💵 Doing the welfare math

WELFARE

The ballooning welfare benefit adding to the government’s fiscal woes

As concern mounts over Brazil’s fiscal sustainability, one of the country’s social programs has gathered particular attention for how much it has grown in recent years — and how much it is costing the State.

The Continuous Cash Benefit, or BPC, consists of a minimum wage social welfare payment to low-income people aged 65 or older and persons with disabilities (of any age) who cannot work to support themselves. 

The BPC has existed since the 1990s, but its number of beneficiaries has skyrocketed in recent years due to a mix of structural factors, litigation, and policy changes by the executive branch — including the Luiz Inácio Lula da Silva government itself. Now, however, the Finance Ministry is trying to raise alarms over the BPC’s future and potential fiscal impact.

After a request from Brazil’s Solicitor General’s Office, the National Council of Justice (CNJ) has until the end of June to rule on a requirement for judges to adhere to the same administrative criteria used by the National Social Security Institute (INSS) when granting BPC benefits to people with disabilities. A majority of CNJ members eligible to vote have already approved the measure, which would start being enforced in March 2026. 

Finance Minister Fernando Haddad is counting on the new rule to reduce the amount of people being granted benefits via court orders. The CNJ’s decision takes on particular importance after members of Congress last week struck down a presidential veto that would have added more steps to the BPC renewal process.

The Social Development Ministry is reportedly creating a department to deal exclusively with matters related to the BPC…

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