Eradicating Extreme Poverty:
Global Lessons on Graduation and Building
Resilience
Syed M Hashemi
BRAC University
Presentation prepared for the conference on
Towards Sustained Eradication of Extreme Poverty in Bangladesh
NEC Conference Room, Planning Commission
8-9 April 2015
1
What is social protection?
• ... a set of transfers and services
• that help individuals and households
• confront risk and adversity
• (including emergencies) and ensure
• a minimum standard of dignity
• and well–being
• throughout the life–cycle.
Source: Michael Samson
2
Emergence of Social Protection
 1980s: Safety nets introduced in response to structural
adjustment programs
 1990: WDR: Safety nets, one of three components of global
poverty reduction strategy
 1997: Financial crisis in Asia, Latin America, Eastern Europe
 2001: World Bank: Social risk management framework
 Rights based social protection (From risk management to
promoting social justice)
IDS: transformative social protection
ILO: social protection floor
UNICEF: child support and Intergenerational support
3
The Lifecycle Approach: Risks and Vulnerabilities
Faced by People Across their Lives
Source: Dr. Stephen Kidd, September 2013
4
Components of Social Protection System
e.g. Weather insurance
Social Protection
Labour policy and insurance
e.g. contributory pensions,
unemployment benefits, health
insurance, minimum wage
Social safety nets
Transfer (non contributory)
and subsidies
Social sector policy
Services and
infrastructure for education,
health, nutrition, HIV/AIDS,
agriculture, etc.
e.g. Cash transfers
Conditional cash
transfers
Food transfers
Conditional food
transfers (e.g.
school feeding)
Public/community
works
Vouchers
Price subsidies
e.g. Health clinics, classrooms
Source: Gentilini, Ugo&Omamo, Steven Were, 2009
5
Typology of Safety Net Programs





Conditional cash transfers
Unconditional cash transfers
Conditional in-kind transfers
Unconditional in-kind transfers
Public works programs
6
Global Coverage of Safety Nets




Over 1 billion people have safety net coverage
However, only 345 million extreme poor are covered
Only 1 out of 5 extreme poor are covered in low income countries
But there has been an exponential growth in social safety nets,
especially cash-based programs
 Every country has at least one social safety net program in place.
 Aggregate spending of social safety nets rises as countries get
richer, but still averages just 1.6 per-cent of GDP
 A quarter of spending on social safety nets is for the poorest 20
percent of households, but generally it is insufficient to lift them
out of poverty
Countries are moving from ad-hoc social safety net interventions to more
integrated and efficient social protection systems
7
Major Social Safety Net Programs
(millions of people covered)
8
Safety Nets Impacts
Safety nets achieve visible results in reducing poverty
 Reductions in headcount poverty on average by 8 percent
and the poverty gap by 17 percent
 Safety nets reduce global extreme poverty by 3 percent
and help move 50 million people above the poverty line
 The poverty-reducing effects are greater where coverage
is higher and more generous transfers are provided
 Progressive impacts can lead to reduction in inequality For
example, Romania reduced its inequality by 14 %
9
Safety Nets Impacts
 World Bank’s Independent Evaluation Group in 2011
concluded that evidence on social safety nets is
“richer than most other areas of social policy” and
that “each intervention has positive impacts on the
original objectives set out in the programs.”
 New evaluations continue to show positive short-term
results on household consumption, school
attendance, children’s health and labor supply, and
provide new evidence on local economy effects and
long-term sustainability.
10
Creating Pathways for the Poorest
promotion
transformation
safety nets alone are insufficient for the poorest
protection
prevention
11
Microfinance Does Not Reach the Poorest
Destitute
Extreme Moderate
Poor
Poor
Vulnerable
Non-Poor Non-Poor Wealthy
12
The Graduation Model:
Carefully Sequenced Interventions
13
CGAP – Ford Foundation
Graduation
Pilots
Pilot Sites
Research
Sites
Honduras
Peru
Haiti
Ethiopia
Ghana
Pakistan India
Yemen
Program Evaluation
Evaluation Method Description
Organizations
Pilot Country
Quantitative
Randomized Control
Trials
IPA, J-PAL, NYU
India, Pakistan,
Ethiopia, Honduras,
Peru,, Ghana
Qualitative
Life histories to classify BDI and IPA
participants based on
their progress (fast and
slow climbers)
India, Pakistan,
Ethiopia, Yemen,
Honduras, Peru,
Ghana
Mixed Method
Combination of
quantitative and
qualitative methods
Haiti
BDI and IDS
15
Selected RCT Results
In 4 of 6 sites – India, Pakistan, Ethiopia, Peru – strong positive
impacts recorded after three years; significant increases in
 Total per capita household consumption
 Monthly food consumption
 Food security
 Total annual household income
 Asset ownership
But context, location, and choices in program implementation
affects results
Source: FordFoundation
16
Impact: Bandhan, India
0.9
0.8
•Data from Endline 2 Survey
(2011)
0.7
0.6
0.5
•Higher proportion of females with
financial assets in treatment group
0.4
0.3
0.2
0.1
0
Food
Security
Borrowing Ownership % Females Number of
of livestock
with
days unable
and durables Financial to work due
Assets
to illness
Control
Treatment
•Adults and children less likely to
skip meals in the treatment group
•Increased awareness of hygiene
may have led to a healthier
population, regardless of
program participation
RESULTS AND IMPACT
• In Bangladesh, more than 95% of
participants achieve graduation with
92% crossing an ultra- poverty
threshold of 50 cents per day and
maintaining their improved conditions
for the next 4 years
• Internationally, reports from the
CGAP - Ford pilots show that in 18-36
months, 75% to 98% of participants
meet the country specific graduation
criteria
RESULTS AND IMPACT : BRAC RCT
 4 years after the start of the
programme (2 years after its end) the
portion of participants entirely self
employed increases from 30% to 47%
- no notable change among control
 Percentage of participants relying
solely on wage labor declined from
26% to 6% over the same period
- little change among control.
