Brazilian Expenditure Surpasses That of Wealthy Countries

07/17/2017 - 08h50

Brazil spends on the Social Security of its public workers a bigger share of its G.D.P. than the 34 developed countries members of the Organization for Economic Co-operation and Development (OECD).

Rogerio Nagamine Costanzi and Graziela Ansiliero, researchers at the Institute for Applied Economic Research (Ipea), say that Brazil spent 3.5% of its G.D.P. in 2016 while the U.K. spent 2.3%, Germany, 1.5%, and the U.S., only 0.8%.

They stress that, although there are some methodological difficulties to make international comparisons, Brazil's expenditure is much above the average due to the high average value of the benefits the country offers: "Brazil is an outlier regarding expenditure with the RPPS (Welfare Regimen for Public Servants)."

In 2016, the public sector (not including the military) was responsible for 40% of the Social Security deficit.

Costanzi believes that the integration of the regimes could reduce double payments and increase expenditure with payments while maintaining benefits, data and information.

Only 4 of the OECD's 34 countries have an entirely separate system for civil servants: Belgium, France, Germany and South Korea.

In all the countries of the group, in the past 20 years there were at least between one and four changes in the public social security system: unification with the private sector; more restrictions for advance benefits; increases in contribution; and increases in age for retirement.

In several cases, however, differences were kept, such as in the sectors of the military, police officers, teachers and judges.

Translated by THOMAS MUELLO

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