POLICIES OF FINANCING AND SUBIDIES FOR
SOCIAL HOUSING IN BRAZIL
JÚNIA SANTA ROSA
Director of the Department of Institutional Development and Technical Cooperation
National Housing Secretariat | Ministry of Cities
Comparative Analysis of the Financing and Subsidy Policy in Social Housing Brazil and the European Union
LSE – London, September 2014
Brazil-EU Dialogue seminar on low income
housing finance and subsidies
SECTOR DIALOGUES EUROPEAN UNION – BRAZIL
Sector Dialogues

New dynamics of cooperation between the European Union and Brazil aiming to:
 deepen bilateral relations between the EU and Brazil;
 support the exchange of knowledge and experience in areas of mutual
interest;
 There
are around 30 dialogues between Brazil and the UE about diverse subjects nanotechnology, smart grids, remote sensing, defense of competition, environment,
etc.
Coordinated between the Ministry of Planning, Budget and Management and the
Delegation of the EU in Brazil – DELBRA.

SECTOR DIALOGUES EUROPEAN UNION – BRAZIL
Comparative Analysis of the Financing and Subsidy Policy in Social
Housing - Brazil and the European Union
General Objectives: evaluate the recent experience of social housing policies in
Brazil and the EU:

Context of social housing production;

Evaluating the effectiveness and equity of the policies.
Describe the main milestones of the social housing policy and present the
instruments for subsidizing social housing in Brazil and the EU.

Quantify values invested and of the effects of these contributions for the housing
market.

SOCIAL HOUSING IN BRAZIL
Housing Programs of the Brazilian Federal Government
BRAZILIAN CONTEXT
A HISTORY OF RAPID URBANIZATION ...
201,5 million inhabitants (PNAD/2013)
85,4% urban population (PNAD/2013)
GRAVES PROBLEMAS FUNDIÁRIOS ...
Lack of formal regestration in informal settelments,
neighbourhoods and cities:

