City of São Paulo Temporarily Suspends 5,000 Rental Aid Benefits

RIO DE JANEIRO, BRAZIL – The City of São Paulo has decided to suspend approximately 20 percent of the 26,000 monthly payments of the rental-aid program, affecting some 5,000 families, after an audit allegedly found signs of benefit irregularity.

The program involves monthly payments of R$400 (US$102) to “high vulnerability families” who have lost their homes due to living in risky conditions or who have been displaced to make way for development programs.

The suspension, disclosed by CBN radio, is temporary, says the municipal secretary of Housing, João Farias.

This was decided after a thorough audit carried out at the request of Mayor Bruno Covas’ (PSDB) administration at the benefit withdrawal point: they were being withdrawn from bank branches outside the city of São Paulo.

Most of these cases were found in the city of Embu das Artes, a town neighboring the capital, although there were withdrawals in the interior of São Paulo and even in states of the Northeast of the country.

To be eligible for aid, one of the main criteria is to live in the city of São Paulo.

Farias says this measure is temporary because payments will return to normal when the family affected by the suspension proves not to have abused the benefit.

Farias also justifies the immediate cut, without prior notice, with the fact that the suspension is not final.

“There wasn’t enough time to inform the families since the next payment is due on August 1st,” he said.

The secretary also says that later this year, it will carry out a complete re-registration of the program. Proof of rental address will be required from beneficiaries.

When asked about the potential inability of many of these families to produce such a document, given the number of informal housing conditions (such as renting shacks, rooms in tenements, and others), Farias reported that “a statement from the person,” i.e., the landlord, would suffice.

In addition to spotting payments made in other cities, the audit of payments found installment benefit withdrawals. “Withdrawals of R$80, R$70 and R$10,” according to Farias.

These beneficiaries did not see their payments suspended, but were targeted by the secretariat since the assessment is that payments may be diverted to other purposes.

The Secretary of Housing said that there has been no re-registration for the program, at least since 2008, and that the goal of the measure is to withhold undue payments in order to be able to include other families in need of the benefit (and entitled to it), but do not receive it due to budget restrictions.

The program costs approximately R$125 million per year.