From: rich@pencil.cs.missouri.edu (Rich Winkel)
Newsgroups: misc.activism.progressive
Subject: Proceso 533: Social Programs
Date: 15 Oct 92 21:13:01 GMT
Followup-To: alt.activism.d
Organization: PACH
Originator: rich@pencil.cs.missouri.edu

/** reg.elsalvador: 130.0 **/
** Topic: Proceso 533: Social Programs **
** Written 11:54 am  Oct 15, 1992 by cidai@huracan.cr in cdp:reg.elsalvador **
From: cidai@huracan.cr (Centro de Informacion Documentacion y Apoyo a la Invest. - UCAJSC)
Subject: Proceso 533: Social Programs

Center for Information, Documentation and Research Support (CIDAI)
Central American University (UCA)
San Salvador, El Salvador
 
PROCESO 533
October 7, 1992
 
SOCIAL PROGRAMS:
Shaky social investment programs
 
     The inadequate degree to which basic needs are met in El
Salvador is one of the cornerstones of the government's socio-
economic strategy. Its Development Plan contains a very
illustrative diagnosis of this problem. For this reason, the plan
has not only an economic component, but also a Social Development
Plan divided into short- and medium-range social strategies.
     The short-range strategy is aimed at alleviating the negative
effects of the government's programs of economic stabilization and
structural adjustment. The medium-range social strategy is an
attempt to build sustained social development on the basis of
sectorial social programs.
     After three year's of ARENA economic policies, evaluations of
social progress conducted by the president and by the Planning
Ministry (MIPLAN) provide some data which could help in evaluating
the government's social policies. According to the latest MIPLAN
statistics, between 1989 and 1991, a growing number of families
were able to meet their basic needs, which is supposedly reflected
in a 1.1% reduction in poverty. If poverty has indeed been reduced,
it would be interesting to study the role in that played by the
government's social programs over the past three years.
     To do this, we must review the record of the Social Committee
in charge of executing the government's social strategy. This
committee is made up of the Ministries of the Interior,
Agriculture, Justice, Health, Education, the Treasury and Public
Works, as well as the Vice-Ministries of Housing and Urban
Development and Labor, the Public Defender's Office, the National
Family Secretariat (SNF), the National Commission for the
Restoration of Areas (CONARA), and the Social Investment Fund
(FIS).
     Any evaluation of the individual role of the different
Ministries in carrying out social policies is limited by the lack
of precise information; however, it is clear that the role of the
Health and Education Ministries have the greatest impact on living
conditions; FIS and CONARA also play an important role in this
area.
 
Social spending in the national budget
 
     Within the Social Committee, the roles of the Ministries of
Education and Health could be said to have the greatest direct
impact on the development of medium-range social compensation
programs. However, to the extent that some social programs are
executed by some of the other ministries and agencies, we present
the evolution of social spending as distributed among the
Ministries which make up the Committee.
     The budgets of these Ministries have grown in a modest
fashion, except for the Ministry of Education, whose budget dropped
between 1990 and 1993. The budgets of Health and Public Works
increased about one percentage point each during that period. 
     The government's housing programs account for approximately
220 million ($2.33 million), of which 200 million are invested by
the National Fund for Popular Housing (FONAVIPO), and 20 million
for Municipal Plots. However, these can not necessarily be
considered social spending, since part of their funds are
reimbursed by beneficiaries.
 
      
                             TABLE 1
                   NATIONAL BUDGETS, 1990-1993
PROPORTION OF SPENDING FOR SOME PRIMARY UNITS, COMPARED TO TOTAL
 SPENDING INCLUDING GENERAL OBLIGATIONS AND SERVICE ON THE DEBT
 
-----------------------------------------------------------------
                                              Percentages
Unit or program                      1990    1991    1992   1993*
-----------------------------------------------------------------
 
Ministry of the Interior             1.99    2.40    2.40    1.91
Ministry of Agriculture              5.24    5.33    3.40    3.14
Ministry of Justice                  1.08    1.06    1.02    1.18
Ministry of Health                   8.86    8.12    7.84    9.56
Ministry of Education               16.63   15.16   13.74   14.49
Ministry of the Treasury             2.87    2.94    2.93    2.87
Ministry of Public Works            11.56   10.97   10.47   12.93
Ministry of Labor                    0.39    0.34    0.28    0.24
Public Defender's Office             0.18    0.20    0.18    0.23
Ministry of Planning                 0.46    0.30    0.18    0.18
 
General Obligations                  4.73    7.98    3.94    7.26
 
Public Debt                         13.49   14.59   28.96   20.84
-----------------------------------------------------------------
Source: National Budget for each year.
* Proposed budget bill.
 
 
     In general, we can see that, between 1990 and 1992, the
Ministries represented on the government's Social Committee have
not received any important share of the national budget. This
tendency will continue in 1993 if the budget is passed as proposed.
     With regard to the National Family Secretariat, there is no
public information for the amount of resources it uses for its
programs, which are related to legalizing ownership of land,
promoting the construction of housing solutions and providing basic
services.
 
