Congress and Lula government agree amendment calendar and fiscal target floor in 2026

Leaders of the National Congress and coordinators of the government of President Luiz Inácio Lula da Silva (PT) reached an agreement to establish, in an unprecedented way, a calendar for payment of parliamentary amendments in 2026, the election year.

In exchange for the calendar of amendments, parliamentarians agreed to free the government to aim at the bottom of the fiscal target, and not at the center, next year – which, in practice, allows for a more flexible rule and more space to spend.

According to the rule included in the 2026 Budget Guidelines Bill (PLDO), the government will be obliged to pay 65% ​​of Pix amendments and individual and bench amendments that transfer resources to state and municipal funds in the first half of 2026, before the elections.

The rule will require the payment of approximately R$12.6 billion in amendments before the electoral campaign. For the rest of the resources, which include the commission amendments, inherited from the secret budget, the government must also adopt agility and pay as soon as possible, if there are no technical impediments, but without a defined deadline. This should increase the total amount paid before the elections.

Parliamentary amendments are expected to total R$52 billion in 2026. The government had sent the Budget with a reserve of R$40 billion, without commission amendments, but Congress increased the revenue projection and cut resources from the Executive Branch to boost the value, as Estadão showed. In addition to the amendments, Congress also opened space to increase the electoral fund.

The PDLO report, presented by deputy Gervásio Maia (PSB-PB), also determined that the government should aim at the bottom of the fiscal target, and not the center, when freezing expenses. In practice, this prevents the Executive from being forced to freeze up to R$34 billion more in spending in an election year. The opinion was presented at the same time that the Federal Audit Court (TCU) took a decision in the same direction.

The amendment calendar delayed the LDO vote by more than four months. The project defines the rules for executing the Union Budget. The government was against the calendar as it considered the measure unconstitutional and tied up the Executive in the treatment of federal resources.

Congress, on the other hand, insisted on the rule and even included an even tougher rule in the initial report, which required payment of 100% of Pix amendments and resources for state and municipal funds in the first half of the year.