Amendments represent 72% of transfers to municipalities in 2024

Discretionary (non-mandatory) transfers to municipalities through amendments reached R$28.8 billion in 2024, which represents 72.2% of the total transfers made voluntarily this year to cities. It is almost triple what was allocated by the government to municipalities voluntarily in the period (R$ 11.1 billion).

The data is available in a study carried out by the deputy’s technical advisor (PSD-RJ). Here is the document (PDF – 7 MB).

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The amendments became the most relevant instrument that transfers from the government to municipalities from 2021 onwards, the year following the start of the covid-19 pandemic. That year, voluntary transfers through amendments totaled R$23.7 billion compared to R$5.5 billion allocated by the federal government.

This position has been consolidated since then. Thus, congressmen began to play a more significant role in relation to city halls.

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The study considers individual amendments (RP6), bench amendments (RP7), committee amendments (RP8), in addition to rapporteur amendments (RP9) – overturned in 2022, after the (Supreme Federal Court), which ruled that they are unconstitutional. Government resources came mainly from discretionary resources (RP2) and from the old PAC (Growth Acceleration Program), RP3.

The last year in which the federal government recorded a greater volume of discretionary transfers than Congress was in 2020, when it allocated R$27.0 billion compared to R$17.1 billion originally transferred by deputies and senators.

“You can discuss how the amendment was created, that it is a ‘Frankenstein’, that no country in the world has this model, that it has grown too much, that it is not very transparent, but it has some aspect that is important: it is another channel of centralization of resources from Brasília to Brazil, and in a federative way”said Pedro Paulo to Poder360.

PIX AMENDMENTS

Pix amendment payments – formally called “special transfers” – totaled R$ 4.5 billion until October 25, 2024, the latest data available in the study by deputy Pedro Paulo. The amount transferred corresponds to 54.8% of the allocation in 2024 (R$ 8.2 billion) for amendments of this nature.

The Northeast was the one that received the most pix amendments in 2024 (R$ 1,597.2 billion or 35.6% of the total), while the Central-West was the one that had the least access to resources from this type of amendment (7.8 % or R$350.2 million).

Pix amendments received their name due to the speed of payment. They fall into the bank accounts of states and municipalities. They are part of the individual amendments and, therefore, binding.

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In 2024, pix amendments represented 1/3 of individual amendments (R$25.1 billion). It’s R$8.2 billion.

Through the allocation, municipalities will have access to R$7.2 billion (88.2% of the total) and the rest will go to States and the Federal District.

Here is the distribution of the R$8.2 billion:

• investments – R$6.9 billion;
• current expenses – R$1.3 billion.

In 2020, it was just R$620 million. This year, they became 13 times greater than the value in 2020 – percentage growth of 1,224.2% (a difference of R$7.6 billion from 2024 to 2020).

There are limitations on pix expenses:

• veto on personnel expenses – cannot be used to pay salaries and civil service charges;
• veto on debt payments;
• use to capital expenditure – 70% must be applied to this type of expense. Includes works, purchase of installations or equipment.

There are loopholes: there is no clear impediment for municipalities to reallocate resources that would be destined for works and start paying salaries.

This would cause the payroll to grow. It is up to control bodies to evaluate the allocation – such as state and municipal audit courts.

COMPARATIVE

The study states that the total amendments from 2024 represent 21.4% of the FPE (State Participation Fund) and 18.2% of the FPM (Municipal Participation Fund) transfers.

According to the current FPE rules, the South and Southeast were those that received the least transfers. Here it is below:

• Southeast – 59,1%;
• On the – 41,4%.

São Paulo received the most in amendments (R$2.7 billion). It is more than double the FPE (R$ 1.3 billion).

DISTRIBUTION BY HDI

According to the study, municipalities that have fewer inhabitants and lower HDI (Human Development Index) received more resources in amendments per capita.

Cities with less than 5,000 people and HDI below 0.600 had amendments distributed per capita of R$ 584.

The amount is almost 14 times more than the average amount allocated to municipalities with an HDI equal to or greater than 0.750 and with a population equal to or greater than 50,000 inhabitants – which had amendments per capita of R$ 42.

According to the study, these values ​​concern amendments committed to 2024.

STRENGTH OF CONGRESSMANS

In July, the Poder360 that each of the deputies allocated in their initial allocation, on average, R$ 15.3 million of investments via individual parliamentary amendments in 2024. The amount exceeds everything that the mayors of 4,502 municipalities managed to invest in 2023. This corresponds to 84% of the cities for which budget data is available.

In the case of senators, the average investment budget is R$30.7 million. It is more than that applied by 4,967 municipalities (or 93% of the total) last year. The data comes from a survey by this digital newspaper with data from Siga Brasil and Siconfi.

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PROPOSAL

Congressman Pedro Paulo wants to link amendments to indicators in specific areas of public policies, such as education, health, security and fiscal indicators. According to the congressman, the objective is “encourage responsible fiscal management”.

The initiative would take place through a complementary bill to create a reserve of resources in the budget law and which would be intended to reward, through parliamentary amendments, States and municipalities that show improvements in the results of fiscal policies.

Among the items to be used as parameters are:

• Capag (payment capacity);
• limit on personnel, investment and fiscal management expenses; and
• public policies linked to the areas of education, health and security would be.

This would be limited to a percentage of around 5% to 10% of the total, depending on the achievement of targets related to the indicators.

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