Friday, April 23, 2021

Guedes denies “war” with Congress on Budget


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The Minister of Economy, Paulo Guedes, tried to minimize this Monday the crisis created around the approval of the Budget 2021, considered by the economic team as “unenforceable”. The text approved by the Congress cut mandatory expenses to raise parliamentary amendments, creating an impasse with Congress.

For Guedes, the controversy is occurring because the government is preparing the Budget with its parliamentary base for the “first time”, according to the minister.

“In the midst of this new political articulation, for the first time the Bolsonaro government is preparing the Budget with its own parliamentary base. It is much more a team that has never played together that is starting to put the Budget on foot than anything else,” said Guedes , during live broadcast with the financial market.

The third year budget of the Jair Bolsonaro government was approved almost four months late. Guedes denied any “fight” with Congress.

“It is not a disagreement, a fight, a war. They said there was a war between the Mayor (Arthur Lira, PP-AL) with the Minister of Economy, or a war against the Senate. That is not the climate,” he said. the minister.

Guedes denied “bad faith” on the part of Congress, but he also did not announce any agreement. The minister also took a stand against the possibility of decreeing public calamity at this time, which, for him, would be signing a blank check for public spending.

“I am sure it was not bad faith. It is natural for a team that started to play together now and started to set up the budget.

The approved budget increased by 26.2 billion (to 48 billion reais) the amount allocated to parliamentary amendments. For this, it cut in this proportion the estimate of expenses such as Social Security, salary bonus and unemployment insurance, which are mandatory. The problem is that there is no evidence that this projection is confirmed.

Therefore, the government would have to cut in other areas, such as funding and investments, to guarantee the payment of pensions and pensions without breaching the rules of public accounts.

The money from the extra amendments is destined for parliamentarians from the allied base to point out works and services in their electoral bases.

However, government technicians defend the veto of President Jair Bolsonaro to the 26.2 billion reais added in parliamentary amendments to recompose mandatory spending.

Guedes admitted that there was a problem of “coordination” in the preparation of the Budget. And he acknowledged the dilemma created between vetoing and creating problems with the allied base, and not vetoing the amendments and leaving Bolsonaro subject to prosecution for breaching fiscal rules.

“If you say ‘let’s veto’, to ensure that it is legally perfect, on the one hand, on the legal side, everything is shielded. There is no possibility of exploitation by the opposition to speak of impeachment. But it is politically uncomfortable. On the other hand, if it moves forward as it is, it leaves the government exposed there in front of a possible non-approval of accounts by TCU [Tribunal de Contas da União] there next year, in the middle of an electoral campaign “, described the minister.

Asked if it would be a possibility to keep 16 billion reais for extra amendments and veto the rest, Guedes said yes.

“What is politically more convenient can be judicially inconvenient. And vice versa,” he added.

The minister reiterated that political agreements must fit within public budgets.

“It is the parliamentarians who are supporting the government who are taking their amendments to apply in that region,” said the minister, adding: “It is a complex exercise, with a lot of people involved. Now, above all, it has to be worth the concepts that allow make it happen without boring the ceiling [de gastos]”.

During his speech, Guedes erred in saying that the Budget was sent in May last year. In fact, the proposal was sent on August 31, as required by law.

In addition, he said that the parameters were out of date and justified that it would take more time for the government to submit a new proposal to update these parameters.


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