KENYA DROUGHT OPERATIONS PLAN SUBMISSION TO THE AFRICAN RISK CAPACITY OCTOBER 2013

Transcription

1 KENYA DROUGHT OPERATIONS PLAN SUBMISSION TO THE AFRICAN RISK CAPACITY OCTOBER 2013

2 Table of Contents Acronyms... 2 Introduction... 3 I. Description... 4 I.A. General Situation... 4 I.A.1. Overview... 4 I.A.2 Livelihood zones in Kenya... 6 I.A.3 Frequency and impact of drought in Kenya... 7 I.A.4. Institutional arrangements for drought management in Kenya... 9 I.B. General Risk Transfer Parameters Selected I.B.1 Total coverage I.B.2 Expected payout frequency I.B.3 Geographical areas of implementation I.C Activities I.C.1 Activity 1: Scale-up of cash transfers through the Hunger Safety Net Programme I.C.2 Activity 2: Access to Water I.C.3 National Coordination of Activities C.4 Risks and Assumptions II. Budget III. Annexes A. Annex 1: Most Drought-Prone Livelihood Zones Northwest pastoral cluster Northeast pastoral cluster Agro-pastoral cluster Southeast marginal agricultural cluster Coastal marginal agricultural cluster B. Annex 2: Briefing on the National Drought Contingency Fund, NDMA, C. Annex 3: Business Process for Disbursement of Drought Contingency Funds: Summary Report, NDMA D. Annex 4: Drought Response Manual: Sectoral Activities Eligible for Funding from the National Drought Contingency Fund, NDMA, E. Annex 5: Ending Drought Emergencies Medium Term Plan,

3 Acronyms AEZ ARC ASALs CSGs EDE EWS GDP HSNP KFSM KFSSG KLMC IPC MTP NDCF NDMA NSC NSNP PDNA WFP WUA Agro-Ecological Zone African Risk Capacity Arid and Semi-Arid Lands County Steering Groups Ending Drought Emergencies Early Warning System Gross Domestic Product Hunger Safety Net Programme Kenya Food Security Meeting Kenya Food Security Steering Group Kenya Livestock Marketing Council Integrated Phase Classification Medium Term Plan National Drought Contingency Fund National Drought Management Authority National Steering Committee on Peace Building and Conflict Management National Safety Net Programme Post Disaster Needs Assessment World Food Programme Water User Associations 2

4 Introduction The African Risk Capacity (ARC) provides parametric weather insurance coverage to African governments for agricultural seasons in case of drought. In return for premium payments into the mutual, 1 governments are eligible to receive a payout of up to 30 million USD. With Kenya s significant exposure to catastrophic drought events, the ARC could help to improve the management of this risk and, if disaster strikes, enable a more timely humanitarian response. Droughts significantly threaten record GDP growth in sub-saharan Africa. A 1-in-10 year drought event would have an estimated adverse impact of 4% on the annual GDP of Malawi, with even larger impacts for 1-in-15 and 1-in-25 year events. At the household level, the consequences of droughts can be devastating. An ARC cost-benefit analysis (CBA) examined existing evidence regarding the timing of household coping actions when faced with a drought and the likely long-term cost impacts of these actions. From this baseline, the study then estimates the economic benefits in acting early and thus protecting households economic growth potential that is intervening in time to prevent households negative coping actions such as reduced food consumption, livestock death, and distressed productive asset sales, which, in the absence of external assistance, have increasingly pronounced negative consequences. The CBA calculates that getting aid to households in the critical three months after harvest could result in nearly USD 1,300 per household assisted in terms of protected economic gains. 2 In order to improve resilience to natural disasters, two key elements are required: risk management and investment. Investments that support long-term resilience against food insecurity can address chronic risks and provide a base of predictable on-going assistance that can support poor and vulnerable households to build assets and livelihoods, which will in turn develop resilience to cope with normal and somewhat frequent, mild shocks without external assistance. From this base level of investment, sound risk management becomes critical. This is where a tool such as ARC can offer the most value, providing dedicated contingency funds that can scale up safety net systems in a reliable, timely manner, allowing them to remain solvent and sustainable, protecting hard-won gains for households, and reducing countries reliance on emergency appeals. This Operations Plan outlines how ARC funds would be used in case of a payout to Kenya. It first outlines the general national drought conditions (section I.A) and the ARC risk transfer parameters for Kenya (I.B). It then describes in detail the activities that would be pursued with ARC funds (I.C) and finally provides additional practical and background information on the implementation and monitoring of this Operations Plan (II-V). 1 A mutual insurance company is owned and overseen by its members. 2 Clarke, Daniel J. and Ruth Vargas Hill, Cost-Benefit Analysis of the African Risk Capacity Facility, International Food Policy Research Institute, IFPRI Discussion Paper 01292, September

5 I. Description I.A. General Situation I.A.1. Overview Drought is the single most important natural hazard in Kenya. In the last 20 years there have been ten drought events that have affected more than one million people. 3 As well as the suffering and loss it inflicts on communities, drought places a heavy strain on the national economy. Between 2008 and 2011 it caused damages and losses of an estimated USD 12.1 billion. 4 Climate variability is a normal characteristic of the dryland ecosystems which characterise more than 80% of Kenya. However, this variability is becoming more pronounced and unpredictable; climate change may exacerbate drought impacts still further. Moreover, a range of factors are deepening vulnerability to drought, including population growth, land pressure, insecurity and persistent inequalities. Women and young people may be particularly at risk due to their subordinate position in society and their limited control over productive resources. Figure 1 below shows the areas of Kenya at greatest risk of drought impacts, based on a five-year average of the Integrated Phase Classification (IPC). The areas of highest risk are in the arid and semi-arid lands (ASALs) to the north, east and south of the country. These areas account for 36% of the total population (around 14 million people). 5 The ASALs also have the highest levels of poverty and the lowest access to public goods and services in Kenya. The Government recognises the link between inequality and vulnerability, and through its Ending Drought Emergencies (EDE) initiative has prioritised investments in infrastructure, security, education, health and nutrition, which will strengthen drought and climate resilience. These have been integrated within the Kenya Vision 2030 second Medium Term Plan for Centre for Research on Epidemiology of Disasters (CRED): 4 Republic of Kenya (2012) Post Disaster Needs Assessment, Drought 5 Republic of Kenya (2010) Kenya Population and Housing Census,

6 Figure 1: Food Security Phase Classification,

7 I.A.2 Livelihood zones in Kenya 6 Figure 2: Livelihood Zones in Kenya 6 The maps in this section have not yet been updated to take account of the new counties. Moyale/Marsabit, Ijara/Garissa, Transmara/Narok, Mwingi/Kitui and Malindi/Kilifi are now combined. 6

