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Can better targeting improve the effectiveness of Ghana's Fertilizer Subsidy Program?

Author: Houssou, Nazaire

Publisher: Intl Food Policy Res Inst

Published: 2017-02-10

Total Pages: 36

ISBN-13:

Despite improvements to the implementation regime of Ghana’s fertilizer subsidy program, this paper shows that considerable challenges remain in ensuring that the subsidy is targeted to farmers who need fertilizer the most. Currently, larger-scale and wealthier farmers are the main beneficiaries of subsidized fertilizer even though the stated goal is to target smallholder farmers with fertilizer subsidies. The experience of other African countries suggests that the effectiveness of fertilizer subsidies can improve with effective targeting of resource-poor smallholders. However, targeting smallholder farmers entails significant transaction costs and may even be infeasible in some cases. Faced with such challenges, Ghanaian policy makers must ponder the question of how to improve the targeting of input subsidy programs in the country. Further research is needed to identify more cost-effective approaches for achieving the goal of targeting.

Can Better Targeting Improve the Effectiveness of Ghana's Fertilizer Subsidy Program? Lessons from Ghana and Other Countries in Africa South of the Sahara

Author: Nazaire Houssou

Publisher:

Published: 2017

Total Pages: 36

ISBN-13:

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Despite improvements to the implementation regime of Ghana's fertilizer subsidy program, this paper shows that considerable challenges remain in ensuring that the subsidy is targeted to farmers who need fertilizer the most. Currently, larger-scale and wealthier farmers are the main beneficiaries of subsidized fertilizer even though the stated goal is to target smallholder farmers with fertilizer subsidies. The experience of other African countries suggests that the effectiveness of fertilizer subsidies can improve with effective targeting of resource-poor smallholders. However, targeting smallholder farmers entails significant transaction costs and may even be infeasible in some cases. Faced with such challenges, Ghanaian policy makers must ponder the question of how to improve the targeting of input subsidy programs in the country. Further research is needed to identify more cost-effective approaches for achieving the goal of targeting.

Improving the targeting of fertilizer subsidy programs in Africa south of the Sahara: Perspectives from the Ghanaian experience

Author: Houssou, Nazaire

Publisher: Intl Food Policy Res Inst

Published: 2017-03-17

Total Pages: 44

ISBN-13:

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This paper assesses whether fertilizer subsidy programs can be better targeted to resource-poor farmers using the case of Ghana and proxy means test approaches. Past fertilizer subsidy programs in the country have not been particularly targeted to the poor, even as targeting poor and smallholder farmers has become key in the program implementation guidelines. As a result, many poor farmers have not benefited from past programs. Our results show that targeting approaches based on proxy means tests that use the correlates of poverty to select beneficiary farmers can potentially improve the poverty outreach and costeffectiveness of Ghana’s fertilizer subsidy programs. Therefore, we propose that the proxy means test approach should be considered for implementing Ghana’s fertilizer subsidy programs, first in a pilot project involving a few communities, and later, if found successful, in a full-scale program.

Mapping the implementation process for subsidized fertilizer distribution under Ghana’s Planting for Food and Jobs Program

Author: Aberman, Noora-Lisa

Publisher: Intl Food Policy Res Inst

Published: 2021-06-09

Total Pages: 31

ISBN-13:

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Planting for Food and Jobs (PFJ) is Ghana’s flagship program for agricultural transformation and employment creation. Alongside other components, the program provides subsidized fertilizer, hybrid and open-pollinated seeds and other planting materials, improved extension services, and marketing support to smallholder farmers across the country. The objective of this study was to assess the implementation process of the PFJ input subsidy program in order to identify opportunities for strengthening the process. The study focused only on fertilizer distribution as a distinct complex process of importance, although some of the lessons will be applicable to other components of the PFJ program. The study applied the Process Net-Map method, a research approach that is particularly useful for assessing the coherence between formally prescribed procedures and how those procedures are implemented in practice, enabling the identification of inefficiencies and bottlenecks in a complex process. The implementation of the PFJ fertilizer subsidy program was mapped in interviews with key informants at national level and in six districts. Interviews with national-level stakeholders yielded important insights about the complex largely administrative process involved in the implementation of PFJ, which is generally unseen by beneficiaries. These administrative processes, however, have a considerable impact on the timeliness of the program and provide an outline of the intended implementation process at the local district level. The perspectives of farmers with regards to these processes were also investigated through in-depth interviews. Across the study districts we found some ambiguity and inconsistency in following the formally prescribed procedures for implementing the PFJ fertilizer subsidy program. While we found broad agreement among key informants and farmers that the program is meeting its objectives, some areas in which the implementation process for the PFJ fertilizer subsidy program could be improved are highlighted. These improvements will enhance the efficiency and impact of the program.

A review of the Ghana Planting for Food and Jobs program: 2017-2020: Implementation, impact, and further analysis

Author: Pauw, Karl

Publisher: Intl Food Policy Res Inst

Published: 2021-04-13

Total Pages: 30

ISBN-13:

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This report examines the evolution of farm input subsidy programs in Ghana, with a focus on the Planting for Food and Jobs (PFJ) initiative, which was introduced in 2017 and replaced the Fertilizer Subsidy Program (FSP) that was launched in 2008. A review of PFJ implementation reports and other official data sources reveal that information on general program features, such as beneficiary numbers, subsidized input quantities, and program budget is readily available and useful for understanding program design and implementation. National crop production estimates are also reported annually, and these provide evidence of rapid output growth in the agricultural sector, especially within the cereals subsector. However, the implementing agency, the Ministry of Food and Agriculture (MoFA), lacks a system for closely monitoring and reporting PFJ program impacts at farm-level. Consequently, most of the published information on the marginal contribution of PFJ to national crop output is based on simulations, which make strong assumptions about seeding rates, fertilizer use by crop, and input use efficiency on beneficiary farms. With this drawback in mind, these simulations show that PFJ contributed substantially to crop output growth, a result which is not implausible considering the quantities of inputs provided, but one that requires further on-farm validation. Recommendations are offered around beneficiary targeting, interpretation of employment impacts, and the need for regular monitoring of farm-level impacts, all of which will help improve transparency of the program.

Agricultural inputs policy under macroeconomic uncertainty

Author: Resnick, Danielle

Publisher: Intl Food Policy Res Inst

Published: 2016-10-14

Total Pages: 43

ISBN-13:

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Ghana’s Fertilizer Subsidy Programme (GFSP) was initiated in 2008 in response to the global food and fuel price crisis. Although initially intended to be a temporary measure that became increasingly expensive as Ghana’s macroeconomy deteriorated, farmers, civil society organizations, and politicians began to expect the subsidy on an annual basis. This paper applies the kaleidoscope model for agricultur and food security policy change to the case of GFSP. In doing so, it uses a variety of analytical tools to highlight how many of the weak outcomes of GFSP can be attributed to the nature of the broader policy process that has surrounded GFSP as well as the underlying political and institutional context in which policy making occurs in Ghana. Based on semi-structured interviews conducted with knowledgeable stakeholders spanning the government, donor, civil society, and research communities, the paper identifies the bottlenecks that need to be addressed if the program is to be more effective in the future.

Improving the Targeting of Social Programs in Ghana

Author: Quentin Wodon

Publisher: World Bank Publications

Published: 2012-10-05

Total Pages: 181

ISBN-13: 0821395939

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This study provides a diagnostic of the benefit incidence and targeting performance of a large number of social programs in Ghana. Both broad-based programs (such as spending for education and health, and subsidies for food, oil-related products and electricity) as well as targetd programs (such as LEAP, the indigent exemption under the NHIS, school lunches and uniforms, or fertilizer subsidies) are considered. In addition, the study provides tools and recommendations for better targeting of those programs in the future. The tools include new maps and data sets for geographic targeting according to poverty and food security, as well as ways to implement proxy means-testing. The purpose of this introductory chapter is to provide a brief synthesis of the key findings and messages from the study.

