Homeless people in San Francisco, during the corona virus crisis days. Picture credit to: Aljazeera
On February 26th, 2020, the first case of Covid – 19 was registered in Brazil. Like in so many other countries, the coronavirus epidemic spread quickly in Brazil. On Sunday, April 5th 2020, 11130 people are infected (with a total population of 209 million) and 486 deaths have occurred in the country. In the past three weeks, the Brazilian authorities have recommended people to stay at home, avoid agglomerations and to go out of their homes only for emergencies. Commerce has closed. As in other countries, only pharmacies, supermarkets, take away services at restaurants, gas stations and a few others essential services have remained functional. Many people cannot work and have been unable to earn enough for their survival.
Brazil was the first nation in the world in which the Federal Congress, with the approval of all political parties, approved the Law 10.835/2004, that institutes a Citizen’s Basic Income to all its inhabitants, including for foreigners living in Brazil for five or more years. Although never implemented as an unconditional program in Brazil, it gave rise to the means tested Bolsa Família program, which covers 14.3 million families today, or around 47 million inhabitants, almost ¼ of the Brazilian population.
Given these latest developments on the corona virus crisis, many civil associations like the Rede Brasileira da Renda Básica, Movimento dos Trabalhadores Rurais Sem Terra, Movimento de Trabalhadores Sem Teto, Movimento Nacional da População em Situação de Rua, União dos Movimentos de Moradia, UNEAFRO Brasil (among many others), as well as many economists, philosophers, social scientists and people of different walks of life, from Brazil and elsewhere, have claimed for the urgent need to implement a basic income in the country. To that purpose, in March 19th 2020, all Brazilian State Governors signed a letter to the Federal Government “to mitigate the effects of the crisis over the poorest part of population, especially with respect to employment and informality, and to evaluate the application of Law 10.835/2004 which institutes a Citizen’s Basic Income, so as to provide resources to protect this economically vulnerable population”.
Last week, the Brazilian Chamber of Deputies and the National Senate approved a Law, sanctioned by President Jair Bolsonaro on April 2nd 2020, that institutes an Emergency Benefit or an Emergency Basic Income unconditionally (not dependent on how it is spent by beneficiaries) providing R$600 (US$113) per month to all adults with more than 18 years old. That is to be given to a maximum of two in each family, reaching R$1200 for each family, covering all people who belong to families with aggregate income up to three minimum wages (R$3135) per month, or half the minimum wage (R$522) per capita per month. For a monoparental family, the father or the mother will receive R$1200 per month. If an adolescent of less than 18 years of age has a child, she (or he) will also receive the benefit (of R$1200). This stipend will be valid for three months, which might be prolongued for a longer period, depending on the continuation of the pandemic economic crisis.
In Brazil, around 75 million people are registered under Cadastro Único as earning less than three minimum wages. An estimated 15 to 20 million more have still to register, and can now do that through an applicative via internet. Public Banks such as the Caixa Econômica Federal, Banco do Brasil, Banco do Nordeste do Brasil, Lottery Houses and private banks will cooperate in providing this Emergency Benefit or Emergency Basic Income.
The payment of the R$600 reaching more than 70 million people, one third of the Brazilian population, for three or six months might imply an increase in demand for goods and services which can stimulate the production of a greater supply of high priority goods and services, with positive effects in raising employment opportunities.
More information at:
“Congress approves basic income due to coronavirus crisis while Planalto fights for protagonism“, Time24News, March 31st 2020
This article was based on a letter written by Eduardo Matarazzo Suplicy (Co-President of Honor of the Basic Income Earth Network and President of Honor of the Rede Brasileira da Renda Básica)
Maricá at a distance.
Original article by Eduardo Suplicy
Last Saturday, May 25th 2019, an event took place in Maricá, a city on the coast of the state of Rio de Janeiro, where the mayor Fabiano Horta (representant from PT, Partido dos Trabalhadores), vice mayor Marcos Ribeiro and the secretary of Solidarity Economy, Diego Zeidan, announced that, from July 2019 onward, 50000 citizens, a third of its 150000 inhabitants, will receive a Citizen’s Basic Income of 130 Mumbucas, a local electronic currency, equivalent to 130 reais, or US$ 32,5 per month. The plan is to have all Maricá’s citizens receiving this unconditional cash, at least until the end of the present city government legislature.
