Of this total, R$30 billion would be cut in 2025 and R$40 billion the following year; information was provided to subscribers via the Poder360 newsletter
The Minister of Finance, indicated to the Congress leadership that the government’s spending cut package should total R$70 billion -30 billion in 2025 and R$40 billion in 2026. The information was anticipated on Thursday (14.Nov.2024) by Drivethe exclusive newsletter for subscribers of Poder360.
The minister is charged with announcing a fiscal adjustment package. The government invested in a speech about reviewing public expenditure, especially in the last 3 weeks. However, there has not yet been an official announcement, which depends on the president’s approval. (PT).
The economic team linked the increase in the minimum wage to the rules of the fiscal framework, approved in 2023. With this measure, the adjustment would be, at most, 2.5% above the INPC (National Consumer Price Index).
The government’s objective is to impose the same spending ceiling as the fiscal framework on mandatory expenses – such as social security benefits, salary bonuses and unemployment insurance, for example. These programs are indexed to the minimum wage.
This digital newspaper had already that changes in the –paid to fishermen when the practice is prohibited for species preservation reasons– and in the salary bonus. The BPC (Continuous Payment Benefit) should also be subject to changes.
The government announced a to make adjustments and combat fraud, but changes in the job market in recent years require structural measures.
NEGOTIATIONS
Haddad met at 4ª fair (13.nov) with representatives from the Ministry of Defense. It was a request from Lula before making the reduction in public expenses official.
The minister said that new measures related to the military body, such as reviewing the pensions of barracks members, could be added to the package already being prepared.
The economic team and other ministers met with President Lula during the past week. There was disagreement on the Esplanada about the package, in addition to concern about the political cost of possible actions, which could harm the government’s popularity.
In addition to Defense, the ministries that have already been involved in the discussions were:
