Jury is out, subject has changed

With cash transfers, the Congress has reset the debate ahead of the 2014 elections

The "Mahakutami", or the TDP-Left-TRS combine, fighting the YSR Reddy juggernaut during the 2009 assembly election in Andhra Pradesh, had a clunky propaganda prop: a model ATM machine wheeled out throughout the campaign, symbolising a poll promise to directly transfer cash. Money would be given to the matriarch of the house, withdrawable ATM-style, to cut the leakage in deliveries of benefits. The idea did not seem to carry, however, as the state was taken with YSR's proposals. Former Chief Minister Chandrababu Naidu, always on the ball with the World Bank discourse, knew cash transfers were the next big proposal being debated as a silver bullet in developing countries.

An idea whose time had not yet come, the prime minister might have argued, as YSR bettered his 2004 score against all odds, thanks to a perception that the delivery mechanisms for Andhra's schemes were working.

Three years on, a paper by the World Bank released in October 2012, titled "Conditional cash transfers, political participation and voting behaviour" (http://goo.gl/ SULnP), studied voter behaviour with respect to cash transfer beneficiaries in polls held recently in Colombia. It concluded that voters reward regimes that implement cash transfers. It says that it is not mere "theoretical conjecture" that targeting beneficiaries helps the implementing government electorally, but that there is compelling evidence from conditional cash transfer (CCT) programmes in Ecuador (PANES) and Mexico (Oportunidades). So much so that in Colombia, a law stating that beneficiaries to the CCT programme called Familias En Accion could not be changed three months before a national election to prevent political abuse of such a scheme was recently passed.

However, the benefits and problems of cash transfer programmes continue to be debated. Are they radical redistributive schemes to transfer purchasing power? Or do they actually shrink the state's responsibility by simply treating the poor as a burden to be dealt with through handouts, with no imperative to strengthen public systems (food, health and education) crying out for imaginative reform?

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