Brazilian President Luiz Inácio Lula da Silva's government has been actively addressing social welfare concerns and economic pressures in the weeks leading up to the country's presidential election. One significant achievement highlighted by the government is the reduction of the social security benefits backlog. In February, pending applications for pensions and social-assistance benefits reached a record 3.128 million, but by the end of August, this number had fallen to 1.252 million. The government considers this backlog "eliminated" as the current number of applications under review is now roughly equal to the monthly volume of new claims, with the average processing time falling from 59 days to 34 days.
Lula has also defended increased social security spending, including minimum wage increases above inflation and the means-tested benefit for low-income elderly and disabled individuals (BPC), arguing that social security is not responsible for the country's fiscal deficit. He attributes the deficit instead to the $260 billion (R$1.3 trillion) in interest the government pays annually. The government has also implemented a costly program of credit expansion, income tax exemptions, fuel subsidies, and debt forgiveness to address widespread malaise caused by climbing debt, high interest rates, and increasing cost of living, which has not been offset by promising GDP growth and a record low unemployment rate of 5.1% by the end of 2025.
In addition to addressing social security, the government announced further cuts to fuel taxes on September 9 to protect consumers from rising oil prices. These measures, alongside the increased social welfare payments, including the Bolsa Família program, are seen as attempts to "win over voters' wallets" ahead of the election. The Bolsa Família program, which began September payments on the 17th, provides a minimum of $120 (R$600) per family, with additional payments of $30 (R$150) for children up to six years old and $10 (R$50) for pregnant women, nursing mothers, and children or adolescents aged seven to eighteen. These payments benefit over 19 million families, with the total amount for September estimated at around $2.74 billion (R$13.7 billion).
Despite these efforts, the election remains tight. A September Datafolha survey showed Lula with 46% support to Bolsonaro's 43% in a run-off scenario. Critics suggest that the government's fiscal expansion and increased social spending could exacerbate public debt and negatively impact the long-term fiscal outlook. However, the government's immediate focus is on demonstrating tangible improvements in public services and financial support to secure electoral success.
