World Study on Poverty and Disparities in Childhood

World Study on Poverty and Disparities in Childhood Childhood and Poverty in Brazil Instituto de Pesquisa Econômica Aplicada (IPEA) Rio de Janeiro - Brazil Panama, June 30th and July 1st, 2008.

Some basic facts about Brazil.

One of Brazil’s striking features is the degree of poverty and inequality consistently higher than those expected from a country with its level of development.

Although it cannot be considered a poor country, Brazil is a country with many poor people. In 2006, 53 million people had been living in poverty and 20 million in situation of extreme poverty.

The share of income appropriated by the poorest 50% is almost of the same magnitude of the one appropriated by the richest 1%.

For more than four decades inequality in Brazil was not only extremely high, but also incredibly stable. Recently this pattern began to change. Between 2001 and 2006 the country experienced a continuous and substantial fall in inequality of income, reaching its lowest level of the last 30 years. The degree of inequality declined sharply, with an average annual reduction of 1,2% between 2001 and 2006.

From the average to the lowest level.

This reduction in the income inequality has had significant impacts on poverty and living conditions for the poorest people.

From 2001 to 2006 the per capita income of the bottom 10% increased at a Chinese rate (9% per year). It was more than three times the national average (2,5%)

In terms of poverty reduction, Brazil has already achieved the first of the Millennium Development Goals (MDG) – to reduce by half the proportion of the population living in extreme poverty by 2015.

Indeed, not only the recent decline in the extreme poverty was three times faster than the necessary for the Country to achieve the MDG in 2015, more than 60% of this fall came from the decline in inequality occurred during this period.

But even with the sharp decline in income inequality, Brazil is still far from a reasonable level of inequality. Therefore, we must ensure the sustainability of this process of poverty and inequality reduction.

Because of the limited ability to raise significantly the social spending, the sustainability of the fall in poverty and inequality will depend on improvements in the efficiency of spending, and particularly in the coverage and attention to social groups that have been less benefited from this recent social progress.

Poverty in Brazil has been concentrated in some groups, and the sharp decline in poverty and extreme poverty observed recently in the Country did not benefit all groups equally.

The degree of extreme poverty is much higher among children than in other age groups and over the last five years, the fall in extreme poverty among the elderly was much higher than that among children.

We have been giving priority to the elderly, while reducing poverty.

So that the decline in poverty in Brazil is sustainable, we must change the focus of social policy, giving greater importance to programs targeted at children. We need to reduce the age bias of public transfers.

As a consequence of this age bias, the level of poverty among children is almost tenfold higher than among the elderly.

Poverty has a child’s face… … in 2006, about 56%, or 11.5 million children, 0 to 6 live in poverty 70 % 60 % … in 2006, about 40.5%, or 4.2 million children, 15 to 17 live in poverty 50 % 40 % 30 % Average: 31.5 % 20 % 10 % 0 % 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 e more

Moreover, poverty is not equally distributed among children. There are groups poorer than others. This inequality is higher in Brazil than in other Latin American countries.

Child with four young brothers in a rural single-parent household, with illiterate parents and per capita income of 1US$ (PPP). Child with one young brother in a urban two-parent household, with completed secondary education and per capita income of 25US$ (PPP).

Child with four young brothers in a rural single-parent household, with illiterate parents. Child with one young brother in a urban two-parent household, with completed secondary education.

In sum, to shift the focus of social policy we need: 1) A wide perception of the precarious position that children occupy in the Brazilian income distribution, its high level of poverty and the serious consequences that this situation may have on child development and hence on the reproduction of poverty. 2)Identification of the causes of this high level of child poverty. In particular, it is necessary to assess to what extent it arises from deficiencies in the social protection system regarding coverage and attention to younger families, the difficulty of inserting these families in the labor market, or of both factors.

Regarding the main objectives of the study: 1) Collect data and build indicators in order to produce a diagnosis of the situation of children in the Country, taking as basis different concepts of child poverty. Whenever possible sub national analysis is going to be done. 2) Examine the scale and scope of social policies aimed at childhood in the country. 3) To prepare suggestions for actions to promote the welfare of children in situations of deprivation, as well as their families

Diagnosis of the situation of children. • 1.1. Poverty among children •  To investigate the position of children in Brazilian distribution of income. • To investigate whether this position has varied over time. 1.2. The profile of poor children Concentration of poverty in some groups of children (profile of poverty). • Degree of inequality among children.

Concentration of poverty in some groups of children. The probability of being poor.

5 dimensions - Indicator 1 Household income - Indicator 2 1) Estimate the predicted probability for each dimension. - Indicator 3 - etc…. Nutrition Health 2) Aggregate this five dimensions in a Child Poverty Index. Child protection Education

2) Examining the scale and scope of social policies aimed at childhood in the country. The impact of demographic, social protection policies and labor market on the differences in poverty among families with and without children. The impact of these factors on the income gap of poor families with children poor and non poor. How these factors for households with children have been changed in recent decades? The impact of these factors on the recent fall of child poverty. Why the decline in poverty among children was less marked than the national average?

3) To prepare suggestions for actions to promote the welfare of children in situations of deprivation, as well as their families. To assess the adequacy of policies on child care, in particular:  Is there an age bias in Brazilian social policy? The programmes reach the poorest children? Identify, based on the diagnosis, the major needs of children in the Country. Compare needs and supply

Some policy issues: •  Survey of policies: In Brazil social policy is extremely decentralized (Federal, Units of federation and municipalities - more than 5,000 municipalities). For example, the educational policy for early childhood is a municipalities' responsibility. • Public spending: We have information on public spending by function. For example, we have the information on health spending by municipal level, but we cannot easily separate the amount spended on children’s health. • Policies’ description: We want a description of how social policy really works in Brazil or we are interested in what the official speech about on the childhood policy?

World Study on Poverty and Disparities in Childhood