The Ministry of Social Security, now separate from the Brazilian health system as discussed above, carries out the conventional mandate of ensuring old-age assistance. Until the 1940s, social security was limited to private plans organized by employers and employees. Over time, the components of the system became increasingly integrated and controlled by the federal government. More recently, health benefits and social security have become nearly universal, no longer depending on formal employment and contributions. Retirement and disability benefits are pegged to the official minimum wage. They weigh so heavily on government spending that they are one of the reasons the government resists raising the minimum wage for the active work force. At the same time, the middle class considers these benefits insufficient and, therefore, seeks private social security plans or makes investments in real estate, given the instability of financial markets in Brazil. The social security system will face even greater challenges as the age structure of the population changes, with a greater number of pensioners in relation to the number of contributing workers.
Data as of April 1997