1. WORLD FAMILY SUMMIT +7 The impact of the crisis: How the international economic and financial crisis has impacted families at the local level Wanda Engel December 6, 2011

2. Types of Crises Idiosyncratic: within the family environment, the level of vulnerability increases due to: Diseases Natural catastrophes Unemployment of adults Systemic: caused by economic shocks 1930: Great Depression 1994/95: Mexico 1997/98: Asian crisis 2008/9 : Global Financial Crisis

3. The crisis as a multidimensional phenomenon Economic Development

4. Areas Affected: Economic Development Poverty and extreme poverty Informal economy (without Social Security coverage) Youth unemployment Infant labor Increase in food and energy prices Reduction in remittances Affect the conditions needed for sustainable development Source: Harper,C. and Jones, N. Impact of Economic Crises on Child Well-Being

5. Increase in underemployment and unemployment Drop in the net creation of jobs - 2009 * Report “The Brazilian Economy in Perspective” - May/July 2011 edition

6. Increase in underemployment and unemployment Behavior in the balance of jobs – 2007-2009 Source: Global Financial Crisis: social impacts and impacts on the labor market, 2009.

7. The crisis as a multidimensional phenomenon Human Development Human Development Economic Development

8. Areas Affected: Human Development Health: Hunger/malnutrition Suicide Heart diseases Alcohol consumption and hepatic cirrhosis Mental diseases Education: Movement from private schools to public schools School Exodus: boys drop out to work and girls drop out to take care of brothers Source: Harper, C. and Jones, N. Impact of Economic Crises on Child Well-Being

9. Human Development Impacts – a few signals (WB/IMF 2010) Human indicators drop more rapidly during crises but improve in subsequent growth periods. 2008 – 2010 Period Growth PeriodCrisis Period Life expectancy> 2 years< 6.5 years Infant mortality 8/1.00024/1.000 Elementary school completion> 4%< 25%

10. The crisis as a multidimensional phenomenon Human Development Human Development Social Development Social Development Economic Development

11. Society Violence and crimes Social fragmentation Political instability Xenophobia Terrorism Halt social progress Reduce social cohesion Areas Affected: Social Development Family Family stress Divorces Migration to work Infant exploitation Violence against women and children

12. Decline of Social Capital Stagnation of the GINI Index 2008–2009 * Report “The Brazilian Economy in Perspective” - May/July 2011 edition

13. The crisis as a multidimensional phenomenon Social Protection Human Development Human Development Social Development Social Development Economic Development

14. Social Protection Concept Public intervention with the objective of helping individuals, families and communities manage crisis situations (structural or idiosyncratic) and offer basic conditions to those submitted to extreme poverty.

15. Social Protection Poverty Line

16. Social Protection Networks: Objectives Prevent the loss of: Human capital Social capital Economic assets Mitigate: Social Security Emergency aid Overcome: Subsidies Transfers

17. Types of Intervention Social SecurityEmergency AidSubsidies Benefits Unemployment insurance Agriculture production insurance Housing aid Helthcare aid Transportation vouchers Meal vouchers Basic food basket Work front Subsidized products Subsidized services Benefits Conditional cash transfer programs

18. Key Challenges The efficiency, efficacy and effectiveness and integration challenge: Partnership: civil society (volunteering) Social control against fraud, error and corruption Dilemma: crisis vs. social investment Double challenge: mitigate impacts and protect against future human and social capital losses Lack of fiscal sustainability risk Need for a universal and permanent Social Protection Network

19. Conditions The crisis as a multidimensional phenomenon Social Protection Network Human Development Human Development Social Development Social Development Economic Development

20. Human Development Documentation Housing Land ownership regularization Credit Urban and living improvements Education Access to different levels of regular education Adult literacy Supplementary education Complementary activities Culture Access to cultural assets Support to different forms of expression Healthcare Sanitation / water Family health Improvement of environmental conditions Sports Access to sporting equipment Sports schools Sports for youngsters

21. Conditions Social Protection Network Human Development Human Development Social Development Social Development Economic Development The crisis as a multidimensional phenomenon Capabilities

22. The main economic development proposals Subsidy and/or control over food prices Flexibilize the labor market Encourage the domestic (family and country) production of food and offer technical support for boosting productivity (EMBRAPA) Unemployment aid Public employment (workfare) Changes in the energy grid Support towards micro-businesses

23. Conditions Social Protection Human Development Human Development Social Development Social Development Economic Development The crisis as a multidimensional phenomenon Capabilities In order to manage a crisis (multidimensional), an intervention that utilizes an integral strategy is necessary. Opportunities

24. A new proposal for facing crises: Cash Transfer Programs Challenge: How to make them a more integral strategy?

25. Cash Transfer Programs (Fiszbein, Ringold and Srinivasan, 2011) Impacts: Inject monetary funds in areas of extreme poverty, creating a consumer market and leveraging the economy. Help reduce the impacts of idiosyncratic and systemic shocks, including the potential effects on the human capital accumulation process in children. Origin: Beneficiaries: families with children A long-term poverty reduction goal; not an answer to crises Types: CCT and UTC Debates regarding the effectiveness of conditions. Monitoring of conditions could scare away the most vulnerable.

26. Summary of selected cash-transfers programmes and responses, 2008-09 Expanded coverage Increased benefit amounts Introduced new programmes Philippines (4P)Mexico (Oportunidades)Indonesia (BLT) Kenya (OVC-CT) Latvia (Guaranteed Minimum Income) Pakistan (BISP) Malawi (Mchinji) Kyrgyz Republic (Unified Monthly Benefit) Senegal (Social Cash Transfer and Nutritional Security) Brazil (Bolsa Família) El Salvador (Comunidades Solidarias Rurales) Mexico (Oportunidades)Guatemala (MIFAPRO) Latvia (Guaranteed Minimum Income) Kyrgyz Republic (Unified Monthly Benefit) Familias en Acción (Colombia); Programa de Asignación Familiar - PRAF (Honduras); Programa de Avance hacia la Educación y la Salud (Jamaica); Plan Familias (Argentina); Chile Solidario (Chile)

27. Cash Transfer Programs (Fiszbein, Ringold and Srinivasan, 2011) Limits: - These programs are an economic answer while the consequences of crisis are multidimensional - They should be one of the components within an integral human, social and economic development strategy Prerequisites: - Administrative capacity - Information system (Census data, household data, indexes) - Mechanisms for payments Focus Strategies: - Self- targeted: inexpensive and the easiest to expand (Brazil) - Geographic targeting - Target methodology: requires household visits, possesses quick-expansion difficulties in the crisis and removal of beneficiaries in the after crisis Lessons Learned: - Countries that implemented CT programs as pilot projects had greater ease expanding them during the crisis

28. Four Generations of Cash Transfer Programs Type of TRC Social Protection Human Development Economic Development Social Development Specific Demands Unconditioned Transfers Minimum income Consumer market Bank Branches (BB) Conditioned Transfers Minimum income Healthcare and education as conditions Consumer market BB Integrated Beneficiary Information System (SIIB) Conditioned transfer + integral family development programs Minimum income Priority access to aid programs Healthcare and education as conditions Priority access to education, healthcare and housing programs Priority access to training, income generation, job market inclusion and credit programs Family strengthening BB SIIB Integrated Information System on Programs and Services (SIIPS) Promoter of families

29. Economic crises serve to remind us that it is essential that people be healthy, educated, have adequate housing, be well fed and live in a positive family and social environment in order to be more productive and qualified to contribute to society.