Social Protection and Poverty in Asia: Casting a Wider Net

Feature | 27 June 2013

A landmark conditional cash transfer program in the Philippines makes a strong case for launching similar schemes elsewhere in Asia and the Pacific.

Conditional cash transfers are now a well-established poverty reduction mechanism in Latin America, where they were started in the mid-1990s. But they hadn't caught on much in Asia and the Pacific, and not at all in Southeast Asia, until the Philippines launched its groundbreaking conditional cash transfer program, known as Philippines' Pantawid Pamilya (Tiding over Families), to uproot extreme poverty.

"Highly promising results of the first impact evaluation of program after three years of implementation will hopefully encourage more developing countries to use this intervention to fight poverty," says Joanne Asquith, senior evaluation specialist at Independent Evaluation at the Asian Development Bank.

"Asia under invests in social protection," Asquith says. "All governments spend some money on safety nets. But the issue is how to do it effectively and efficiently so you genuinely reach the poor." Asquith notes that in Asia and the Pacific - where public spending on social protection is lower than in any other region except sub-Saharan Africa - many countries continue to prefer food, fuel, and other broad-based commodity subsidies for their social programs. But these generally cost more, benefit the better-off, and are often politically difficult to unwind.

"Highly promising results of the first impact evaluation of the program after three years of implementation will hopefully encourage more developing countries to use this intervention to fight poverty."

- Joanne Asquith, senior evaluation specialist at Independent Evaluation

Rigorous impact evaluations of the effectiveness of social safety net programs are therefore essential for helping change this mind set. Indeed, impact evaluations have long been standard practice in the design of cash transfer programs in many Latin American countries.

"There is a huge body of evidence that these programs, when well designed and targeted, can reduce poverty, have an impact on human capital, and can reduce inequality," Asquith says.

Measuring success

Compared to Latin America, the evidence base for the effectiveness of safety nets, including conditional cash transfers, is rather thin in Asia and the Pacific. But that's changing thanks to the Philippines' program. Following the example of Latin America, impact evaluation was built into the project design to assess whether its objectives are being achieved at various stages of implementation.

The 2008-launched program has been massively scaled up by the current government, and now reaches more than 3 million households (about 15 million people), with 4.4 million targeted for 2014.

The first impact evaluation, found more children in school and staying in school, and more mothers using antenatal care services in the beneficiary households compared with the equally poor non-beneficiary households. Beneficiary households were found to spend 34% more on education and 38% more on health compared with non-beneficiaries. The results compared favorably with the impact levels of similar programs around the world. The most promising were in the increased use of public health services and in school enrollment, both core objectives.

These results are most encouraging when considering the question: should ADB do more to support the development of safety nets in Asia and the Pacific?

"The immediate answer is yes," says Asquith, noting that social protection is a pillar for achieving inclusive growth under ADB's long-term Strategy 2020.

Independent Evaluation believes that the best way for ADB to grow its social protection portfolio is through partnerships with other development agencies - as is already the case with Pantawid Pamilya, where ADB is working in partnership with the World Bank and AusAID.

"ADB needs to invest more in rigorous impact evaluations of social protection programs. Evidence that these programs work is what convinces policy makers that they should invest in social safety nets," adds Asquith.

The development community faces a considerable challenge in changing the widespread practice of scrambling to adopt social protection programs during an emergency - such as the Asian financial crisis, when ADB's social protection support began - but are reluctant to invest in building comprehensive systems in stable times.

This is certainly reflected in ADB's experience. For example, lending for social protection support surged during the global economic crisis of 2008-2010, but then sharply declined.

Yet, comprehensive systems built in stable years are far more effective in coping with the human impact of future economic and financial crises or natural disasters.

"ADB needs to maintain its dialogue [with client governments] on social protection long after a crisis is over," says Asquith. "Sustained dialogue on inclusive growth is key to building demand for social protection."