Cash-transfer program vulnerable to power abuse—NGO exec

Cash-transfer program vulnerable to power abuse—NGO exec

By Leila B. Salaverria
Philippine Daily Inquirer
First Posted 20:53:00 11/27/2010

MANILA, Philippines—The selection of beneficiaries is one of the most contentious aspects of social welfare cash transfer programs in various countries, according to Social Watch coordinator and Third World Institute executive director Roberto Bissio.

Bissio, who works with non-government organizations around the world, said the dynamics of choosing whom to give the cash assistance make the process vulnerable to corruption and abuse of power.

"The problems related with cash transfer are mainly around the decision of whom do you give the money to. How do you determine who is entitled to it or not? And that is one of the aspects where many, many things can go wrong," Bissio told reporters.

He also said a cash-transfer program could help people, but for it to help people get out of their impoverishment, it has to be coupled with job provision and other services.

"Cash transfer can be a very fast way of reaching a lot of people fast and efficiently, and improve immediately their lives. But then it has to be supported and be part of a wide range of other measures and service provision and job creation if you want the poverty eradication to be sustainable," he said.

The Uruguay-based Bissio also spoke at a Pan Asian Capacity Building workshop on regional development hosted by Social Watch Philippines in Ortigas, Mandaluyong.

The conditional cash-transfer program in the Philippines, which the new administration seeks to expand, has become controversial.

Critics question its sudden expansion to cover 2.3 million households (from one million households), as well as its P21 billion budget, which they say should be devoted to basic services and livelihood projects.

According to Bissio, biases may be involved in determining who is poor enough to receive monetary assistance from the government. The selection of beneficiaries could also vary from country to country, from region to region and from province to province.

The absence of very clear rules on who is entitled to the cash assistance could also create problems. The interpretation of these rules could pave the way for corruption or abuses of power when determining which households get the money. Officials could choose the beneficiaries arbitrarily or based on their personal preference.

But even with set criteria, the selection of beneficiaries is not a cut and dried activity, Bissio said. For instance, it would be difficult to choose beneficiaries from impoverished communities based on income because the residents are essentially unemployed and their money comes sporadically, depending on whether they have come upon an odd job or some other means to put food on the table.

Families that own certain appliances, like a flat-screen TV, for instance, may be deemed excluded, but in reality the item may have been a gift and the family could still be considered poor.

And keeping an eye on the chosen beneficiaries, to make sure they are qualified and that they are keeping their part of the bargain, could be a costly and complicated activity.

"You may have to check and recheck, and then it's complicated, expensive, bureaucratic," he said.

He also said that when families fail to meet the conditions set for the cash assistance, such as not sending their children to school, it usually means there is a bigger problem, like lack of food

Taking the cash assistance away because of the families' failure to meet the conditions could just exacerbate the families' woes, he pointed out. He said that in most of the cash transfer programs, the condition "tends to be more like an ethical statement of commitment than a natural trigger that would stop the transfer."

But he said not automatically cutting the cash assistance for failure to meet the condition was okay, especially if the cash transfers are going to the families that need it.

"You have to understand the real logic of what you want to achieve," he said.

Bissio also stressed the need to ensure the proper selection of beneficiaries and distribution of the money, especially since cash transfer programs tend to involve large sums of money. He said such big amounts tend to attract interest and greed.

"It's unavoidable, it's human nature. People will have an interest of some kind, either tapping from that money or tapping from the political power or benefits that one way or the other they can extract out of being perceived as the providers of that money," he said.

Bissio also said the cash-transfer programs still have a role to play in helping countries reduce poverty, even if many countries have come to realize that it is better to offer universal services, such as education for all, rather than setting up programs specifically targeting the poor.

According to him, monitoring the quality of programs geared toward helping the poor is difficult because the poor usually do not have the means to complain and just accept what is given to them, no matter how deplorable it is. But when a service is offered to all, the middle class acts as a quality control measure, since they have the means to complain when the services deteriorate.

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