Longtime politician (presently councilman in the City of São Paulo) and basic income activist Eduardo Suplicy had already explained the advantages of implementing basic income in Brazil, as a part of a general upgrade of social policy in the country. That policy, actually, has been written into Brazilian law since 2004 (Law 10.835/2004), but sanctioned by president Lula on January 8th 2004. There, it says that a basic income shall be rolled out in Brazil, step by step, starting with those most in need, until one day it benefits all citizens.
After an important Conference on Human Rights, held in Brazil in December 2015, where Suplicy reinforced his views, Maricá’s mayor at the time, Washington Quaquá, manifested his intention of implementing the Citizen’s Basic Income in his city. That same month, he was able to pass his purpose into municipal law, which would be introduced in phases: 95 Mumbucas per month in 2016 (85 Mumbucas from a Minimum Income program, plus 10 Mumbucas/month), 130 Mumbucas per month in 2017 (110 Mumbucas from the Minimum Income program, plus 20 Mumbucas/month), disbursed to 14000 families, and now in 2019, starting in July, that same amount will be enlarged to cover 50000 individuals. This payment will be now limited to citizens who belong to families enrolled in the Unique Register, having monthly incomes lower than three minimum wages (1 minimum wage is equal to around 1000 reais/month), but expected to cover all citizens in the village by 2021.
So, the ongoing cash transfer in Maricá is done in a non-transferable social local currency (Mumbuca), is set to cover one third of the population (although projected to cover the whole population by 2021), and amounts to the equivalent of 67% of the individual official poverty line in Brazil (1). Although far from ideal, this is a very significant step when in comparison to some recent basic income test trials such as in Finland (2000 unemployed citizens receiving 560 €/month for two years), Stockton California (125 citizens receiving 500 US$/month for 18 months), Namibia (1000 people in Otijivero receiving the equivalent to 12 US$/month, for 12 months) and India (6000 people in Madhya Pradesh receiving 300 (adults) and 150 (children) rupees/month, for 36 months).
Even though the Mumbuca is a local currency, most commercial stores in Maricá accept it. Also, a Communitary Bank Mumbuca was created in order to provide microcredit at zero interest rates, in Mumbucas, which can also fund housing projects. Maricá mayors (Quaquá and Horta) have, on the other hand, introduced social security measures / programs alongside with this more general basic income approach. For instance, a minimum income program has been created for pregnant mothers and youngsters. Additionally, starting in 2019, another specific program was initiated, dispensing 300 Mumbucas/month to 200 indigenous people that live in small villages near Maricá. There is also a Future Mumbuca program for young people, that are currently enrolled in high school courses involving solidary economy and entrepreneurship, which will pay 1200 Mumbucas per year. In that program, the valued is transferred once the youngster completes high school, starts a firm, a cooperative or becomes an undergraduate student.
Other social support programs have been created in Maricá, over the years, such as free transportation (14 lines in Maricá’s urban area), and special conditions for university students (around 4000), in and out of Maricá. Plenty other public investments were made in education, health, and even organic farming. This unusual plentiful municipal budget (16665 reais/inhabitant, compared to São Paulo’s 5041 reais/inhabitant) is the product of oil exploration royalties along Maricá’s coast. Despite the inherent pollutant nature of this municipal revenue stream, past and present city mayors have been investing in providing better living conditions for the population within their administration’s borders. This way, Maricá has become a bright example for all municipalities in Brazil, as well as for the federal government.
Note (1) – The official poverty line in Brazil stands at 387 reais/month per family. Considering a two-adult composition in each family, this equates to 194 reais/month per (adult) individual.
Article reviewed by André Coelho
Jurgen De Wispelaere and Eduardo Suplicy, at the Catholic University of São Paulo.