Fertilizer Quality Assessment: Perception versus testing in selected Ghanaian districts

Author: Asante, Seth

Publisher: Intl Food Policy Res Inst

Published: 2021-12-23

Total Pages: 18

ISBN-13:

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Fertilizer use in Sub-Saharan Africa remains below recommended rates, contributing to low yields, and increasing poverty. Poor quality fertilizer – whether perceived or real – is often cited as a reason for low adoption rates. In Ghana, for example, there are widespread but often unsubstantiated claims of substandard fertilizers. This is a concern for farmers with limited purchasing power and without the means to independently substantiate the quality of agricultural inputs. This paper describes the agricultural input sector in Ghana, compares farmers’ perception of fertilizer quality with those of input dealers, and analyses chemical tests of fertilizers performed in a laboratory. The fertilizers were sampled from selected districts participating in the Planting for Food and Jobs initiative, a large-scale farm input subsidy program. We find that input dealers and farmers are somewhat suspicious of the quality of commercially supplied and government subsidized fertilizers. However, the true quality measures based on laboratory testing of fertilizers sold in agricultural input shops were found to largely meet the labeled chemical composition.

Old Problems in the New Solutions?

Author: Afua Branoah Banful

Publisher:

Published: 2010

Total Pages: 26

ISBN-13:

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Despite their disappointing performance in the recent past, fertilizer subsidies have re-emerged as a tool in the agricultural strategies of many countries in Sub-Saharan Africa. The new paradigm for fertilizer subsidies calls for use of such mechanisms as vouchers to target benefits to poor smallholders and public-private partnerships to develop private markets. There is some belief that with these innovations, fertilizer subsidy programs will circumvent the deleterious consequences of the programs of the past. However, there has been a glaring lack of innovation in how to prevent politics from dominating the allocation of subsidy program benefits and exacerbating inefficiencies as was the experience in earlier programs. This paper studies how vouchers, which could be used towards the purchase of fertilizer, were distributed amongst districts in Ghana's 2008 fertilizer subsidy program. We find that politics played a significant role in the allocation of vouchers. Higher numbers of vouchers were targeted to districts that the ruling party had lost in the previous presidential elections and more so in districts that had been lost by a higher margin. A district received 2 percent more vouchers for each percentage point by which the ruling party had lost the previous presidential election - this amount is both statistically and numerically significant. The analysis also shows that district poverty levels, which should have been an important consideration in an economic efficiency motivated distribution, were not a statistically significant determinant of districts' voucher allocation. The evidence that vouchers were targeted to areas in which the opposition party received strong support is suggestive of the vouchers being used for vote-buying. This finding raises the caution that despite innovations in implementing fertilizer subsidies, politically motivated allocation of subsidy benefits remains a major potential source of inefficiency.

Evaluating the Determinants of Access to Ghana Fertilizer Subsidy Program

Author: Salisu Mustapha

Publisher:

Published: 2016

Total Pages: 0

ISBN-13:

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In line with economic conditions in 2008 and the need to boost agricultural productivity and stabilize agricultural commodity prices, the government of Ghana instituted a nationwide fertilizer subsidy program. This study analyzes the determinants of access to the Ghana Fertilizer Subsidy Program (GFSP). The paper uses cross-sectional data collected from 352 farmers in four districts in Ghana. To achieve the main objective of the study, probit and tobit models are used. This study reveals that access to the GFSP is still low (42.6%) despite the government's increasing budgetary allocation into subsidy provision over the years. The results of the probit and the tobit models indicate that access to the GFSP is largely determined by farmers' gender and political influence. It also reveals that the subsidy program does not crowd out private fertilizer retailers as farmers who buy more quantities from the commercial market are less likely to be allocated subsidy passbooks. It is therefore recommended that discrimination against women should be minimized to encourage their participation in agriculture and empower them to bring to the fore their potentials. Also, the government must encourage more private fertilizer retailers to establish sales points at vantage places to improve access to fertilizer.