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ARGENTINA:
Child Benefits Expanded to Unemployed and
Informal Workers
By Marcela Valente
BUENOS AIRES (IPS) - A new monthly family
allowance of nearly 50 dollars per child
that will be paid out as of December to
parents who are unemployed or work in the
informal economy in Argentina was heralded
by experts as an extraordinary step forward
in terms of social policy.
"There are a large number of families who
needed a complementary income, and now they
will receive it," economist Rubén Lo Vuolo,
a researcher at the Interdisciplinary Centre
for the Study of Public Policy (CIEPP) and a
member of the Basic Income Earth Network
(BIEN), told IPS.
"This marks a watershed in social policy in
Argentina," said the expert, who had been
calling for the creation of a universal
child benefit scheme, because the current
system only covers the children of formal
sector workers.
In Lo Vuolo's view, the new government
strategy is "original," and the "generosity"
of the amount makes this country a leader in
South America in initiatives that recognise
the right to an income for vulnerable
groups, like poor children and the elderly.
Since 2007, neighbouring Uruguay also has a
similar family allowance scheme for children
under 18, which provides comparable
payments.
Economist Claudio Lozano, a lawmaker with
the centre-left opposition group Proyecto
Sur, told IPS that the expanded child
benefit "is very important" because it
"broadens coverage to youngsters excluded
from the system."
Although formal sector workers in this South
American country already receive monthly
payments per child up to the age of 18,
informal sector workers and the unemployed
do not.
A measure of this kind was demanded by
nearly the entire political spectrum, the
Catholic Church, and the Central de
Trabajadores Argentinos (CTA), one of the
country's two central trade unions.
The government of Cristina Fernández, of the
centre-left wing of the Justicialista (Peronist)
Party, created the "Universal Family
Allowance per Child for Social Protection"
of 180 pesos (48 dollars) a month as a
social safety net for hundreds of thousands
of children and adolescents who are
marginalised by the social system.
The benefit is higher than what the
Brazilian government provides low-income
families through the Bolsa Familia programme,
which pays poor families with children an
average of around 35 dollars a month,
conditional on school attendance and regular
medical check-ups.
Like the Brazilian programme, Argentina's
expanded family allowance is targeted,
rather than universal.
It covers the children – up to the age of 18
- of unemployed parents and informal sector
workers, rural workers and domestics with
incomes below the minimum monthly wage,
equivalent to 390 dollars. It also covers
disabled dependents of any age. Families
will receive payments for up to a maximum of
five children.
Families currently receiving smaller
subsidies under other social assistance
plans, such as the one that pays unemployed
heads of households 150 pesos (40 dollars) a
month, will instead be covered by the new
family allowance system to go into effect on
Dec. 1.
According to official statistics – which the
government has been accused of manipulating
since 2007 – unemployment stands at 8.8
percent in Argentina, while over 40 percent
of those who work do so in the informal
economy, without being registered in the
social security system.
The measure could benefit 5.4 million
children, which is close to the number of
poor children in Argentina. According to the
CTA, 47 percent of children under 18 – a
total of 6.3 million youngsters - in this
country of 40 million are poor.
The government decree that created the new
family allowance scheme states that despite
the economic growth, rise in employment and
drop in poverty seen in the last few years,
there are still excluded segments of society
in need of attention. It also stresses that
"the most diverse political and social
sectors" were demanding a measure that would
address the needs of "the most vulnerable."
However, observers argue that the measure
should have been passed by Congress, rather
than created by means of a government
decree. Even those who backed the idea of a
direct cash transfer programme wanted to
debate the different alternatives in
Congress and pass a new law, rather than see
a programme created by decree, which could
easily be repealed or modified.
"Much progress had been made towards a
consensus on the need to expand the family
allowance, and it should have been done
through a law," said Lozano. "This way, an
opportunity to implement a new right to a
basic income for all children, without
depending on the will of any specific
government, was lost."
He said that in order to make the right
truly universal, the current family
allowance law, under which the government
pays a per child benefit to formal sector
workers with incomes under 4,800 pesos
(1,260 dollars) a month, should have been
overturned.
Critics also say the income tax exemption
benefiting parents with incomes higher than
that ceiling should have been eliminated,
because it represents a state subsidy to the
children of the best-paid workers.
They maintain that the best solution would
have been to create a unified scheme
granting a basic income to all children,
instead of different systems depending on
the parents' employment situation.
Another problem, they say, is that if a
parent's employment situation changes – for
example, an informal sector worker's income
climbs above 390 dollars a month, or the
parent becomes self-employed – the youngster
would lose the monthly child benefit.
In addition, they criticise the programme's
source of financing, which will come from
the National Social Security Administration
(ANSES).
ANSES officials say earnings generated by
the social security funds will be used to
finance the new family allowance programme,
which will cost around 2.6 billion dollars a
year.
But critics say that if the social security
funds generate returns, they should be used
to increase pensions, extend them to those
who do not draw a pension, or pay off unpaid
pensions whose beneficiaries won court cases
but have not yet received what they are
owed.
The CTA, to which Lozano belongs, argued
that the new child benefits should be
financed through reforms of a tax system
that is considered regressive because it
does not have a capital gains tax on stocks,
bank deposits, or real estate transactions.
The sources who spoke to IPS also question
the effectiveness of the conditions set for
receiving the cash transfer. Lo Vuolo called
it a "repressive mechanism" because it
threatens to take the benefit away from
children who drop out of school or don't get
their vaccinations. "That's not fair,
because if it happens, it wouldn’t be the
child's fault," he said.
Lozano said that although it's not a bad
thing to monitor school attendance and
vaccination, the state must also assume
shared responsibility for compliance, and
should also keep track of the children of
formal sector workers, who receive child
benefits without conditions. |
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