NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, March 7, 2012

In the race to meet the millennium development goals, cash transfer (CT) programmes have made a significant impact on reducing the numbers of those in poverty. Yet, a combination of disabling conditions still leaves millions of women trapped in destitution, and at great risk of disease and domestic and civil violence.

CTs are programmes that give mothers a cash supplement to cover the costs of children’s schooling. In Latin America (but not in Africa), they are conditional on children’s attendance at school and health clinics for check-ups. Success has been measured in higher rates of enrolment, and improved nutritional levels of children, and breastfeeding and pregnant women. Women are said to be “empowered” by being given charge of the cash stipend.

Though they are a welcome palliative, critical voices have been raisedabout the limits of these programmes (pdf). The stipend, at around half the minimum wage, is too low to make a great difference, and in the majority of cases there are no training and employment links that could secure sustainable livelihoods. When investment in health and education is limited or misdirected, the quality of services suffers, and benefits are less positive than the statistics show.

Cash transfers are designed to prevent the inter-generational transmission of poverty by focusing on children’s needs. While an entirely laudable and necessary objective, the means of securing it raise questions about the effectiveness and ethics of “micro-targeted” cash–only programmes where general conditions are poor and all household members suffer acute deprivation and vulnerability. It is a well-established fact that children flourish when their mothers are educated and healthy, and suffer when they are not; households flourish when they are free of violence, and are more sustainable when women are able to generate an income. These conditions cannot be secured by small amounts of cash alone, however valuable these may be in contexts of extreme hardship.