The fifth phase of the programme (PSNP 5) became operational in 2021 and will conclude by December 2025. PSNP incorporates both protective components (monthly cash/food transfers to safeguard livelihoods) and productive components (public works and complementary livelihood services to strengthen rural livelihoods).

It targets approximately 8 million people, contributing to the overarching goal of reducing extreme poverty in PSNP woredas and enhancing communities’ resilience to shocks.

Objectives

With an estimated per capita income of US$869 in 2019, Ethiopia remains one of the poorest countries in the world but has achieved substantial progress in economic, social, and human development over the past decade.

Although poverty is decreasing overall, the poorest segments of the population do not benefit equally from growth, and vulnerability to shocks remains high. Rural communities, in particular, are increasingly exposed to recurrent natural disasters (e.g. droughts and floods) as well as man-made shocks, including conflicts and inflationary pressures resulting from economic reforms. These factors have heightened vulnerability levels and led to the adoption of negative coping mechanisms.

The welfare levels of the poorest 10 percent, who are predominantly rural, have not improved since 2011. Ethiopia’s labour force remains largely low-skilled, with employment dominated by agriculture and unpaid labour.

To address these challenges, the Productive Safety Net Programme (PSNP) aims to reduce extreme poverty and enhance resilience to shocks among extremely poor and vulnerable rural households in PSNP woredas.

Project Activities

• Cash or food payments are transferred to approximately 7 million people engaged in Public Works (PW) initiatives. Participants receive transfers for six months per year while engaging in community asset-building activities. An additional 1 million people, identified as chronically poor and labour-constrained, receive unconditional cash or food transfers for 12 months.

• Public Works (PW) are implemented in both pastoral and non-pastoral areas to protect communities and households from asset depletion caused by shocks and poverty. These activities include:

• Rehabilitation and construction of schools and roads.

• Environmental protection initiatives, such as growing seedlings for reforestation.

• Soil and Water Conservation (SWC) activities, including gully control and soil erosion prevention.

• Rangeland management interventions.

• Water development projects and small-scale irrigation rehabilitation or construction.

Mainstreaming climate change adaptation into PW activities helps mitigate the impact of climatic shocks, such as drought. Examples include:

• Watershed rehabilitation and area closures, which promote vegetation growth for livestock feed.

• Reducing risks of landslides, floods, and soil erosion through environmental management practices.

Empowering PSNP clients through livelihood-based initiatives, such as access to grants and loans for farming and off-farming activities, supports graduation and exit from poverty.

Facilitating linkages and referrals to available social services, including nutrition, health, and education programmes, further supports PSNP clients.

The Shock Responsive Safety Net (SRSN) provides timely complementary support to food-insecure PSNP clients, primarily those affected by droughts and other shocks.

• Technical assistance and capacity-building support are provided to implementing Government of Ethiopia (GoE) entities to improve programme management and enhance overall performance.

Expected Results

• Output 1: Timely and adequate transfers are received by the eligible core caseload of PSNP clients.

• Output 2: Shock-responsive transfers are provided to eligible clients when needed.

• Output 3: Public Works respond to community livelihood needs and contribute to disaster risk reduction, climate change adaptation, and mitigation.

• Output 4: Linkages to available social services are facilitated for core PSNP clients, with an emphasis on Permanent Direct Support (PDS) and Temporary Direct Support (TDS).

• Output 5: Tailored livelihood options are accessed by eligible PSNP clients.

• Output 6: PSNP management and capacity are enhanced.