18 million informal urban households

12 million – families with monthly income up to € 712
% of municipalities with slums, informal
settlements by population/size of the municipality
Fonte: IBGE PNAD-2013 / Censo 2010
1
BRAZILIAN CONTEXT
HOUSING DEFICIT 2012
5,79 million households
AND GREAT LIABILITIES TO BE OVERCOME ...
Urban X Rural
Housing Deficit: 5,79 million (2012), of which 5
million located in urban areas;
RURAL
Over 3 million households in slums, 85% in
metropolitan regions;
URBANO
Componentes
6.6%
15.3%
Habitação
precária
Estimated annual growth of 1,5 million new
households – future demographic demand for
housing (until 2023).
Coabitação
32.2%
45.9%
Ônus
excessivo
adensamento
excessivo
Source: Fundação João Pinheiro FJP/MG/IBGE PNAD 2011 - 2012/Cedeplar
2
BRAZILIAN CONTEXT
DEMOGRAPHIC PYRAMID - 2013
70 anos ou…
4,9%
6.5%
65 a 69 anos
3,0%
60 a 64 anos
3,9%
55 a 59 anos
7.0%
7,4%
7.6%
8,2%
25 a 29 anos
8.4%
7,8%
20 a 24 anos
0 a 4 anos
6.7%
6,8%
35 a 39 anos
5 a 9 anos
6.2%
6,5%
40 a 44 anos
10 a 14 anos
7.8%
8,0%
7.7%
9,2%
8.2%
8,8%
7.7%
7,8%
7.2%
7,0%
6.2%
MEN
Source: IBGE PNAD-2013
3
5.3%
5,8%
45 a 49 anos
15 a 19 anos
4.3%
4,9%
50 a 54 anos
30 a 34 anos
3.2%
WOMEN
BRAZILIAN CONTEXT
DISTRIBUTION OF THE ECONOMICALLY ACTIVE
POPULATION BY INCOME BRACKET (Euros €)
Sem declaração
3%
Mais de 4,436.00
2%
1% 0%
2,218.01 a 4,436.00
2% 1%
1,109.01 a 2,218.00
6%
666.01 a 1,109.00
3%
8%
444.01 a 666.00
4%
14%
7%
Renda Média = € 400.78
222.01 a 444.00
28%
24%
111.01 a 222.00
17%
Sem rendimento de trabalho
-30%
Source: SNH-MCidades/IBGE-PNAD 2013
Date: ano 2013
Exchange rate: € 1.00 = R$ 3.05
4
19%
17%
-20%
28%
-10%
MEN
0%
10%
WOMEN
20%
30%
BRAZILIAN CONTEXT
SOCIAL ASCENSION AND EXPANSION OF THE INTERNAL
MARKET
COMPOSITION OF INCOME CLASSES, IN MILLIONS
Source: FGV and IPEA
Elaboration: Ministry of Finance
*Projection IPEA
5
BRAZILIAN CONTEXT
EVOLUTION OF INEQUALITIES IN THE INCOME
DISTRIBUTION
Gini Coefficient – 1976/2012
Anos
Fonte: SAE-PR/IBGE-Censo e PNAD
Data Base: Série histórica 1976 a 2012
6
BRAZILIAN CONTEXT
INEQUALITIES IN THE INCOME DISTRIBUTION
Gini Coefifcient Comparative 2000 X 2010
2010
2000
Coeficiente Gini:
Fonte: SAE-PR/IPEA/FJP/PNUD (www.atlasbrasil.org.br)
Data Base: Censo 2000 e 2010
7
BRAZILIAN CONTEXT
MUNICIPAL INDICATOR FOR HUMAN DEVELOPMENT– IDHM
Comparative 2000 X 2010
2010
2000
very high human development (above 0,800)
high human development (0,700 to 0,799)
medium human development (0,600 to 0,699)
low human development (0,500 to 0,599)
very low human development (to 0,499)
Fonte: SAE-PR/IPEA/FJP/PNUD (www.atlasbrasil.org.br)
Data Base: Censo 2000e 2010
8
BRAZILIAN CONTEXT
EVOLUTION OF THE EXPECTATION OF LIFE AT BIRTH
Municipal Comparative 2000 X 2010
2010
2000
Years of life:
Fonte: SAE-PR/IPEA/FJP/PNUD (www.atlasbrasil.org.br)
Data Base: Censo 2000e 2010
9
BRAZILIAN CONTEXT
NEW MIDDLE CLASS:
Evolution of the pyramide of economic classes
+ 42 MILLION
PEOPLE
Fonte: SAE-PR/CPS/FGV/IBGE-PNAD 2012 (www.atlasbrasil.org.br)
Data Base: 2003 a 2012
* Estimativa
10
NATIONAL HOUSING POLICY




