Government officials seek to reduce friction to speed up the processing of the PEC on spending cuts

Government officials seek to reduce friction mainly with the Chamber of Deputies to try to speed up the processing of the Proposed Amendment to the Constitution (PEC) on spending cuts, the main measure to adjust the country’s accounts that the Executive wants to approve later this year, sources said alongside negotiations with Reuters this Tuesday.

One of the main obstacles to starting to discuss an express analysis of the PEC, according to the sources, is not even the merit of the text. Parliamentarians preliminarily want the government to adjust the pace of releasing certain amendments, following the decision of the Minister of the Federal Supreme Court (STF) Flávio Dino, confirmed by colleagues, to guarantee the transfer of these resources under certain conditions.

Dino had suspended since August — in the middle of the municipal campaign period — the transfer of rapporteur amendments, commission amendments and the so-called PIX amendments. It released them on Monday, although it placed a series of conditions such as compliance with rules regarding transparency, traceability and public control. It was approved by the Supreme Court.

However, this moralizing attack by the STF on these types of amendments caused outrage in the Chamber to the point of threatening the voting calendar this year on the spending package, which involves the PEC and two other proposals.

If approved, the package provides for a containment of public expenditure of around 70 billion reais until 2026. Amid the recent rise in the dollar and pressure for a further increase in Brazil’s interest rate at a meeting of the Monetary Policy Committee (Copom) of the Central Bank next week, the measure has been awaited by investors who demand fiscal commitment from the Lula government.

The deadline for advancing the package this year is short because Congress has three weeks before the parliamentary recess and will only return on February 1st, already under new command from both Houses. Arthur Lira (PP-AL) leaves the head of the Chamber at the end of January, as does the president of the Senate, Rodrigo Pacheco (PSD-MG).

COMMITMENT

In a meeting this Tuesday with Lira and party leaders, the government leader in the Chamber, José Guimarães (PT-CE), informed that the Executive committed to paying 7.8 billion reais in resources from parliamentary amendments that were blocked, according to a source with knowledge of the negotiations.

Reuters had access, with a palace source, to the letter sent by the Secretary of the National Treasury, Rogério Ceron, to eight ministries in which he reports the release of amendments.

“The request is justified by the need to pay expenses with resources for individual amendments (RP6) and bench (RP 7), according to the aforementioned links”, highlighted the document.

Guimarães’ announcement, according to this source, could improve the environment for the PEC to move forward. For now, Lira intends to vote on the proposal this year even without a definitive solution to the issue of amendments, reinforced the source.

Until the end of this Tuesday afternoon, amid the impasse of the amendments, the package’s texts had not been discussed in the Chamber. The government is at least trying to approve an urgency regime so that the matters can be processed directly in plenary, but negotiations are still ongoing, according to the sources interviewed.

One of the most influential PT deputies, Zeca Dirceu (PR) stated that the receptivity to the package was “average to good”. He admitted that the decision by STF minister Flávio Dino “generated noise”, but they would be small and should in no way interfere with the vote on economic measures.

“What could hinder (the votes) is if the government delays in paying the amendments, I haven’t seen anything happen so far,” Zeca Dirceu told Reuters late in the afternoon.

One of the government’s deputy leaders in the Chamber, deputy Pedro Paulo (PSD-RJ) participated earlier on Tuesday in a presentation of the cost containment package with other deputy leaders and stated that resistance to the package was “small”. According to him, author of a tougher fiscal adjustment PEC, it will be up to the president of the Chamber to decide whether he wants a more or less tough measure.

“It will be supported by the House, the question is whether it will be carried out in a more or less rigorous manner”, he stated.

The parliamentarian stated that, if an agreement is reached regarding the impasses in the process, the package will move forward. “With an agreement, everything goes quickly”, he summarized.