Advances in Conditional Transfer Programs (PTC) for poverty reduction

In the 80s a higher proportion of formal employment with pension and health insurance existed, along with an important subsidy to hospitals and schools. With the decline in formal employment, informal employment increased and became more difficult to universalize insurance, also pensions and education coverage remained low.

The PTC for poverty reduction are based on providing compensation to the poor who do not benefit from economic policy, through targeting and demand subsidies. The result is an increase in health coverage and education, as well as an increase in human capital and income. But not so with formal employment and contributive social security growth, which depends on economic policy. Social security systems are based on formal employment and only formal workers are covered by it.

The next step is to articulate social and economic policy (as is the case of Colombia and Peru): PROTECTION, INCLUSION, and TRANSIT to Social Security. Social Policy generates skills, increases universal access to basic social services; whereas economic policy should be directed to the generation of quality jobs in coordination with social policy.