The expected fiscal package, with spending cutting measures by the federal government, remains without a date to be announced. Until this Monday morning (11), there was no prospect of when the economic team would make the official announcement of the main points, amid the impasse involving, mainly, ministers from departments linked to the social area who resist reducing their budgets.
Last week, the president Luiz Inácio Lula da Silva (PT) he had practically daily meetings to discuss the matter – and was still not convinced about what should be announced, although he understood the need for the government to reduce expenses.
Last week, in fact, Lula asked the Minister of Finance, Fernando Haddad (PT)to postpone an official trip to Europe to stay in Brasília (DF) and participate in meetings on the fiscal package with other ministries. That’s what happened. Even so, there is still no consensus within the government on the measures.
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Haddad, who would leave Brasília for São Paulo (SP) last Friday (8), ended up staying in the federal capital to participate in a new round of discussions with Lula and the other ministers. What could be the last meeting on spending cuts, however,. Haddad only went to São Paulo on Friday night, but is already back in Brasília.
Initially, in an interview with journalists last week, . Market expectations grew and, given the government’s uncertainty in the following days, there was tension among investors and the dollar rose.
Lula and Haddad recognize that, before the government announces the fiscal package, it is necessary to present the measures to the presidents of the Chamber of Deputies, Arthur Lira (PP-AL)and the Senate, Rodrigo Pacheco (PSDB-MG).
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Last week, both participated in the 10th Summit of Presidents of the G20 Parliaments (P20), which ended this Friday (8), which made any negotiations on cutting spending with members of the government impossible. Furthermore, Pacheco had to travel to Belo Horizonte (MG), on Friday, due to the death of his father.
Strong resistance
Ministers who command portfolios linked to the social area, such as Wellington Dias (Social Assistance), Carlos Lupi (Social Security) e Luiz Marinho (Work) are among those who strongly resist fiscal adjustment.
Since the end of October, Marinho has publicly raised his tone against the economic team and workers.
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“If no one talked to me, there is no [debate sobre essas supostas mudanças]. I am responsible for Labor and Employment. Unless the government fires me”, said Marinho.
case of cost-cutting measures that, in his view, would be “acquired rights” – or change the policy of increasing the minimum wage.
“Our biggest challenge is fiscal balance. How can we do this given the misery of the Brazilian people? I want to discuss taxation of great fortunes. Haddad is even proposing this. Those who have to donate something in this process are those who have a lot, not those who have nothing. How are you going to get Social Security?” asks Lupi.
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“The average salary for people is R$1,860. What am I going to do with this? Take away acquired rights? Don’t count on me. Will I lower my salary? Don’t count on me. I will no longer have any real gains [no salário mínimo]? Don’t count on me. If that happens, I can’t stay in government. I don’t think the government will do that. We have to charge large debtors, tax evasion and undue exemptions”, stated the minister.
According to Carlos Lupi, “mandatory expenses cannot be cut”. “Do you think any congressman will take away retired people’s rights? I have to be born again to believe this story. What we can do, and are doing, is tighten the irregularities. We are making big savings by giving people who are no longer entitled to sick leave. If a guy had an illness and got cured, how can he continue to have a license?”, he explained.
“The big challenge for Social Security is that more than half of our requests are for sickness benefits. Is Brazil this sick? We have to improve, for example, biometrics. We need to use cutting-edge technology and help those who have the right to separate the wheat from the chaff.”
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Proposals on the table
is to “redesign” the salary bonus (a type of 13th salary paid to formal workers who receive up to two minimum wages).
Government members estimate that the benefit – which will cost R$30.7 billion in 2025 – could be more concentrated on the poorest. According to current rules, an increasing number of people have benefited from the bonus, which is driven by the policy of increasing the minimum wage.
On the other hand, the decoupling of social benefits, such as the bonus and the Continuous Payment Benefit (BPC), in relation to the minimum wage, has been ruled out by the government.
There are still those in the economic team who defend that the health and education floors be changed, but the measure does not have the sympathy of Lula and the government’s social ministers. So far, the simulations presented to the President of the Republic indicate that there would be a
One of the pillars of the measures presented by the Ministry of Finance to Lula would be the adoption of instruments that would help optimize the review of social policies, minimizing possible irregularities. One of the ideas raised is the requirement for biometrics.
Another important step would be to expand the target audience for the review, previously restricted to people whose registration is more than 48 months out of date. With the expansion, this time would be reduced to 24 months.
Ministers Fernando Haddad (Finance), Rui Costa (Casa Civil), Simone Tebet (Planning and Budget), Geraldo Alckmin (Development, Industry, Commerce and Services), Camilo Santana (Education), Nísia Trindade (Health) and Paulo Pimenta (Secretariat of Social Communication of the Presidency).
“Shortest” week
This week will be “shorter” in Brasília because of the national holiday of November 15th (Friday), the date of the Proclamation of the Republic – which, in theory, could make any announcement related to the tax package even more difficult. vNext week, there is also another national holiday on the calendar: November 20th (Wednesday), Black Awareness Day.
According to the official agendas of the Presidency of the Republic for this Monday, there is no specific meeting planned on cutting expenses. Lula has scheduled talks with minister Márcio Macêdo (General Secretariat); the special secretary for Legal Affairs of the Civil House, Marcos Rogério de Souza; in addition to a meeting with leaders of the G20 Engagement Groups — in which Haddad will also participate.
