Presentation by Mr. Ricardo Paes de Barros, Ms Rosane Mendonça and Ms Raquel Tsukada from the Secretariat of Strategic Affairs of the Presidency of Brazil on 27 March to the Uganda Delegation.
(http://pressroom.ipc-undp.org/2012/uganda-mission-visits-brazil-for-first-ever-exchanges-on-social-development/)
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The determinants of the sharp improvement in income distribution in Brazil
1. The determinants of the
sharp improvement
in income distribution in Brazil
Ricardo Paes de Barros
Rosane Mendonça
Raquel Tsukada
Republic of Uganda Delegation Visit
Brasília, 27 March 2012
3. Evolution of extreme poverty rate in Brazil: 1990-2009
25
22.6 22.9
23 Cardoso Lula
22.1
Percentage of the population below
21
Real Plan
the extreme poverty line
19
17.7 17.8 17.4 17.4 17.5
17.3
16.8 16.5
17
15.1
15
13.3
13
10.8
11 Millennium Development Goal for 2015 10.3
8.8
9 8.4
7
5
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
4. Evolution of extreme poverty in Brazil: 1999-2009
20
19 Reduction in extreme poverty necessary to
achieve the MDG by 2015
18
Percentage of the population below
Extreme poverty in 2001
17
the extreme poverty line
16 4.0
15
14
13
12
11 Millennium Development Goal for 2015
Total reduction in
10 9.1
extreme poverty
9
Extreme poverty in 2009
8
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
5. Evolution of extreme poverty in Brazil: 1999-2009
20
19 Reduction in extreme poverty necessary to
achieve the MDG by 2015
18
Percentage of the population below
Extreme poverty in 2001
17
the extreme poverty line
16 4.0
15 5.5
Poverty evolution without growth
14
13
Reduction in extreme poverty due to
the reduction in inequality
12
11 Millennium Development Goal for 2015
Total reduction in
10 9.1
extreme poverty
9
Extreme poverty in 2009
8
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
7. Average annual growth rate in per capita income by tenths of the
distribution: Brazil, 2001-2009
9
Bottom 10%
8
7
Annual growth rate (%)
6
5
4
Top 10%
3
Average
2
1
0
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth
8. Distribution of countries according to the average per capita GDP
growth rate between 1990 and 2005
15
13
Average annual growth rate (%)
11
China
9
7 Brazilian bottom 10%
5
3
Germany
1
Brazilian top 10%
-1
-3 Haiti
-5
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100
Distribution of countries (%)
10. Reduction in infant mortality adjusted for inequality of opportunity:
Brazil 1996-2006
Postinfant mortality (1 to
5 years)
Faster than Slower than
required by the required by the
Postneonatal mortality MDG MDG
Reduction
to 1/2 in 25
years
Neonatal mortality Remaining level of mortality Reduction
Reduction
Child mortality (up to 5 to a 1/3 in
years) 25 years
Infant mortality (first
2006 1996
year)
0 10 20 30 40 50 60 70 80 90 100
Infant mortality at the end as a percentage of the initial level
11. Reduction in malnutrition and lack of access to basic health services:
Brazil, 1996-2006
Malnutrition,
underweight: weight for
age Faster than Slower than
required by the required by the
MDG MDG
Malnutrition, wasting: Reduction
weight for height to 1/2 in 25
years
Malnutrition, stunting:
height for age
Reduction to
1/3 in 25
years
Postnatal care
Remaining deficits
Prenatal care
2006 Reduction 1996
0 10 20 30 40 50 60 70 80 90 100
Malnutrition and lack of access to basic heath at the end as a percentage of the initial level
12. Reduction in educational deficit adjusted for the inequality of
opportunity: Brazil 1999-2009
Has not completed
secondary school at age 18
Has not completed eighth
grade at age 16
Faster than Slower than
required by the required by the
Has not completed eighth MDG MDG
grade at age 15
Has not completed forth
