Social transfers and chronic poverty: emerging evidence and the challenge ahead
20 October 2005
Social protection is a basic human right and has contributed significantly to poverty reduction in developed countries since the Second World War. But, for some reason, its potential has been ignored by development practitioners in many of the world's poorest countries. Yet, significant challenges remain if the Millennium Development Goals (MDGs) are to be achieved by 2015. Large numbers of the very poor are being left behind, trapped in long-term, chronic poverty that is transmitted through the generations. And, while growth is essential for poverty reduction, its benefits often fail to reach the very poor.
The Practice Paper considers the potential role that could be played by social transfers in tackling poverty in very poor countries - as well as some of the challenges to their implementation. Social transfers are regular, predictable grants - such as old age pensions, child benefits, and household cash (or food) transfers - that are provided to the very poor on a long-term basis. They are increasingly being adopted in a number of developing countries - such as Brazil, Mexico, South Africa, Lesotho, Mozambique and Bangladesh - and the evidence of their impact on a wide range of MDGs is impressive.
The paper concludes that we should take social transfers much more seriously as a policy option in even the poorest countries. The evidence suggests that they are affordable and that the biggest barrier to their implementation is political will - among both developing country governments and donors. Of course, it is too early to say whether they will be successful in the poorest communities, so as large-scale national programmes are implemented it will be important to evaluate their impact carefully and learn lessons.
For a summary of the Secretary of State's view on the role of social protection, please read the speech he gave at the Millennium Review Summit in September.
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