Conditional Cash Transfer penalties Vs. no penalties

• Transfers of money to beneficiary household only if they fulfill some conditions of the Programme:

* Regular school attendance of their children

* Regular visits to health facilities: vaccination, growth monitoring, immunizations

Example: PATH – Jamaica

Conditional Cash Transfers (CCT)

Advantages of CCT Programmes

• Income Effect: Reduce poverty and inequality in the short term

• Investment in human capital in the long run• Conditionalities can increase empowerment

and accountability to the poorest• Increase access to assets• Monitoring system of conditionalities.

Changes in the quality of life of beneficiaries: health,

education, etc.

Limitations of CCT Programmes

• Can deprive poor families of freedom to choose services (health facilities, schools)

• Conditionalities can be more expensive• If the conditionalities have a poor structure,

it could undermine social protection’s Programmes.

• Verification of conditionalities is not easy: information technology not always available

• Penalties may affect the poorest, the most vulnerable???

COMPARING IMPACTS OF TWO CCT PROGRAMMES WITH

PENALTIES (MEXICO & COLOMBIA)

VERSUS A CCT PROGRAMME WITHOUT

PENALTIES (ECUADOR)

MAIN ASPECTS OF THE PROGRAMMES: MEXICO, COLOMBIA AND ECUADOR

CONDITIONALITIES IN THE THREE PROGRAMMES - EDUCATION

CONDITIONALITIES IN THE THREE PROGRAMMES - HEALTH

Note: In BDH case (Ecuador) the process, described in the two previous tables, is not implemented yet, penalties were only announced, but never carried out

Oportunidades - MexicoConditional Cash Transfer:• Education: Elementary and high school scholars -

enrolment and regular attendance to over 85% of the classes. Middle-higher education scholars - Constant level of attendance and participation in integrated education chats.

• Health: Household must attend health checkups and community education training sessions on self-care and health issues.

• Nutrition: Household must attend scheduled appointments.

• Support to Mature Adults: Attend scheduled health appointments.

Main Outcomes - OportunidadesEducation • Positive impact for the permanency in the school system• Higher levels of enrollment in High school• Decrease in drop out and failure rates• Improvement of school achievement and school promotion Health • A health culture was created with social conditionality: better knowledge

about reproductive health and new contraception methods, risk factors • Improvement in the nutritional condition of beneficiary population • Decrease of maternal-infant mortality rates, morbidity and incapability

rates Other• The migration has not increased significantly after the Programme’s

implementation• The violence against women as well as the deterioration of

communitarian bonds have been reduced • The beneficiaries employ most of their resources to the vital needs such

as housing and productive investment

Familias en Acción - Colombia

Conditional Cash Transfer:• Nutrition Subsidy: Meet the

growth control and development checkups scheduled every 2 months for all minor children.

• School subsidy: The mother must guarantee school attendance by children, who can have a maximum of 8 unjustified absences every two months.

Main outcomes – Familias en AcciónHealth:• Positive impact in nutrition and health of children who are younger

than 7 years old • Decrease of chronic malnutrition • Decrease of diseases• More attendance in growth and development monitoring• More diffusion of vaccinationEducation: • Increase of attendance school rate in high school Child Work:• Reduction of children work • Increase of adult women work: substitution of the child labor• Reduction of the labor day in the youth Other: • Increment of the consumption in basic goods of the beneficiary

families (food with high nutritional value, and education expending) • The beneficiary families tend to move less toward other municipals

than the non beneficiaries

Origin: Bono Solidario (1999)• Cash transfers to poor households, but eligibility

criteria were not clearly defined Voluntary basis

• BDH (2003): efforts to re-target transfers towards the poor).

Welfare index on the basis of information on individual

characteristics• Transfers of money without conditionalities• Households believed that children had to be

enrolled in school to be eligible for transfers

Bono de Desarrollo Humano BDH - Ecuador

c

c

Main outcomes - BDHEducation:• A large, positive impact on school

enrollment• Larger enrollment impacts among older

children and households that were poorer at baseline.

Child work:• A large, negative impact on child work.• Effects are largest among households

who believed that transfers were conditional on school enrollment.

(Shady, Araujo)

COMPARING SPECIFIC RESULTS – META ANALYSIS

COMPARISON BETWEEN CCT PROGRAMMES AND CT PROGRAMME: Education

COMPARISON BETWEEN CCT PROGRAMMES AND CT PROGRAMME: Health

It’s not possible to make comparisons for the lack of information for BDH Programme

COMPARISON BETWEEN CCT PROGRAMMES AND CT PROGRAMME: Child Work and Consumption

Conclusions

• The best results of the three Programmes are present in the rural areas

• With penalties, it seems the CCT impacts are better. On the other hand, without penalties, even if the reslults may seem good in the short term, households can learn they have no obligation to send their children to school to get the benefit. Therefore, child work may go back to original status.

Conclusions…

• In BDH Programme child schooling and work are substitutes among poor households in Ecuador

• BDH program effects are largest among households who believed that transfers were conditional on school enrollment.

• Nevertheless, results are not conclusive, two CCT pilots – Kenya and Pakistan – are planning to measure the effect of penalties in CCTs. Initial results are expected in 2008.

THANK YOU!!!