Examining conditional cash transfer programs : a role for increased social inclusion?

Conditional Cash Transfer programs (CCTs) provide money to poor families contingent upon certain verifiable actions, generally minimum investments in children’s human capital such as regular school attendance or basic preventative health care. They therefore hold promise for addressing the inter-generational transmission of poverty and fostering social inclusion by explicitly targeting the poor, focusing on children, delivering transfers to women, and changing social accountability relationships between beneficiaries, service providers and governments. CCT programs are at the forefront of applying new social policy theories and program administration practices. They address demand-side barriers, have a synergistic focus on investments in health, education and nutrition, and combine short-term transfers for income support with incentives for long-run investments in human capital. They also are public sector leaders in program administration, using modern targeting, registering, and monitoring systems along with strategic evaluations. Their impact depends on the supply of quality, accessible health and education services and may increase with strengthened links to the labor market, and a greater focus on early childhood and transient support to households facing shocks. CCT programs are facing a number of challenges as they evolve, from reaching vulnerable groups to fostering transparency and accountability, especially at the community level. Centralized programs have been criticized for limiting the engagement of local governments and civil society and it is clear that in limited capacity environments, a greater reliance on communities is warranted. In sum, though promising, these programs are not a panacea against social exclusion and should form part of comprehensive social and economic policy strategies and be applied carefully in different policy contexts.