How the Graduation Approach Fits Into Social Protection Programs

This past decade has seen an exponential growth in social protection programs.

In Africa in 2000, the continent’s 25 cash transfer programs were concentrated in nine countries, mostly in southern Africa. By 2012, a more than ten-fold increase enabled 245 programs to reach nearly every sub-Saharan nation (Garcia and Moore 2012). In South Africa, for example, two out of every three people live in a household that receives a social grant (EPRI 2014). Similar growth has transformed strategies for tackling poverty in Latin America and Asia. Despite this progress, substantial expansions in coverage are required to reach all the poorest.

When appropriately designed and effectively implemented, these programs not only tackle poverty and vulnerability but also broadly promote developmental outcomes, better enabling households to break free from a cycle of poverty. In South Africa, social grants eradicate 65% of the country’s food poverty gap while strengthening educational outcomes and improving labor market participation (EPRI 2014). The success of existing programmes across the continent suggests the enormous potential impact if further extensions can reach the three-quarters of families in the poorest wealth quintile in Africa not currently receiving social transfers.

National scale cash transfer programs in Latin America build human capital while tackling poverty and social exclusion. The Organisation for Economic Cooperation and Development (OECD) published a report in 2009 that outlined how these developmental gains contributed to inclusive economic growth in countries investing in social protection.

The success is not accidental. The most innovative social protection frameworks recognize that core social protection instruments—designed primarily to tackle poverty, vulnerability and/or social exclusion—not only provide for basic needs, protect people from the worst consequences of deprivation and prevent further declines into poverty, they also promote more sustainable livelihoods and thus transform people’s lives.

This success raises an important question for policy-makers in the developing world:

If programs mainly designed to tackle poverty, vulnerability and social exclusion are so effective in strengthening long-term developmental outcomes, how much more effective would they be if they were designed from the outset to also have an impact on socio-economic development?

The next decade of social protection programs includes approaches that move beyond income support and behavioral incentives, to design social protection policies that contribute more broadly to achieving development outcomes.

Bangladesh provides a leading example. Government schemes like the Rural Employment Opportunities for Productive Assets, as well as non-governmental programs such as BRAC’s Challenging the Frontiers of Poverty Reduction (CFPR) and the Chars Livelihood Program, have shown how social protection instruments can directly reduce poverty while building social and economic assets that strengthen resilience. Often the immediate income gains are small, but other important results include continuous and sustained improvement across many areas, including in people’s attitudes and economic opportunities.

Figure 1 illustrates continuing increases in a multiple indicator index of developmental outcomes for three groups of participants in the BRAC’s CFPR program from 2007 to 2009. Beneficiary groups consistently improved year after year across a range of developmental outcomes, including food security, livelihoods diversity, productive assets, and human capital. Even after BRAC’s provision of developmental benefits ended, program participants increased their productive assets, improved their livelihoods and strengthened their households’ social development (measured through education, health and gender empowerment indicators) and economic opportunities (Das and Misha, 2010; Akhter et al., 2009; Samson, 2012a). The increases in the developmental index year-over-year for each of the 2007 and 2008 groups illustrate the sustainability of the program’s impact. The increases over time across groups represent on-going improvements in the program’s design and implementation (OECD 2013, chapter 6).

Percentage of CFPR households achieving development threshold

Source: Samson, M. (2012a), “Exit or developmental impact? The role of ‘graduation’ in social protection programs”, 23 August 2012

The CGAP-Ford Foundation Graduation Pilots in Ethiopia, Ghana, Haiti, Honduras, India, Pakistan, Peru and Yemen aim to understand how various forms of support and developmental initiatives, including food consumption, savings plans, skills training, and microfinance, can be sequenced to enable people to “graduate” out of extreme poverty and into sustainable livelihoods. This adapts a methodology developed by BRAC in Bangladesh.

South Africa’s government, with the Ford Foundation support, is implementing a similar pilot in two provinces to address the challenges of high HIV rates, unemployment, an under-resourced education system and the legacy of apartheid. The pilot adopts an evidence-based approach which combines a robust evaluation methodology with a dynamic, flexible design. The pilot mixes financial inclusion, education and career development initiatives with South Africa’s successful social protection programs to strengthen economic opportunities for the country’s youth (Samson 2011).

These second generation social protection programs tackle the complex drivers of chronic poverty in order to trigger and accelerate development — creating a virtuous cycle that enables poor people to lift themselves to more sustainable livelihoods, build assets and access economic opportunities. The challenges vary from country to country, however, and to adapt these approaches to each context requires complex evaluation and a better evidence base than single-country studies can provide. Development partners support global networks that share what they have learned and build capacity through exchanges of experience and knowledge among developing countries, with promising initial results. More rapid progress demands better integrated cross-country evaluation frameworks that can effectively identify the strategies with the greatest impact.