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LIESAP/CISR, June 2003

On the Results of Testing the Unified Application Form "Demand for Social Assistance" Used to Define the Need for Social Assistance Experienced by the Population (Commune Cucuruzeni, Orhei)

All the actions aimed at ensuring economic growth and poverty reduction in Moldova shall be bearing onto the institutional foundation ensuring good management. Thereat it is important to clearly specify social commitments of the government with regards to both     able-bodied part of population (ensuring employment) and most vulnerable categories of population, which are unable to overcome critical situations in their life independently.    

One of the negative sides of transition period lies with sharp increase in the contingent of population that requires social support on behalf of the state, including such through paying out cash allowances and compensations.  

Insufficiency of financial resources induces government searching for   better ways of rational use of budget resources allocated for the purpose.  

Since July 1, 2000 Moldova has accumulated three-years long experience of using targeted compensations (TC) system on paying communal services and energy consumption bills based on category principle. Social assistance is granted by the state to 11 categories of citizens (about 250 thousand persons) in compliance with the Law on rendering special social protection to some categories of population No. 933-XIV оof April 14, 2000 and Government Resolution No. 761 of  July 31, 2000 (disabled, single pensioners, participants of WWII, families with four children and more aged under 18 years and other categories).   

In general, this system was taken positively by the population as it was easy to understand and allowed to make some savings as compared to post-Soviet system of privileges. Besides, practice acquired by the National Social Insurance House as well as a number of targeted surveys have proven that the effective system needs to be upgraded in the sense that it needs to be better targeted onto the needs experienced by specific households and individuals.     

With the scope of reaching this objective at the initiative of the National Social Insurance House (NSIH) and the USAID project on social assistance and granting compensations on electricity bills to population with low earnings developed was the Unified Questionnaire (Demand for socail protection), which was sample tested with the local NSIH bodies so as to determine applicability of this questionnaire to identifying actual needs of those who appeal to the state for support. The Strategic Research and Reform Center   (CISR) had the task of testing this questionnaire within the framework of a large territorial social community.   

Selected as such was the communityCucuruzeni of Orhey District (8 villages with total of 4755 dwellers), which served as an object of through sociological survey and has been carried out for the first time in Moldova. Using Unified Questionnaire as an instrument of surveying a database was compiled, which was used to assess the level and different aspects of living with rural population, their revenues and expenditures, including beneficiaries of Targeted Compensations. Revealed was the error of exclusion in relation to targeted compensations system; identified were groups of persons soliciting compensations as well as such who could have solicited social assistance; suggestions were made on improving practical applicability side of the Unified Questionnaire (UQ).    

Selection of community Cucuruzeni for testing UQ was stipulated by the following circumstances:   

·        community Cucuruzeni is a typical for Moldova example of group rural settling by density of population and number of households as well as by the structure of employment, education, income level and number of needy ones. In March 2003, the share of recipients of targeted compensations in total population of the community was  4,5%, which is, practically, identical to average index in rural areas of the Republic of Moldova;

·        the community is located in the «depth of rural area» outside the influence of urbanized territories or intensive traffic flows and includes villages that are equivalent by number of population and size of economic activity;   

·        village Cucuruzeni (with 1890 dwellers as at January 1, 2003; 1985 dwellers as at January 1, 1989) is making part of 45 populated areas where the Department of Statistics is making regular (since 1997) surveys of household budgets.  This circumstance has offered additional possibility to evaluate efficiency of UQ and to test the results obtained.    

In the process of testing UQ out of total population of 4 755 persons and total of 1 870 households in Cucuruzeni we have managed to encompass 94,0% of population (4 461 persons) and 81,0% of households (1 515 households), which is a fairly good representative sampling. With the assistance of mayoralty and co interestedness of the population the number of rejects was minimum and basically due to people absent from their households due to labor migration.    