8 The Kenya Food Security Steering Group (KFSSG), an inter-agency coordination mechanism for food security and drought management co-chaired by the Government and the World Food Programme (WFP), analyses drought risk and vulnerability according to different livelihood zones. Four types of livelihood in Kenya namely pastoralism, agro-pastoralism, mixed farming, and marginal agriculture are highly dependent on the natural resource base and therefore highly exposed to variations in precipitation. The five geographical clusters across the ASALs that are particularly drought-prone are the Northwest pastoral cluster (Turkana, Marsabit, Samburu), the Northeast pastoral cluster (Mandera, Wajir, Garissa, Tana River, Isiolo), the agro-pastoral cluster (Kajiado, Narok, West Pokot, Baringo, Laikipia, part of Nyeri (Kieni)), the Southeast marginal agricultural cluster (Kitui, Machakos, Makueni, Tharaka Nithi, partof Embu (Mbeere), part of Meru (Meru North)), and the Coastal marginal agricultural cluster (Kwale, Kilifi, Taita Taveta, Lamu). They are described in more detail in Annex 1. I.A.3 Frequency and impact of drought in Kenya Kenya has a bimodal rainfall pattern with a short rains season and a long rains season. These determine the performance of different livelihoods. Figure 3 shows the seasonal calendar and key events for both livestock and crop production. Figure 3: Seasonal Calendar and Critical Events Timeline Source: FEWSNET The frequency of drought appears to be increasing, with major drought episodes in , , , and Given that there are now few good seasons between droughts, households have had progressively less time within which to recover. Further, food security is most gravely threatened when the failure of a rainy season combines with other factors, such as price variability (Kenya is a net importer of maize), conflict (which limits access to pasture, water and services) or disease (of both livestock and crops). Figure 4 shows the number of people assessed as food insecure between 2006 and The number has reduced since the peak of the last drought in 2011, but approximately one million Kenyans are chronically food insecure. 7

9 Figure 4: Food Insecure Population in Need of Assistance Source: KFSSG Short Rains Assessment The scale of drought-related humanitarian need is further illustrated in Figure 5, which shows the funds requested (in years when an appeal was launched) and funds received since The figures show drought-related response only; they exclude donor assistance to refugees in Kenya and to non- ASAL areas after the post-election violence in Figure 5: Humanitarian Appeals and Funding, Source: UNOCHA, cited in Fitzgibbon, C. (2012) Economics of Resilience: Kenya Country Report, London: DFID The humanitarian consequences of drought have been most recently and thoroughly evaluated by the Post Disaster Needs Assessment for the drought period, produced by the Government with assistance from a number of development partners. The many impacts of that drought included the following: Nutrition: rates of Global Acute Malnutrition (GAM) in three arid counties (Turkana, Wajir, Mandera) remained above 20% during the whole period ( ), rising above 25% in

10 These spikes are overlaid on a situation of chronic under-nutrition: an estimated 35% of Kenyan children are stunted. 7 Livestock: animals to the value of approximately KES 56.1 billion died (approximately USD 645 million); milk yields reduced and livestock productivity fell. Additional expenditure was required for veterinary services, water and feed. As a result, the livestock sector sustained 72% of total damages and losses. Education: the pressure on children to contribute to domestic chores led in some areas to irregular attendance and an increase in temporary drop-outs; in other areas, school enrolment increased, putting added pressure on school feeding rations. High food prices affected families ability to pay school fees. Gender: women and girls reported a significant increase in the burden placed on them due to factors such as male migration and changing livelihood patterns. Women can be vulnerable to an increased risk of gender violence in situations of economic and social stress. Economy: the drought slowed GDP by an average of 2.8% per annum. Had the drought not occurred, GDP would have grown at an annual average of 6.3%. In conclusion, the growing frequency and severity of drought episodes, overlaid on a situation of chronic vulnerability and inequality, is putting the livelihoods of Kenya s pastoralists and small farmers under ever-increasing stress. I.A.4. Institutional arrangements for drought management in Kenya The Government of Kenya has been making steady improvements to its drought management system in recent years. This work is now led by the National Drought Management Authority (NDMA), a state corporation established in November 2011 to provide leadership and coordination of drought management and climate change adaptation. Through the NDMA, the Government has effectively institutionalised the drought management system in a permanent and specialised body. Kenya s drought management system has the following elements: a) National policy and legislation. The guiding documents for the NDMA are the Constitution of Kenya 2010 (which places a duty on the state to protect the vulnerable), Sessional Paper No. 8 of 2012 on the National Policy for the Sustainable Development of Northern Kenya and other Arid Lands (the ASAL policy ), and the Ending Drought Emergencies Medium Term Plan (mentioned above). The NDMA is responsible for the EDE MTP and works closely with the relevant sectors to ensure that the commitments they have made to strengthen drought resilience are prioritised, financed and implemented. These commitments are primarily in public goods (security, infrastructure, health and education) to create the necessary enabling environment for development and growth. 7 Republic of Kenya (2013) National Nutrition Action Plan,

11 b) A drought early warning system (EWS) based on information aggregated from different sources, ranging from field interviews (collected at sentinel sites) to satellite imagery. The EWS is currently being updated in order to review and refine the thresholds and triggers for early warning phase classification, to integrate new technologies, and to strengthen sampling, data collection, quality control and communication. c) A set of pre-determined warning stages triggered by the early warning information. Kenya uses five stages: normal, alert, alarm, emergency and recovery. Specific activities have been identified as being appropriate at each warning stage, and are detailed in a drought response manual. 8 The warning stages also trigger rapid assessments on the ground. d) A set of county-level contingency ( shelf ) plans for rapid reaction to early warning information and changes in the warning stages. The NDMA facilitates the development of these plans and coordinates their implementation in close collaboration with county stakeholders. The contingency planning process has recently been made more rigorous, systematic and computerised. e) A drought contingency (response) fund to enable rapid implementation of the contingency plans. Financing is the biggest challenge still facing the drought management system, which underlines the significance and potential impact of the ARC initiative. The Government intends to create a National Drought Contingency Fund (NDCF), managed independently of the NDMA. This will be a multi-donor basket fund through which finance will be allocated against the activities in drought contingency plans, triggered by information generated through the EWS. The NDCF will ensure that action in the early stages of a drought, when its effects can best be mitigated, is more timely, flexible and appropriate. 9 f) Coordination structures at both the national and county levels principally the Kenya Food Security Meeting (KFSM), the Kenya Food Security Steering Group (KFSSG), and the County Steering Groups (CSGs). The CSGs are responsible for coordination at the county level and links with communities. Kenya is fortunate in having an active and diverse group of agencies working on drought management. These coordination structures are about to be reviewed in light of Kenya s recent move towards devolved governance and other changes in the policy and institutional context, such as the increased emphasis on resilience. g) Measures to reduce risk and strengthen resilience over the long term, regardless of prevailing drought conditions. These include guiding the new county governments in mainstreaming drought risk reduction within their development plans and budgets (in line with the EDE), introducing county climate adaptation funds, and implementing a range of risk reduction and social protection programmes. Chief among the latter is the Hunger Safety Net Programme (HSNP), which is discussed in more detail in section C. 8 NDMA (2010) Drought Response Manual: Sectoral Activities Eligible for Funding from the National Drought Contingency Fund 9 The government has long experience of managing drought contingency funds from donors such as the World Bank and European Union under a project mechanism (the Arid Lands Resource Management Project, ALRMP). The design of the proposed NDCF is based on ALRMP experience. 10