 Reduction in seasonality
 More even allocation of hours across
days
BRAC: Briefing Note, based on Robin Burgess (LSE and IGC)
RESULTS AND IMPACT : BRAC RCT
 Among participants, a 33% increase in
earnings within 2 years (period of
intervention)
 Among participants, 38% increase in
earnings within 4 years
 Higher gains than control
 Savings Increases:
818% after 2 years
875% after 4 years
 Consumption Increases:
8% increase after 2 years
15% increase after 4 years
 Investment in land: 38% increase after 4
years
 Changes in occupational choices were
accompanied by increase in income,
expenditure and food security achieved
BRAC: Briefing Note, based on Robin Burgess (LSE and IGC)
Typology of Extreme Poor Participants
Constraints
Resources
• No vertical social
networks
• Low earner – dependent
ratio
• No cooperative male
• Lack of previous
experience
• Health shocks
• Existence of vertical
relationships
• High earner-dependent
ratio
• Cooperative male in
household
•Previous experience
•Demonstrating agency
LESS DYNAMIC | MORE DYNAMIC
21
Poverty Traps
HAITI
Political instability
Natural disasters
Lack of infrastructure
Male irresponsibility
INDIA
Caste-based poverty and landlessness
High salinity and marshlands
Politicized access to state entitlements
Male irresponsibility
CONTEXT MATTERS
PAKISTAN
Purdah: limited mobility of women
Reliance on middlemen
Lack of networks with the elite
Poor health and education services
ETHIOPIA
Environmental degradation
Absence of vertical networks
Isolation and poor transportation
Dependence on state safety nets
22
Process of Change Matrix
Pre-program
Less Dynamic – More Dynamic
SLOW CLIMBERS
FAST CLIMBERS
 Negative circumstances  Possessed “success” factors
trajectory naturally “devolved”  More resources than
Program failed to provide
constraints
enough of a safety net
Program “strengthened” their
positive trajectory
 Lacked “success factors”
Constraints unaddressed
Program failed to bring
about change
 Program succeeded in
transforming trajectory
Acquired success factors
through program and
“transformed” their trajectory
Less Dynamic – More Dynamic
In program
23
Key Elements:
forming strategic partnerships
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Growing Interest in the Graduation
Approach
•
Graduation approach is being adapted
and tried by NGOs and governments in a
number of countries
–
–
–
–
–
–
–
–
–
•
Afghanistan
Peru
Ethiopia
Colombia
Brazil
South Africa
Indonesia
Ghana
Kenya
Many donor agencies interested in
promotion:
–
–
–
–
World Bank
IFAD
AusAid
UNHCR
25
BRAC
CGAP-Ford Foundation Graduation
Pilots
Scaling up
New/upcoming adaptations
Pathway to Scale
• Integrate graduation approach into government social
protection programs or other large anti-poverty programs
• Why?
 Government programs reach large numbers of people
 Graduation approach subsidy can’t be provided at scale by
philanthropy
 Growing interest from government because existing programs are
not putting very poor households on a pathway out of poverty
• How to accomplish this?
 Work with governments to adapt the graduation approach to
their contexts and needs
 Create community of practice for governments to share
experiences
27
Developing an Analytical Framework for Action:
Challenging Extreme Poverty
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Policy Implications
• Holistic model: integrating micro, meso and macro
• Focus on graduation: multiple pathways
• Consistent and continuous engagement
• Different entry points for different stakeholders
• Categorize poorest: determine diverse pathways
• Agency for poor people
29
Thank you
For more information, please visit
http://graduation.cgap.org/