The most important social characteristics of the community, disclosed  with the help of UQ are as follows:   

a)      56,7% of households include families, composed of three and more persons. At the same time, as compared to 80th the share of small households (1-2 persons) has increased (up to 43,3%), which is an alarming signal of villages depopulation. Single persons amount to 37% (!) of the community population. In 2/3 of households the heads of households are men and in 1/3 women. 

b)      educational level of the population is rather high: 7,8% have university education, 17,4% have vocational education, and 50,0% have general secondary education;

c)      the nature of occupation reflects transformation processes taking place in Moldovan villages after land privatization in  1998-2000. Prior to that community was hosting 2 state farms, 1 collective farm, and 1 state Agricultural College (in village Verhnie Cucuruzeni). Currently the predominant forms of entrepreneurship on the basis of private property are independent farming units (1 268 units), farmers associations and limited liability companies. Population of the community disposes of 7,87 thousand hectares of farm land, including arable land - 4,16 thousand hectares, orchards – 889 ha, vineyards - 228 hа. Technical equipment – 48 tractors (including 5 new ones), 9 harvesters and 15 trucks. Part of able-bodied population (250 persons as per survey, 400 parsons as per mayoralty data) are solving their occupational problems outside community/country;   

d)      incomes gained by the population are basically formed at the expense of agricultural activity in privatized land parcels  (approximate size 1,7 hа), leasing land, journey work (26% of population), as well as at the expense of earnings gained by households members (aged 24-25) abroad. The substantial part of cash receipts is made out of pensions, benefits and social compensations.  Differentiation of households by cash incomes is rather high.  With average monthly income per one household amounting to  Mdl 407,2 ($29,5), the average income in the first quintile amounts to Mdl 101,6 ($7,3), in the fifth quintile is makes  Mdl 1174,3  ($85,1). The summed up income of the fifth quintile amounts to  57,7% of the total income of all households, while such in the first quintile amounts to 5,0% only. Cash income of the fifth quintile of households is by 11,6 times exceeding such gained by the first quintile;

e)      expenditures: during the surveyed months community population has spent  Mdl 987 774 ($71,6 thousand) for 11 types of household services, paying for medical care, food, schooling, etc. Unusual at first sight for rural area that spending on food is ranking the first Mdl 334 516 ($24,2 thousand); this followed by spending on energy resourcesMdl 121 498 ($8,8 thousand). Spending incurred with electricity bills amounted to Mdl. 67 347 ($4,9 thousand) and differed significantly by households quintiles. Thus electricity consumption in the fifth quintile by 17 times more than in the first. Part of households is consuming less than 15 kW/h. Monthly income of this group of electricity consumers in the first quintile is less than Mdl.124 ($9,0), in the second Mdl.125 – 148, in the third Mdl 149 – 177,4, and in the fourth and fifth Mdl 170,8 – 300 and more than Mdl 300 ($21,7) respectively. Thus, monthly income of this group is less that average over community households  (Mdl 407,2 or $29,5);

f)        housing conditions for the majority of population is characterized by availability of private residence (85,4% of households) or apartments granted by the state (4,9%), availability of TV sets (72,4%), refrigerators (47,5%), washing machines (33,3%), motor cars and motorcycles (16,1%). 75% of households have gas supply, including 13,8% - from gas pipeline,  61,2% - are using gas bottles. 18,0% of the poorest households can not afford using gas. Only 8,5% of households are connected to water supply pipelines. Heating is basically (stoves) individual (92,6% households), while 5,7% have gas heating;

g)      rural entrepreneurship within community is so far underdeveloped.  The key reasons being: financial problems (lack of savings, problems incurred with getting credits), lack of required infrastructure (transportation, agro-chemistry, vet services, seed breeding, etc.) and information. Cereals are sold at low price to intermediary companies, milk is sold to Lapte SA from Chisinau and to private cheese-making  plant from Braviceni, fruit and vegetables are delivered to Orhei cannery and winery.  Meat sales are not regulated   In the majority of cases it is the buyer who dictates prices detrimental to producers (farmers households).  

h)      contacts between community population and  social institutions and organizations (frequency and contents) serve to clearly mirror social needs experienced by the population. According to UQ the most frequented place was the post office  (85,5% of households), to health care facilities (49,3%) or hospitals (16,4%). Next come  primary and secondary school - (15,6%) and very rareculture facilities: libraries (9,5%), clubs, cinemas (1,3%). One third of the households (36,0%) was addressing local authorities rather frequently – village and community mayoralties.  At the same time there is a group of households within the community that has almost no contacts with the “external world”; their social estrangement is being caused by utmost poverty.  

