World Study on Poverty and World Study on Poverty and Disparities in ChildhoodDisparities in Childhood

Panama, June 30Panama, June 30thth and July 1 and July 1stst, 2008. , 2008.

Childhood and Poverty Childhood and Poverty in Brazilin Brazil

Instituto de Pesquisa Econômica Aplicada (IPEA) Rio de Janeiro - Brazil

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.

Indicators PovertyExtreme poverty

Average income (in R$ per month)¹ 495 495

Percentage of poor (P0) 29,6 10,7

Number of poor people (in millions) 53,0 19,3

Average distance between the poor's income and the poverty line (in percentage of the poverty line) 41,7 40,4

Average distance between the poor's income and the poverty line (in R$ per person per month)¹ 69,7 33,8

Average income of the poor (in R$ per person per month)¹ 97,4 49,8

Poverty line (in R$ per month)¹ 167 83,6

Relation between the average income and the poverty line 2,96 5,92

Annual volume of necessary resources to eradicate poverty (in billions of R$)¹ 44,3 7,8

Necessary resources to eradicate poverty as a percentage of the families' income 4,16 0,73

Necessary resources to eradicate poverty as a percentage of non-poor families's income 4,42 0,74

Necessary resources to eradicate poverty as a percentage of income superior to the poverty line of non-poor families 5,92 0,87

Notes: 1. Values in R$ from september 2006 2. It was used the regional average poverty line

Poverty and extreme poverty in Brazil - 2006

Source: Estimates based on Pesquisa Nacional por Amostra de Domicílios (PNAD) - 2006.

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

Indicators Value

Percentage of income appropriated by the poorest tenths (%)

First 0,94

Second 2,97

Third 5,87

Fourth 9,71

Fifth 14,7

Sixth 21,0

Seventh 28,9

Eight 39,6

Ninth 55,6

Percentage of income appropriated by the last cent 12,6

Gini Coefficient 0,559

Theil-T index 0,634

Ratio between the income of the richest 10% and the poorest 40% 18,3

Ratio between the income of the richest 20% and the poorest 20% 20,4

Indicators of per capita income inequality in Brazil, 2006

Source: Estimates based on Pesquisa Nacional por Amostra de Domicílios (PNAD) - 2006.

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.

Evolution of inequality in per capita income: Brazil, 1976-2006 (Gini coefficient)

0,559

0,566

0,600

0,600

0,600

0,599

0,602

0,580

0,612

0,634

0,599

0,587

0,596

0,623

0,623

0,604

0,5890,588

0,615

0,5820,593

0,5940,592

0,593

0,587

0,569

0,581

0,550

0,560

0,570

0,580

0,590

0,600

0,610

0,620

0,630

0,640

0,650

1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006

Year

Gin

i co

eff

icie

nt

Source: Estimates based on Pesquisa Nacional por Amostra de Domicílios (PNAD) - 1976 to 2006.

Minimum Gini coefficient

Average of Gini coefficient

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%)

Average annual growth rate of family per capita income by tenth of the distribution: 2001-06

0

1

2

3

4

5

6

7

8

9

10

First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth

Ave

rag

e a

nn

ual

gro

wth

ra

te (

%)

Bottom 10%

Top 10%

National average

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.

Evolution of Extreme Poverty in Brazil: 2001-2006

10

11

12

13

14

15

16

17

18

19

20

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Pro

po

rtio

n o

f th

e p

op

ula

tio

n b

elo

w t

he e

xtr

em

e p

ov

ert

y lin

e

Extreme poverty in 2001

Millenium Development Goal for 2015

Total reduction in extreme poverty

Reduction in extreme poverty due to Inequality decline

Evolution without growth

Reduction in extreme poverty necessary for meeting the MDG by 2015

Extreme poverty in 2006

6.7

2.2

4.

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.

Average annual rate of reduction in poverty headcount by age: Brazil, 2001-06

0

5

10

15

20

25

30

0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80

Age

avera

ge a

nn

ual

rate

of

red

ucti

on

(%

)

Poverty

Extreme 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.

Extreme poverty by age, Brazil 2006

0

2

4

6

8

10

12

14

16

18

20

22

24

0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80age (years)

extr

eme

po

vert

y h

ead

cou

nt

(%)

Children

Elderly

National mean

0 %

10 %

20 %

30 %

40 %

50 %

60 %

70 %

0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 emore

Average: 31.5 %

… in 2006, about 56%, or 11.5

million children, 0 to 6 live in

poverty

… in 2006, about 40.5%, or 4.2

million children, 15 to 17 live in

poverty

Poverty has a child’s face…

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.