New institutional frameworks for the housing policy
Resumption of housing policy and planning at the national level
Housing gains importance in the Federal Governments agenda
Significant increase of investments
2001 Passing of the City Statute (Act nº 10.257)
2003 Creation of the Ministry of Cities
2004 New National Housing Policy and creation of the National Cities Council
2005 Passing of National Social Housing System and Fund - SNHIS and FNHIS (Act nº 11.124)
2007 Growth Acceleration Program – PAC Slum Upgrading
2008 National Housing Plan - PlanHab
2009 My House, My Life Program – PMCMV and Land Regularization Legal Framework (Act nº 11.977)
2010 PAC 2, Slum Upgrading articulated with PMCMV
2011 2nd phase of PMCMV (Act nº 12.424)
11
NATIONAL HOUSING POLICY
SLUM UPGRADING
+
LARGE SCALE HOUSING PRODUCTION
SLUMS AND HOUSING INADEQUACY
 Lack of services and infrastructure
 Land tenure irregularity
 Overcrowded homes
 Lack of bathroom
 Inadequate roofing
PAC
URBANIZATION
HOUSING DEFICIT
 Improvised or rustic homes
 Involuntary family cohabitation
 Excessive expenditure with rent
12
MY HOUSE MY LIFE
PROGRAM
PAC SLUM UPGRADING
PAC SLUM UPGRADING [2007-2014]
2,5 MILLION HOUSEHOLDS BENEFITED UNTIL 2014
7,6 MILLION PEOPLE BENEFITED UNITL 2014
TOTAL INVESTMENT OF € 15,7 BILLIONS UNTIL 2014
Data base: August/2014
Exchange Rate Sep 2014: € 1,00 = R$ 3,05
13
PAC SLUM UPGRADING
SÃO PAULO/SP – Complexo Billings Guarapiranga – Investments € 353 million
14
PAC SLUM UPGRADING
SÃO PAULO/SP – Complexo Billings Guarapiranga – Investments € 353 million
15
PAC SLUM UPGRADING
SÃO PAULO/SP – Complexo Paraisópolis – Investments € 104,3 millions
16
PAC SLUM UPGRADING
SÃO PAULO/SP – Complexo Paraisópolis – Investments € 104,3 millions
17
PAC SLUM UPGRADING
RIO DE JANEIRO/RJ – Complexo do Alemão – Investments € 307,84 millions
18
PAC SLUM UPGRADING
Roads, drainage, sewage, water
Roads and cable car
Housing
19
RIO DE JANEIRO/RJ – Complexo do Alemão
Social equipments
PAC SLUM UPGRADING
20
RIO DE JANEIRO/RJ – Complexo do Alemão
PAC SLUM UPGRADING
RIO DE JANEIRO/RJ – Complexo do Alemão – Investments € 307,84 million
21
PAC SLUM UPGRADING
RIO DE JANEIRO/RJ – Complexo do Alemão – Investment € 307,84 million
22
PAC SLUM UPGRADING
RIO DE JANEIRO/RJ – Complexo da Rocinha
23
PAC SLUM UPGRADING
24
RIO DE JANEIRO/RJ – Morro do Cantagalgo Pavão Pavãozinho
PAC SLUM UPGRADING
RIO DE JANEIRO/RJ – Morro Chapéu Mangueira Babilônia
25
MY HOUSE MY LIFE PROGRAM
5 MODALITIES: FAMILY INCOME X URBAN OR RURAL
AEREAS X POPULATION
PMCMV PUBLIC OFFER
PMCMV COMPANIES
PMCMV RURAL
PMCMV ENTITIES
PMCMV FGTS*
* EMPLOYEE’S SEVERANCE GUARANTEE FUND, USED FOR FINANCING HOUSING AND URBAN INFRASTRUCTURE
26
MY HOUSE MY LIFE PROGRAM
THE PROGRAM MIXES A COMBINATION OF DIFERENT TYPES OF
INSTRUMENTS AND A MODEL THAT COMBINES SUBSIDIES AND
FINANCING
GROUP 3
DIVIDED IN THREE GROUPS, THE
PROGRAM ATENDS FAMILIES WITH
A MONTHLY INCOME OF UP TO €
1.640 BUT WITH EMPHASIS ON
THOSE WITH A MONTHLY INCOME
OF UP TO € 525
GROUP 1: UP TO € 525
GROUP 2: UP TO € 1.074
GROUP 3: FROM € 1.074 UP TO € 1.640
1 – FEDERAL BUDGET
2 - EMPLOYEE’S SEVERANCE GUARANTEE FUND
27
INITIAL GOALS BY NUMBER
OF HOUSING UNITS
8%
GROUP 2
25%
GROUP 1
67%
HEAVY SUBSIDIES
OGU¹
FINANCING + SUBSIDIES
OGU + FGTS²
FINANCING
FGTS
MY HOUSE MY LIFE PROGRAM
PMCMV [2009-2014]
TOTAL HOUSING UNITS CONTRACTED: 3.560.296
FAMILY INCOME GROUPS
HOUSING UNITS DELIVERED
GROUP 1: UP TO € 525,00
1.65 MILLION
GROUP 2: UP TO € 1.074
1.47 MILLION
GROUP 3: € 1.074 TO € 1.640
440 THOUSAND
INVESTMENTS € 72,8 BILLIONS
HOUSING UNITS DELIVERED 1.769.730
Data base: Agosto/2014
Exchange Rate Sep 2014: € 1,00 = R$ 3,05
28
SOCIOECONOMIC IMPACTS OF MCMV PROGRAM
IMPACT ON JOBS, INCOME AND SERVICE SECTOR
