ESCAP Development Paper 1306, September 2013
How much do small old age pensions and widow’s pensions help the poor in India? An ex-post evaluation of the National Social Assistance Programme and implications for its planned reform, by Christopher Garroway
The National Social Assistance Programme consists of five social assistance transfers, which form the core of India’s fledgling minimum social protection floor. These transfers have been scaled up over the last decade and further steps will soon be taken towards their universalization with exclusion criteria. This paper provides a rigorous evaluation of two of the NSAP schemes, the old age pension and the widow’s pension. Using the 2005 Indian Human Development Survey data’s detailed information on household income and consumption expenditure, the paper measures the impact of the two pensions on household’s incomes, consumption and poverty status, using the propensity score matching estimator. The pensions are found to vary dramatically in their effectiveness given the wide diversity of recipients across income quintiles, spatial location, and social group. The widow’s pension is shown to reduce poverty among recipients by about 2.7 percentage points. Government attempts to target the pensions to poor households have been ineffective, and steps towards universalization may in fact improve their effectiveness.