Conditional cash transfers as a tool of social policy

The design of public cash transfers involves a careful balancing of policy priorities and objectives. Variations in the rationale for a conditional cash transfer shape benefit amounts, coverage, duration of programme participation, targeting practices and the definition of conditionality. Drawing on the experience of low- and middle-income countries in Latin America, this article highlights differences in the design of CCTs and the central issues and trade-offs associated with income transfers, targeting and conditionality. It also reviews the evidence on the impact of CCTs on income poverty, service utilisation and outcomes in education and health.