Cash transfers: Graduation and growth

This Project Briefing present's ODI review of expectations towards cash transfers programmes, as part of a wider, three-year study on cash transfers. Despite their limited coverage and, usually, the small amounts of cash distributed to individuals, cash transfer programmes continue to be ambitious in their stated objectives, with many claiming that they are likely to result in graduation (however defined) out of poverty at a household level, and in growth at both local and national level.

The briefing argues that there is an imperative among donors and governments to demonstrate that cash transfers help households graduate from poverty and contribute to growth. However, there is a contradiction between providing cash transfers to those who are unable to work, and the simultaneous expectation of graduation. For either graduation or growth to take place, cash transfer programmes must be implemented effectively, on a large scale, with adequate national, district and community level coordination, and transfers must reach poor people regularly and on time. A further requirement is the existence of capacity to extend the provision of other complementary programmes and services (such as health, education and agricultural extension) as cash transfers require complementary interventions if they are to result in graduation and stimulate growth.

ODI - November 2009