The Brazilian Basic Income Network (Rede Brasileira da Renda Básica) was finally formalized on the 26th of April, 2019. The organization had been formed in 2010, when the Basic Income Earth Network (BIEN) 13th Congress was organized in São Paulo, Brazil. At the time, BIEN members where received by Brazilian president Luiz Inácio Lula da Silva.
Interest in basic income has been rising in Brazil, as well as around the world, and so a decision was made to formalize the Brazilian Basic Income Network, the Brazilian affiliate of BIEN. This was done at a meeting last Friday, where its new statutes and objectives were examined and its members elected. Also, study groups were also formed, in order to find ways to institute the Citizens Basic Income (in Brazil) as expressed in the Law 10.835/2004, approved by the National Congress and sanctioned by President Lula on January 8th, 2004.
The event was held at São Paulo’s City Council, in its Auditorium Sérgio Vieira de Melo, from 2 to 6:30 pm. Related to the event, two other speaking events were held in the city. On Thursday, April 25th, at the Catholic University of São Paulo, Jurgen De Wispelaere spoke about “Experiences of Basic Income in different places in the World” and on Friday 26th, at BookShop Tapera Taperá, Lena Lavinas presented a talk entitled “Citizen Basic Income: A Social Policy for the XXI?”, an initiative of the Friedrich Ebert Foundation.
Written by: Eduardo Matarazzo Suplicy and Mônica Dallari
This January, we discovered an extraordinary pioneer effort towards poverty eradication in poor rural villages in Kenya: the transfer of Universal Basic Income (UBI). Through the initiative of GiveDirectly, an institution created by four graduates of Harvard University and MIT, Silicon Valley institutions and other organizations contributed to the formation of a US$30 million fund to benefit about 20,000 Kenyans in the most important and thorough study about UBI in history. In the visits to rural villages in the Kisumu and Siaya areas, reports were unanimous in stating that with UBI contributed to a significant improvement in the quality of life of all the beneficiaries.
Lula da Silva on the far left; Eduardo Suplicy on the far right
Upon learning that GiveDirectly was carrying out this experiment in Kenya, we decided to write a letter to them, in which I (Eduardo) introduced myself as the author of the Brazilian Law 10.835 / 2004, which establishes the implementation, in stages, the UBI for all people in Brazil, including foreigners residing here for five years or more. As honorary co-chair of BIEN (Basic Income Earth Network), I said I would like to know about the experiment. This request was accepted by Caroline Teti, GiveDirectly’s external relations director in Nairobi.
Eduardo Suplicy visits Grameen Bank with Muhammad Yunus, in Dhaka Bangladesh. July 2007
How the UBI program works
GiveDirectly´s office in Nairobi. January 2019
As soon as we arrived in Nairobi, we met with her and started a dialogue with the coordinator of a team of 34 people who work in the call center. The call center is responsible for the quarterly contacts with each one of the 21,000 adult beneficiaries of the UBI experiment. In 2016, GiveDirectly started the pilot to provide a UBI payment in Kisumu, Siaya and Bomet counties. More than 630,000 people in these counties live below the poverty line, defined by the Kenyan government as less than US$15 a month per household member, in rural areas, and $28 a month per household member in urban areas.
For the execution of the experiment, 295 villages (14,474 residences) were randomly selected, divided into four groups:
- Control Group: 100 villages that do not receive payments;
- Long-Term UBI: 44 villages in which adults (over 18 years old) receive sufficient income for basic needs, about US$0.75 per day, or $22 per month for 12 years;
- Short Term UBI: 80 villages where adults receive sufficient income for basic needs, about $0.75 per day or $22 per month for 2 years;
- Lump Sum UBI (or UBI Cash Payment): In 71 villages, families receive UBI in the fixed amount of US$1,000 divided into two payments of $500.
The transfers are made through M-Pesa, a mobile money service created in 2007 by Safaricom, a Vodafone telephone company in Kenya. The platform enables financial transactions that are safe, fast and cheap through a cell phone, such as deposits, transfers, and savings. The platform does not need a bank account.
