‘calculated investment’, con-cerns donors who anticipate either explicitly or implicitly some form of return in thefuture, and who make a measured judgement to secure a source of assistance. The thirdgroup, ‘reciprocal altruism’, consists of donors who do not actively anticipate a returnbut justify their action in terms of maintaining options for assistance in the future. Theaction is superficially philanthropic but would not occur without some regard for theself. Finally, ‘benevolent donations’ take place when the donor expects no return andjustifies his or her action in terms of pity or a desire to help.

This classification can be applied to horizontal transfers in the study community tocompare reported motives for engaging in transfers based on kinship proximity (donorto family) with motives based on geographical proximity (donor to immediate neigh-bours). The four categories in Figure 3 are positioned to show the degree of reciprocitydecreasing and the level of benevolence increasing in a progression from left to rightalong the horizontal axis for both kinship- and proximity-based transfers. Each transfer,therefore, becomes increasingly skewed in favour of the beneficiary.

Figure 3 shows that reciprocal altruism and benevolent donations are the main drivingmotivations behind exchanges based on kinship proximity (low reciprocity; highbenevolence), whereas true two-way transfers and calculated investment feature mostprominently during exchanges based on geographic proximity (high reciprocity; lowbenevolence). For the latter, it is perhaps to be expected that respondents view theirneighbours and friends more explicitly in terms of securing future sources of assistance,as most respondents (28 individuals) gave the impression that they felt no obligationto assist others outside of their family. This point might explain why the type of goods

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exchanged on the basis of geographical proximity tended to be smaller (e.g. soap,maize-meal, candles), although the frequency of exchange was undoubtedly greater.However, three respondents reported having developed a ‘special’ relationship with acertain community member over a long period of time, and that they were now viewedas the particular responsibility of that donor to the point where they were seen asfamily:

My friend knows he is just helping me and that he won’t receive anythingin return. I am his responsibility. But my friend will be glad when I returnhome [to the Eastern Cape].

Although in this case the donor would almost certainly have a regular source ofincome, such transfers are not viewed as vertical because the respondent considered thebenefactor’s income to be ‘normal’.

4.3.3 Perceptions of informal safety nets

Fifteen respondents viewed informal transfers as ‘extensive’ within the study com-munity, and every respondent interviewed had benefited from such a transfer in someform or other within the last year. The system also appeared to be well-liked – of the19 respondents who expressed an opinion in this regard, 15 considered Mooiblom’sinformal transfer system to be effective. Various reasons were given, with the conceptof helping as an ideal per se forming a central idea:

To help … is a good system, because when people are not helping eachother they are not living peacefully. You cannot love a person who does nothelp.

This is the way people live in Mooiblom because people respect each other.

Even more common was the idea of helping as a necessity for survival:

If people did not help each other in Mooiblom, people would not survive.

These arrangements are a good thing because I see everyone suffering.Helping reduces suffering.

Indeed, the consequences of failing to secure informal safety net support seemedsevere, and such individuals often resigned themselves to defeat (Box 2). This does notindicate, however, that the feeling was universal: three respondents appeared indifferentand another expressed his discontent when asked to reflect on community arrange-ments:

I believe [these arrangements] are both a good and bad system.

In Mooiblom, these borrowing and lending relationships are not normalbecause people are laughing when they see others struggling. People arelike this.

Box 2: The consequences of failing to secure informal safety net support –‘giving up’

The consequences of failing to secure assistance in times of need seem severe.Twelve respondents stated that many people within the community would notsurvive without the help of others:

If times got very hard then I would die. This is because I have no one togo to. I worry about this because I do not have a plan.

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Twenty-one respondents stated that they had no way of coping apart from thesources of assistance already open to them, and half of these people had directlyexperienced the consequences of safety net failure. In the words of one respondent:

Apart from going to people, I have no other way of coping. I just lock thedoor, drink lots of water and go to sleep.

This situation was placed in a wider context by one interviewee:

There are many people suffering in Mooiblom but [those suffering] don’tsay anything about it … It is not easy to tell someone you are suffering butit is easy to see. The person is always tense and holding their body.

4.3 The limits to, and constraints on informal safety nets

According to the research in the Mooiblom community, three main issues limit theexistence and effectiveness of informal safety nets. These are: social isolation withinfamily exchanges, the requirement of reciprocity in community-based exchanges, andthe impacts of meso-threats (particularly unemployment). These are discussed in moredetail below.