12 The various mechanisms and processes outlined above are being constantly refined and improved, particularly in light of the slow response to the 2011 drought. In this regard, the ARC initiative represents an invaluable opportunity to scale up and reinforce these efforts. The Government is also taking steps to strengthen its broader disaster management capacity. The Disaster Management Policy has been approved and a Disaster Management Bill has been drafted. A National Drought Management Authority Bill is also before Parliament which aims to strengthen the legal foundation for the NDMA and NDCF. These two pieces of legislation are now being reconciled to ensure that Kenya has specialist capacity to manage distinct disaster risks, appropriately coordinated at a senior level in government. I.B. General Risk Transfer Parameters Selected Note: Work to determine the risk transfer parameters is ongoing. The final parameters will be provided once this work is complete. I.B.1 Total coverage Attachment point: Exhaustion point: Coverage limit: Ceding percentage: 1-in-5 TBD USD 30 million TBD I.B.2 Expected payout frequency The risk parameters should consider drought occurrence as the successive failure of more than one rainy season. Since the magnitude of drought is more cumulative in the subsequent second failed season, the risk cover should be higher in the second failed season compared to the first. Kenya will likely plan to insure both seasons. I.B.3 Geographical areas of implementation Implementation will take place in any of the 23 most drought-prone ASAL counties where the NDMA is currently operational, as determined by the EWS and drought status. These counties are Turkana, West Pokot, Baringo, Marsabit, Samburu, Isiolo, Mandera, Wajir, Garissa, Tana River, Lamu, Kilifi, Kwale, Taita Taveta, Kitui, Makueni, Embu, Tharaka Nithi, Meru, Laikipia, Nyeri, Kajiado and Narok. I.C Activities The overall objective of the action is to protect the lives and livelihoods of drought-affected households and to prevent the descent into loss and destitution. ARC payouts will fund two specific activities: unconditional cash transfers and water interventions. Finance from the ARC will reduce the response time by making resources quickly available. It will complement existing drought contingency finance and thus reduce still further levels of food insecurity and vulnerability. 11

13 The decision to use ARC payouts for these two activities was reached after lengthy consultation within the technical working group of the KFSSG. It was decided that other sectors, such as education, livestock, agriculture and human health would continue to access support from Government and other partners. Food-for-fees, for example, is already a common intervention during drought periods in northern Kenya, complementing the WFP-supported school feeding programme and the Government-supported free education programmes. It is important to note that the operational detail of each activity in this plan, including the number of beneficiaries, their location, the precise indicators and the budget, can only be determined based on the drought conditions prevailing at the time and the assessments which will be conducted in response to those conditions. These precise indicators and the budget will be included in the Final Implementation Plan (FIP). I.C.1 Activity 1: Scale-up of cash transfers through the Hunger Safety Net Programme I.C.1.1 General response strategy General Description The Hunger Safety Net Programme (HSNP) provides unconditional cash transfers through biometric smart cards to chronically food insecure households in the four counties which are the poorest in Kenya and among the most vulnerable to shocks (Turkana, Marsabit, Mandera and Wajir). Allocating USD 22.5 million out of a total ARC payout of USD 30 million to this activity, via three mutually exclusive options either 100,000 households (option 1), 182,100 households (option 2), or 141,000 households (option 3) would be targeted. The regular programme: Phase 1 of HSNP was implemented between 2009 and 2013 and reached 69,000 households or 496,800 beneficiaries with a cash transfer to beneficiaries every two months. The size of the bi-monthly transfer was set at KES 2,150 to each beneficiary household, representing 75% of WFP food aid ration at the time of determination (2006). This was adjusted over time and remained at KES 3,500 after March/April Beneficiary households were selected using three different targeting mechanisms: 10 Up to 50% of households were selected using community-based targeting (CBT), where the community selected households they considered most in need of cash transfers; Via the dependency ratio (DR), households were selected if the proportion of members under 18 or over 55, disabled or chronically ill, exceeded a certain threshold; Via social pension (SP), any individual older than 54 years was eligible for cash transfers. 10 Oxford Policy Management (2013) Kenya Hunger Safety Net Programme Monitoring and Evaluation Component: Impact Evaluation Final Report 2009 to

14 In total, 75% of the beneficiaries of Phase 1 were female. 11 The effectiveness of cash transfer programmes such as the HSNP depends on a functioning market. Therefore, market conditions, including inflation, are regularly reviewed by a number of agencies working in the arid lands, including WFP s Vulnerability Analysis and Mapping (VAM) Unit. 12 The final impact evaluation report for the HSNP during the period 2009 to 2012 has shown that the HSNP has not been causing inflation in any of the program areas, nor has it stabilized prices over time. 13 Payment to beneficiaries is facilitated by Equity Bank that was selected by the Financial Sector Deepening Trust (FSD). For this, Equity Bank uses a network of traders and shopkeepers as payment agents (158 in December 2012) that pay the beneficiaries in specific locations. Agents make payments using biometric cards and point of sale devices, using either the Safaricom or the Zain mobile network. The HSNP is funded by DFID, AusAID and the Government of Kenya and implemented by the HSNP Secretariat within the NDMA in partnership with five international partners (Oxfam, CARE, Save the Children, World Vision, and HelpAge International). It is also part of the Government of Kenya s National Safety Net Programme (NSNP), supported by the World Bank through its new lending instrument called Programme for Results. Phase 2 of the HSNP will start before the end of 2013 and will provide a similar safety net as the one provided during Phase 1 for 100,000 households. An additional component of the HSNP s Phase 2 is the possibility for a rapid scale-up of transfers to a possible 470,000 households during acute drought crises. This mechanism is planned to be fully established (i.e. reaching 470,000 additional households) by As of August 2013, 378,576 households have already been registered during the preparation for Phase 2 and will be issued with biometric smart cards. The scale-up will not only assist a larger number of households during periods of stress by cushioning them against drought, it will in effect climate-proof the regular transfers by ensuring that their impact is not dissipated by wider pressures within the same communities. Use of ARC funds: USD 22.5 million out of a total ARC payout of USD 30 million would be allocated to the HSNP. The money would be used in one of three different ways that are presented below ( Option 1-3 ). The option selected during an emergency would depend on the specific nature of the drought, in particular on its severity. The option to be employed would be specified in the FIP. Option 1: Increasing transfer value for regular beneficiaries while maintaining the same number of beneficiaries. Phase 2 of the HSNP will provide regular cash transfers to 100,000 beneficiary households. Under Option 1, for all 100,000 regular households, the regular monthly transfer value of KES 3,500 per household would be increased to KES 9,875 for a period of three months with ARC funds. This is calculated using the following formula and assuming an exchange rate of USD 1 = KES 85: 11 Oxford Policy Management (2013) Kenya Hunger Safety Net Programme Monitoring and Evaluation Component: Impact Evaluation Final Report 2009 to WFP (2013) Market Dynamics and Financial Services in Kenya s Arid Lands 13 Oxford Policy Management (2013) Kenya Hunger Safety Net Programme Monitoring and Evaluation Component: Impact Evaluation Final Report 2009 to