Acute shortage of available cash in rural areas, irregularity of cash income from selling farm products or leasing land creates semblance that not all of  targeted compensation recipients belong to most poor part of community population. It’s rather paradoxically, but according to general self-estimation done by the community population, average cash income of 17,4% of households receiving targeted compensations is by 1.8 times more than cash income of 62,9% of households, which do not receive any targeted compensations.  It means that 2/3 of the households have income less than TC recipients and only with 20% of household it’s higher.   

Arising from these estimations, the need for keeping multilateral track of data characterizing economical situation of TC solicitor becomes rather  evident. The current situation is such that targeted compensations are creating the core part of cash receipts obtained in the form of social allowances, which in case of Cucuruzeni amount to Mdl 13 815 ($1,0 thousand). Although in the total amount TC are below such gained from salaries and pensions, still these are very important as regular cash support to granted poor. This type of social allowances is especially demanded in rural area, where receipt of cash income is rather complicated due to lack of developed economic relations. On the other side, for the significant part of recipients (taking into account their old age and weak health) targeted compensations are the only source of means for paying for utilities, electricity, fuel and medicines.    

Use of UQ as an instrument of through surveying populated areas has allowed to obtain information not only on different aspects of households living but also to establish that the contingent with lower income (poverty zone) is much higher as the contingent of TC recipients, i.e. to find out exclusion error.  Besides, on a number of aspects of life in Moldovan villages obtained were rather “surprising” data that are not available with the official statistics: lack of land parcels with 10% of households; excessive spending on medical care and medicines;  8,8% of households are not using electricity and  18,0% are not using gas; availability if phone sets with almost half of households; strikingly high cash incomes in case of household receiving cash transfers from abroad, etc.     

General conclusion: UQ as an instrument  for gathering information on the needs of households and individuals in social assistance has fully confirmed its appropriateness due to as follows: 

a)      Information obtained with the use of UQ is distinguished by sufficient completeness. It encompasses practically all what is needed: social-demographic as well as material-financial data on household required for taking decision on rendering social assistance.  Information received bears monographic nature, which serves to significantly rise the level of its quality and completeness;    

b)      Inclusion of 80 variables into UQ allows to obtain not only practically full characteristics of surveyed households on their material and financial situation but also to build up this information by constructing correlation ties between independent and dependent variables; 

c)      Information, accumulated in UQ is bearing upon 33 documents of the respondent, which confirm data related by the latter, which serves to fortify their authenticity; 

d)      UQ contents and working name Demand for social protection») are appealing to population as they count for some future assistance. As a result the respondents do not fear to submit information of either objective or subjective nature, which contributes to credibility of information received; 

e)      The questionnaire allows to obtain data not only on the solicitor of assistance but on his own and his family material-financial situation (environment) in which he/she is residing. Such data are very important since the material situation of the respondents depends not only on his/hers income, but on such gained by his/hers family as well;

f)        UQ allows to obtain information on «external ties», on social processes into which the respondents are involved and primarily, on their contacts with the formal and non-formal social institutions; 

g)      Suggestions on improving UQ  are confined to the following: (i) making some corrections contents-wise and editing certain indicators, including such leading to simplification of data processing on the basis of SPSS standard and  (ii) rearranging front page of the questionnaire so as to enhance its informative value. 

Thus, unified questionnaire «Demand for social protection» has basically proven its function ability.  It leaves space for further adjustment and  «packing». The Government has to decide on the way of its practical implementation. Most probable, it will be done gradually through its implementation as the bearer of the principle  «assistance related to the needs» into the effective system of social assistance based on category principle.  With the time the potential value of  this “embryo” will become decisive in crossing over initially to mixed system  categories + needs») and then to social assistance system “based on need”, i.e. fully targeted towards persons actually in need for the assistance granted to them by the state.