grade at age 11
Reduction
Not attending school (15-17 to 1/2 in 25
Remaining educational deficit
years olds) years
Not attending school (7-14
years olds)
Reduction
Not attending school (5-6 to a 1/3 in
25 years
Reduction
years olds)
Child labor (10-14 years 1999
2009
olds)
0 10 20 30 40 50 60 70 80 90 100
Educational deficit at the end as a percentage of the initial level
13. Reduction in deficits in access to information, water and
sanitation adjusted for the inequality of opportunity:
Brazil 1999-2009
Lack of adequate acess to
water and sanitation
Faster than Slower than
required by the required by the
MDG MDG
Lack of adequate acess to
sanitation
Reduction
to a 1/2 in
25 years
Lack of adequate acess to
water Remaining deficit in access
Reduction to
a 1/3 in 25
years
Adequate access to
information 2009 1999
Reduction
0 10 20 30 40 50 60 70 80 90 100
Deficit in access to information, water and sanitation at the end as a percentage of the initial level
17. Brazilian Income Transfer Programmes
I. Bolsa Família
Conditional cash transfer programme to poor families,
conditional on children attending school and health care visits
Small per capita transfer
Number of beneficiaries in 2009: 13 millions families (around 35
million individuals)
Annual expenditure in 2009: R$ 10 billions (0,4% do PIB)
18. Brazilian Income Transfer Programmes
II. Pension to Poor Elderly or Disabled People (BPC)
Income transfer to poor elderly (> 64) and disabled people
One minimum wage transfer
Number of beneficiaries in 2009: 3,5 million
Annual expenditure in 2009: R$ 18,7 billions (0,6% do PIB)
19. Brazilian Income Transfer Programmes
III. Rural Pension
Income transfer to rural poor old people
One minimum wage transfer
Number of beneficiaries in 2009: 8,1 millions
Annual expenditure in 2009: R$ 44 billions (1,7% do PIB)
20. Distribution of Bolsa Família beneficiaries by percentile of the
distribution of per capita income: Brazil
5,0
Red de Oportunidades - Panama
4,5
4,0 SUF - Chile
3,5
3,0
percentage
2,5
Bolsa Família
2,0
1,5
1,0
0,5 Oportunidades
0,0
0 10 20 30 40 50 60 70 80 90 100
percentiles of the distribution
Source: Estimates based on Pesquisa Nacional por amostra deDomicílios (PNAD) from 2004 to 2008 and Encuesta de Hogares, Panama, 2008 and CASEN, Chile, 2003.
Note1: The per capita income that defined the hundreths of population excludes the income of the benefit.
21. Distribution of Bolsa Família beneficiaries by percentile of the
distribution of per capita income: Brazil
4,00
3,50
2007
3,00
2004
2,50
percentage
2,00
1,50
1,00
0,50
0,00
0 10 20 30 40 50 60 70 80 90 100
percentiles of the distribution
Source: Estimates based on Pesquisa Nacional por amostra deDomicílios (PNAD) from 2004 to 2007.
22. Determinants of Bolsa Família targeting
Percentage of the
benefits going to families Contribution
Targeting mechanism
with per capita income (%)
below R$120
Without any targeting mechanism
(random allocation) 19,8
Targeting solely based on municipal
cotas proportional to poverty 32,0 33
Random selection from the Cadastro
Único 55,0 62
Targeting using the information on
income from Cadastro Único 57,1 6
23. The contribution of transfers to the recent decline in income inequality and
poverty: Brazil, 2001-2007
Percentage
Percentage Extreme Extreme
Gini Poverty gap Poverty of extremely
Income sources of poor poverty gap poverty
coefficient (P1) severity (P2) poor
(P0) (P1) severity (P2)
(P0)
Total transfers 49 42 51 57 52 66 79
Public transfers 49 41 50 57 51 67 82
Pensions and retirement
benefits 28 30 25 22 22 19 18
Benefício de Prestação
Continuada (BPC) 10 6 9 11 7 14 19
Bolsa Família 13 3 15 25 19 39 57
Source: Estimations produced based on the Pesquisa Nacional por Amostra de Domicílios (Pnad) 2001 and 2007.