15 22,500, =100,000 3 h 6, This option would be employed in times of a particularly severe drought, where the regular beneficiary households of the HNSP would not be able to sustain themselves with the regular transfer value of KES 3,500 per month but need almost triple the amount. Such a scale-up has been carried out in September 2011, when the size of the transfer value was doubled without difficulty and without any delay in the process. Similarly, an increase in transfer value is expected to be feasible under the ARC without delay, i.e. within 120 days of the ARC payout. Option 2: Increasing number of beneficiaries while maintaining the same transfer value. Under Option 2, regular HSNP beneficiary households would continue to receive KES 3,500 per month. Yet using the rapid scale-up mechanism of the HSNP Phase 2, the number of beneficiary households under the HSNP would be increased by 182,100 for a period of three months with ARC funds. This is calculated using the following formula and assuming an exchange rate of USD 1 = KES 85: 22,500, =182,100 3 h 3,500. With the 100,000 beneficiary households in the regular HSNP, a total of 282,100 households would benefit from the programme. This option would be employed during a less severe drought, when supplementing households income with KES 3,500 would already enable them to sustain themselves. A consultancy is currently underway to develop the methodology for implementing the rapid scale-up, which will include the criteria for targeting beneficiaries and the appropriate level of transfer. It is already clear, however, that information generated by the drought EWS and through vulnerability analysis and mapping will guide the targeting process. For the time being, the scale-up of cash transfers can only be operationalised in the four counties where registration has been carried out and where the payments infrastructure is already in place. However, the NDMA will be working with its development partners to try to expand the registration to all nine arid counties (those most vulnerable to drought and climate shocks) within the next two years, since cash transfers provide a quick, accountable and direct means of reaching vulnerable households. Given that the scale-up mechanism is only being introduced with Phase 2 of the HNSP, it has not been implemented before. However, as 378,576 (potential) beneficiary households have already been registered as of August 2013 for Phase 2 with further registration on-going, the largest part of the work has been done. Using the existing network of payment agents, increasing the number of beneficiaries within 120 days of the ARC payout is expected to be feasible. 14 This formula is indicative and the value could be updated on the basis of market analysis. 14

16 Option 3: Increasing both transfer value and number of beneficiaries. Under Option 3, the 100,000 beneficiary households of the regular HSNP would receive an increase in monthly transfer value of KES 3,500 per household, resulting in a total monthly transfer value per household of KES 7,000. The remaining money from the ARC payout would be used to increase the number of beneficiaries with an equal monthly transfer value of KES 7,000. Thereby, under Option 3, a total of 141,000 households would benefit from the ARC funds. This is calculated using the following formula and assuming an exchange rate of USD 1 = KES 85: 22,500, = 100,000 3 h 3, ,000 3 h 7, This option would be employed during a drought, when beneficiary households would be able to sustain themselves with a transfer value of KES 7,000. As the implementation of Option 3 presents a combination of increasing the transfer value (Option 1) and increasing the number of beneficiaries (Option 2), which are both deemed to be feasible within 120 days of the ARC payout, also the implementation Option 3 is expected to be feasible within the same time frame. Coordination The implementation of the HSNP scale-up would follow existing systems and procedures, and be undertaken in collaboration with established partners and networks. These include: HSNP Secretariat within the NDMA; NDMA county offices; Kenya Food Security Steering Group (KFSSG); County Steering Groups; NGO consortium (Oxfam GB; CARE International; Save the Children International; World Vision International; ALDEF; WASDA); Financial Sector Deepening Trust (FSD); Equity Bank; Oxford Policy Management; and, HelpAge International. The national drought response and therefore also the response under the ARC would be coordinated at the national level by the NDMA and at the county level by the NDMA county offices. The scale-up process would follow the regular HSNP process: 15 The formula could be updated pending on market analysis. 15

17 An NGO consortium under the leadership of Oxfam GB has carried out the pre-identification and registration of (potential) beneficiaries for Phases 1 and 2 (see below); The County Steering Groups would conduct a rapid emergency-related needs assessment with help of the KFSSG and the NDMA in order to determine the most-affected LZs this assessment would serve as the basis for the final selection of additional beneficiaries under the scale-up; From the pre-identification of potential beneficiaries, the NDMA county office would select the additional beneficiaries that are to be targeted under the scale-up mechanism of the HSNP; Equity Bank (selected by FSD) would facilitate payments to beneficiaries (see above); Monitoring and Evaluation is would be done by Oxford Policy Management (see below); HelpAge International would lead the implementation of the Social Protection Rights (SPR) component, whereby it acts as an independent evaluator of other components, implements mechanisms of downward accountability and transparency maximization, and acts as a beneficiary advocate within the HSNP system. Needs Assessment The NDMA uses two main mechanisms to determine needs and lay the basis for targeting decisions: 1. Bi-annual food security assessments are always carried out by the KFSSG after the short rains and the long rains. The information is used by the government to design necessary interventions. 2. Rapid food security assessments are carried out by the sectoral working groups of the County Steering Groups (CSGs) with support from the NDMA and the KFSSG in counties, when the early warning status has reached alert/alarm. They can be completed in three or four days and would be implemented in case of an ARC payout in affected areas. The assessments determine the geographical location, the number and type of people affected, the interventions required, and their costs and timeframe. The results of the assessments update the county contingency plans and are used as the basis for submitting requests for the disbursement of drought contingency funds. Under the ARC, such rapid food security assessments would also be conducted in the areas identified to be affected most by combining information from ARV and the bi-annual food security assessments. These rapid assessments serve as the basis to determine the areas for the HSNP scale-up. The NDMA has its own resources to carry out both these types of assessment, provided either by the government or by development partners. 16