INDICATORS
ANNUAL
AVERAGE
2010
2011
2012
2013
158.710
804.249
1.108.298
1.260.665
1.273.071
920.997
INCOME – DIRECT AND INDIRECT
(€ BILLIONS)
1.481
7.005
8.140
9.832
9.734
7.239
PURCHASE OF MATERIALS AND SERVICES
(€ BILLIONS)
0.815
4.130
5.690
7.251
7.322
5.042
JOBS – DIRECT AND INDIRECT
(Nº PEOPLE)
2009
Source: Ministry of Cities
Data: Contas Nacionais - IBGE
Cotação de 31/12/2013: 1US$=R$2,34
29
SOCIOECONOMIC IMPACTS OF MCMV PROGRAM
CONTRACTS PMCMV [2009 - 2013]
NUMBER OS UNITS CONTRACTED PER YEAR
Source: Ministry of Cities
30
AMOUNT CONTRACTED (€ BILLIONS)
SOCIOECONOMIC IMPACTS OF MCMV PROGRAM
IMPACT ON THE HOUSING STOCK
Annual impact of the PMCMV housing
production in relation to the total
formal housing stock
Annual impact of the PMCMV housing
production in relation to the stock of
the target group
1,7%
1,5%
1,0%
1,0%
0,3%
2009
Source: Ministry of Cities
* Estimated
31
2010
2011
2012
2013 *
SOCIOECONOMIC IMPACTS OF PMCMV PROGRAM
IMPACT ON THE PRODUCTION OF NEW HOUSING
Annual amount of housing produced by
PMCMV in relation to the total produced
in the country
Annual amount of housing produced by
PMCMV in relation to the total produced
for the target group
48,0%
40,3%
26,7% 27,5%
7,5%
2009
Source: Ministry of Cities
* Estimated
32
2010
2011
2012
2013 *
SOCIOECONOMIC IMPACTS OF PMCMV PROGRAM
NUMBER OF DWELLINGS CONTRACTED PER MUNICIPALITY
I
5.310 municipalities atended
(95,3%)
Fonte: Ministério das Cidades/Caixa/Banco do Brasil
Data Base: 2014
33
SOCIOECONOMIC IMPACTS OF PMCMV PROGRAM
INVESTMENTS PER MUNICIPALITY (€)
I
5.310 municipalities atended
(95,3%)
Fonte: Ministério das Cidades/Caixa/Banco do Brasil
Data Base: 2014
34
SOCIOECONOMIC IMPACTS OF PMCMV PROGRAM
NUMBER OF DWELLINGS CONTRACTED PER MUNICIPALITY
GROUP 1
4.369 municipalities atended
(78,4%)
I
Fonte: Ministério das Cidades/Caixa/Banco do Brasil
Data Base: 2014
35
SOCIOECONOMIC IMPACTS OF PMCMV PROGRAM
INVESTMENTS PER MUNICIPALITY GROUP 1 (€)
4.369 municipalities atended
(78,4%)
I
Fonte: Ministério das Cidades/Caixa/Banco do Brasil
Data Base: 2014
36
PMCMV COMPANIES
PMCMV COMPANIES – NUMBER OS DEVELOPMENTS
Size of the developments (number of housing units)
Size municipality
More than
5.000
From 1.500 to
4.999
From 1.000 to
1.499
From 500 to 999
From 100 to
499
Less than
100
Total
<= 50.000 inhab
1
3
32
173
38
247
50.000 to 100.000
inhab
4
21
107
405
70
607
> 100.000 inhab
34
63
184
453
63
797
32
32
58
233
32
392
25
30
87
383
42
567
96
149
468
1.647
245
2.610
Capital
5
Metropolitan Region of
Capital
Total
5
PMCMV COMPANIES:
Total of 2.610 developments
718 developments with more than 500 housing units
101 developments with more than 1.500 housing units
Medium size of the developments: 463 housing units
Apart from those there are another 2.254 developments with less than 100 housing units in
municipalities with less than 50 thousand inhabitants
37
HOUSING DEVELOPMENTS
VIVER MELHOR
Manaus - AM
8.895 housing units
38
HOUSING DEVELOPMENTS
BOSQUE DAS BROMÉLIAS
Salvador - BA
2.400 housing units
39
HOUSING DEVELOPMENTS
PARQUE VALDARIOSA
Queimados - RJ
1.500 housing units
40
HOUSING DEVELOPMENTS
JARBAS PASSARINHO e MACAUA
Rio Branco - AC
424 housing units
41
HOUSING DEVELOPMENTS
NOVO SÃO MIGUEL
São Miguel dos Campos - AL
499 housing units
42
HOUSING DEVELOPMENTS
VILA ESPERANÇA, VERDE E REAL
Petrolina - PE
1.396 housing units
43
HOUSING DEVELOPMENTS
RESIDENCIAL JAIME NORBERTO DA SILVA
ARACAJU – SE
369 housing units
44
HOUSING DEVELOPMENTS
RESIDENCIAL SERVIDOR
Anápolis - GO
352 housing units
45
HOUSING DEVELOPMENTS
BAIRRO CARIOCA
Rio de Janeiro - RJ
2.240 housing units
46
HOUSING DEVELOPMENTS
RESIDENCIAL PARQUE IGUAÇU
CURITIBA – PR
1.411 housing units
47
BENEFICIARIES – GROUP 1
Beneficiaries:

