The aim of this article is to summarise certain positive results achieved by the Lula government in the sphere of social policy and to highlight the new challenges taken on by President Dilma Rousseff in terms of eradicating extreme poverty, after her first year in government. After Lula’s success with social policy, Rousseff has committed herself to eradicating extreme poverty over the short term (the four years of her mandate) in a federation that is marked by weak links in cooperation, a distinct heterogeneity within the federated bodies and profound socio-economic inequality among citizens. Under Lula’s government, the factors that most helped to reduce poverty and inequality were the recovery of the minimum salary’s real value in rates higher than that of inflation, as well as an increase in formal employment, with the creation of approximately 12,000,000 jobs in eight years. For Dilma’s term of office, which began with a downturn in economic growth rates, an even bigger challenge lies ahead. In light of this, the article evaluates the prospects for success of Dilma’s government in terms of eradicating extreme poverty in Brazil.