Bolsa Famlia is Brazil's largest conditional cash transfer program seeking to break intergenerational poverty (2003-2021)

Brazil’s Bolsa Família (PBF) conditional cash transfer program seeks to break the intergenerational poverty cycle through monetary transfers and by promoting access to education and health for low-income households.¹ The national program, launched in 2003 to overcome fragmentation in federal cash transfer programs,² provides monthly cash transfers to households living in poverty and extreme poverty, reaching up to 25 percent of Brazil’s population.³ Up until 2021, the program successfully improved educational and health outcomes across its beneficiaries, reduced poverty, and inequality levels in the country, and was lauded for its cost-effectiveness.

Bolsa Família (PBF) is a federal conditional cash transfer (CCT) program under the responsibility of the Ministry of Social Development (MDS).⁴ It is targeted at households living in poverty, calculated as a quarter of the minimum wage—and extreme poverty—half of the minimum wage.⁵ Priority is given to certain households among those eligible, including certain Indigenous and Afro-descendant groups.⁶

Once households are registered onto the Single Registry, all families under the income thresholds are automatically eligible.⁷ Following surveys about family composition, schooling, employment, income, and access to services and monthly expenses, the amount of the monthly transfers for each household are set by MDS staff.⁸ Households can receive up to four kinds of benefits:

• Basic Benefit (BRL 77), exclusively for families in extreme poverty;
• Variable Benefit (BRL 35), for families with pregnant or lactating women and/or children up to 15 years of age (up to five transfers per family);
• Variable Youth Benefit (BRL 42), for families with youth 16-17 years of age (up to two beneficiaries per family);
• Benefit to Overcome Extreme Poverty (variable amounts), for families below the extreme poverty line even after the transfers.

The conditions for obtaining the transfers include school enrollment and attendance, as well as proper vaccination and regular health check-ups for children and mothers.⁹ Noncompliance results first in a notification, followed by blockage, suspension, and cancellation.¹⁰ Beneficiaries also have access to complimentary programs provided by their municipalities in vocational training, education, and microcredit, and the principle of retorno garantido (“guaranteed return”) allows households who surpass the income threshold to enter the program if their economic situation worsens in the following 36 months.¹¹

Implementation

Bolsa Família was created by the federal government in 2003 and enshrined in law in 2004,¹² in an effort to unify several CCT programs.¹³ In 2011, the PBF was integrated into the Brazil Without Poverty Plan, with additional financial resources for states to supplement the income of families remaining in extreme poverty.¹⁴

By 2014, the program reached 14 million families (25 percent of Brazil’s population), who received an average monthly amount of BRL 169 (about USD 74).¹⁵ The PBF was expanded during the COVID-19 pandemic, under the Auxílio Emergencial, to include an additional 1.2 million families, and increased the amount to be received by households to up to BRL 600.¹⁶ In October 2021, it was announced that the program would be replaced with Auxílio Brasil, intended to double the amount of the payments and increase coverage.¹⁷

Cost

PBF’s cost has averaged between 0.4 and 0.5 percent of GBP, which in 2018 amounted to BRL 30 billion (USD 8.21 billion).¹⁸

Assessment

Although it is not the first CCT program in the Latin American region, PBF is the largest in terms of coverage.¹⁹ In its first 10 years, it accounted for between 16 percent and 21 percent of total reduction in inequality.²⁰ In 2017, the transfers were responsible for a reduction of around 15 percent and 25 percent in the number of poor and extremely poor people, respectively.²¹ The program had the greatest impact in the poorest regions of the country, thus helping to reduce regional inequalities.²²

PBF has been linked to reduced infant mortality rates, lower rates of premature births, increased attendance rates for young people,²³ and a greater likelihood of formal employment.²⁴ It is also considered more cost-effective than other social assistance programs showing greater multiplier effects; studies associated a BRL 1.78 growth in GDP for every BRL 1 invested in PBF.²⁵ Its popularity has been sustained through multiple administrations, with reforms like Auxílio Brasil intended to increase its coverage.

Some criticisms remain. For example, lack of access to health and education facilities in rural areas made it difficult for Indigenous households to comply with the conditionalities, and those living away from urban areas had challenges in accessing the transfers.²⁶

Additional Information

Extreme poverty threshold increased from BRL 50 a month in 2004 to BRL 77 in 2014.

The program has also managed to overcome prejudice. Some criticism included the fear that the program would encourage families to have more children; disincentivize families to seek employment; and worries that families would not use the cash “appropriately.” Studies have demonstrated the contrary: PBF beneficiary households have seen the same downward trend in family composition as the rest of the country, employed beneficiaries have remained employed, and most of the cash transfers have been used for food.²⁷

Photo: “Bolsa Família,” © Jefferson Rudy/Agência Senado

Tags

• Brazil
• Children & Youth
• Education
• Health
• Income & Wealth
• Indigenous Peoples
• Latin America & the Caribbean
• Low-Income Groups
• Middle-Income Country
• Race & Ethnicity
• Redistribution
• Social Protection