Lula raises Bolsa Familia benefits 15% ahead of Brazil presidential vote

Brazilian President Luiz Incio Lula da Silva on Thursday signed a decree raising benefits under Bolsa Familia, his flagship welfare programme, by 15 per cent, weeks before the first round of the presidential election. From next month, the minimum monthly payment per family will go up to 691 reais from 600 reais. The decree said the change adjusts payments for accumulated inflation since March 2023.

The move comes ahead of the October vote, when voters will decide whether to give Lula a fourth, nonconsecutive term or back Sen. Flvio Bolsonaro, son of former President Jair Bolsonaro, in what is expected to be a run-off. Polls currently show the two in a close contest. Last week, Lula also signed a decree and a provisional measure aimed at lowering fuel prices, as the U.S.-Iran war pushes up the cost of fuel, an issue that is especially sensitive for voters.

Finance Minister Dario Durigan said, "Bolsa Familia is central to our strategy to look after more vulnerable families, guarantee income so that people emerge from poverty and don't suffer from food insecurity." He added that the extra spending would be absorbed within existing budget allocations and would not amount to new expenditure.

Lula launched the cash-transfer programme at the start of his first term in 2003. It gives financial support to low-income families, provided children attend school and meet health requirements such as vaccinations.

Bolsa Familia has been the subject of thousands of academic studies in Brazil and abroad, which reported major reductions in poverty, inequality and infant mortality. Researchers also found improved access to basic health care and better school attendance. Bolsonaro replaced the programme with Auxilio Brasil ahead of the 2022 election, in a move that analysts widely saw as an attempt to rebrand a popular scheme associated with Lula and boost his re-election chances. Lula went on to defeat Bolsonaro, who is now serving a 27-year prison sentence for attempting a coup.

In sum, Lula has raised Bolsa Familia payments in line with accumulated inflation, defended the move as part of his anti-poverty strategy and said it will be covered within the existing budget, as Brazil heads into a closely fought presidential contest.