This paper reviews the programs implemented in selected countries to protect the poor during normal times and during transition or adjustment. In particular, two questions are addressed: how have countries implemented the programs in practice, and what are the lessons. The paper reviews five sets of programs: (i) food subsidies and related interventions, (ii) food for works and other public works programs, (iii) credit-based self-employment programs, (iv) social funds and related interventions, and (v) child allowances. More representative than comprehensive, the selection of programs and countries is based on the availability of rigorous evaluations, the importance of the program, and the issue under consideration. In choosing between the instruments and their duration and coverage, governments face key issues, including how much to spend and how to finance programs; how to target assistance to the poor, within politically feasible limits; how to select the most appropriate delivery mechanism; and how to avoid adverse effects on incentives for labor supply and private savings and transfers. The reviewed program and country experience offers a few key lessons. First, it is

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Social assistance programs can play an important role in reducing poverty. However, these programs are costly and impose a financial burden that must be covered by taxation or debt. Moreover, they can affect people’s economic behavior by distorting their incentives. In addition, any social assistance program must compete with other government social spending (such as basic education and health) and other government programs that alleviate poverty. Sri Lanka has a long history of social programs, and of food subsidies in particular. The most recent poverty alleviation program, Samurdhi, was introduced in 1995. The program claims almost 1 percent of the gross domestic product (GDP) or roughly half of all welfare expenditures, excluding expenditures on education and health, and is the largest welfare program presently operating in the country. This program was conceived by the Government of Sri Lanka to alleviate poverty and create opportunities for the youth, women, and the disadvantaged. The bulk of program resources is distributed as transfers of consumption grants to households, with eligibility determined by means testing.2 In 1998, the household eligibility threshold was set at approximately one-third of the national poverty line. In the same year, the Central Bank reported the program covering 50 percent of households in the country while poverty rate was 20 percent already in 1990. This outcome alone suggests that many non-poor households receive