18 Nov 2010IDS Seminar, UvA – John Sydenstricker-Neto © Development Strategies in Brazil:...

18 Nov 18 Nov 20102010

IDS Seminar, UvA – John Sydenstricker-IDS Seminar, UvA – John Sydenstricker-Neto Neto ©©

Development Strategies in Brazil: Development Strategies in Brazil: Conditional Cash Transfer ProgramsConditional Cash Transfer Programs

John Sydenstricker-Neto, Ph.DJohn Sydenstricker-Neto, Ph.DCEBRAP, BrazilCEBRAP, Brazil

18 Nov 18 Nov 20102010


OutlineOutline Washington ConsensusWashington Consensus CCT in PerspectiveCCT in Perspective Bolsa FamilliaBolsa Famillia Critical RemarksCritical Remarks DiscussionDiscussion

BreakBreak

Participatory ProcessesParticipatory Processes DiscussionDiscussion

18 Nov 18 Nov 20102010


Washington Consensus – Washington Consensus – 80-90s80-90s

Economic stabilization Economic stabilization Structural adjustmentsStructural adjustments Market deregulationMarket deregulation Increasing market competitionIncreasing market competition Growing privatization of servicesGrowing privatization of services Severe cuts in public spending – socialSevere cuts in public spending – social

RESULT: RESULT: – Dismantling of the social protection infrastructureDismantling of the social protection infrastructure

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Turning Point – Social Turning Point – Social servicesservices

Universal welfare systems and rightsUniversal welfare systems and rights– Too expensive and not effective (universal)Too expensive and not effective (universal)

Safety nets targeting the poorSafety nets targeting the poor– Short-term and targeted interventionsShort-term and targeted interventions– Mitigate effects of poverty and related risksMitigate effects of poverty and related risks– Assistance: cash, food, housing, subsidies, fee Assistance: cash, food, housing, subsidies, fee

waivers, scholarships, temporary employment.waivers, scholarships, temporary employment.

New Approach: Reach the poor and protect themNew Approach: Reach the poor and protect them New Instrument: CCT – Conditional Cash New Instrument: CCT – Conditional Cash

TransferTransfer

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Conditional Cash Transfers - Conditional Cash Transfers - CCTCCT

Rationale:Rationale:– Human capital is seen as a development Human capital is seen as a development

tooltool– Cash allows families to invest in themselvesCash allows families to invest in themselves– Education and health as long-term meansEducation and health as long-term means

GoalGoal– Break the inter-generational poverty statusBreak the inter-generational poverty status– Springboard for development (growth)Springboard for development (growth)

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CCT – Theory at WorkCCT – Theory at Work

Joint responsibilities – ind./family & Joint responsibilities – ind./family & governmentgovernment

Empowerment – people making decisionsEmpowerment – people making decisions Flexibility – cash benefitsFlexibility – cash benefits Effectiveness – targeted audienceEffectiveness – targeted audience Long-term impact – education, health, and Long-term impact – education, health, and

nutrition nutrition Synergies:Synergies:

– Human capital broadly definedHuman capital broadly defined– Public services and infrastructure Public services and infrastructure

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Major CCT Programs in L. Major CCT Programs in L. AmericaAmerica

Since late 1990s Since late 1990s • Brazil Brazil Bolsa FamiliaBolsa Familia • Mexico Mexico Progresa, now OportunidadesProgresa, now Oportunidades• Argentina Argentina Jejes de HogarJejes de Hogar• Chile Chile Subsidio Unitario FamiliarSubsidio Unitario Familiar • Colombia Colombia Familias en AccFamilias en Acciónión• Ecuador Ecuador Bono de Desarrollo HumanoBono de Desarrollo Humano• NicaraguaNicaraguaRed de Protección SocialRed de Protección Social

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Agenda Development - Agenda Development - ChamberChamber

Chambers (1997)

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Spending on Social Programs Spending on Social Programs 2001-062001-06

Year Total Social Budget Social Assistance Budget R$ billions % GDP R$ billions % total social budget

2001 160 13.3 8.5 5.3 2002 - FHC 2 182 13.5 10.2 5.6 2003 - Lula 1 213 13.7 12.9 6.0

2004 249 14.1 16.2 6.5 2005 255 12.0 17.0 6.6 2006 293 12.7 22.0 7.5

Social budget: social security, pensions, health, education, social assistance, worker protection, housing and sanitation

Social assistance: assistance to children and nutrition including Bolsa Familia, school meals, help for elderly and disabled, indigenous groups, etc

(Hall 2008)

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Spending on Bolsa Familia Spending on Bolsa Familia 2001-062001-06

