By Anthony Boadle
BRASILIA (Reuters) - President Dilma Rousseff on Tuesday raised the monthly stipend of 2.5 million people living below the poverty line to make good on her promise to eradicate extreme poverty in Brazil, a nation with enormous income gaps between rich and poor.
She said she has almost met her anti-poverty target halfway through her four-year term, though Brazil's last census points to 700,000 Brazilian families who still live in extreme poverty but are not registered on government social programs.
Success in the war on poverty would garner useful political capital for a possible re-election bid by Rousseff in 2014 and compensate on the welfare front for her failure to deliver strong economic growth.
With a stroke of her pen, Rousseff raised monthly stipends for the remaining 2.5 million people known to be living below the poverty line, raising their income to 70 reais ($35) a month through the so-called Bolsa Familia, or Family Grant program, the country's flagship social program for the past decade.
"We are turning the page on our long history of social exclusion that had perverse roots in slavery," Rousseff said after signing the decree authorizing the increase, which will go into effect on March 18.
There are still extremely poor Brazilians, she acknowledged, but the government does not know who or where they are because they have not signed onto Brazil's national register of social programs. They could be as many as 700,000 families, or 2.5 million people, based on census data.
"The state will have to go and find them to include them before they come knocking on our door," Rousseff said. "But the most difficult part has been done. Soon there will be no Brazilians steeped in extreme poverty."
Brazil's internationally praised monthly stipend program has pulled 36 million people from extreme poverty since it was first expanded in 2003 by Rousseff's predecessor and political mentor, Luiz Inacio Lula da Silva. In eight years in office, Lula oversaw an economic boom that helped create a vast middle class in a country long known as a society of haves and have-nots.
The means-based program is based on conditional cash transfers - usually paid to mothers who must prove their children attend school and are properly vaccinated. According to the United Nations Development Program, Brazil has successfully raised living standards through its anti-poverty programs, which are being emulated worldwide.
Despite an economic slowdown that has dogged her administration, Rousseff extended Lula's poverty reduction program when she took office in 2011 to add stipends for children and adolescents living in extreme poverty, farmers who engage in conservation and people who start technical training.
Brazilians who have benefited from these programs are still poor by any standard, but a regular income, however small, affords them some stability. While Brazil uses the same definition of extreme poverty as the United Nations - anyone who earns less than $35 a month - critics say that is hardly enough to raise people above the poverty line in a developing country where the cost of living is as high as in wealthy nations.
More than 48 million Brazilians, or one quarter of the population, are registered for the social programs that will cost the federal government 24 billion reais this year, including 800 million reais to fund Tuesday's expansion.
Rousseff's new slogan for improving social conditions in Brazil is: "The end of poverty is just the beginning."
She said her government will now focus on improving access to public services for poorer Brazilians, extending school hours for their children, and ensuring they have electricity, water, sewers and basic housing.
With the help of local mayors, her government will seek out families still not registered for social programs, either because they live in remote corner of the Amazon rainforest or in shantytowns in the big cities of southern Brazil.
Brazil's sputtering economy has not dented Rousseff's wide popularity, largely because unemployment has fallen to its lowest level on record, but also thanks to her continued efforts to reduce poverty. Rousseff is widely expected to run again in 2014 and delivering on her promise to end extreme poverty should help her win re-election in the face of weak opposition.
(Editing by Todd Benson and Doina Chiacu)