Poverty and conditional cash transfers

IT IS quite obvious, from the way it seeks to double the magnitude of the previous administration’s Pantawid Pamilyang Pilipino Program or 4Ps, that the P-Noy government has decided this will be its immediate response to poverty. Whether conditional cash transfers will also define its strategic approach to this nagging social problem is not yet clear however. My hope is that the new leadership has bolder ideas for solving poverty in the long term.

Cash given to the absolutely poor for a given period, whether conditional or not, can greatly alleviate the effects of poverty. But it will not end poverty. Only economic growth and the equitable sharing of its fruits can wipe out poverty in any sustainable way. A conditional cash transfer program is justifiable as a quick and effective way of easing hunger among the poor and the marginalized who have fallen through the cracks of a ruthless market economy. It can be a first step towards re-inserting them into the productive circuits of a volatile economy, but it cannot be the solution to poverty. Neither does it constitute a meaningful redistribution of wealth.

But, it cannot be denied that direct conditional cash transfers have proven to be less susceptible to waste and leakage compared to more conventional forms of state subsidy. Of the latter, the one that immediately comes to mind is the rice subsidy program supervised by the National Food Authority. There is no way of checking how many of the poorest of the poor actually benefited from the billions that had gone into the purchase of imported rice and its reselling at subsidized prices under the Arroyo administration. But, most certainly, the P21 billion that has been allotted for the 4Ps in the 2011 budget is a pittance compared to what was annually given to the NFA.

Former President, now Representative, Gloria Macapagal-Arroyo, of all people, knows this only too well. It was her administration that started the 4Ps with the encouragement of the World Bank and the Asian Development Bank. The budget allotment for the program was P10 billion for 2010. She knows that it works. The impact on the lives of the poor is immediate. It also establishes the credentials of a caring government. In an election year, she would have preferred a bigger amount.

I suspect that the multilateral financial institutions that were supporting the program would have been more open to lending a larger amount had they been more trusting of her government. They were fully aware of the magnitude of mass poverty in the country. But they would have been deterred by the past government’s boundless capacity to convert every social program into a political tool and/or a milking cow. Only the reassuring presence of Esperanza Cabral at the DSWD could have stilled their apprehensions.

By making more funds available to the program, the WB and the ADB are communicating their full confidence in the new government. These institutions would have been the first to object to any move to scale up the 4Ps if they even half-suspected that the Aquino government was corrupt or lacked the ability to professionally run a substantially enlarged program. From the countless studies they have conducted on the program’s implementation in different settings, they know the varied forms of misuse to which cash transfers can be put. The targeting of the absolutely poor is essential to the program’s success; the need to insulate the list of beneficiaries from interference by local power brokers cannot be overstated. On top of this is the need to regularly monitor the situation of the families and their compliance with the minimum conditions of the cash grant. Needless to say, the organizational structure required by such a program can be forbidding.

But, if the alleviation of absolute poverty is every patriotic Filipino’s concern, the burden of ensuring its success has to be shared with the Social Welfare Secretary Dinky Soliman. I certainly do not mean that every congressman must now be given oversight powers over the implementation of the program. I think that is the surest way to corrupt its purpose. I mean that it is the duty of every concerned citizen to inform himself about the goals of the program and to see what else can be done to help the beneficiary families overcome their situation.

Poverty has been with us for such a long time that most of us have learned to accept it as part of everyday reality. It no longer disturbs us. We sometimes even blame its victims for being irresponsible or for not striving enough. But, assuming that they are, why should the children be penalized for the failure of their elders? The plain and simple truth is that individuals in our society do not have equal access to opportunities. A few are favored at the expense of the many. This is compounded by the fact that the resulting poverty of many families is carried across generations. That is what is unjust.

Conditional cash transfers will not change the structure of our society. Nor will it significantly change the behavior of the poor. But it will alleviate hunger and disease, and perhaps stem the attrition of poor kids in public schools. It may spark hope among those who have become accustomed to despair.

But, to me, the important thing is that the program is a first step towards reconciling with the poor. They have been under grave social abuse in the sense of being trapped in a society that uses them and counts them among its members, but does not allow them to live with dignity.

(public.lives@gmail.com) –Randy David, Philippine Daily Inquirer