Spending on BPC is the highest in history; government says it will do a fine-tooth comb

The federal government’s expenditure on the payment of the Continuous Payment Benefit (BPC) was the highest in history in the year 2023, both in nominal value and as a proportion of the Gross Domestic Product (GDP).

According to the National Treasury Secretariat, expenditure on the program and the former Lifetime Monthly Income (RMV) last year reached R$92.67 billion, equivalent to 0.85% of GDP. In 2022, the amount spent on this item had been R$78.83 billion (0.78% of GDP). In nominal terms, this corresponds to an increase of 17.5% in one year.

Part of the growth in expenditure is due to the policy of the government of Luiz Inácio Lula da Silva (PT) of a real increase in the minimum wage, which rose from R$1,212 in 2022 to R$1,302 in 2023, a nominal increase of 7. 43%.

But there was still growth in the BPC beneficiary base, which was also a record last year. In total, according to data from the Comptroller General of the Union (CGU), 5.89 million people received at least a portion of the program in 2023, compared to 5.45 million in the previous year, which represents an expansion of 8.1 % in the list of beneficiaries.

At the beginning of the month, the president of the National Social Security Institute (INSS), Alessandro Stefanuto, announced that he will carry out a fine-tooth comb process on the database of various social benefits, starting with the BPC.

Considered a type of “retirement” for those who have not contributed enough to Social Security, the BPC is a guarantee worth one minimum wage granted to the elderly (65 years or over) and to people with disabilities who have a per capita family income of less than a quarter of the minimum wage.

To be entitled to the benefit, you must be registered in the Single Registry. Furthermore, people with disabilities undergo medical and social assessment at the INSS, which is responsible for operating the program. As it does not require a contribution to the organization, it is not considered a social security benefit and, therefore, does not include a 13th salary or death benefit.

The BPC has been paid since 1996 to replace the Lifetime Monthly Income (RMV), a social security benefit created in 1974 and aimed at people over 70 years of age and “invalids” who did not carry out paid work and did not have an income exceeding 60% of the minimum wage. The RMV is considered a disappearing benefit, but it is still paid to those who were already beneficiaries until December 31, 1995.

In 2020, Congress approved a bill that increased the per capita family income limit for access to the BPC from a quarter of the minimum wage to half a minimum wage – which would increase the number of people eligible to receive the benefit. At the time, the then special secretary of Social Security and Labor, Bruno Bianco Leal, estimated an impact of R$217 billion on public accounts over ten years.

Then-president Jair Bolsonaro (PL) vetoed the section, but had the veto overturned. The change, however, was blocked by the Federal Audit Court (TCU), which accepted the government’s request and issued a precautionary measure, guaranteeing legal protection so that the expansion of the BPC would not be implemented.

The decision was taken based on a 2019 ruling that prevents the execution of any expenses without provision in the annual Budget and without indicating the source of the additional expense.

In 2021, however, a new law approved and sanctioned by Bolsonaro once again expanded the reach of the BPC to those with a per capita family income of up to half the minimum wage, however, as long as they meet criteria such as:

• dependence on others to carry out basic activities of daily living; It is
• expenses on treatments, medicines, diapers and special foods not made available by the Unified Health System (SUS) or services not provided by the Unified Social Assistance System (SUAS), as long as they are proven to be necessary for the preservation of health and life.

In the process of reviewing INSS benefits announced at the beginning of the month, the body must start with a balance to determine which benefits considered “consolidated”, such as those intended for dependents with autism, will be exempt from review.

Subsequently, the remaining beneficiaries will be summoned, starting in May, for medical examination and proof of family income, in order to identify possible accumulation of benefits or undue income.

The review of overlaps in the registers of assistance benefits is a measure defended by fiscal analysts as a way of reducing the Union’s expenses.

Economist Gabriel Leal de Barros, former director of the Independent Fiscal Institution (IFI) and currently partner at Ryo Asset, calculates that the integration and redesign of programs such as Bolsa Família, Farmácia Popular, family salary, maternity salary, closed season insurance, aid -incarceration and Continuous Payment Benefit (BPC) could yield tax savings of R$185.4 billion in ten years.