Mexico's 20-year conditional cash transfer program supports low-income households to access services

From 1997 to 2019, the program (originally named Progresa, then renamed to Oportunidades and finally Prospera) provided conditional cash support to households with an income below a minimum welfare line, to support their education, health, and nutrition. By the late 2010s, the program reached over 26.6 million people—approximately one quarter of people under the well-being threshold.

Through surveys and interviews, households were identified as eligible for the program.  Eligible families would receive monthly or bi-monthly cash transfers. The precise amount was calculated based on the needs of the households (i.e., number of children in school and number of women under 49 years of age). The grants were conditional, meaning that they were in exchange for meeting certain conditions–i.e., school enrollment and attendance, registration in a healthcare unit, and attendance to medical visits. Such services provide in-kind support, such as, food supplies, health education, and capacity building sessions, etc.

Implementation

The 1997 program known as Progresa was only available to rural households living under the threshold of minimum welfare (línea de bienestar mínimo) – calculated based on the cost of the basic food basket and that amounted to. In 2002, the program was renamed Oportunidades and was expanded to all 32 states and urban areas. The program was also expanded to include scholarships for secondary education, cash for young people finalizing their education, and monthly subsidies for energy spending. Moreover, the eligibility criteria were updated to reflect multidimensional poverty and indicators such as health, education, and shelter conditions were used. In 2014, Oportunidades became the PROSPERA Programa de Inclusión Social, and in addition to the cash transfers, the program sought to foster financial inclusion by providing young people with vocational training, capacity building in financing, banking and savings tools, and access to savings plans and basic credit to foster financial inclusion. Over the years, the objective shifted from supporting the poorest households to breaking the intergenerational cycle of poverty.

The SEDESOL (Ministry of Social Development) coordinates the program. The implementation is a cross-departmental effort which includes the Ministry of Education, the Ministry of Health, and the Mexican Institute of Social Security. There is a significant presence of workers who spread information about the program to eligible families and collect data for evaluations.

In 2019, the government announced the program’s replacement with other federal, more centralized programs, including the Benito Juarez scholarship program for young people, in an attempt to reduce the administrative burden and cost of social assistance.

Cost

The program received an increased share of the GDP, starting from 0.004 percent in 1997 to 0.47 percent in 2016. In 2017, this amounted to around MXN 82 billion (around USD 4.3 billion). The program accounted for one fifth of Mexico’s expenditure on poverty eradication between 2000-2010s and received support from the World Bank and the Inter-American Development Bank.

Assessment

The Prospera program has been internationally celebrated, and its model has been replicated in over 52 countries across the world.

By the late 2010s, the program reached 26.6 million people, and by 2016, almost half of people in extreme poverty (70 percent in rural areas) had access to the program, as well as 28 percent of households in moderate poverty and 11 percent of non-poor households.

The program improves child development in rural areas and increases the likelihood of completing basic education. In urban areas, it has also been associated with a lower likelihood of child labor. The program beneficiaries have also seen improved medical attention and nutritional outcomes, with food insecurity decreasing by 15 percent.

Although studies have demonstrated that the program alleviated poverty for many families, ultimately, a lack of access to better quality and higher paid jobs for the poorest parts of the population have hindered the program’s ability to lift people out of poverty over the long term. Its targeting mechanisms were also criticized for not properly reaching all the population in need.

Further Sources

• “El Progresa-Oportunidades-Prospera, a 20 años de su creación,” Coneval, 2017
• “How does Prospera Work?: Best Practices in the Implementation of Conditional Cash Transfer Programs in Latin America and the Caribbean,” IADB, 2016
• “Prosperity. Social Inclusion Programme (2014-2019),” ECLAC

Tags

• Children & Youth
• Education
• Food
• Gender
• Health
• Income & Wealth
• Latin America & the Caribbean
• Low-Income Groups
• Mexico
• Middle-Income Country
• North America
• Redistribution
• Rural Areas
• Social Protection
• Spatial Inequality