Cash transfers represent a foundational approach to social protection. Unconditional cash transfers have proven to be successful in improving socioeconomic outcomes for recipients. However, there is evidence that in certain contexts, targeted conditional cash transfer programmes can be more effective at achieving an impact. The Philippine conditional cash transfer programme: Pantawid Pamilyang Pilipino Programme (4Ps) represents a successful example of this targeted approach, most notably in its impact on health care. Here, cash is received on the condition of healthcare and education expenditure (Fernandes and Olfindo, 2011).
Conditional versus unconditional cash transfers
Conditionality is a determinant element of social protection programme design. Unconditional cash transfers involve the transfer of cash to recipients without requirements or monitoring of spending. As is commonplace with unconditional programmes, concerns have been raised as to recipients spending priorities. Conditional cash transfer programmes dictate either the eligibility requirements to receive the cash or what recipients can spend their cash on (Fizbein, 2009). There is much debate over the effectiveness of each approach (Hawakaya et al., 2015).
Empirical data shows that objective-driven expenditure has a rippling effect from individuals to the wider community. These benefits include stimulating the local economy, thereby helping to increase broader livelihood opportunities. In the case of agricultural production, there are also secondary benefits such as increased herd immunity, which increases the effective labour pool thanks to a higher immunisation rate (Fizbein, 2009).
Educational benefits include a decrease in the drop-out rate of children from formal education followed by a greater increase in the numeracy and literacy of those who receive the benefit. These are just a few of the wider benefits of cash transfers. Health and education are both variables with great potential in achieving wider impacts and long-term adult human capital outcomes.
The success of 4Ps
4Ps was launched in 2007 and focuses on helping families provide healthcare and education for their children. It has seen exceptionally good results, with children being given critical access to both education and health in accordance with the conditions agreed upon when entering the programme. The World Bank Group attributes most of the programme’s success to the way in the cash transfer programme is governed, outlining five key elements (Hawakaya et al., 2015). These are:
(i) Objective verifiable criteria for targeting is used
(ii) A sound complaints management system, with acceptance of citizen’s input
(iii) Community engagement on implementation of the programme
(iv) The ability to measure results
(v) Communication and outreach
These elements help to afford confidence to the community by ensuring their continuing involvement. It also helps to prove that the government is willing to be open and accountable, creating transparency and trust in the programme. These factors have likely played a considerable role in the success of the programme, beyond the transfer of cash in and of itself.
Conditionalities and compliance
4Ps currently serves 4.4 million households that fall below the poverty line. These households were recognised by surveying 11 million households (60% of the households in the Philippines) and compiling this information in a database known as Listahanan. Proxy means-testing and community validation were then used to determine if a family fell below the poverty line (Fernandes and Olfindo, 2011).
One of the key objectives of the programme is improving healthcare outcomes (DSWD, 2017). Accordingly, the condition of the cash transfer it that recipients are required to spend the received cash on healthcare and education. The primary targets for expenditure on healthcare are maternity care and child healthcare, with each household receiving P500 (US $11) per month for health expenses. This amount does not change with the number of children in the household.
The education conditionalities and transfers are substantially larger in comparison to the healthcare payouts. Every child in elementary school receives Php. 300.00, while children in secondary school receive Php. 500 per month for 10 months. This is limited to three children per household.
Interestingly, there is a difference in the levels of compliance with the two different conditionalities. Lower rates of adherence to conditionalities are found with healthcare versus education. For example, in 2010, education conditionality compliance was as high as 90% in the third quarter of the year while by comparison only 57% of households met the healthcare conditionalities in the same quarter (DSWD, 2017).
Impact of the 4Ps:
- Greater access to professional birthing facilities: 7 in 10 childbirths versus 5 in 10 among non-beneficiary households. Mothers and their newborns also had increased access to postnatal care (Hayakawa et al., 2015).
- Expanded the range of healthcare services beneficiaries attended, including weight monitoring and receiving critical dietary supplements.
- The number of children that undertake deworming at schools and receive vaccines from health centres has dramatically increased.
- Participants benefit from health seminars and development sessions in their communities.
- Recipients are far more likely to be enrolled in the PhilHealth health insurance programme, further increasing their chances of receiving suitable healthcare (Olfindo and Fernandez, 2011).
- One of the main objectives outlined for the 4Ps is to increase the enrolment of children in primary, secondary and kindergarten schooling. The conditionality states that all child beneficiaries should have an 85% attendance rate at school. As mentioned earlier, compliance is extremely high.
- There has been a marked decrease in child labour, one of the original aims of the 4Ps.
- The retention rate of elementary schools dramatically decreased, in some cases, down to 0%. The retention rate refers to the number of students who need to repeat the year. This reduction is an exceptionally favourable outcome (Torre, B. 2016).
- Parents reported an increase in access to healthcare and education has improved the prospects for their children’s future.
Department of Social Welfare and Development Philippines (2017). Philippines’ Conditional Cash Transfer (CCT) Program. Accessible: https://pantawid.dswd.gov.ph/
Fiszbein et al. (2009). Conditional Cash Transfers Reducing Present and Future Poverty. The World Bank. Accessible: https://siteresources.worldbank.org/INTCCT/Resources/5757608-1234228266004/PRR-CCT_web_noembargo.pdf
Hayakawa, H., van den Brink, R. J. E. and Posarac, A. (2015). Why Does the Conditional Cash Transfer Program Matter in the Philippines? A Governance Perspective, The World Bank. Accessible: http://documents.worldbank.org/curated/en/383851468188930738/pdf/100523-BRI-P150519-P082144-PUBLIC-ADD-SERIES-Box393236B-PH-SP-Note-No-7.pdf
Olfindo, R. and Fernandez, L. (2011) Overview of the Philippines’ Conditional Cash Transfer Program: The Pantawid Pamilyang Pilipino Program (Pantawid Pamilya), The World Bank. Accessible: http://documents.worldbank.org/curated/en/313851468092968987/pdf/628790BRI0Phil0me0abstract0as0no010.pdf
Torre, B. (2016). “Financing Education through the Pantawid Pamilyang Pilipino Program (4Ps)”, International Journal of Humanities and Social Science, Vol. 6, No. 5. Accessible: http://www.ijhssnet.com/journals/Vol_6_No_5_May_2016/13.pdf