Differential school attendance rate for children 10 to 14 - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Chile

Honduras

Mexico

Colombia

Uruguay

El Salvador

Ecuador

Costa Rica

Peru

Guatemala

Paraguay

Venezuela

Dominican Republic

Nicaragua

Panama

Brazil

Bolivia

Jamaica

Argentina

School attendance rate

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).

Differential probability of completing 6th grade on time - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Brazil

Argentina

Ecuador

Guatemala

Peru

Honduras

Chile

Dominican Republic

Nicaragua

Costa Rica

Venezuela

Paraguay

Panama

Jamaica

Colombia

Uruguay

Bolivia

Mexico

El Salvador

Average probability

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).

Differential probability of completing third grade on time - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Brazil

Ecuador

Honduras

Guatemala

Paraguay

Costa Rica

Venezuela

Dominican Republic

Peru

Nicaragua

Chile

Panama

Jamaica

Argentina

Colombia

Uruguay

Bolivia

Mexico

El Salvador

Average probability

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).

Differential literacy rate at age 15 - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Nicaragua

El Salvador

Honduras

Venezuela

Colombia

Uruguay

Dominican Republic

Paraguay

Panama

Costa Rica

Brazil

Bolivia

Peru

Guatemala

Mexico

Ecuador

Chile

Argentina

Jamaica

Literacy rate

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.

Differential access to water and sanitation - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Jamaica

El Salvador

Bolivia

Nicaragua

Panama

Honduras

Dominican Republic

Guatemala

Brazil

Peru

Colombia

Mexico

Argentina

Venezuela

Paraguay

Ecuador

Chile

Uruguay

Costa Rica

Average access to water and sanitation

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).

Differential access to electricity - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

Colombia

Jamaica

Bolivia

El Salvador

Guatemala

Nicaragua

Peru

Panama

Dominican Republic

Honduras

Paraguay

Brazil

Chile

Ecuador

Mexico

Uruguay

Argentina

Costa Rica

Venezuela

Average access to electricity

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.

Differential access to water - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

El Salvador

Jamaica

Dominican Republic

Colombia

Guatemala

Peru

Bolivia

Mexico

Nicaragua

Ecuador

Honduras

Panama

Paraguay

Venezuela

Uruguay

Chile

Brazil

Argentina

Costa Rica

Average probability

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).

Differential access to sanitation - around 2005

0,0 0,1 0,2 0,3 0,4 0,5 0,6 0,7 0,8 0,9 1,0

El Salvador

Bolivia

Nicaragua

Panama

Honduras

Brazil

Peru

Mexico

Guatemala

Dominican Republic

Argentina

Venezuela

Chile

Paraguay

Ecuador

Colombia

Uruguay

Costa Rica

Average access to sanitation

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).

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

1) 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.

Distribution of children aged 0 to 14 in population distribution according to per capita income

0

0,5

1

1,5

2

2,5

0 10 20 30 40 50 60 70 80 90 100

Centiles of the distribution

Dis

trib

uti

on

of

child

ren

(%

)

Source: Pesquisa Nacional por Amotra de Domicílios (PNAD) 2006.

Poverty and extreme poverty among children (0 to 14 years) of the southern elite and northeast

0

10

20

30

40

50

60

70

80

90

White, parents with some education, in the urban area of thesouthern region

Black, illiterate parents in the rural area of the northeast region

(%)

Poverty

Extreme poverty

Source: Pesquisa Nacional por Amotra de Domicílios (PNAD) 2006.

Concentration of poverty in some groups of children.

The probability of being poor.

Household income

Nutrition

Health

Child protection

Education

5 dimensions5 dimensions

1) Estimate the predicted

probability for each dimension.

2) Aggregate this five dimensions in a Child Poverty Child Poverty

IndexIndex.

- Indicator 1- Indicator 2- Indicator 3

- etc….

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?

Indicators All familiesFamilies with children

(0 to 14 years)

Per capita income 495 341Proportion of adults 0,74 0,60Income per adult 669 571Proportion of adults occupied 0,46 0,39Labor income per adults 507 484Labor income per worker 808 734Other incomes per adult 161 87Source: Pesquisa Nacional por Amostra de Domicílios (PNAD) 2006.

Components of per capita income for the total of families with children aged 0 to 14 - 2006

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?