Module 2: Livelihood approaches in a nutshell
2.1: The DFID approach to sustainable livelihood in a nutshell
Origin and guiding assumptions of DFID's sustainable livelihoods approach
Sustainable livelihoods (SL) thinking gained ground in the Department for International Development (DFID) poverty reduction efforts in the 1990s. The guiding assumption of the DFID approach is that people pursue a range of livelihood outcomes by which they hope to improve or increase their livelihood assets and to reduce their vulnerability. The five types of assets that form the core of livelihood resources in the DFID SL framework range from financial, human, natural, physical, to social capital. These constitute the actual building blocks for livelihoods. In a recent extension to the DFID SL framework, political capital has been added.
The livelihood strategies applied for achieving livelihood outcomes evolve in interaction with a context of vulnerability and transforming institutions. The actual framework has been considered, from the beginning, as one of many possible ways to conceive a livelihood framework. DFID attached therefore more importance to the underpinning principles of a poverty focused and livelihood-oriented development.
Main elements of the DFID SL framework and core principles of application
Based on above understanding, DFID differentiates between three groups of components in the livelihood framework: (1) the asset portfolio forming the core element of livelihood, (2) the Vulnerability Context and Policy, Institutions and Processes, and (3) the loop linking livelihood strategies and livelihood outcomes.
The Vulnerability Context of livelihoods refers to shocks, trends and seasonality with their potential impact on people's livelihoods, while Policies, Institutions and Processes on the other side comprise the context of the political and institutional factors and forces in government and the private and the civil sectors that affect livelihoods.
The figure below offers a graphical representation of the DFID SL framework, slightly adapted for the purpose of this module. DFID stresses the illustrative purpose of the framework, as providing a structure and focus for thinking. It emphasises the necessity to adapt the framework flexibly to the requirements of the actual situation under analysis and underlines the need to respect and follow the guiding principles in application. Poverty-focused development activities should be people-centred, flexible, responsive and participatory. They should be conceived as multi-level approaches and be conducted in partnership with both the public and private sectors. Finally, they should strike a balance between key dimensions of sustainability and recognise the dynamic nature of livelihood strategies. For a detailed discussion, please consult Doc. 1.4.
SL approaches must be underpinned by a commitment to poverty eradication. Although they can, in theory, be applied to the work with any stakeholder group, an implicit principle for DFID is that activities should be designed to maximise livelihood benefits for the poor.
Need for integrating further dimensions
Some important dimensions appear to be under-emphasised in the SL framework or are not made explicit enough in the underlying principles. For the purpose of this paper the "vulnerability context" has already been extended by the "context of opportunities". Current areas of concern include also power relations and gender issues. When it comes to understanding the development of livelihood strategies, the DFID framework does not offer an explicit platform for dealing with crucial elements of decision-making, such as people's individual orientations and collective worldviews or their experience and emotional attachments. It is clearly important to remember these 'missing' aspects and to use different tools to ensure that they feed into development planning and our overall understanding of the driving factors behind livelihoods and poverty reduction. Doc 2.3 and 2.4 offer a closer look into these topics.