Conditional cash transfers: Essential but not sufficient

MİNE TAFOLAR – CHRISTIAN BERGMANN

Political parties of varying ideological positions all over the globe have started to implement the Conditional Cash Transfers (CCTs) including the center-left Worker’s Party (PT) of Brazil and center-right conservative Justice and Development Party (AKP) of Turkey. In Brazil, the Bolsa Família Program has become globally known as presenting an example for a highly effective short-term poverty alleviation mechanism. Up until today about one quarter of Brazil’s population (about 11 million households) have been pulled out of extreme poverty and through that social participation for the most vulnerable members of Brazilian society was being increased remarkably. In Turkey, the Bolsa Família program served as a model for the Social Risk Mitigation Project (SRMP) that was introduced as a World Bank project after the financial crisis in Turkey in 2001. Recent impact evaluations have shown that CCTs are particularly successful in terms of diminishing poverty and indigence levels among lower segments of the society in the developing world. While we acknowledge the positive characteristics of the CCTs, in this piece we would like to highlight some of the potential limitations of these programs arguing that in the long term these programs should be complemented with some more structural solutions in order to address poverty and inequality in the developing world. 

First, one of the main objectives of the CCTs is to break with the intergenerational transmission of poverty by giving money to low-income families on the condition that they send their children to schools and health clinics. With this incentive, the program aims at eliminating the potential barriers that would prevent children from receiving proper health treatment and going to school. In other words, CCTs would like to ensure that children born into destitute families do not face similar problems of poverty their families have gone through after they finish their education. Yet, as of now we do not know whether CCTs have so far accomplished this goal and have made a change in the lives of the children whose families have been receiving CCTs. However, when aiming at the eradication of intergenerational transmission of poverty, the transition between school and the labor market is of utmost importance. As CCT programs are only designed for children up until the age they graduate from school, this does ultimately create a situation in which the recipients of CCTs are running the risk of ending up in a dead-end street, as it is not being secured that the latter do in fact commence a professional activity. This seriously puts the sustainability and long-term success of CCTs into question.
We believe that more research should be carried out to discern in how far this target can be attained. 
Second, while the CCTs have been successful in terms of fighting against poverty and indigence in the developing world, we are of the opinion that they would remain palliative solutions unless complemented with some more radical tax reforms in the developing world characterized by regressive taxation. Unless a more rigorous taxation reform is carried out and the rich are taxed more in these countries, we are afraid that it would be impossible to eradicate the gross inequality and gap between the wealthy and the worse-off. But in times of debts being socialized and profits being privatized, the outlook for a radical change in taxation policies around the globe is far from reality. 

Our third point of criticism refers to gender. All of the CCT programs simply reinforce the traditional division of labor that confines women strictly to domestic roles. Many programs did not even incorporate an explicit gender focus in their design or implementation and emphasize the maternal role of woman as people who live for others. Hence, CCT programs do give one the impression of encouraging women to become active agents in improving the welfare of their families, but only within the restriction of traditional gender relations. Therefore, as Enrique Valencia Lomelí from the University of Guadalajara concludes, “with a program design that confronts and overcomes maternalism and familism, women will continue to have serious difficulties integrating themselves into productive employment in less precarious ways that are less conductive to continuing the reproduction of poverty”. 

*Mine Tafolar is a PhD candidate at the Government Department at the University of Texas at Austin. 
Christian Bergmann is a MA candidate at the Global Labor University in Kassel/Berlin, Germany.