18 Targeting The identification and registration of both regular beneficiaries under HSNP Phase 2 and potential beneficiaries in the event of the rapid scale-up is on-going. It is being implemented by an NGO consortium comprised of Save the Children International, CARE International, World Vision International, ALDEF, and WASDA, under the leadership of Oxfam GB. So far, 378,576 households have been identified: Save the Children International is currently registering households in Mandera (estimated 170,959 households or population of 1,025,756) and Wajir (estimated 110,320 households or population of 661,920). In Mandera, registering in six Districts: Mandera East, Mandera West, Mandera South, Mandera North, Laflafey and Banisa; CARE is registering households in four Districts (Moyale, Laisamis, North Horr and Saku/Central) Marsabit, a total of 90,000 households; Oxfam GB is registering households in four Districts of Turkana Central, West, North and Loima. This is an estimated 99,616 households equivalent population of 687,349; World Vision International is registering a total of 28,437 households in South and East of Turkana. 16 The details of the targeting process for a scale-up under the HSNP Phase 2 and therefore under the ARC are currently being developed by a consultancy. However, it is clear that the NDMA county office would conduct the targeting at the county level and that the comprehensive registration of households described above would guide the targeting process. The registration database contains relevant information to identify beneficiaries according to the nature of risk and vulnerability (such as by gender, age, dependency, location and main livelihood activity). Targeting would be an open and interactive process at both the county and community levels. Livelihood vulnerability analysis and mapping would also inform the targeting. 16 Ndoka, Carrie, Hunger Safety Net Programme: Past, Present and Future ( ), May

19 I.C.1.2 Eligibility Criteria ARC eligibility criteria Time-sensitive / catalytic Activity 1: Scale-up of cash transfers through the Hunger Safety Net The payments infrastructure for the cash transfers is already in place (described above). An increase of transfer value (double) has already been carried out with no difficulties and no delay in procedures in September Thus, it is expected that an increase of transfer value would also be possible under the ARC within 120 days of the ARC payout (Option 1 and 3). Given that the scale-up mechanism is only being introduced with Phase 2 of the HNSP, it has not been implemented before. However, as 378,576 (potential) beneficiary households (as of August 2013) have already been registered during the preparation for Phase 2 with further registration on-going, the largest component of the work has been completed. Using the existing network of payment agents, increasing the number of beneficiaries within 120 days of the ARC payout is expected to be feasible. Without ARC funds, there is no on-going resource to scale up this fund to additional beneficiaries. Because of ARC funds, the HSNP can be expanded before drought stress creates negative coping strategies. Livelihood savings Duration The assets of households in arid lands (such as livestock) are fluid, and a key concern in drought mitigation is to prevent distressed sales. Between September 2009 and November 2011 (a drought period) HSNP evaluation reports showed that the percentage of HSNP households owning livestock actually increased by 5.4%, while the figure for non-hsnp households in the same locations decreased by 6.6%. Households were using the cash transfers to prevent the sale of assets. 17 Timely availability of funds will facilitate these livelihood-saving activities before the drought moves to a critical stage. The activity can be completed within six months. Transfers are made every two months and can be adjusted with minimal lead time. 17 Oxford Policy Management, 2012 Qualitative Impact Evaluation Report: 2009/10 to 2010/11 and Quantative Impact Evaluation Report: 2009/10 to 2010/11 18

20 I.C.1.3 Log frame OUTCOMES / RESULTS Outcome 1: Reduced response time for assistance to targeted households. Outcome 2: Improved implementation time for ARC activities Outcome 3: Increased proportion of households able to retain / accumulate assets with higher HSNP payouts per household OUTPUTS Output 1.1: Cash transfers disbursed to drought-affected households Output 2.1: Assistance to affected households timely provided Output 3.1: Activity timely completed Intervention: Scale-up of cash transfers through the Hunger Safety Net Programme Overall objective: To protect household assets during drought stress Objective Verifiable Indicators Means of Risks, Verification Assumptions Targeted beneficiary households are able to receive payouts within 4 months on a timely basis. Activity s implementation duration not exceeding 180 days. More than 60% of households report herd size increase and retain their assets throughout the drought period. 40% of targeted households adopt other livelihoods diversification options. Option 1: 100,000 regular HSNP households receive their monthly transfer value increased by KES 6,375 for 3 months. Option 2: 181,100 additional households receive a monthly transfer value of KES 3,500 for 3 months. Option 3: 100,000 regular HSNP households receive their monthly transfer value increased by KES 3,500 and 41,000 additional households receive a monthly transfer value of KES 7,000 for 3 months. For all three Options: Households assets are protected from depletion; They have enhanced purchasing power during time of drought; They are able to maintain herd sizes. Actual time taken to roll out response programme from ARC pay-out date against planned Actual time taken to provide food to targeted households against planned time Actual time taken to complete activity against planned Monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC MIS, monthly and final monitoring reports from NDMA to ARC MIS, monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC Incidence of intercommunity conflict is reduced. Food price inflation will affect the real value of the transfer if not managed. Functioning local markets 19

21 I.C.1.4 Action Plan ARC payouts could occur after either of the insured seasons (short rains and long rains). The sequence of events as illustrated in the following would remain the same. Month Implementing body Activities Signing of agreements ARC and NDMA Review and update of contingency plans Development of response plans Bi-annual food security KFSSG assessment Rapid assessments (day 0-15) CSG Targeting (day 16-25) NDMA county offices, supported by implementing partners (Oxfam, CARE Kenya, Save the Children, World Vision, HelpAge International) HSNP Scale-up (day ) NDMA county offices, supported by implementing partners (Oxfam, CARE Kenya, Save the Children, World Vision, HelpAge International), service providers (FSD, Equity Bank) and development partners (DFID, AusAID, World Bank) County implementation and NDMA county offices, NDMA headquarter financial report are submitted to NDMA headquarter at the end of implementation (day ) Consolidate county reports and NDMA headquarter submit to Treasury (day ) Get review from Treasury and submit final report to ARC (day ) Treasury, NDMA headquarter 20

