Human Development Report 2013 - UNDP

• China. The Minimum Livelihood GuaranteeScheme is the Chinese government’s mainresponse to the new challenges of social protectionbrought about by increasing privatizationand engagement with the globalmarket. It guarantees a minimum income inurban areas by filling the gap between actualincome and a locally set poverty line. So, despiteincreasing income inequality in China,there is potential for redistributive policies toreduce poverty and enhance food security. Inaddition, extending equal rights to migrantsin cities can have a decisive impact on theirability to access comparable social services.• Brazil. Despite slower economic growth thanin China and India, Brazil has reduced inequalityby introducing a poverty reductionprogramme, extending education and raisingthe minimum wage. Its conditional cashtransfer programme Bolsa Escola, launchedin 2001, followed the conceptual foundationof others in Latin America, such as Mexico’sProgresa (now called Oportunidades;box 3.9). In 2003 Bolsa Escola was expandedto Bolsa Familia by folding several othercash and in-kind transfer programmes intoa unified targeting system under streamlinedadministration. By 2009, Bolsa Familiacovered more than 12 million householdsacross the country, or 97.3% of the targetpopulation. These programmes have alsobroken ground in terms of programme administrationand female empowerment bydeveloping innovative distribution channels,such as ATM cards for low-income motherswithout bank accounts. The result has beensubstantial declines in poverty and extremepoverty and reduced inequality. 106• Chile. In response to findings that state subsidieswere not reaching the extreme poor,Chile Solidario was launched in 2002 to reachthe extreme poor with a combination of aidand skill development. Focusing on householdassistance, it takes the view that extremepoverty is multidimensional, extending beyondlow income to include other deprivationsin basic capabilities such as health and education.Furthermore, poverty reduction requiresthe mitigation of vulnerability to commonevents, such as sickness, accidents and unemployment.Together with other social policies,the programme has increased the take-up ofBOX 3.9Conditional cash transfer programmes and Mexico’s OportunidadesConditional cash transfer programmes are designed to increase beneficiaries’incomes and their access to health and education by making transfers conditionalon requirements such as visits to health clinics and school attendance.They target certain beneficiaries (typically individuals from low-income ordisadvantaged households) and provide support in cash instead of as in-kindbenefits, with the transfers conditional on activities related to health andeducation. Moreover, the programmes can be designed to allow rigorous impactevaluation. For instance, the Tekopora programme in Paraguay has beenshown to have positive impacts on nutrition, health, education and povertyreduction without having negative impacts on labour supply.Mexico’s Oportunidades is a conditional cash transfer programme targetedto poor households conditional on children’s school attendance andmedical checkups and parents’ attendance at community meetings whereinformation is provided on personal health and hygiene. The programme isdesigned to break the intergenerational transmission of poverty. Originallycalled Progresa, it aims to alleviate current and future poverty by giving parentsfinancial incentives (cash) to invest in the health and education of theirchildren. The programme, which started in 1997, is one of the largest conditionalcash transfer programmes in the world, distributing about $3 billion tosome 5 million beneficiary households in 2012.Oportunidades transfers, given bimonthly to female heads of household,have two parts. The first, received by all beneficiary households,is a fixed food stipend, conditional on family members obtaining preventivemedical care, and is intended to help families spend on more andbetter nutrition. The second comes in the form of education scholarshipsand is conditional on children attending school a minimum of 85% of thetime and not repeating a grade more than twice. The education stipendprovided for each child under age 18 enrolled in school between thethird grade of primary school and the third (last) grade of junior highvaries by grade and gender. It rises substantially after graduation fromprimary school and is higher for girls than for boys during secondary andtertiary school. Beneficiary children also receive money for school suppliesonce a year.Conditional cash transfer programmes cost less than traditional inkindsocial assistance interventions. Brazil’s Bolsa Familia and Mexico’sOportunidades, the two largest programmes in Latin America, cost less than1% of GDP. In some cases they have been perceived as tools to provideaccess to universal basic rights such as health and education, but in othersthey have led to the exclusion of some localities due to the inadequate supplyof services.Source: Hailu and Veras Soares 2008; Ribas, Veras Soares and Hirata 2008.84 | HUMAN DEVELOPMENT REPORT 2013