Costs and benefits

32. Calculating the cost-benefit ratios of supplementary feeding expenditures is usually not attempted in WFP-assisted projects. Studies of a similar programme in the United States, however, have shown that prenatal participation by low-income women saves over three dollars in "Medicaid" costs for every dollar spent on the feeding programme.

33. The thematic evaluation found that as a result of carefully designed food baskets, the transfer-efficiency in the projects analysed was quite satisfactory. Where food is used as an incentive, the commodities should have a transfer value to the recipient which is not lower than the costs incurred by the donor. The cultural appropriateness of a food incentive and visibility of the resource have also been found to be important arguments in favour of food, particularly in countries with significant "leakage" problems.

34. WFP has demonstrated that cost-effective food strategies can be developed which make good use of available aid budgets for addressing early malnutrition. Inevitably, though, providing food assistance to malnourished individuals through a dispersed network of MCH centres cannot be expected to be the food aid intervention with the lowest cost per ton ratio. In addition, in the poorest countries where the level of early malnutrition is highest, provision of food assistance tends to be more expensive than in many of the better off countries.

35. Obviously, the costs involved in supporting supplementary feeding programmes targeted to the neediest regions in the world must be considered in the light of lasting benefits to the individuals and to the society. One of the implications of WFP’s mandate is that food assistance is provided to those who need it most. However, choices must be made and a given benefit should be achieved with the least cost. Therefore, the cost implications of proposals for supplementary feeding interventions will be carefully analysed. Costs may be particularly high where essential non-food complementary inputs need to be included in order to make the project work. Funding of such interventions may only be possible if WFP can provide its assistance in collaboration with others.

• WFP will carefully analyse the costs of food assistance in all supplementary feeding interventions. Basic measures for judging the appropriateness of food aid for the prevention and treatment of early malnutrition will be the targeting and transfer efficiency; i.e., does it reach the right beneficiary; does it lead to additional and better nutrition; does its value to the beneficiary justify the costs to the donor and the government?
• WFP will make special efforts to seek parallel financing, when the need for complementary inputs is of a scale beyond what is feasible and appropriate to be met under the direct support cost category.