View of the National Park at Nairobi. January 2019
Small retailers in rural villages across the country were trained and became agents of M-Pesa services. Beneficiaries can withdraw money or shop at accredited establishments in all villages in Kenya. Those who did not have cell phones were able to purchase a low-cost GiveDirectly device. Today, 80 percent of the country’s adult population has a cell phone.
From the visits to the beneficiaries of the Kenyan experiment of UBI, we can say that the improvement in the well-being of the people is very significant. This was what we were able to witness in all the residences we visited and in the dialogue with beneficiaries of UBI. Mothers and fathers spoke of the concern to prioritize the education of children and adolescents, ensuring attendance and completion of school. This became possible due to UBI, which even helped in the hiring of auxiliary teachers. In general, our respondents stated that they were better fed and had access to a greater variety of foods.
The benefit of the UBI resulted in people being able to work more intensely and productively, especially because they were able to acquire better working equipment, such as tools, motorcycles to transport people or make deliveries, livestock (goat and cattle) to supply meat and milk, fishing equipment to get more fish in the lake to sell them, land purchasing for vegetable and fruit trees planting. These activities directly increased their income. Some families have invested in systems to better capture rainwater or solar energy collectors in order to have electricity. Households purchased better furniture, such as mattresses, sofas, tables, chairs and small electrical appliances, such as a stereo or radio. Straw roofs have been replaced with steel that contains gutters.
Sunset at Lake Victoria. January 2019
It is important to note that we do not perceive any use of alcohol or other drugs. A study by Innovation Poverty Action1, IPA, corroborates our observation since there was no increase in spending on tobacco, alcohol or gambling. The impression we have goes in the opposite direction; behaviors based on solidarity and cooperation between individuals have been reinforced.
Perhaps most remarkable was the redefinition of gender roles. Because women also receive the benefit, we hear from them how they feel freer in deciding where to spend their money, and we record reports of how couples have come to the table on UBI payday to talk about the household budget. Households frequently organize groups to pool money for a larger purchase or to assume a higher value expenditure. In Kenya, polygamy is allowed. We sometimes see that the UBI contributed to greater solidarity between the wives of one husband, and even between his widows and children.
The agility and speed provided by the digital income transfer system were also fundamental. Each beneficiary is notified by SMS when the transfer is made, being able to make purchases in the M-Pesa accredited establishments, or if she prefers, to exchange the credit for money.
City of Kisumu. January 2019
Another important development was numerous reports demonstrating a noticeable decrease in violence against women and other criminal acts, such as theft in the villages. The direct income transfer done in this way has avoided incorrect procedures and corruption.
M-Pesa Agency. January 2019
For those who want to know more about this Universal Basic Income (UBI) experiment in Kenya and other countries, please access the website. The website provides testimonials from beneficiaries of the UBI collected by the people who work in the call center, available to everyone. You will have confirmed the positive impression of this remarkable pioneering experiment on Universal Basic Income. In addition, you will have the opportunity for this remarkable and important experiment. If you would like more information, write to email@example.com.
Call Center at the GiveDirectly´s Office. January 2019
Visiting Barack Obama’s Grandmother Sarah Obama
Eduardo Suplicy visits Mama Sarah Obama, in Kogelo. January 2019
On our last day in Kenya, we visited Mama Sarah Obama, Barack Obama’s grandmother, at her farm in Kogelo, another rural village. At first, we would have only three minutes to be with her because of her age, 98 years, but we talked with Mama Sarah and Obama’s aunt, Marsat Oniango, for almost 30 minutes. Enthusiastic about the conversation, they assured me they would send President Obama a letter that I had with me, the same one I had handed to him on October 5, 2017, during a lecture in Sao Paulo.
I spoke of my enthusiasm when I watched on TV the homage Obama paid to South African President Nelson Mandela on his 100th birthday in the packed stadium of Johannesburg. In that speech, the former US president made an important statement, expressing concern about “artificial intelligence that is accelerating. Now we will have automobiles without drivers, more and more automated services, which will mean the need to provide work for all. We will have to be more imaginative because the impact of change will require us to rethink our political and social arrangements to protect the economic security and dignity that comes with work. It’s not just money that a job provides. It provides dignity, structure, a sense of place and purpose. And we will have to consider new ways of thinking about these problems, such as universal income, review of working hours, how to train our young people in this new scenario, how to make each person an entrepreneur of some level.”