The role of FIS and CONARA
 
     According to the government's Development Plan, the FIS was
created to "raise national and international financial resources;
channel those resources to productive areas on a small scale, as
well as priority social areas; and supervise the execution of the
projects to be undertaken."
     During its first year, FIS has invested 124.03 million colones
($14.4 million) in 704 projects, of which only 92 have been
finished, as we can see in Table 2. CONARA has carried out programs
for a total of 387.6 million colones ($45 million), of which a
large part were civic-military actions such as the Plan Oriente/89
and Chalatenango/88.
     In terms of job creation, it is estimated that CONARA and FIS
have together generated 280,953 person-months of work. As a
comparison, the Economically Active Population of El Salvador was
2.2 million in 1988, meaning that full employment could only be
guaranteed by guaranteeing that many jobs per year.
 
                             TABLE 2
             CONARA and FIS. PROGRAMS AND PROJECTS.
-----------------------------------------------------------------
Program                     # of       Amount*  Person/months
                          Projects                generated
-----------------------------------------------------------------
CONARA                       9,187     387.6       238,337
 
Social
Infrastructure               8,637     366.8       238,337
 
  Municipalities in Action   3,267     182.5       118,279
  Chalatenango/88            2,804      62.2        41,503
  Oriente/89                 1,677      48.9        32,443
  Urban Emergency Plan         662      53.3        35,446
  Special Devel. Commissions    79       4.5            --
  Joint Department Committ.    148      14.0         9,333
  Reforestation               n.d.       1.4         1,333
 
Social plan                    550      20.8          n.d.
 
  Training                    n.d.       7.5          n.d.
  Productive projects          300       2.3          n.d.
  Credit (Community banks)     250        11          n.d.
 
FIS                            704    124.03        42,576
 
  Finished projects             92      n.d.          n.d.
  In progress                  349      n.d.          n.d.
  Yet to begin                 269      n.d.          n.d.
 
OVERALL TOTAL                9,891    511.63       280,953
-----------------------------------------------------------------
*Millions of colones (8.6=$1)
Source: Based on Planning Ministry Annual Reports 1991-1992.
 
 
     CONARA and FIS together have generated just over 10% of the
total person-months required to guarantee full employment for 1988;
however, the fact that these person-months of work were generated
over a period of more than four years (in the case of CONARA, which
accounts for the majority) makes the results look much less
significant.
     The modest role played by FIS in executing social programs
contrasts with its initial goals, which estimated necessary
starting funds at 300 million colones ($34.9 million). Since the
FIS is one of the chief pillars of the government's social program,
there is room for serious doubts about its effectiveness.
 
Reflections from the standpoint of the Social Debt
 
     The social debt is a category created to estimate the
resources necessary to compensate the adverse effects of government
economic policies on living conditions.
     According to PREALC (Employment Program for Latin American and
the Caribbean), the social debt has two components: one is short-
term and the other long-term. The short-term social debt is related
to the increase in poverty which occurs during a specific period,
as a consequence of economic policy measures, and can be quantified
by calculating the resources necessary to produce the goods and
services necessary to bring poverty down to previous levels. The
long-term social debt is the amount of resources necessary to
eradicate all accumulated poverty and achieve a socially acceptable
level of equality.
     According to a study carried out in 1990, the present
government has accumulated a social debt for urban poor of around
1,500 million colones ($177.5 million). The long-term social debt
is around 13 billion colones ($1.5 billion) (Acevedo, C., "The
growth of poverty in El Salvador, 1989-1990, using social debt
methodology", in Realidad Economico-Social No. 19-20, UCA, 1991).
     As we can see, social spending from 1989-1992 has been
inadequate even to pay off the social debt to urban dwellers up to
1990. The situation looks even worse if we recall that about half
of all poor live in rural areas. According to the 1985 MIPLAN
Household Surveys (the most recent data available on rural and
urban poverty), 49.7% of poor families live in urban areas, and
50.3% live in rural areas, which would therefore approximately
double the government's social debt.
     This casts doubts on the results obtained by MIPLAN, which
reflect a drop in urban poverty, from 55.2% in 1988/89 to 54.1% in
1990/91. According to the study mentioned, poverty grew by 2.6%
between 1989 and 1990, meaning around 3.8% of the nation's Gross
National Product would necessary to offset that growth, if we use
the figure of 1,500 million colones for the short-term social debt.
FIS and CONARA spending between 1988 and 1991 represent only around
35% of that figure.
     However, if we were to use the MIPLAN Household Surveys as a
guide, total poverty dropped 1.1% between 1989 and 1991, which
implies that the necessary social spending was higher than the
figures reported. If we accept MIPLAN's figures, we would have to
agree that the government's social compensation programs have been
far-reaching enough to pay the short-term social debt and begin to
pay off the long-term portion. The spending figures available to us
leave such an assertion in doubt.
     Furthermore, the programs carried out by other State agencies
have also been none too generous. In the areas of health and
education, investment programs and those aimed at broadening
coverage receive far too small a share of their respective
Ministries' budgets -0.02% and 0.007% respectively- to be able to
attribute them to any strategy of poverty reduction. In addition,
the structure of spending allocations has historically been
inadequate to contain the advance of poverty. It is worth noting
that, as we saw in Table 1, payments to service the debt and
fulfill general obligations have increased substantially in
proportion to overall national spending over the last several
years.
     The inconsistencies seen between the figures used to measure
poverty and those for the social debt reflect errors of calculation
in one or the other. Reasonable doubts persist about the veracity
of the figures on poverty presented by MIPLAN (cf. Proceso 531),
and there might even be room to question the calculations of the
social debt; however, a study of the performance of the
government's Social Program makes it evident that social spending
has not changed so considerably as to have produced a reduction in
poverty.
 

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