(b) As PWPs/FFW have joint objectives, there are two elements to measuring cost-
effectiveness: the project's cost-effectiveness as a resource transfer mechanism and its
effectiveness in producing rural community assets. Our interest here is primarily in the first.

 It is reasonable to assume that PWP/FFW is no worse, and may possibly be better in
reaching its target beneficiaries than other mechanisms for resource transfer. Therefore the
analysis can concentrate on the amount transferred to beneficiaries as a proportion of total project
cost. For both MASAF and WFP'( P-) the figures have to be taken from the project proposals
and do not reflect actual costs borne. -'-9.

 The MASAF proposal gives a total cost of the PWP component as $19.47million. This
should provide 120,960 household years with a total of MK252million over a five year period.
At current exchange rates this would imply that 86 percent of total project costs would be
delivered to the beneficiaries. This appears to be unrealistically high. The project manager of
MASAF gave a verbal estimate that the project aims toadeliver 35 50 percent of total costs to
beneficiaries and the rest will be spent on materials. This seems a more realistic assessment.

 In the 1995/96 emergency FFW program, WF delivered 4321 MT of food to
beneficiaries, with an approximate value of $8.7 million. The cost of delivery was approximately
MKO.5million.

 WFP's QAP proposal gives a total cost of $4.057, of which 73 percent represents the value
of food transferred to beneficiaries. However the project envisages inputs from NGOs and
various government ministries which are not costed.

 It is very difficult to estimate how cost-effective PWP/FFW projects are as a way of
providing rural assets, and it is not directly relevant here. There is a large literature on the
subject. It is worth noting, however, that there may be a conflict between the characteristics of
eligible beneficiaries from a food security perspective and their suitability for participation in a
PWP.

(c) Is there a role for food as a supplement to or substitute for cash in PWP/FFW projects?
A number of issues arise in regard to this question. Firstly, how acceptable is this to participants?
An argument has been put forward in Malawi that a food wage is sometimes preferred by FFW
participants because of the high transactions costs involved in exchanging cash for food. MASAF,
in conjunction with WFP, gave participants in their pilot projects the choice of cash, food or a
combination. In Ntcheu and Mulanie. the community chose a combination of cash and food. This
choice was made in November when food was relatively scarce on local markets and prices ere
likely to rise. By April, when local food was coming on to the market, there were requests for
the wage to be paid entirely in cash. In Machinga. which shares a border with Mozamh"bi.e the
community requested cash which could easily be exchanged for cheap food from over the border.
Thus the preference depends on market conditions, location and time of the year. It is more


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