Subsidies and contributions in the payment of utilities were determined using the value reported by households in the ENPH and the percentage of subsidy or contribution available in the administrative data. For those departments for which administrative information was not available, aggregate information was taken nationally. In addition to these subsidies, in Colombia, there are gasoline and diesel subsidies. However, due to the lack of a historical series of reference prices for these fuels, it was not possible to model them.

In-kind transfers in education were determined by calculating how much each student costs the national government and local administrations. For the calculation of this per capita value, the value allocated by the national government per student at the beginning of each year was taken, and an adjustment factor was calculated to account for the additional resources provided by local administrations to finance primary and secondary education. Subsequently, this value was imputed to the students of public schools, differentiating them according to the level of education, the territorial entity in which they live, and whether it is an urban or rural area.<sup>39</sup> The exercise concerning higher education is still under construction because of the many obstacles present in carrying it out. The first problem is that even if the household survey allows students who are attending higher education to be identified, it does not allow their differentiation between technical, technological, and university levels. Added to the preceding is that it is not possible to identify to which educational institution they belong: one of the 32 public universities, or any technical or technological institution, or the SENA (National Apprenticeship Service). In the case of public universities, the national government contributes to their financing, but so do the local administrations, often through stamp taxes that are not recorded in the FUT (Local Fiscal Account). Likewise, the budget of technical and technological institutions can fall heavily on the contributions of departments and municipalities, making identification of the budget very difficult. Due to these difficulties, and as a temporary alternative, the per capita value per public university student was allocated to higher education students identified in the ENPH. This cost was obtained by dividing the total budget of public universities by those enrolled by the semester.<sup>40</sup> Finally, health care transfers were considered for people enrolled in the subsidized health care system using a cost of insurance approach. Although the survey identifies who a beneficiary of the subsidized health care system is, there are no questions to determine the use of health services. Moreover, following Inchauste and Militaru (2018), this approach keeps individuals who use the services more or who get sick more from receiving a larger transfer, and therefore have a much higher final income just because they are sick. However, instead of a per capita cost, the value of the Capitation Payment Unit (UPC) of the subsidized health care system was assigned, which is the value recognized annually by the Ministry of Health to the EPS for each of the subscribers of the subsidized health care system. Associated risk factors adjust this value regarding age and gender and by the residential zone. A higher value is also delivered to indigenous EPS since, by their nature, they must provide services in addition to the POS.

Additionally, 68<sup>41</sup> percent of the UPC from the contributory health system was included for employees with incomes below 10 smmlv, given that, from the entry into force of Law 1607 of 2012, the portion of the contribution that corresponded to employers was eliminated and replaced by the CREE. Subsequently, Law 1819 of 2016 eliminated the CREE tax (tax with specific destination), and since then, the national government uses resources from the National General Budget to make the missing money transfers to the contributory health care system. Figure 1 in Box III-2 presents the legislative changes that the

> 39 The detailed procedure and the sources of information used are presented in Annex VII, in Nuñez et, al. (2019). 40 See Annex V in Nuñez et, al. (2019).

> 41 For more details on the calculation of said percentage see Box III-2.

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