Year Bolsa Familia

R$ billions % social budget % social assistance 2001 1.5 0.9 18.0

2002 - FHC 2 2.4 1.3 23.0 2003 - Lula 1 3.4 1.6 26.0

2004 5.9 2.3 36.0 2005 6.8 2.6 38.0 2006 8.2 2.9 38.0

Social budget: social security, pensions, health, education, social assistance, worker protection, housing and sanitation

Social assistance: assistance to children and nutrition including Bolsa Familia, school meals, help for elderly and disabled, indigenous groups, etc

Bolsa Familia: Bolsa Escola, Bolsa Alimentacao, Cartao Alimentacao, Auxilio Gas and PETI

(Hall 2008)

18 Nov 18 Nov 20102010


Recent Social Programs in Recent Social Programs in BrazilBrazil

Goes back to mid 1990sGoes back to mid 1990s Bolsa Escola (School grant) – 1995Bolsa Escola (School grant) – 1995

– Brasilia (PT governor, Cristovam Buarque)Brasilia (PT governor, Cristovam Buarque)– Campinas, Sao PauloCampinas, Sao Paulo– 2001 became a national program (FH Cardoso)2001 became a national program (FH Cardoso)

Bolsa Alimentacao (maternal nutrition)Bolsa Alimentacao (maternal nutrition) Cesta Basica – PRODEA (food basket/stamps)Cesta Basica – PRODEA (food basket/stamps) Auxilio Gas (cooking gas subsidy)Auxilio Gas (cooking gas subsidy) PETI (against child labor) PETI (against child labor)

18 Nov 18 Nov 20102010


Fome Zero – Zero HungerFome Zero – Zero Hunger Flagship Fome Zero – Umbrella ProgramFlagship Fome Zero – Umbrella Program

– Bolsa Escola Bolsa Escola (school)(school)– Bolsa Alimentacao (nutrition)Bolsa Alimentacao (nutrition)– Cesta Basica – PRODEA (food basket/stamps)Cesta Basica – PRODEA (food basket/stamps)– Auxilio Gas (cooking gas subsidy)Auxilio Gas (cooking gas subsidy)– Cartao Alimentacao (food card)Cartao Alimentacao (food card)– PETI (against child labor)PETI (against child labor)

Major Changes – Lula 2003Major Changes – Lula 2003– Political commitment – the poorestPolitical commitment – the poorest– Bypass local political interests (food card)Bypass local political interests (food card)– Novel approach - corporate social responsibilityNovel approach - corporate social responsibility

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Fome Zero at work – Fome Zero at work – 03/200303/2003

Enthusiastic start versus implementation issuesEnthusiastic start versus implementation issues– Independent programs Independent programs – Separate administrative structuresSeparate administrative structures

Beneficiary selection processBeneficiary selection process Bank contracts for paymentBank contracts for payment Reporting systemsReporting systems Limited accountability and evaluation cultureLimited accountability and evaluation culture

– CadUnico (central cadastral system)CadUnico (central cadastral system) Limited coverage of target audience (70% estimate)Limited coverage of target audience (70% estimate) Quality of cadastral dataQuality of cadastral data

High implementation costs & targeting errorsHigh implementation costs & targeting errors Increasing disbelief – political and operationalIncreasing disbelief – political and operational

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From Fome Zero to Bolsa Familia From Fome Zero to Bolsa Familia 10/200310/2003

Marketing Strategy – Relabeling of Fome ZeroMarketing Strategy – Relabeling of Fome Zero

Integration of programsIntegration of programs– Bolsa Escola Bolsa Escola (school) – Ministry of Education(school) – Ministry of Education– Bolsa Alimentacao (nutrition) – Ministry of HealthBolsa Alimentacao (nutrition) – Ministry of Health– Auxilio Gas (cooking gas) – Min. Mines and Energy)Auxilio Gas (cooking gas) – Min. Mines and Energy)– Cartao Alimentacao (Fome Zero)Cartao Alimentacao (Fome Zero)– PETI (against child labor)PETI (against child labor)

Integration of Ministries (01/2004)Integration of Ministries (01/2004)Ministry of Social Development & Fight Against Hunger Ministry of Social Development & Fight Against Hunger

(MDS)(MDS)– Social WelfareSocial Welfare– Food Security and Fight Against Hunger (Fome Zero)Food Security and Fight Against Hunger (Fome Zero)

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Novelty of Bolsa FamiliaNovelty of Bolsa Familia

New Target - Household Units (not individuals)New Target - Household Units (not individuals) Better Enforcement of Conditionalities Better Enforcement of Conditionalities

