Background

The Government of Timor-Leste, cognizant of the negative socio-economic impact of the COVID-19 outbreak that is affecting the majority of the population, approved on 17 April 2020 a package of economic measures. One of the measures financed by this package is a cash transfer scheme targeting poor households, which was approved on 24 April 2020.

The proposed scheme will target the poorest households in Timor-Leste, each receiving payment of USD 100 for a period two months to subsidize their basic needs. This will be the first time that the Government of Timor-Leste will be implementing a social protection scheme of this scale, and the lead ministry – Ministry of Social Solidarity and Inclusion – has requested for UN technical and financial support to operationalize this scheme.

Objective

Funded by UN COVID-19 Response and Recovery Multi-Partner Trust Funds, the project will provide technical and financial support for the implementation of cash transfer scheme.

The implementation will be led by the Ministry of Social Solidarity and Inclusion with support of the UN inter-agency technical team, including ILO, UN Women, UNDP, UNICEF, WFP, IOM and HRAU.

Total funding received from MPTF is USD 999,380 (The Recipient UN Organization is ILO and UN Women), the project allocated USD 748,000 for financial support to the operational costs of the cash-transfer programme.

Technical support from the UN will be provided to the Government in designing the most effective, efficient and safe implementation plan for the scheme, in line with the principle of Do No Harm and protection of human rights.

The project will ensure that Government’s cash transfer scheme targeting low-income households is rolled out swiftly in an efficient, inclusive, transparent and accountable manner (SDG 16.6), to have an immediate impact on the vulnerable people’s lives and livelihoods by contributing to meeting their basic needs and relieving their socio-economic burden (SDG 1.3). It will also enable the consumption of basic items, which would mitigate the already acute prevalence of moderate and severe food insecurity (SDG 2.1).

Furthermore, it will contribute to sustaining the economy (SDG 8.1) by stimulating consumption, stabilizing aggregate demand, and curtailing adverse effects on businesses and unemployment, both in the formal and informal sector.

If this scheme of unprecedented scale is implemented successfully, it will have a medium-term impact on future social protection programmes, in terms of their targets and scope, design, implementation and M&E, resulting in an impact in line with the principle of “build back better.”