families with monthly income up to € 525,00
Prioritization criteria:

women head of family

families living in risk areas

people with disabilities
Additionally the municipality may establish
other 3 criteria's for selection
Reserve:

3% elderly

3% people with disabilities
48
Who selects the families:
Local government based on national
regulations and criteria

Registration:
families have to be registered in the
municipal cadastre and after selected must
be registered in two national cadastres:

1. CadÚnico – federal governments
cadastre of beneficiaries of social
programs
2. CadMut – federal governments
cadastre of any person that ever financed
a dwelling
BENEFICIARIES – GROUP 1
PROPORTION OF BENEFICIARIES BY FAMILY COMPOSITION
PRPORTION OF BENEFICIARIES BY INCOME GROUP
PROPORTION OF REGISTRATIONS BY GENDER
PROPORTION OF BENEFICIARIES BY AGE
8%
26%
0 a 29 anos
30 a 59 anos
60 anos ou +
66%
49
SOURCE: Caixa e Ministry of Social Development
BENEFICIARIES – GROUP 1
DISTRIBUTION OF PMCMV BENEFICIARIES ACCORDING TO
EDUCATIONAL LEVELS
42% OF THE BENEFICIARIES HAVENT COMPLETED PRIMARY SCHOOL
Fonte: Caixa e Ministry of Social Development
50
CHALLENGES
Its necessary to meet the HOUSING SHORTAGE and at the same time cope with the
POPULATION GROWTH
Developing countries are under CONSTRUCTION and lack URBAN AND SOCIAL
INFRASTRUCTURE
Our challenge is to produce, with SUSTAINABILITY, million homes, breaking
paradigms and building CITIES
51
CHALLENGES
THE PROGRESS ACHIEVED ARE SIGNIFICANT
HOWEVER, IN THE BRAZILIAN CONTEXT, LARGE SCALE PROGRAMS
CENTRALIZED AT THE NATIONAL LEVEL IMPOSE ENORMUS
CHALLENGES
52
SCALE
x
CELERITY
MUNICIPALITIES COMPETENCE TO
REGULATE LAND USE AND
APPROVE PROJECTS
x
MINIMUM REQUIERMENTS AT THE
NATIONAL LEVEL
NATIONAL RULE
x
REGIONAL DIVERSITY
CHALLENGES
THE GOVERNMENTS NEW INVESTIMENTS SHOULD BE ABLE TO
ENCOUNTER THE CHALLENGES THAT HAVE BEEN OUTLINED:
 Implementation of developments consistent with the municipalities ability to offer
urban infrastructure and services;
 Implementation of developments articulated to a strategy for generation of
employment and income;
 Increase levels of participation of local governments in regulating and controlling
land use and in the planning process and approval of developments;
 Greater participation and empowerment of families;
 Improvement of indicators and mechanisms for monitoring and evaluation of
housing programs;
 Expansion of the agenda of formation, capacity building, academic research and
extension related to social housing.
53
CHALLENGES
DESPITE SIGNIFICANT IMPROVEMENT IN INCOME AND URBAN
PATTERNS, THE BRAZILIAN CITIES STILL PRESENT, IN THEIR
PERIPHERIES, LOW STANDARDS OF URBAN INFRASTRUCTURE AND
SERVICES
It is necessary:
 To converge urban and housing policies and connect them better to the
territory;
 Establish a new governance structure including government, academia, private
sector and social organizations;
 Establish an interactive and horizontal agenda through innovative and
multidisciplinary networks.
54