– Education (enrollment and attendance)Education (enrollment and attendance)– Health (vaccination and appointments - child & Health (vaccination and appointments - child &

mother)mother)

Expected OutcomesExpected Outcomes– Better administrative coordination Better administrative coordination – Reduced administrative costsReduced administrative costs– Improved targeting efficiencyImproved targeting efficiency– Unified protocols and procedures (conditionalities)Unified protocols and procedures (conditionalities)

18 Nov 18 Nov 20102010


Bolsa Familia – Cash BenefitBolsa Familia – Cash Benefit

Based on self-declared per capita incomeBased on self-declared per capita income

Very Poor Households – up to R$ 70 (U$ 41)Very Poor Households – up to R$ 70 (U$ 41)– Flat payment of R$ 68 (no strings attached)Flat payment of R$ 68 (no strings attached)– Additional payments based on conditionalitiesAdditional payments based on conditionalities– Cash benefit: R$ 68 – 200 (US$ 40 – 118)Cash benefit: R$ 68 – 200 (US$ 40 – 118)

Poor Households – up to R$ 140 (US$ 82)Poor Households – up to R$ 140 (US$ 82)– All payments based on conditionalitiesAll payments based on conditionalities– Cash benefit: R$ 22 – 132 (US$ 13 – 78)Cash benefit: R$ 22 – 132 (US$ 13 – 78)

18 Nov 18 Nov 20102010


Bolsa Familia – 2003-Bolsa Familia – 2003-20102010

Number of FamiliesNumber of Families

2003 – 3.6 million 2003 – 3.6 million

2010 – 12.7 million (50 million ind. – 25% of 2010 – 12.7 million (50 million ind. – 25% of Brazil)Brazil)

Annual Resources - R$Annual Resources - R$

2003 – R$ 570 million2003 – R$ 570 million

2010 – 13.4 billion2010 – 13.4 billion Total Transfer – R$ 60.2 billion (2003-2010)Total Transfer – R$ 60.2 billion (2003-2010) Average Benefit – R$ 96.00 Average Benefit – R$ 96.00

47% increase in household income47% increase in household income

18 Nov 18 Nov 20102010


Contested IssuesContested Issues

Poverty versus InequalityPoverty versus Inequality Universal Policies versus Focal PoliciesUniversal Policies versus Focal Policies ConditionalitiesConditionalities Political UsesPolitical Uses Exit StrategyExit Strategy

18 Nov 18 Nov 20102010


Poverty versus InequalityPoverty versus Inequality Bolsa Familia boosted household incomeBolsa Familia boosted household income

– City of Sao Paulo (2004) – CEBRAP, Figueiredo et al. 2006City of Sao Paulo (2004) – CEBRAP, Figueiredo et al. 2006 19% population had access to CCT19% population had access to CCT CCT represented 21% of income of the poorestCCT represented 21% of income of the poorest

– Northeast, BrazilNortheast, Brazil 33% of total households receive/enrolled in CCT Programs33% of total households receive/enrolled in CCT Programs 44% for rural areas44% for rural areas

Bolsa Familia – 35% drop in income inequality, IPEA 2006Bolsa Familia – 35% drop in income inequality, IPEA 2006

Rise in urban poverty since 1990sRise in urban poverty since 1990s Consumption vs. income earning capacityConsumption vs. income earning capacity Increasing minimum wage vs. CCT Programs (78% - Increasing minimum wage vs. CCT Programs (78% -

22%)s22%)s

18 Nov 18 Nov 20102010


Universal Policies - Focal Universal Policies - Focal ProgramsPrograms

PRO Universal PoliciesPRO Universal Policies– Dismissing long-term social investments & policy Dismissing long-term social investments & policy

design design – Targeting only one part of the problemTargeting only one part of the problem– Creating stigma – most vulnerableCreating stigma – most vulnerable

PRO CCT ProgramsPRO CCT Programs– Efficiency of targeted policiesEfficiency of targeted policies– Better use of limited resourcesBetter use of limited resources

Complementary approachComplementary approach– Short-term priorityShort-term priority– Long-term strategy to reach universal coverageLong-term strategy to reach universal coverage

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ConditionalitiesConditionalities

PRO ConditionalitiesPRO Conditionalities– Moral responsibility of beneficiariesMoral responsibility of beneficiaries– Impact on development of human capitalImpact on development of human capital– Breaking with clientelism/narrow wellfarism Breaking with clientelism/narrow wellfarism

Against ConditionalitiesAgainst Conditionalities– Denying the right for accessing goods & servicesDenying the right for accessing goods & services– How effective is enforcing conditionalities?How effective is enforcing conditionalities?

