Benefits to voters in 2026 total R$187 billion, with R$176 billion outside the ceiling for expenses and R$119 billion excluded from the surplus target
The president’s government (PT) announced R$ 187.2 billion in direct benefits to voters this year. They are out of R$ 176.7 billion. This value is equivalent to 94% do total.
There are measures that reduce revenue and escape the spending limit – they end up impacting the of primary surplus. But part of the measures, totaling R$ 118.7 billionit is even outside the primary surplus target that the so-called fiscal framework establishes. The value is equivalent to 63% of the total measurements.
The criteria used are of a by economist Marcos Mendes, associate researcher at (Institute of Study and Research). He was head of economic advisory at the Ministry of Finance from 2016 to 2018. he was the minister. (MDB), the president.
“It’s a total demoralization. The volume of exceptions is so large that the target [de superavit] loses its meaning. And we end up with a country with a high chronic deficit”, stated Mendes.
The 2023 tax framework the spending ceiling that had been created in 2016 by the Temer government. The previous rule was stricter. It was only possible to increase expenses if others were cut.
OMISSION INSTRUMENTS
The Lula government uses these mechanisms to escape the fiscal rule spending limit system that it helped to create in 2023:
- loans – the Treasury sends money to state banks to grant lines of credit. This is the case with Move Applications. It doesn’t come out of the Budget. It is a financial expense. Theoretically, the bank will return it to the Treasury. Hardly returns;
- funds – the government uses funds with idle money as collateral for loans. This is the case of Desenrola 2.0 and Minha Casa, Minha Vida. The argument is that the resource was not used. But before, these funds were often used to pay off public debt. They can no longer have this destination;
- tax reduction – does not influence expenses, therefore, it is outside the limit for increased expenses. But it has a fiscal impact, because the government collects less. The government will have to cut other spending or the surplus will be lower than the stipulated target;
- extraordinary credit – is money disbursed by the Treasury. But, because it is extraordinary, it is excluded from the increase in spending and the fiscal target. This is the case with the gasoline subsidy.
DEBT GROWTH
All this spending increases public debt. None of the items escapes, even if it is an exception, or does not even pass through the Budget.
In Brazil, the government has . It does not even pay the interest on the Union’s liabilities, despite meeting the elastic target it created.
The debt at 80.4% of GDP (Gross Domestic Product). THE of market analysts is expected to reach 83% by the end of the year. For 2026, they expect 86.5%.
The increase in spending in an election year tends to deteriorate the situation. An aggravating factor is that the BC (Central Bank) needs to keep interest rates high to contain inflation caused by excessive government spending.
The result is low growth and GDP below potential. Compared to the country’s economy, the debt burden increases.
In the government of (PT), the fiscal cost of re-election was high. The debt went from 54.2% of GDP in 2011 to 56.3% of GDP in 2014, when Dilma sought – and got – a new mandate. In 2015 it rose to 65.5%. In 2016, when there was impeachment, it reached 69.8% of GDP.
EXCEPTIONS FROM THE BEGINNING
Mendes stated that the lack of credibility in the fiscal framework has existed since its creation in 2023. Many items were left out from the beginning, such as spending on court orders.
Other expenses created later were excluded. This is the case of to mitigate the effects of the flood in Rio Grande do Sul in 2024.
The economist said that the framework is insufficient to reduce public debt. “Simply to contain debt growth, a surplus of more than 4% of GDP is needed“, he stated. With exceptions to the target, there is a deficit of 0.5% of GDP.
Mendes believes that it would be worse without the framework. “The pressure to increase expenses is very great. There was a large block of expenses to comply with the fiscal framework. This provides some expense control instrument”, these.
