Measure published in the “Official Gazette of the Union” extends the deadline and favors states more indebted to the Union
The president (PT) edited the , which changes the rules of the (Program for Full Payment of State Debts). The measure was published on Tuesday (7.Oct.2025) in the DOU (Official Gazette of the Union). Ice cream a (PDF – 594 KB).
The text makes requirements more flexible and extends deadlines for adhesion and delivery of documents, a measure that can mainly benefit States with a greater volume of debts to the Union. The decree is signed by Lula and the Minister of Finance, (PT), and came into force on the date of publication.
According to data from the Ministry of Finance, released in June, the States and the Federal District contributed R$827.1 billion to the Union. São Paulo, Rio de Janeiro and Minas Gerais, the 3 in the Southeast, account for almost half of this amount — respectively R$299.7 billion, R$174.2 billion and R$134.2 billion.
The main changes to the decree signed by Lula are:
- States may request to join Propag even pending the approval of authorizing state laws, as long as they present the required documents later;
- the asset valuation report is no longer a requirement for initiating the membership application;
- revenue transfers to the Union must be made in currency, with the use of fund shares or private securities being prohibited;
- the deadline for communicating to the Ministry of Finance the intention to transfer equity interests was set at December 31, 2025, with the possibility of extension until 2026;
- the program’s reduced interest rate will only be valid after signing the 1st addendum;
- States that sign an addendum or file an application for membership by November 30, 2025, must present a resource investment plan and make contributions to the FEF (Fiscal Equalization Fund) in the same year.
The decree reinforces the limitation on the growth of primary expenses of the benefited entities, which must follow the variation of the IPCA (Broad National Consumer Price Index) and primary revenue. This rule applies to States that obtain suspension, postponement or reduction of debt payments with the Union.
The standards detail the supervision of the use of resources in secondary-level professional and technical education, which will be the responsibility of the Ministry of Education and the state audit courts.
Created in April 2025 by , Propag allows States and the Federal District to renegotiate debts with the Union through the transfer of assets, credits and corporate interests, in exchange for more favorable financial conditions and tax and investment commitments.