Availability and quality of servicesAvailability and quality of services Moral responsibility of the state as providerMoral responsibility of the state as provider Costs of control mechanismsCosts of control mechanisms

18 Nov 18 Nov 20102010


Political Use vs. Political Political Use vs. Political AgendaAgenda

Electoral uses of Bolsa FamiliaElectoral uses of Bolsa Familia– Large expansion before 2006 national electionLarge expansion before 2006 national election– Lula’s “personal gift” – “Father of the Poor”Lula’s “personal gift” – “Father of the Poor”– Lula effect - high approval vs. congress scandalsLula effect - high approval vs. congress scandals– Bypassing the state level – federal-municipal linkBypassing the state level – federal-municipal link– Data on 2010 national electionData on 2010 national election

Politicization of Social AgendaPoliticization of Social Agenda- Long-term policy design and planningLong-term policy design and planning- A new-populism at work in Latin America ?A new-populism at work in Latin America ?

18 Nov 18 Nov 20102010


2010 Presidential Votes versus 2010 Presidential Votes versus Bolsa Familia BeneficiariesBolsa Familia Beneficiaries

OESP October 2010

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Dependence vs. Exist Dependence vs. Exist StrategyStrategy

Culture of DependenceCulture of Dependence– Household’s dependence on federal transfersHousehold’s dependence on federal transfers– Mayors and the “Poverty Industry”Mayors and the “Poverty Industry”– Bolsa Familia/Escola – Bolsa Familia/Escola – Bolsa EsmolaBolsa Esmola ( (almsalms))

Poverty DriversPoverty Drivers– Individual/family responsibilities – max. timeIndividual/family responsibilities – max. time– Structural conditions – increasing beneficiaries Structural conditions – increasing beneficiaries

18 Nov 18 Nov 20102010


DiscussionDiscussion

“O que vemos não é o que vemos, senão o que somos” Fernando Pessoa

“What we see is not what we see, but in deed what we are.”

18 Nov 18 Nov 20102010


BreakBreak

BreakBreak Short video – Health Council in Sao Short video – Health Council in Sao

PauloPaulo Waves of ParticipationWaves of Participation

• Participatory Democratic Innovation – Representation Gurza Lavalle et all (2004) “Atores da sociedade civil e atores políticos: participação nas novas políticas democráticas em São Paulo”

Participatory Democratic Innovation

Three waves of institutional innovation experiences

• Wave 1 - Participatory budgeting (PB)

• Wave 2 - Mandatory policy councils (MPCs)

• Wave 3 - National conferences (NCs).

Participatory Democratic Innovation

2nd Wave Mandatory Policy Councils (MPCs)• 1988 Constitution - commitment to citizen participation• 2001 Data (Munic, IBGE):

5,426 municipal health councils - 98% of Brazilian municipalities5,178 social welfare councils 4,036 child and adolescent rights councils 4,072 education councils

3rd Wave National Conferences (NCs)• Prominence under FHC term (1995-2002) - 17 Conferences• Consolidated as a key element of democratic governance under Lula

55 conferences (2003-2010)97% of themes/issues were introduced under the Lula government.

• NCs are wide-ranging decision-making processes• NCs involve the main stakeholders in a public policy area or sub-area such as education and indigenous school education• Major aim - defining long-term priorities or exploring the definition of partial consensuses between stakeholders with conflicting positions.

Representation and participation by whom Delegados y consejeros electos en el Presupuesto Participativo de Porto Alegre,

según la entidad en la cual más participan

Entidad en la cual más participan %

Asociación de moradores 47,1

Comisión de calle 3,5

Club esportivo 2,4

Partido político 1,8

Consejos institucionales 4,7

Entidad carnavalesca 0

Centro comunitário 2,9

Club de madres 0

Grupo religioso o cultural 4,7

Club recreativo 0

Consejo popular/Unión de villas 5,9

Sindicatos 2,4

Comisiones 1,2

Otras 5,9

No respondió 9,4

No participa de entidades 8,2

Total 100

Number of Cases 170

Source: Cidade (1999), cited by Luchman (2010), in Isunza e Gurza Lavalle (eds.) La inovación democrática em América Latina”. México: CIESAS, 2010.

Participatory Democratic Innovation Contingent on Political Parties

Source: Tatagiba (2009)

PT

PT

New Participatory Spaces – City of Sao Paulo

Participatory Democratic Innovation – Local Participatory Jungle (SP)Tatagiba (2009). “ A particiapção em São Paulo”.

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