4.3.1 Family exchanges and social isolation

Many respondents stated they would prefer to approach family members first whenseeking assistance. Their reasons included the size and type of loan, and motives forassistance (Table 2). However, it was also pointed out that, due to absence of kin, manyrespondents were forced to seek alternative sources of assistance. In fact, 12 respon-dents stated that they were unable to approach family outside of the household eitherdue to geographical considerations or, less commonly, poor relationships:

I never go to ask for help from my brother. He is supposed to be helpingme but he does not. Sometimes things between us are not so good.Sometimes my brother says he is fed up with me. This hurts but I can donothing about it.

Other community donors, such as immediate neighbours, friends and patrons, aretherefore also important, accounting for 31 per cent of transfers. However, thesesources of assistance may be considerably harder to secure than family sources, as theyrely to a large extent on the social skills of the respondents and their ability to negotiateaccess. Some respondents were clearly not as effective at this as others:

I know the neighbours but I do not go to them for help because they arejust looking at me. They do this because they are not the same as me.

Therefore, in the context of absent family sources, the severity of social isolation ishighlighted. This is particularly common in Mooiblom where many respondents spenta considerable part of their working lives travelling from farm to farm as casuallabourers before moving to the informal settlement. Under these conditions it isdifficult to maintain secure social linkages.

4.3.2 Community exchanges and reciprocity

The high degree of benevolence involved in family assistance can be very valuable tothose who have nothing to offer in exchange except gratitude. On the other hand, manycommunity exchanges are based on reciprocity, and this can be a serious problem if therespondents know that they are in no position to offer goods in return:

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I sometimes struggle to return the money [I have borrowed] because theneighbours will try to collect it on Fridays. I worry that the neighbours willrefuse to help.

In addition, three respondents reported that an appeal to benevolence was oftenineffective in changing neighbours’ attitudes towards them:

It is hard for me to tell what is happening in the mind of another person.When I tell [my neighbours] that I am not working … I am not sure if theybelieve me or not.

When I say that I can’t find a job, people tell me that I do not want to work.This makes me feel hurt.

Another respondent made it clear that she was too ashamed to request assistance in thefirst place:

I never go to the neighbours because I do not want them to know what kindof a person I am.

Even if a household has goods to exchange with its neighbours, this does notnecessarily mean that the offered goods will be accepted. This problem is illustrated inTable 2, which shows that commodity transfers, particularly the exchange of cash, arepreferred to the exchange of services:

I know that people might love each other [in Mooiblom], but they don’tlove each other with money.

Those who have skills to trade in Mooiblom’s informal economy, but find that theirassets are of little value to others, face a serious predicament:

Sometimes people come and ask me to clean the heads of sheep for them.When I have finished with this, then they help me with food or money. Butit’s hard to find this work now … I don’t know why.

4.3.3 Meso-threats

Twenty-one respondents stated that people’s ability to help each other withinMooiblom had decreased in recent years:

There have been changes in borrowing habits. Things are not the samenow. People help less.

Awareness of the causes of this decline varied. Twelve of these respondents hadencountered the problem personally, and their insights tended to centre on the fact thatpeople had less with which to share:

I have tried to receive help [from my neighbours] but they also don’t haveanything.

Some stated that others had too many problems of their own to begin assisting thosein need:

I could go to [my neighbours] but I don’t think they would be able tohelp … Each person has his own problems and they are therefore not in agood position to help.

The remaining nine respondents were able to reflect on the problem more widely, somein a general sense:

When you are in need … you will not get help. This is because resourcesin Mooiblom cannot stretch so far as to help someone desperate.

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Others interpreted the problem of decreased assistance in relation to levels of employ-ment within the community:

The borrowing relationships are not enough. Other things are needed, likejobs.

There are times when the help people give is inadequate. People arerefusing to help … because everyone is poor and unemployed.

It would appear that unemployment, as the most pervasive meso-threat to impact on thestudy community, has a severe effect on people’s ability to engage in the informaltransfer of commodities. Apart from unemployment, the only other meso-threatexplicitly acknowledged as having an impact on the study community was rising prices.Under these circumstances, many of the micro-threats that drive the system of informaltransfers can no longer be insured solely within the boundaries of the study community.One interviewee summed it up well:

The system used to work better when people had more things. Now,because it is off-season, people have less … due to lack of employment.More people are struggling … the system does not work so well duringthese times.

