Brazil's Favela Housing Program

Brazil's Lula launches favela housing program
By Raymond Colitt

BRASILIA, Brazil, March 6 (Reuters) - President Luiz Inacio Lula da Silva launched a program on Monday to rebuild rickety housing in Brazil's sprawling shantytowns, but a peasants' group that has traditionally supported him said he had fallen short of his pledge to tackle social inequality.

The government earmarked 1 billion reais ($472 million) to finance housing in favelas, or shantytowns, mostly for those on stilts along rivers, mangrove swamps, or the seaside, Lula said in his fortnightly radio address "Coffee with the President."

Tax incentives, land titles for favela inhabitants, and a line of credit of 18.7 billion reais from a state bank would help kick-start the construction industry, Lula said.

"Brazilian society finally is seeing the government meet a social demand (for housing) that had dragged on for years in this country," Lula said.

Opposition politicians say Lula is boosting social spending this year to improve his chances in a presidential election scheduled for October.

The former union leader came to power in 2003 with pledges to tackle Brazil's gaping income inequality.

Polls show Lula is particularly popular among the poor. In his Monday address he recalled his impoverished background.

"The poor are generous by nature, we help each other," he said.

Lula and his family migrated on the back of a truck from northeastern Brazil to Sao Paulo, where he shined shoes and sold peanuts on the street.

Lula aides say increased publicity to showcase government action since December helped rebuild his popularity, which was dented by a corruption scandal last year in which his Workers' Party used illicit funds to finance election campaigns and allegedly bribe legislators.

He has traveled extensively to inaugurate public works projects in recent weeks.

But critics say he has fallen far short of initial promises. The Movement of the Landless Rural Workers on Monday occupied three sites in northeastern Pernambuco state in protest against the government, bringing its total land occupations there to 18.

The government resettled only 1,500 families in Pernambuco last year, short of its target of 8,000 families, the group said.

"Lula did not carry out the land reform he promised," Edilson Barbosa, a coordinator for the movement, told Reuters. ($1=2.12 reais)>