Think tank urges charities to give money not food parcels

Charities tackling poverty are being urged to offer vulnerable families in need money rather than food parcels and other goods and services.

The move would help empower people to control their lives amid financial hardship to buy their own goods and services.

It would also save charities money in overheads such as leasing premises, according to the call from think tank New Philanthropy Capital.

It says that issues such as fuel, food and period poverty amid the cost-of-living crisis are “not separate issues” and are related to a lack of money.

“So, what if instead of worrying about goods, services, premises, overheads – we just gave people cash,” states a blog post on the think tank’s website by its policy manager Theo Clay.

“The mental toll of poverty is huge,” he explains.

“You’re no longer in control of your own life. Your future, and that of your family, is unpredictable. This lack of autonomy is a considerable driver behind the mental and physical health disparities we see between rich and poor.

“Instead of forcing people to be passive and grateful recipients waiting upon generous charity, why would we not give people some of their agency back?

“In giving goods rather than cash, we’re saying that we know best. Why aren’t we allowing people to make their own choices about how to overcome the barriers they face?”

He says that often families know better than charities how to spend money to support them in times of hardship and that cash transfers to people have been used in international development for several years.

This has shown improvements in “monetary poverty, gender empowerment, health and employment or educational outcomes”.

Cash transfers are also being used in North America, adds Clay, who cites the example of cash being given to homeless people in Vancouver through the New Leaf Project.

But “cash transfers are rarely used by charities working in Britain,” he adds.

“Of course, cash is not going to be appropriate in every situation,” says Clay.

“If there is not a ready market where the person can buy what they need then it will not solve the problem. A cash transfer will not cut air pollution, improve a green space, or educate someone in prison for example.

"But where cash is effective, there is an opportunity cost to providing goods instead. During the cost-of-living crisis we need to get people the help they need most efficiently as quickly as possible.

"If a person would most benefit from a cash transfer, then giving them a good or service instead is using resources we do not have, thereby limiting our ability to help someone else in need.

“In a crisis this is not just wasteful, it’s irresponsible.”

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