The impacts of meso-threats can lead to further problems. There was evidence thatpeople became increasingly frustrated with their inability to fulfil their obligatorynorms, to the extent of generating conflict between residents. Eight respondentsreported that they or other community members regularly experienced difficulty inapproaching potential donors, because people were getting ‘fed up’ or ‘bored’ withhelping others:

If [my neighbours] help me today, then they won’t be able to help metomorrow. This is because … when you are always asking people for helpthey get sick of it.

5. CONCLUSIONS

The principal objective of this study has been to contribute to the understanding ofinformal safety net systems by investigating local perceptions in a South Africaninformal settlement. The emphasis in such an approach is on understanding criticalissues, relationships and processes based on in-depth analysis of a specific case. In thisstudy, the researchers were struck by respondents’ high degree of variability in opinion,with thoughts, ideas and aspirations being of greater complexity than some of theprevious work in this area might suggest. This supports the idea that communitiesshould not be viewed as homogeneous social units but as often possessing different,sometimes contradictory, interests (Chambers, 1989).

The main findings of the study are as follows:

• People in the community face many forms of threats to their livelihood, but concernsover unemployment dominate.

• Households are involved in a wide variety of activities relating to informal safetynets. Within this system:

—Families are the most important source of inter-household support.—Peoples’ motives to engage in transfer activities vary, depending partly on kinship

and geographical proximity.

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Table 3. Summary of conditions that facilitate and impedeinformal community transfers

Aspect of transfer Effect on transfer

Facilitate transfer Impede transfer

Family member Community memberSource of assistance

Poor social skillsNegotiation of access Good social skills

Reciprocity Nothing to offerSomething to offer

Good on offer Service (e.g. home-help)Commodity (e.g. cash)

—Most respondents reflected on the community’s informal safety net system in apositive manner, stating that it was an important way to live.

These findings indicate that the average household in Mooiblom may be perceived notas an isolated entity, but as embedded in a complex network of transfer relationships.The exchanges observed within this network were based on either commodities orservices. Although previous studies have tended to focus on commodity-based trans-fers, this study has shown that services can play an important role in buffering poorhouseholds against livelihood shocks. This suggests that future work could give greateremphasis to service-based transfers. It is also noteworthy that horizontal transfersbetween people of similar socio-economic status dominated relative to vertical trans-fers. However, there is clearly scope for more research to examine patronage and therole that such mechanisms play in informal transfer systems.

Some households were clearly more effective than others in utilising their socialnetworks to gain access to scarce commodities and services, and this study has exposedsome of the everyday constraints that govern people’s ability to engage in transferactivity. According to the research in the Mooiblom community, three main issues limitthe existence and effectiveness of informal safety nets. These are:

• Social isolation within family networks• The requirement for reciprocity in community-based exchanges• The impacts of meso-threats (particularly unemployment)

These limitations are in accordance with previous findings that social isolation canseriously constrain the effectiveness of private safety net systems, and that informalcommunity arrangements work well under certain circumstances (such as in responseto micro-threats) but can begin to break down under periods of prolonged or wide-spread stress (Moser, 1998). This suggests that poverty is not only a matter of havingtoo few assets, but also of constraints that limit the effectiveness with which thoseassets are used (Carter & May, 1999). Such constraints may be embedded in complexsocial phenomena surrounding motivations to remit and the associated tensions inherentin informal safety net systems. The main factors that facilitate and impede informaltransfers are summarised in Table 3.

In the study community there clearly are important links between the reciprocityproblem, meso-threats and the depth and persistence of poverty. Much of thisdeprivation stems from South Africa’s ongoing structural unemployment crisis and,consequently, from peoples’ perceptions of future jobs and income-earning opportuni-

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ties. These factors are the greatest threat to the future of the informal safety net systemin Mooiblom.

The findings of this case study also reflect wider concerns regarding moral economyretraction in many parts of Africa. There is evidence within the literature to suggest thatthe informal system of redistribution – the moral economy – might be becoming lesswidespread. For example, Devereux (1999) points out the proliferation of monetisation,commoditisation and the associated spread of the market across the world as being, atleast in part, responsible for this. This, in turn, implies the importance of developingformal mechanisms for protecting livelihoods (e.g. direct transfer mechanisms, such asgrants and public works) to protect people from livelihood shocks and stresses while,at the same time, recognising the value of local systems. In reality, such developmentstrategies might be difficult to implement (cf. Marsh, 2002), and further research isrequired before the policy consequences of the interactions between formal andinformal safety nets systems can be considered.

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Documents

Perceptions of informal safety nets: A case study from a South African informal settlement