Monday, April 22, 2013

Family Allowance to solve child labour



The Governmental Program Bolsa-Familia - Family Allowance has been extremely successful in removing more than 45 millions of people from poverty. According to the private Centre of Statistics Getulio Vargas Institute - FGV, between 2002 and 2006 the poverty in Brazil was reduced in 27%. This successful program helps to keep millions of children in school and reduces drastically child labour in Brazil. However despite the success there is a lot of criticism around the Family Allowance.


Poor supervision, no incentive to seek for a job for the people enrolled in the program and possible fraud are the main concerns for the critics of the Family Allowance. Is believed that the gigantic dimensions of Brazil make it difficult to properly check on the benefited families and that this is a fertile field for widespread fraud. Also the beneficiaries have no incentive to be retrained and acquire new skills to be able to find a job, or possibly have no reason to work since the government will provide for them no matter what.


These concerns might be rightfully based but does not diminish the importance of this watershed social inclusion program. Even if some individuals enrolled in Family Allowance might be abusing or depending exclusively of this program to survive, there is irrefutable proof that their offspring will have better chances in life than their parents.


Previous generations of under privileged classes had very low expectations in life and even lower chances to go to school and were forced to work at earlier age to help their families. This has contributed to cement the social inequality and increase the socio-economic gap that exists in Brazil. The Gini Index, that measure the distribution of family income, places the South American giant in 10th place behind Haiti and some countries in Africa.


According to statistics, 4.8 million of children between 5 and 17 years old are currently working in order to help to provide for their family. From this total 1.2 million are aged between 5 and 13 years old. Family Allowance was initially created as School Allowance assistance exclusively intended to prevent children to enter the workforce at such an early age.


In 1994 a local government, in south of Brazil, created the program School Allowance with the intension of keeping children in school. Due to its popularity, the same program was introduced the following year in the Brazilian capital, Brasilia, and in 2001 President Fernando Henrique Cardoso went national with the School Allowance initiative. Since then the program has been reshaped and expanded by his successor, Luis Ignacio “Lula” da Silva, to accommodate more people and this eventually led to an interesting development as the Family Allowance program is now a taboo among Brazilian politicians.


In the recent presidential race the opposition candidates did not criticized the program and its flaws, but instead they only praised and promised to expand it to include more families. Apparently Family Allowance has become something sacred and untouchable that cannot be questioned or criticized by any politician with presidential aspirations in Brazil.


There are negative and positives consequences of this social program. One can argue that while the Family Allowance has little effect in the great centres such as Sao Paulo, Rio de Janeiro or Brasilia due to the high cost of living, in the countryside and especially in poor regions as North and Northeast of the country this financial assistance is absolutely vital to families. In these regions the wave of cash has also benefited the economy in small towns and allowed families to have access, for the first time in their life, to kitchen appliances and electronic goods such as TVs and DVD players and even beds.


On the positive side statistics show that homes benefited by the Family Allowance have lower figures of broken marriages with a reduction between 2% and 11% of the mothers being left alone with their children. Other statistics link children rose by a single parent (usually the mother) with criminality in Brazil and United States, however is still early to tell if the Family Allowance will contribute to reduce criminality. It seems to be a sensible step on the right direction though.


The program has enormous potential to empower the most vulnerable and help to raise these families from poverty, but lacks tools to help the benefited to achieve financial independence from the government. This creates an environment that incentivize people to remain chronically unemployed and one might argue that this make them cast their ballot in favour of the Labour Party coalition. Time will tell which families will be the most benefited from it, the poor or the politicians.

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