Project Evaluation

Ultra Poor Graduation Pilot in Peru

Can an intensive package of support lift the ultra poor out of extreme poverty to a more stable state? Graduation programs provide ultra-poor beneficiaries with a holistic set of services including: consumption support, new livelihoods (such as chickens or goats) provided as an asset transfer along with training on management of the assets, access to savings, and coaching visits over a 24-month period. IPA is conducting randomized evaluations of CGAP and Ford Foundation-sponsored graduation pilots in seven countries: IndiaPakistanHondurasPeruEthiopiaYemen, and Ghana.

Policy Issue: 

Governments have often attempted to address the needs of the ultra poor by offering consumption support that is costly and offers no clear pathway out of food insecurity. The Graduation Approach, developed by BRAC in Bangladesh, recognizes that the ultra poor face an interrelated set of challenges: lack of skills, assets, and confidence, along with nutritional gaps and health shocks. The graduation approach incorporates a comprehensive package of services designed to ensure that households have the "breathing space" to focus on building new livelihoods, along with a secure place to grow their assets.

This project is a part of a set of evaluations, in partnership with CGAP and the Ford Foundation, that intends to determine whether the model, pioneered in Bangladesh, is effective in a range of contexts.

Context of the Evaluation: 

The study takes place in rural communities of the Canas and Acomayo provinces in the Department of Cusco, Peru.  To assist ultra poor households with young children in the region, Juntos, a government-run conditional cash transfer program, provides families with a monthly stipend. Arariwa and Plan, the project partners, are implementing the Graduation Model in concert with the Juntos program.

Details of the Intervention:

The project team will use a Participatory Wealth Ranking (PWR) to target the ultra poor in the chosen provinces. As overlap is expected between the Ultra Poor Graduation project beneficiaries and Juntos beneficiaries, the project will provide a nine-month cash stipend equivalent to US$35 to those not already receiving it from Juntos.

This program will then build on the base of the Juntos program by providing all beneficiary households with a productive asset, which over two years, they will be trained to manage. During this time period, beneficiaries will be monitored with weekly visits intended to contribute to the holistic development of the family's economic potential. A microfinance promoter will also encourage beneficiaries to save in group mechanisms. At the end of the two year period, Arariwa will offer microcredit products to the beneficiary families that demonstrate characteristics of reliable clients.

In total, 80 communities will participate in the study. Three groups will be defined within these communities:

(A) Treatment households: an average of 20 treatment households will be selected in each of 40 treatment communities.
(B) Neighbors: an average of 20 comparison households will be selected from each of the same 40 treatment communities, for comparison against their neighbors who received the treatment.
(C) Comparison households: an average of 20 comparison households will be selected in each of 40 comparison communities.

The impact of the program can be assessed by comparing groups A and B or by comparing groups A and C. The two comparisons will give different answers if spillover effects are present.

Results:

Results forthcoming.

For additional information on the Ultra Poor Graduation Pilots, click here.

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