This Friday (22), the Lula government officially blocked R$6 billion in the 2024 Budget. The information was disclosed in the Bimonthly Revenue and Expense Assessment Report for the 5th Bimester of this year. The document is prepared by the Ministry of Planning and Budget (MPO).
With the announcement, the total blocked went from R$13.3 billion in the 4th two months to R$19.3 billion in the last period of the year.
On Thursday (21), the Minister of Finance, Fernando Haddad, had confirmed the s.
With the blockade, the economic team projects a R$28.7 billion hole in public accounts by the end of 2024. The total is close to the tolerance limit established by the year’s fiscal target.
The government’s objective is to eliminate the deficit in public accounts, which means equalizing expenses and revenues.
The fiscal framework determines a “band” of 0.25% of the Gross Domestic Product (GDP) for the primary result annually. Which means that even with the target, the government could present a gap of R$28.8 billion without breaking the law.
In the report, the MPO highlights that despite the blockade, there was no contingency.
The blockage occurs when the government reviews Budget expenses because they were greater than allowed by the fiscal framework. Contingency occurs when revenue does not reach the expected value.
Expenses
Furthermore, according to the report, the blockade was motivated by a higher-than-expected increase in public expenditure.
“Among the variations in expenses subject to the limit, projected in the Report, the highlight is the increase of R$ 7.7 billion in Social Security Benefits, explained by the behavior of expenditure in the 5th two months. This increase was partially offset by the reduction of R$ 1.9 billion in expenses with Personnel and Social Charges resulting from the redesign of expenses with cash bonuses”, says an excerpt from the report.
The blockade is not about the package of cost-cutting measures expected to be announced next week.
