RIO DE JANEIRO, BRAZIL – President Jair Bolsonaro announced on Tuesday, June 15, that the new Bolsa Família (Family Grant) will pay an average of R$300 to beneficiaries, in an announcement that took members of the government by surprise. Until now, the teams’ attempts were to adjust the social benefit average amount from the current R$190 to R$250.
The redesign of the Bolsa Família has been under discussion at a time when the president’s popularity is declining, and he is expected to run for reelection in 2022.
Experts say that the amount Bolsonaro proposed in an interview to a TV Record affiliate in Rondônia, would break the spending cap set for 2022. The cap is the law that limits one year’s government spending increases to the prior year’s inflation.
During the interview, Bolsonaro said that the inflation of basic food basket products was “around 14%,” and some items had risen as much as 50%. “And for the Bolsa Família, the plan is to boost it by 50% in December, to go from an average of R$190, a little more than 50% would be (the increase), to R$300. That’s what is practically agreed,” said the president.
Bolsonaro also said that today “there are around 18 million Bolsa Família recipients” (in fact, there are 14.7 million, according to the Ministry of Citizenship’s May data) and considered that it is “quite a large” number. “It weighs on the federal government, but we know how difficult it is for our population. So the economic team has virtually brought the gavel down on this new Bolsa Família as of December, of R$300 on average,” he stated.
Internal calculations within the government show that the increase of the Bolsa Família to the average of R$250 (i.e., an increase of approximately R$60 per month) represents an additional cost of R$18.7 billion for next year. Raising the average to the R$300 stated by Bolsonaro, by adding an additional R$50 per month to families, would have an even greater impact on spending on the program – an impact that will not fit within the cap.
Secretary of the Treasury Jeferson Bittencourt said that the net space in the spending cap in 2022 should be close to R$25 billion.
Behind the scenes, officials say that so far they have received no indication that the average value of the Bolsa Família will be raised to R$300 and that they are still working with the assumption of raising this amount to R$250. The total cost of the new program, with the average of R$250, is estimated at R$51.51 billion next year.
Bolsonaro further said that the emergency aid should have an extension of “two or three more R$250 installments” on average and that the measure needs to be done “responsibly”.
Source: Infomoney