22 I.C.2 Activity 2: Access to Water I.C.2.1 General response strategy General Description This Activity proposes two components to be implemented under the ARC: (i) Water trucking and (ii) actions to ensure the functionality of strategic boreholes. The provision of water during drought emergencies is a key response activity and has a major impact on several adverse drought effects including rates of malnutrition and morbidity, livestock condition, crop production, and the labour demands on women and girls. It is particularly important during the alarm and emergency stages of a drought. The funds available from Government and development partners are often insufficient to address rapidly increasing water resource demands. ARC funding will thus enable the target population to access water for both domestic and livestock use during the critical stages of drought. However, the provision of water must also be undertaken with great care, since poor design can contribute to conflict and environmental degradation. First, water trucking is often necessary at different stages of a drought but can be constrained by the lack of storage facilities, particularly in areas where the water infrastructure is poorly developed. Under the ARC, County Steering Groups would take an inventory of existing community storage facilities and the gaps, and provide temporary plastic tanks where necessary to widen the benefits from water trucking. The tanks are also appropriate for use in rangelands in circumstances where livestock have moved into areas with pasture but no water. The temporary tanks can serve as strategic water points and be replenished. Subsequently, water would be supplied to targeted communities. In these circumstances, water trucking would sustain both the core livestock herd left behind by satellite herds and the household members who have accompanied them. Water trucking will only be implemented during the emergency stage of a drought, on a limited scale, and only in those pockets of counties which are identified by the rapid needs assessments to face chronic water shortages. Second, there is high demand at strategic boreholes during drought periods, particularly those located in dry season grazing areas. As a result the boreholes are prone to breakdown. Borehole downtime is a major cause of livestock mortality. Moreover, as pastoralists purchasing power declines, so does their ability to procure the necessary fuel and lubricants. ARC funds would be used by County Steering Groups to provide fuel subsidies to strategic boreholes, stockpile fast-moving spares, and constitute rapid response teams (including trained community technicians) who can keep the boreholes running. The water user associations (WUAs) responsible for managing these boreholes will pass on the subsidy to community members by temporarily reducing the cost of water. Further, with resources from the NDCF and other development partners, the rehabilitation of strategic water points during the recovery stage of drought will contribute to building resilience. Coordination The involved actors in the implementation of Activity 2 are: 21

23 NDMA and NDMA county offices; KFSSG Water and Sanitation Working Group; Ministry of Water county offices; County Steering Groups (CSGs) and their sectoral working groups; Community Borehole Committees; Water service providers such as the Northern Water Service Board and the Athi Water Service Board; and, Water User Associations (WUA). Both for water trucking and borehole activities, the NDMA, with technical support from the KFSSG Water and Sanitation Working Group, would coordinate the intervention at the national level and act through its county offices at the county level. For water trucking, the NDMA county office would coordinate the intervention with the Ministry of Water county office and the County Steering Group (CSG). The County Steering Group would take an inventory of existing storage facilities as described above and distribute temporary plastic tanks where needed. The Ministry of Water would then be in charge of purchasing water from local water service providers and would use its own trucks to transport and distribute the water to the targeted communities. For borehole activities, Community Borehole Committees would request support bottom-up from the respective CSG. The CSG would then coordinate the response with the Ministry of Water county office, with the NDMA county office, and with Water User Associations (WUAs) that are responsible for managing the affected boreholes. The CSG in collaboration with the Ministry of Water county office would provide fuel subsidies to strategic boreholes, stockpile fast-moving spares, and constitute rapid response teams (including trained community technicians) who can keep the boreholes running. The WUAs would pass on the subsidy to community members by temporarily reducing the cost of water. Procurement Any procurement required for water activities would be done in line with the Public Procurement and Disposal Act 2005 and as stipulated in government regulations. The NDMA has pre-qualified suppliers for all items at both the county and national levels. For water trucking, the Ministry of Water county office would procure the water from water service providers. For borehole activities, CSGs would procure fuel and lubricants for the boreholes using Local Purchase Orders (LPOs). They would keep issue registers and ensure that delivery notes are signed by the WUAs. The NDMA has established tendering committees at both the national and the county levels to oversee the tendering process, as envisaged in the Act. Local communities will also be assisted to 22

24 oversee the planning, implementation, monitoring and evaluation of their preparedness and mitigation measures. Needs Assessment The needs assessment process is the same as the one described for Activity 1. Targeting For both water trucking and borehole activities, targeting at the national level is informed by the drought EWS which indicates the drought status per county. Geographical targeting within each county is determined by the rapid assessments. Water trucking would be implemented purely based on such geographical targeting. If water stress levels are high enough for water trucking to be implemented, everybody in the affected region would receive water supplies from this activity. For borehole activities, intervention is based on bottom-up requests from Community Borehole Committees to the respective County Steering Groups, as described above. County Steering Groups assist in cooperation with the described partners accordingly. 23

25 I.C.2.2 Eligibility Criteria ARC eligibility criteria Time-sensitive / catalytic Activity 2: Access to water Implementation can take place well within the 120 days, since: These activities are included in county drought contingency plans which must be pre-approved; They are also activities which CSGs have carried out in the past; and, The NDCF business process is in place (described in section 3 below). Fast delivery of water can prevent asset depletion and increase the ability of households to carry on income-generating activities rather than selling assets and trying to keeps herds alive. Livelihood savings Early intervention to prevent borehole breakdown is key to preventing livestock mortality and the loss of assets, hence funds for response are required within the early stages of a drought. Early actions to ensure continued access to water also have an impact on livelihoods. For example, during the droughts there was a substantial loss of wages as household members replaced normal economic activities with fetching of water. 18 Duration The provision of water tanks will be carried out within one month. Fuel subsidies and borehole repairs will be provided over a three-month period. These timeframes are within the critical stages of a drought. 18 The PDNA estimated total losses in the water sector at approximately KES 73 million. Some of this was the reduction in revenue to water service providers, but most was due to lost wages. 24

26 I.C.2.3 Log frame OUTCOMES / RESULTS Intervention: Access to water Overall objective: To enhance access to water for household and livestock use during drought Objective Verifiable Indicators Means of Verification Risks, Assumptions Outcome 1: Increased access to water via water trucking and fuel subsidies Outcome 2: Strategic boreholes remain operational with the use of rapid response teams. Outcome 3: Reduced response time for assistance to targeted households. Outcome 4: Improved implementation time for ARC activities. OUTPUTS Output 1.1: Plastic tanks per county distributed to strategic community points in 23 counties to enable subsequent water trucking. Output 1.2: Water trucking carried out to vulnerable households in 10 counties Output 1.3: Fuel subsidies provided to water user associations responsible for managing strategic boreholes. Over 60 percent of households have access to clean and safe water Incidences of water borne diseases reduced by 80 percent 80 percent of strategic boreholes being able to sustain water demand during drought period. Drought response period reduced to less than 120 days. Drought interventions implemented in less than 6 months 25 water tanks per county delivered and utilised as water reservoirs by communities and institutions. 50,000 beneficiaries access water throughout the drought period. 50,000 beneficiaries direct their time to other production household roles rather than seeking water. 60% of motorised boreholes running throughout the drought period. 80% of WUAs are able to manage strategic boreholes. MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC Incidents of conflict are effectively managed to ensure access to water Rapid response teams and WUAs are able to carry out basic maintenance throughout the implementation period Water trucking proceeds as planned Careful assessment of the ecological implications and impact on customary rights will be required. Water trucking activities do not lead to human settlements along watering points. Clear agreements in place with the WUAs governing the terms on which subsidies are given. 25