I concluded by expressing my certainty that this positive experiment in the Universal Basic Income in the country of Obama’s father and grandfather, whose graves we visited on the grounds of Mama Sarah’s house, will resonate very favorably throughout the world.
Steps after the trip
Eduardo Matarazzo Suplicy
Steel Roof to capture rainwater
The fact of having experienced a real immersion in the subject of Basic Income in such a short space of time and in two very different dimensions, that is, the theoretical academic approach of the conference in Cambridge and the opportunity to make field observations during our visits to Kenya, provoked a series of reflections, which made me desire to act.
The trip was made throughout the month of January 2019, coinciding with the inauguration and first month of the government of Jair Bolsonaro. The campaign of the victorious candidate in the 2018 election, his statements after confirmation of his election and the movements of the transition process between the Temer government and the new occupants of the Planalto indicate that the new government has an economic agenda that is based on intentions to resume growth and development of the country, generate jobs and guarantee some stability in public accounts. Despite the fact that I belong to the party that opposed the Bolsonaro candidacy, I believe that certain principles of equity, income distribution, and assistance to the most excluded are values of democracy that are not exclusive to this or that political aspect. So I decided that it was time to warn President Jair Bolsonaro, Minister of Economy Paulo Guedes and the Special Secretary of the Federal Revenue of Brazil Marcos Cintra Cavalcante de Albuquerque about the pertinence to take the steps towards the Citizenship Basic Income.
Philippe Van Parijs and Eduardo Suplicy at the University of Cambridge. January 14th, 2019
Soon after coming back to Brazil, I wrote a letter to these three government officials who had just taken their first steps and offered two copies of works that I believe are fundamental to understanding the concept of basic income: My book “Citizen’s Income: The Exit is Through the Door,” and “Basic Income – A Radical Proposal for a Free Society and a Sane Economy” by Philippe Van Parijs and Yannick Vanderborght, which contains a foreword by myself.
In my argument, I stress the fact that Law 10.835 / 2004, which establishes the Citizen Basic Income, Universal and Unconditional, was approved by all the parties in both houses of the National Congress, including by the then deputy Jair Bolsonaro. I reminded the President “in case the President of the Republic wishes to comply with Article 3 of the Constitution on the fundamental objectives of the Republic of Brazil, in a manner compatible with what is expressed in its program of government, to guarantee a minimum income for all Brazilian families, as liberal thinkers like Milton Friedman argue, the most effective way to do so will be through the implementation of the Citizenship Basic Income, a concept that Friedman considered another way to apply the Negative Income Tax.”
Beneficiary receives credit by SMS. January 2019
In the letter, I also summarized some up-to-date information on the subject, such as the fact that today “more than 40 countries are debating, conducting experiments and considering the implementation of Unconditional Basic Income.” I briefly reported on the visit I had just made: “The results so far are highly promising, as I found out in person. Brazil would have all the conditions to carry out local experiments, as indeed has been the desire of several municipalities like Santo Antônio do Pinhal, Apiaí and Maricá. In the City Council of São Paulo, a Law Project of Mayor Fernando Haddad is in process, already approved in the Commissions of Constitution and Justice and Public Administration, to establish, in stages, UBI in cooperation with the state and federal governments.” Finally, I suggested that a Working Group, possibly coordinated by IPEA, to study the steps towards the Citizenship Basic Income. I stated that I had already spoken with both the Perseu Abramo Foundation of the Workers Party and the Fernando Henrique Cardoso Foundation, linked to the PSDB, who have already been willing to discuss basic income with the newly elected government.
The letter, as well as the volumes, were delivered to Marcos Cintra Cavalcante de Albuquerque, current Special Secretary of the Federal Revenue of Brazil, with whom I had a hearing on February 1, 2019. At the same time, I delivered a letter to the then president and future president of IPEA, Ernesto Lozardo, and Carlos Von Doellinger, detailing how this Working Group could be constituted and reporting my dialogue with former President Fernando Henrique Cardoso during the electoral process. “Given that a number of Presidential candidates were in agreement with this objective, we could very possibly meet the various economic teams of the various candidates to work on this subject.” Sérgio Fausto, the working coordinator of the FHC Foundation, suggested that this meeting should be held after the elections in the first half of 2019.
