The president (PT) sanctioned the LDO (Budget Guidelines Law) for 2026 with a veto on the section that expanded the party fund, an extra budget for party expenses. The measure, in December, was considered unconstitutional by the Executive and overturned in the sanction on Wednesday (31).
Congress’s proposal was for the party fund to be readjusted retroactively, since 2016, according to the fiscal framework rule (increase of up to 2.5% above inflation per year), which would give the parties around R$160 million more.
“The legislative proposal incurs an unconstitutionality error, as, by linking the amount of Party Fund expenses to the real growth in revenue from previous years, the device would promote the growth of these expenses at a level higher than the growth of the primary expense limits”, says the Executive’s justification for vetoing the section.
This extra amount for parties was approved by the CMO (Mixed Budget Committee), which is made up of deputies and senators, with controversy among parliamentarians. At the time, the government leader in Congress, senator (PT-AP), had already indicated that President Lula could veto the section.
The request for inclusion of this increase came from deputy Luiz Carlos Motta (PL-SP). The measure that would benefit the parties would cause a million-dollar impact on public coffers.
The LDO also provides for the rules for passing on parliamentary amendments. As agreed between the government and Congress, 65% of the transfers of individual and mandatory bench amendments will have to be made by the end of this first half of 2026.
The rule contemplates transfers passed on to the states in favor of the respective funds
health and social assistance and also the so-called “Pix” amendments.
In the 2026 election year, around R$1 billion is already planned for the party fund, which finances the general expenses of the parties, and another R$4.9 billion for the electoral fund, which finances the candidates’ campaigns.
By agreeing to write this amendment payment schedule into law, the government gave in to a demand from parties in the center. The group until the middle of the year, but accepted the 65% agreement — the government’s proposal was 60%.
