My family progresses, or does it?

Though for decades, Guatemala has had one of the highest rates of chronic malnutrition in the world – one in every two children are stunted – the issue has barely entered the country’s political discourse. Guatemala is the only Latin American country to have failed to decrease its malnutrition rates even as countries with greater income inequality, such as Brazil, or those who are poorer, like Bolivia, made advances.

During his 2007 campaign, President Alvaro Colom pledged to make malnutrition a priority. In addition to food distribution – giving rice, beans, and nutritional supplements to the poorest of the poor — the government’s strategy focuses on a conditional cash transfer program called “My Family Progresses.” The government pays poor mothers a stipend in exchange for proof that their children are attending school and regularly receiving health check-ups and other preventative services, including growth monitoring, important for identifying and helping malnourished children.

Wildly popular throughout Latin America and the Caribbean, conditional cash transfer programs have generally been viewed as successful: cutting poverty, reducing income inequality, increasing access to educational and health services and, important for policy makers, doing so relatively cheaply.

In Guatemala, however, the program has been mired in criticism, partly due to a lack of transparency and accountability and partly because of Guatemala’s politics and history of corruption.

Colom placed the program under an inter-institutional body not accountable to Congress and chaired by his wife. An astute politician, Sandra Torres has eyed her husband’s seat for years. Critics charged the initiative was a political tactic to reward Colom’s supporters — who are overwhelmingly rural and indigenous and helped him barely beat his conservative opponent in 2007 — as well as shore up support for Torres’ inevitable campaign, which she officially declared in May.

Colom is the first left-of-center candidate to rule Guatemala in more than five decades. After attempts at social reforms, particularly land redistribution, the country’s last leftist government was toppled in a U.S.-led coup, catapulting Guatemala into a 36-year-long civil war.

Colom eventually improved the program’s transparency and accountability, but shoddy oversight hasn’t helped its credibility. An investigation last year by one of Guatemala’s biggest newspapers, El Periodico, found many of the identification documents registered in the program belonged to the same individuals. Health workers call the program “The Bar Progresses,” referring to husbands pocketing stipends for alcohol and other frivolities instead of food as intended.

The program has also been blamed for further weakening the already broke Ministries of Health and Education. Over the past two years, Guatemala’s health budget sunk to 1 percent of the gross domestic product because of the global financial crisis, Guatemala’s low tax collection rates, and its skyrocketing population growth. Transferring millions to fund the conditional cash transfer program only added to the crisis.

Critics say additional kids in a classroom hurt rather than help if the budget doesn’t compensate for the increase. The same goes for an already over-burdened health system where many key medications aren’t arriving, some health workers haven’t been paid in months, and many rural communities see a physician only every 30 days. Guatemalan’s health minister has said it would take three times the budget to fund current health needs.

“The health system is really an anemic system,” said Dr. Baudilio Lopez, a project development specialist at the U.S. Agency for International Development (USAID.) “They have almost no resources and the few resources they have aren’t well invested.”

A Mi Familia Progresa spokeswoman didn’t respond to requests for an interview. According to an impact assessment by the Inter-American Development Bank, participating families have higher rates of vaccinations in children younger than two, school enrollment increased by 5 percent, and household consumption increased by up to $8 per adult per month. Its impact on chronic malnutrition remains unknown.

Because of the country’s budget crisis, the future of the program itself also remains unclear. According to figures released last week, it is running short at least $100 million, meaning it could collapse in just two months. Critics said political considerations prevented the program’s dire financial straits from becoming public earlier.

“It’s an irresponsibility of the former first lady, who was running these programs, because for electoral purposes,” the likely collapse wasn’t adequately anticipated, Rosa Maria de Frade, a congresswoman and president of the Legislative Transparency Commissio, told the Guatemalan newspaper Siglo Veintiuno.

Guatemala’s presidential elections are set for September, and Otto Perez Molina, a former head of military intelligence who barely lost to Colom in 2007, is all but assured victory.. In recent polls, his closest opponent was Torres who trailed behind by about 30 percentage points. In late June, electoral officials denied Torres eligibility based on a constitutional clause restricting relatives of the president from running.

Perez Molina, who represents a conservative right-wing party, has said he would continue Mi Familia Progresa, and has vowed it would receive better oversight. What remains to be seen is if a Perez Molina government has the will and capacity to succeed at tax reform, crucial to properly funding the conditional cash transfer program and the education and health ministries on which it relies.