Finance Secretariat warns that social security revenues are insufficient to cover future expenses
In the last twelve months, the debt of Brazilian states and municipalities with the Union has experienced a significant increase of 17%, reaching the significant mark of 727 billion reais. According to the Secretariat of linked to the Ministry of Finance, this growth is attributed to the fact that the monthly debt repayment was lower than the debtor balance update. In practical terms, payments made by federated entities were not enough to reduce debt, which is corrected by factors such as inflation and monetary correction.
The increase in debt, which jumped from 92 billion reais between last year and last year, was driven mainly by debt financing programs. In response to this worrying situation, President Lula sanctioned, in January, the State Debt Payment Program (Propag). This innovative program offers interest discounts and allows the installment of debtor balance within 30 years, as well as creating a federative equalization fund to compensate for states that maintain a good fiscal situation.
*With information from André Aneli
*Report produced with the aid of AI