24. Extreme poverty by age:
Brazil, 2009
50
45
Percentage of the population below the
40
35
extreme poverty line
30
25
20
15
Excluding public transfers
10
Average including transfers
5
Including public transfers
0
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75
Age (years)
25. Continuity of results, not necessarily of policies
Extreme poverty by age after transfers:
Brazil, 2009
20
18
16
Percentage of the population below the
14
extreme poverty line
12
10
Average
8
6
4
2
0
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75
Age (years)
27. Table 1: Characteristics of the income growth of the 20% poorest:
Brasil, 2003-2009
Variation
Indicator 2003 2009
Absolut Relative Annual growth
(R$/month) (%) rate (%)
Income per capita (R$/month) 62 100 39 63 8,4
Percentage of adults (%) 55,0 58,0 3,0 5,5 0,9
Non work-related income per adult (R$/month) 25 49 25 100 12,3
Work-related income per adult (R$/month) 87 123 35 40 5,8
Percentage of the family income originated from
78,0 71,0 -7,0 -9,0 .....
work (%)
Income per capita if only work-related income
..... 81* 19 31 4,7
had grown (R$/month)
Source: Estimates obtained from the household survey Pesquisa Nacional por Amostra de Domicílios (PNAD) in 2003 and 2009.
Note: * Income per capita if w ork-related income w ere as of 2009, all else constant, in 2003 values.
28. The Productive Inclusion of the Poor
Brazil has demonstrated a significant capacity of promoting the
productive inclusion of its most vulnerable segments.
Conditions for a successful productive inclusion:
Availability of good opportunities
Guarantee for effective access
Protagonism
29.
30. The Productive Inclusion of the Poor
For the effective eradication of extreme poverty is necessary that
both private and public sectors contribute as much as possible to
the productive inclusion of the low-income population.
The public sector must complement the initiatives implemented
by the private sector to generate productive opportunities in
communities with less-dynamic economies:
Direct creation of productive opportunities
Legislation, supervision and tripartite agreements
Promotion of the local economy
31. The Productive Inclusion of the Poor
Regarding the vital role of public policies: it is important to
guarantee that the poorest workers will have effective
access to the available productive opportunities.
Providing information about locally available opportunities
Training and overcoming discrimination
Guaranteeing minimum conditions
32. 6. The magnitude of the economic crisis
in Brazil and the nature of the
adjustment process in the labor market
33. Real GDP: Brazil, 2008 and 2009
150
145
140
REal GDP (1995=100)
135
130
Current
125 Previous year
Average of three previous years
2008 2009
120
3rd quarter 4th quarter 1st quarter 2nd quarter
34. Real GDP - Secondary sector: Brazil, 2008 and 2009
140
135
130
REal GDP (1995=100)
125
120
Current
115 Previous year
Average of three previous years
2008 2009
110
3rd quarter 4th quarter 1st quarter 2nd quarter
37. Monthly job net creation relative to the average for the previous five years:
Brazil, 2008-09
200
150
100
Difference in job creation (thousand jobs per month)
50
0
-50
-100
-150
-200
-250
-300
-350
-400
-450
2008 2009
-500
October November December January February March April May June July August September
38. Monthly job creation relative to the average for the previous five years:
Brazil , 2008-09
100
80 Primary
Secondary
60
Difference in job creation (thousand jobs per month)
Superior
40
20
0
-20
-40
-60
-80
-100
-120
2008 2009
-140
October November December January February March April May June July August September
39. Monthly job creation and job destruction: Brazil, 2008-09
1500
1450
job creation and destruction (thousand jobs per month)
1400
1350
1300
1250
1200
1150
Creation
1100
Destruction
1050
2008 2009
1000
October November December January February March April May June July August September
40. Strategic Themes - SSAE
ERRADICATION OF EXTREME SOCIAL, SPATIAL AND SYMBOLIC
POVERTY VIA MOST EFFECTIVE USE INTEGRATION IN LARGE CITIES
OF EXISTING POLICY AND SOCIAL
PROGRAMS
PROMOTION AND CONSOLIDATION HOW TO DEVELOP A NATIONAL
OF A PRODUCTIVE AND DYNAMIC SYSTEM OF EVALUATION OF
NEW MIDDLE CLASS, RISK-FREE OF PUBLIC POLICY
RETURNING TO POVERTY
OPORTUNITY FOR A FULL AND FORMULATING STRATEGIES FOR
COMPREHENSIVE INCLUSIVE DEVELOPMENT WITH
DEVELOPMENT IN EARLY STATES
CHILDHOOD
OPORTUNITIES FOR A HEALTHY AND STRESSING THE PROMOTION OF
PRODUCTIVE TRANSITION TO ADULT PRINCIPLES IN THE DESIGN OF
LIFE SOCIAL POLICIES WITHOUT
LIMITING THE RESULTS