• Introduction and Overview of Possible Interventions
  • Fee Waivers and Exemptions
  • Conditional Transfers
  • FRESH – Focusing Resources on Effective School Health
  • Home Visitors Program
  • Psychosocial supports
  • Addressing OVC Nutrition

Conditional Transfers

Overview: Conditional transfer programs consist of transfers to targeted families on the condition that they comply with specific requirements (e.g., send children to school). They have been widely used in Latin America and have proven to be an effective strategy to improving access to basic social services for children in vulnerable households, transforming social assistance expenditures into investments in human capital development (for more on how to approach the possibilities for a conditional transfer initiative in an African country, see this mission note from Nigeria).

While more common in the education sector, conditional transfers have also been used to improve access to health care for children and pregnant and lactating mothers – of course, the pre-condition for this type of program is the existence of adequately equipped and staffed health posts or clinics. For children, health benefits are often offered in tandem with educational benefits. A targeted household receives a monthly transfer conditional on the children attending primary school and on 0–6-year-old children going for regular well-baby health check-ups.

In Nicaragua, the 0 – 6 year olds must show regular weight gain and mothers must participate in bimonthly seminars on nutrition, hygiene, early childhood development and other subjects in order for the household to remain in the program. If one child does not show weight gain as would be healthy during two payment cycles, the health grant is suspended unless the family presents a health certificate issued by a local health facility. About 95 percent of beneficiaries comply regularly with all conditions in Nicaragua (so far, there is little experience with these types of programs in the health sector in Africa).

Compliance with the conditions must be verified at least once every three months. This requires the existence of a reliable information management system for tracking attendance and other compliance indicators. Conditional transfers linked to health conditions are designed to improve the health status, weight gain and immunization rates among children aged 0–6. Grants to poor pregnant and lactating mothers serve to protect the unborn and newborn child.

Calculating the Value of the Benefit: The value of the benefit should have a strong relationship with the actual out-of-pocket costs of health care (including transport and medications). In the case of a Bank-financed conditional transfer program in Jamaica (See Jamaica Social Safety Net Project), the monthly transfer for a combined health and education program started at $6 per beneficiary per month and rose to $9 per person per month by the end of the program. In this case, the value of the transfer was equivalent to roughly 60 percent of the average monthly per person cost of education, health care and medications. The value of the grant for pregnant and lactating mothers was equivalent to that offered to children. In calculating the value of the benefit, the rule of thumb is to make it attractive enough for low-income households to adopt and maintain positive behaviors, and at the same time, low enough to ensure that better-off populations refrain from making illicit solicitation of benefits and payments.

Targeting: One of the biggest challenges for conditional transfer programs is targeting to ensure that the benefits reach the most deserving/relevant households. Information campaigns are important in getting the word out to eligible beneficiaries about the transfer opportunity. In turn, the potential beneficiaries must be screened against objective selection criteria. In Jamaica a means-tested system or scoring formula based upon data from a Survey of Living Conditions is being used to identify beneficiary households. Indicators may include location and quality of housing, ownership of durable goods, features of household demographics, human capital and sometimes labor force activity. In countries where household survey data does not exist, community-targeting methods may be the best option – and perhaps a more relevant strategy for identifying deserving OVC. (see the sub-section on Identifying eligible vulnerable children at the community level) Here a carefully selected community committee identifies the poorest households, including those with orphans and other vulnerable children.

A World Bank assessment of Targeted Conditional Transfers Programs in several Latin American countries found that these programs target well and result in little leakage of benefits to non-deserving beneficiaries. However, this study found that under-coverage rates (deserving beneficiaries who are not included in the program) tend to be high. Often, high under-coverage rates are due to the lack of government funds to cover all of the deserving beneficiaries. This is particularly true in decentralized programs that are meant to be financed by municipalities with their own funds because poor municipalities have fewer resources to distribute, but have a higher proportion of deserving beneficiaries. For this reason, such programs are best financed at the national level, allowing the transfer of resources from wealthier areas to poorer areas.

Getting the benefit to beneficiary households: Another challenge is getting the transfers to the beneficiary households. Options include food, small stock, food stamps, cash transfers , and vouchers. One option is to make payments through banks or even informal credit institutions in market towns, which most rural households visit at least once a month. In Africa, programs may need to be creative about finding effective approaches of getting the transfer out to the beneficiaries because the banking system in many countries does not have enough outreach. One option is to make the transfer to the health care provider rather than directly to the targeted beneficiaries, but this takes some of the accountability for ensuring compliance with the conditions away from the household, where it belongs, and transfers it to the health care provider. If the transfer is made to the health care provider, annual audits of the providers would be needed to verify compliance.

Conditional transfer programs typically designate one household representative to receive the benefit payments. Usually, this is the mother, since research clearly shows that women are much more likely to spend cash assistance on food or the needs of the children. Payment to the mother may be difficult in some regions where the tradition is for the father to do the shopping in town and to control finances. When this is the case, consider carefully whether sticking to the principle of payment to mothers could help to empower women, or may become a probable source of domestic and/or community conflict. For households without mothers, it is important to specify who will receive the benefit payments on behalf of the household, so again, consider carefully who the most likely person to have the best interest of the OVC in mind could be.

For more information on Conditional Transfers, go to the Education section and see the subsection on Conditional Transfers.