On the other hand, Márcio Pochmann, President of the Perseu Abramo Foundation, accepted the proposal to create a Working Group for this purpose, and two meetings of this group have already been held. I believe it will be common sense for IPEA to coordinate the efforts of these various institutions linked to the parties whose candidates have made proposals to do this.
It is up to the Government to take the suggested steps.
Mumbuca Card – Photo by Michel Monteiro
Maricá approves changes in basic income program
Maricá, Rio de Janeiro (Brazil), 19th June 2017
The city of Maricá, in the state of Rio de Janeiro, has voted on changes to their basic income program, Renda Básica de Cidadania (RBC). The program, which was initially introduced in 2015 by former mayor Washington Quaqua, has been expanded under his successor Fabiano Horta. Quaqua and Horta are both members of the left-wing workers party, Partido dos Trabalhadores (PT), that currently controls the municipal government of Maricá. A virtual social currency, created to pay welfare under Quaqua, called the Mumbuca, is used to distribute the payments to citizens. The initial value of the payment was ten Mumbucas per month; equivalent to R$ 10 or approximately US$ 3.
The municipality of Maricá sent the city council proposals for the readjustment and increase of both its Basic Income (RBC) and Minimum Income (Programa Renda Mínima or PRM) programs. The combined increases, which were approved unanimously on June 19, means recipients of the Minimum Income (PRM), will be entitled to at least 130 Mumbucas per month beginning in July — equivalent to roughly US$ 41.
The value of the RBC payment will increase from 10 to 20 Mumbucas (R$ 20). The PRM, which is aimed at poor families with a household monthly income of up to three minimum wages, will increase from 85 to 110 Mumbucas (R$ 110). Beneficiaries of the PRM, are also entitled to the RBC program, so in total will receive 130 Mumbucas.
Beginning last year, the Basic Income program was extended to all citizens; having initially been distributed to 14,000 families, or about a third of the population. The last increase to the Minimum Income was made in 2014.
The proposed increase was discussed by the Marica council before being brought to vote.
During the council discussion, the Brazilian Labor Party (PTB) councilor Tatai asked for more government supervision of the city’s trade due to some unintended effects of the basic income program. He alleged that merchants are changing the prices of goods on the eve of topping up recipients’ Mumbuca cards. That is, if the money is due to be paid on day five, on day four many traders increase the prices of their products. For example, meat that had cost R$ 14 Reais on day 4 is increased to R$ 30, according to Tatai. Democrat (DEM) councilor, Marcio da Silva Carvalho—who is also president of Maricá’s consumer protection commission—insisted that irregularities will be monitored.
Opposition councilor, Fillipe Poubel, said that the program will be a great success when more people do not need it. The Workers’ Party (PT) councilor Aldair de Linda countered that the idea is to double the number beneficiaries, in part because the program has been effective in boosting commerce. Many businesses that were closing are now sustaining themselves and generating jobs, he asserted.
Despite concerns from some councilors, the council voted unanimously to increase the benefits.
References and further reading:
Davi Souza, “Segurança: Proeis volta a funcionar em Maricá a partir de julho”, Maricá Info, June 20, 2017 <https://maricainfo.com/2017/06/20/seguranca-proeis-volta-a-funcionar-em-marica-a-partir-de-julho.html>
O Dia, “Moeda social de Maricá é premiada”, O Dia, June 28, 2017 <https://odia.ig.com.br/rio-de-janeiro/2017-06-28/moeda-social-de-marica-e-premiada.html>
Andre Coelho, “BRAZIL: Maricá municipality continues on course for basic income implementation”, BIEN Basic Income News, April 20, 2017 <https://basicincome.org/news/2017/04/brazil-marica-municipality-continues-course-basic-income-implementation/>
Reviewed by Kate McFarland