Targeted cash transfers in Guyana right decision – IDB

The People’s Progressive Party/Civic (PPP/C) Government’s approach of targeted cash transfers to vulnerable groups of people has been applauded by the Inter-American Development Bank (IDB) in its latest economic report.
In its report, ‘Headwinds Facing Post-Pandemic Recovery in the Caribbean’, the IDB has been full of praise for the Government’s various economic policies, which had been tailored towards vulnerable groups during the turbulence of the COVID-19 pandemic and the war between Russia and Ukraine.
One highlight in the report is the way the Government increased targeted assistance to the elderly. Since the PPP/C entered office, monthly old-age pension has increased by about 40 per cent from $20,500 to $28,000, representing a total pension payout of more than $21 billion.

“One important approach is to provide additional targeted assistance to lower-income groups, including the elderly. For example, in Guyana, the Government’s public assistance payments for vulnerable groups were increased from US$57 to US$67 per month, benefitting approximately 18,000 people.
“The Old Age Pension program, which benefits approximately 65,000 senior citizens, also provided a series of increases that raised the monthly payment from US$98 in 2020 to US$134 in 2022,” the IDB noted.
According to the IDB, the economic literature has already shown that well designed and targeted conditional cash transfers can have positive and statistically significant effects, as seen in Jamaica’s ‘Programme of Advancement Through Health and Education’ and Brazil’s ‘Bolsa Familia’.
“Furthermore, in July 2022, in line with a broad economic consensus, the IMF, World Bank, Food and Agricultural Organization, World Trade Organization, and World Food Programme argued in a joint statement that cash transfers to the most vulnerable are more effective – both in cost and impact – than untargeted food and energy subsidies,” the bank noted.
The PPP/C Government’s targeted cash transfers to vulnerable groups have periodically been criticised by Opposition Leader Aubrey Norton, who has claimed that the cash transfers are not being effectively managed. However, the cash transfers have so far benefitted thousands.
Last year, the World Bank had noted that Guyana had the third highest share of households to receive emergency cash transfers during the COVID-19 pandemic… at a rate of approximately 70 per cent. Only El Salvador and Bolivia had higher rates of emergency cash transfers, compared to the other 22 countries surveyed.
With the aim of cushioning the high shipping costs due to the global pandemic, President Dr Irfaan Ali had also announced several reductions to shipping-related charges, to the tune of $4.8 billion, in order to bring relief to citizens and businesses last year.
There was also the Government’s $19,000 per child “Because We Care” initiative, which comprises the grant, valued at $15,000, and the school uniform and supplies voucher, valued at $4000.
Government has committed to increasing the “Because We Care” cash grant incrementally each year until it reaches $50,000. The school uniform and supplies voucher was increased last year from $2000 to $4000, representing a 100 per cent increase.
Piloted back in 2014 under the previous PPP/C Administration, this initiative was designed to assist parents with children in the public school system with some financial support, thereby raising the disposable income in households and increasing attendance rates.
It was scrapped in 2015 after the APNU/AFC Government took office. Last year, the new PPP/C Administration reintroduced the grant, raising it from $10,000 to $15,000 per child, in addition to raising the uniform allowance from $2000 to $4000.
Then there were Government policies last year that resulted in some $28 billion in banking relief to businesses in various sectors, and to consumers, helping to cushion them from the fallout of the pandemic.
This year, the Government has continued its policy of targeted transfers. In October 2022, a $28,000 cash grant was announced… the second one-off transfer to pensioners by the PPP/C Government, after it had increased old-age pension from $20,500 to $28,000 in its over two years in office. (G3)