Federal deputies Kim Kataguiri (União-SP), Júlio Lopes (PP-RJ) and Pedro Paulo (PSD-RJ) presented this Wednesday (27) a Proposed Amendment to the Constitution (PEC) that aims to guarantee fiscal balance in federal accounts. The text was prepared by legislative consultants based on the current Union budget.
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The main measures of the proposal (see below) were presented by deputies at a press conference in the Chamber’s green room. Now, they intend to start collecting signatures, with at least 171, to register the PEC and begin processing.
According to deputy Kataguiri, the PEC brings a series of “objective measures to end the amount of mandatory spending” and “free up more budget for public policies”.
“It is the most important structural reform since the real plan. We estimate savings in 6 years of R$1.1 trillion and in 10 years of almost R$3 trillion. So, we attack the issue of super salaries, limiting compensation funds in the Constitution. We also foresee a reduction in tax privileges by 10% that today many large companies receive without giving due return to society”, explained Kataguiri.
The parliamentarian highlighted that the prospect is that by 2026 there will already be something “around R$80 billion in reduced spending”.
The PEC projects an economy of R$ 1.12 trillionfrom 2026 to 2031, distributed as follows:
- Review of tax expenditures: R$ 194.4 billion.
- Deindexation of social benefits: R$485.9 billion.
- Unlinking constitutional floors: R$323.2 billion.
- Changes in the salary bonus: R$ 122.3 billion.
Deputy Pedro Paulo mentioned that “there is no point in wiping out the ice”, as Lula’s government has proposed with the spending cuts package, which has not even been announced, but has only been postponed by the Minister of Finance, Fernando Haddad.
“We need medium and long-term measures, which have to attack large expenses, because the problem is very serious. The patient [Brasil] He is in the ICU, there is no point in giving dipyrone and providing palliative care. We have to carry out a complete, vigorous, painful treatment. The remedies that we are proposing here have a political cost for parliamentarians”, he declared.
For deputy Júlio Lopes, one of Brazil’s biggest budgetary problems is the social security system. “There is an inversion of the age pyramid and this inversion needs to be treated, it needs to be cared for and managed. From 2040 onwards, our population will start to shrink. By 2070, we will have almost 40% of the population as elderly. Therefore, this is not a possibility of postponement, it is an immediate problem”, said Lopes.
Limitation of parliamentary amendments
Among the measures of the Fiscal Balance PEC is limiting the amount of parliamentary amendments. The deputies propose that the total number of amendments will be limited by the percentage of discretionary expenses of the Executive Branch, in addition to ensuring better management of the control of mandatory expenses.
According to Julio Lopes, the PEC aims to create a “positive incentive” for the allocation of amendment resources. “By placing parliamentary amendments, they are linked to the discretionary space we have in the Budget. We are provoking the parliamentarian himself to work on containment, on responsibility for the growth of mandatory expenditure. Because if we have more discretionary budget, the amendments will grow together. It’s almost a reward to parliamentarians for their restraint”, explained the deputy.
Kataguiri also reinforced that the PEC will be a “sacrifice for everyone” and “the more parliamentarians cut spending, the more they will have to invest in their bases, in their states”.
PEC measures
At the press conference, the deputies highlighted that the economic challenges faced by Brazil motivated the presentation of the PEC. They cited the following challenges as an example:
- High public deficitcomparable to that of countries at war.
- Growing public debtwith fiscal risk projections.
- Accelerated demographic transitionincreasing pension costs.
- Flattening discretionary expensescompromising investments.
- Unsustainability of the New Tax Frameworkwith risks of fiscal dominance.
The PEC seeks to promote a gradual and socially balanced fiscal adjustment, aiming for a sustainable future for public accounts and national development. However, it faces significant challenges in terms of political acceptance and impact on the most vulnerable, requiring broad debate and adjustments for its effective implementation.
The measures aim to ensure fiscal sustainability and social development:
- Deindexation of Social Benefits:
- Unlinking Floors for Health, Education and Fundeb:
- Combating Super Salaries:
- Review of Military Inactivity:
- Limitation on Budget Amendments:
- Structural Fiscal Balance Program (PEFE):