27 Output 2.1: Rapid response teams equipped with fastmoving spares and equipment to repair strategic boreholes. Output 3.1: Assistance to affected households timely provided Output 4.1: Activity timely completed. Rapid response teams in 23 counties activated and able to respond to borehole breakdowns At least five WUAs per county trained and equipped to repair motorised boreholes. Actual time taken to roll out response programme from ARC pay-out date against planned Actual time taken to provide food to targeted households against planned time Actual time taken to complete activity against planned MIS, monthly monitoring from CSGs to NDMA, monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC Monthly and final monitoring reports from NDMA to ARC Availability of spares and equipment in the counties. 26

28 I.C.2.4 Action Plan ARC payouts could occur after either of the insured seasons (short rains and long rains). The sequence of events as illustrated in the following would remain the same. Where exact implementation times particularly depend on individual circumstances, an estimate of the timing was applied (indicated). Month Implementing body Activities Signing of agreements ARC and NDMA Review and update of contingency plans Development of response plans Bi-annual food security assessment KFSSG Rapid assessments (day 0-15) CSGs Targeting (estimate) NDMA county offices Water trucking: Assessment of water CSGs storage facilities and distribution of temporary containers (estimate) Water trucking: Procurement of Ministry of Water county offices water (estimate) Water trucking: Provision of water to Ministry of Water county offices targeted communities (estimate) Borehole activities: Provide fuel subsidies to strategic boreholes, stockpile fast-moving spares, and constitute rapid response teams CSGs, Ministry of Water county offices, WUAs, NDMA county offices Implementation reports are NDMA county offices compiled and submitted to NDMA headquarters (day ) Consolidate county reports and NDMA headquarter submit to Treasury (day ) Get review from Treasury and submit Treasury, NDMA headquarter final report to ARC (day ) 27

29 I.C.3 National Coordination of Activities I.C.3.1 Flow of funds The funds from the ARC will flow through the National Treasury to temporary arrangements until the National Drought and Disaster Contingency Fund (NDCF) is established. Although the NDCF is not yet in place, the National Treasury has confirmed that it can provide the framework for the disbursement of ARC payouts by establishing fund flow channels. This will be an interim measure while the NDCF is being formally established. Once the NDCF is operational, ARC payout procedures will be integrated within its systems. 19 In the unlikely event that the NDCF should not be established, the National Treasury will continue to provide an interim fund flow channel until another institutional arrangement subject to approval by the ARC Governing Board has been achieved. For Activity 1, all funds are transferred from the NDCF (or Treasury) to the Financial Sector Deepening Trust (FSD). FSD manages the payments component and transfers funds to the payment service provider (Equity Bank), which loads the smart cards used by registered beneficiaries to access cash from point-of-sale devices held by a network of traders across the four counties. Payments are automated and can quickly be scaled up and down as required. The two-factor authentication and use of biometric data protects against fraud. This is the established process for the HSNP. For Activity 2, CSGs would submit requests for NDCF funds to the NDMA headquarters, which will then consolidate the total amount requested and submit this to the NDCF. Upon approval by the NDCF, funds will be disbursed directly to the NDMA s county accounts. From there, funds are disbursed to the Ministry of Water county accounts and the respective CSGs (water trucking and borehole activities). The period between the request of funds and the start of implementation will be no longer than 14 days. With this process, the requisition of ARC funds from the NDCF will follow the approved business process developed by the NDMA (Figure 6). As a State Corporation, the NDMA has established a financial management system guided by the Government s systems. The flow of ARC funds will thus follow the procedures laid down for financial management by State Corporations. Funds requisition and disbursement procedures for contingency finance are automated through the business process software. The NDMA has its own fiduciary risk management framework which will enhance transparency and accountability. Government financial and procurement procedures will be adhered to throughout the implementation period. 19 Kenya has civil contingency funds (e.g. via the Contingencies Fund and the County Emergency Funds) but these are for unforeseen needs. They also have financial limits, are discretionary and reactionary, and benefit only from Government appropriations. The NDCF is designed to be the opposite of such an approach. Drought can be foreseen through the early warning system and requires the systematic allocation of finance based on objective triggers, rather than an individual s judgment. 28

30 Figure 6: Contingency Planning and Funds Requisition Model Source: NDMA Business Process for Disbursement of Drought Contingency Funds Figure 7: Flow of ARC Finance for Cash Transfers Day 0-10 Day Day Day Day 0-15 Day Day Day

31 Figure 8: Flow Diagram for Water Activities Day 0-10 Day Day Day Day 0-15 Day Day Day I.C.3.2 Monitoring, evaluation and reporting In the case of a payout, monitoring of the implementation of all three ARC activities would be coordinated by the NDMA. The NDMA would submit monthly operational and financial reports to the ARC Agency according to the Operational Planning guidelines. At the end of the operation, NDMA would submit a final comprehensive operational and financial report to the ARC Agency for both activities. This final financial report would consist in a thorough comparison of the planned budget as per the FIP against the actual expenditure during the intervention. A financial audit would be done by the Auditor General s office. For both activities, the web-based Management Information System (MIS) that has been developed to support the NDCF business process will track the progress of each intervention. The MIS allows financial transactions to be accessed on a monthly basis. Reports will be generated and disseminated to the relevant sectors and stakeholders. County Steering Groups are responsible for monitoring and evaluation of all drought mitigation interventions. Their efforts will be supplemented by ad hoc monitoring and evaluation missions constituted from the national level. CSG monitoring committees have already developed monitoring and evaluation frameworks. The county governments also have their own monitoring systems with proper guidelines. One of the key parameters to be monitored and evaluated will be the mainstreaming of thematic issues such as gender, HIV/AIDS, and environmental impacts. The interventions supported by ARC payouts will be subject to these same M&E frameworks in order to ensure consistency and conformity at the county level. A strong gender focus is critical throughout the project cycle, particularly to ensure equitable 30

