Brazilian public funding to nonprofits has dropped, study reveals

An important public policy instrument has suffered with the economic crisis in Brazil: nonprofits, which support fundamental activities such as healthcare and education, have been suffering constant cuts in public funding.
Law
05 September 2018
Brazilian public funding to nonprofits has dropped, study reveals

An important public policy instrument has suffered with the economic crisis in Brazil: nonprofits, which support fundamental activities such as healthcare and education, have been suffering constant cuts in public funding. Public funding dropped from around BRL 8.4 billion in 2014 to BRL 4.3 billion in 2017, down to virtually the same level of funding recorded in 2004.

This is one of the pieces of data that called the most attention in the research project conducted by IPEA, which launched the study “Profile of Civil Society Organizations” on August 16, during a seminar at FGV’s Sao Paulo Law School (Direito SP). The work included an Advisory Group composed of experts in the field, among which were Grupo de Institutos, Fundações e Empresas (Gife) and Direito SP, which has a research track on Civil Society Organization.

“This update to such mapping puts the work of Civil Society Organizations (CSOs) into context, which are crucial for democracy and operate on relevant social areas. Aline Gonçalves, executive coordinator of the “Economic Sustainability of Civil Society Organizations”, of Direito SP’s Coordination for Applied Legal Research (CPJA), explained that some of them perform an important job of complementing the State in the provision of basic services such as education and healthcare.

According to the researcher, the study also aims to bring new elements that may help promote the donation culture throughout the country. One of the most important debates is the regulation of the ITCMD (Estate and Donation Tax) levied on private donations to organizations. Alongside South Korea and Croatia, Brazil is one of the few countries in the world (the study surveyed 75 countries) that virtually makes no distinction between donations to for-profit or non-profit legal entities. “This lack of distinction hinders the transfer of private funds to CSOs, which nowadays in Brazil is practically negligible, compared to other countries where this culture is well established”, said Gonçalves.

In addition to the drop in funding, IPEA’s report also points to a decrease in the percentage of federal funding between 2015 and 2017 – from around 0.85% to just over 0.5%. In 2016, those funds reached approximately 0.2%.

The Profile of Civil Society Organizations also brings information on the geographical distribution of the activities of Civil Society Organizations, purposes, legal nature, data on officially registered workers, size of OSCs, formal employment relationships, education of employed human capital, average compensation in the sector and a research agenda for coming years, aiming to develop and professionalize the work of CSOs. The information can also be accessed on the website.

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