32 impact of interventions on beneficiaries. The cash transfers and water interventions will both seek to enhance community participation in decision-making. The HSNP grievance and complaints committees and the water resource user associations, which are already established, also have equal participation of both men and women across all age brackets. On a monthly basis, or at the end of the intervention if earlier, at the county level all ministries and other organisations which have received drought contingency finance submit comprehensive implementation and expenditure reports to the County Drought Coordinator (CDC). The CDC validates the reports by making a physical inspection of the interventions and submits the report on to the NDMA. The monthly reports form the basis for a monthly report that the NDMA submits to the ARC in accordance with the reporting guidelines of the ARC Secretariat. At the end of implementation, at the county level the CDC compiles a financial report while the NDMA s county finance officer carries out a reconciliation exercise and ensures that all funds disbursed have been accounted for. The reports are passed on to NDMA headquarters, where the NDMA carries out a sample audit and produces a consolidated national financial report which is submitted to the National Treasury. In addition, the NDMA consolidates a final operational and financial report that is submitted to the ARC. Periodic internal audits will be conducted by the NDMA s Internal Audit section. An external private audit verifying the flow of ARC funds will be commissioned at the end of implementation, following terms of reference prepared by the ARC Secretariat. In addition, the National Treasury will carry out a further audit at the end of implementation. These audit reports will generate lessons and highlight areas for improvement in future drought response. External audit reports will be disseminated to all stakeholders, and audit reports for ARC funds will be submitted to the ARC. For Activity 1, the HSNP had a strong monitoring and evaluation component provided by Oxford Policy Management during Phase 1. In Phase 2, DFID will contract a Project Implementation and Learning Unit, whose terms of reference will include the management of an independently contracted evaluation provider. ARC will also require an independent audit of the programme after implementation. For Activity 2, the Management Information System (MIS) that has been developed to support the National Drought Contingency Fund business process will track the progress of each intervention. Reports will be generated and disseminated to the relevant sectors and stakeholders. County Steering Groups are responsible for monitoring and evaluation of all drought mitigation interventions. CSGs are comprised of agencies from the government and other development partners in the county. The sector working groups will be instrumental in spearheading the implementation of ARC planned interventions in the county. Their efforts will be supplemented by ad hoc monitoring and evaluation missions constituted from the national level. Figure 9 illustrates the monitoring and reporting system for ARC payouts. 31

33 Figure 9: Monitoring and Reporting of ARC Payouts Monitoring & Reporting ARC SA Executive Board ARC F Min istry of De volution and Pla nning Ministry of Finance and National Treasury Quarterly financial reports to ARC F N DMA Databases (EWS, Contingency Pla nning, MIS) National Drought Management Auth ority N ational Drought & Disaster Contingency Fund Monitoring / audit of County DM Units Quarterly reports submitted to NDMA HQ & onwards to NDDCF / Ministry of Finance NDMA County Drought Management Units, in partnership with County Steering Groups (CSGs) Monitoring of implementation, supplemented by periodic monitoring missions from NDMA HQ Implementing agencies, community groups & beneficiaries Monthly reports submitted to NDMA County DM Unit Mo nitoring Reporting 32

34 C.4 Risks and Assumptions Table 1 discusses the risks and assumptions related to the ARC activities and the mitigating strategies proposed. Table 1: Risks, Mitigating Strategies and Assumptions Risks Inflation reduces the value of cash transfers Outbreaks of conflict in dry season grazing areas The National Drought Contingency Fund is not operational before the next drought period Mitigating strategies The actual value of the transfer can be adjusted with a minimum of lead time (since the process is automated). HSNP also has provisions in place to protect the value of the regular transfer (such as an annual review under the NSNP). The NDMA works closely with the National Steering Committee on Peace Building and Conflict Management (NSC) which supports rapid response to local-level conflicts. Likely hotspots where groups converge are generally known and will be mapped in order to facilitate response planning. The NDMA is working hard to ensure that the NDCF is established and operationalised before the next drought period. In the event that it is not, the National Treasury has given assurances that it can facilitate the flow of ARC funds. Assumptions 1. County governments have sufficient capacity to carry out their responsibilities. 2. Drought coordination structures continue to work effectively at both national and county levels. 3. Collaborative working relationships continue to be maintained between the national and county governments Outbreaks of conflict can be managed and controlled. 20 The NDMA has been taking concrete steps to ensure that there is close collaboration between the national and the county governments on matters of drought management. These include detailed briefings and meetings with the new Governors and their teams one held on 7-8 June 2013 and a second on August

35 II. Budget A detailed budget can only be prepared once the precise drought conditions and impacts are known. However, as the outline budget in Table 2 shows, the NDMA proposes to allocate three-quarters of ARC payouts to the cash transfers (in areas with the highest levels of food insecurity), and the remaining one-quarter to water interventions (which are appropriate in any arid or semi-arid county). Table 2: Budget Activity Allocation (%) Amount (USD m) Cash transfers Water TOTAL

36 III. Annexes A. Annex 1: Most Drought-Prone Livelihood Zones 1. Northwest pastoral cluster Counties: Turkana, Marsabit, Samburu Approximate size: 173,876 km 2 Estimated population: 1.3 million people. AEZ: arid (annual rainfall 150mm-550mm) Food and income security are tied to livestock. Pastoralism is practised by around 60% of people, and agro-pastoralism and fishing by a further 20% and 10% respectively. Figure 10: Northwest Pastoral Cluster 35

37 2 Northeast pastoral cluster Counties: Mandera, Wajir, Garissa, Tana River, Isiolo Approximate size: 190,753 km 2 Estimated population: 1.8 million people. AEZ: arid (annual rainfall 150mm-550mm) Livestock and crop production account for 60% and 30% of total income respectively. The dominant livelihood is pastoralism, followed by agro-pastoralism and mixed farming. Figure 11: Northeast Pastoral Cluster 36

38 3 Agro-pastoral cluster Counties: Kajiado, Narok, West Pokot, Baringo, Laikipia, part of Nyeri (Kieni) Approximate size: 68,820 km 2 Estimated population: 2.9 million people. AEZ: semi-arid (annual rainfall 550mm-850mm) The main livelihoods are mixed farming, pastoralism, marginal mixed farming and agro-pastoralism. Households in this cluster access 30% of food from their own production and 60% from the market. Figure 12: Agro-pastoral Cluster 37

39 4 Southeast marginal agricultural cluster Counties: Kitui, Machakos, Makueni, Tharaka Nithi, partof Embu (Mbeere), part of Meru (Meru North) Approximate size: 52,000 km 2 Estimated population: 4.1 million people. AEZ: semi-arid (annual rainfall 550mm-850mm) Mixed farming and marginal mixed farming predominate, practiced by 65% and 26% of the population respectively. Crop production contributes 40% to household income; livestock production 35% and employment 25%. Remittances are also important. Figure 13: Southeast Marginal Agricultural Cluster 38

40 5. Coastal marginal agricultural cluster Counties: Kwale, Kilifi, Taita Taveta, Lamu Approximate size: 48,000 km 2 Estimated population: 2.3 million people. AEZ: semi-arid (annual rainfall 550mm-850mm) The main livelihoods are mixed farming, formal and informal employment, and marginal mixed farming. Figure 14: Coastal Marginal Agricultural Cluster 39