By Maria Carolina Marcello
BRASILIA (Reuters) -The vice-president-elect, Geraldo Alckmin, presented this Wednesday to parliamentarians a draft of the Transition PEC with a proposal to “exceptionalize” the 175 billion reais of the spending ceiling for the payment of Bolsa Família from 2023 worth BRL 600, with an additional BRL 150 per child, without a set deadline.
The suggestions presented by the transition team also include an authorization for part of the extraordinary income to remain outside the ceiling and can be redirected to investments, within a limit of 23 billion reais, and also proposes to remove donations to universities from the spending ceiling rule. and funds related to the preservation of the environment.
“We delivered a proposal to the senators, a preliminary project”, said the vice president, in a nod to Congress by making it clear that “everything is being done to strengthen the Legislative”.
Alckmin delivered the draft to the general rapporteur for the Budget, Marcelo Castro (MDB-PI), and to the chairman of the Senate Constitution and Justice Commission, Davi Alcolumbre (União-AP), among other leaders of the House. Afterwards, he met with the president of the Chamber, Arthur Lira (PP-AL), to deliver the suggestions for the text of the PEC, following the orientation of the president-elect Luiz Inácio Lula da Silva to seek a solution through politics.
In addition to removing the entire Bolso Família from the spending ceiling, the draft provides that part of any excess revenue can be allocated to public investments without exceeding the limit on primary expenses. Alckmin explained that there will be a “lock” to the use of these resources, corresponding to 6.5% of net current revenues for 2021, which represents, in practice, 23 billion reais.
“The objective of this is to reach 1% of GDP for investment”, said Alckmin. “This is important to induce growth and also induce private investment.”
The draft PEC presented this Wednesday also excludes from the ceiling “expenses with socio-environmental projects or related to climate change” funded through donations and “expenses of federal educational institutions funded by their own expenses, donations or agreements entered into” with entities of the Federation or with the private sector.
According to Alckmin, the exclusion of Bolsa Família from the cap is “unanimous” in Congress, as well as, he assesses, there should be no difficulties in relation to resources for investment, education and socio-environmental issues, since they are about extra income or donations .
There is, however, resistance in relation to the deadline for exceptionalization of the ceiling, especially by parliamentarians linked to the current president, Jair Bolsonaro, and there is also apprehension in the financial market.
Last week, a speech by Lula in which the president-elect criticized the need to comply with fiscal rules to the detriment of social spending and defended that some expenses should be considered investments generated noise, causing the stock market to plummet and the dollar to soar.
“There is no blank check”, defended Alckmin, recalling that it will be up to deputies and senators to define the period to be covered by the PEC.
PROCESSING
Responsible for the task of formalizing the creation of the PEC, senator Marcelo Castro explained that the idea is to first trim all possible edges between parliamentarians, to then collect the 27 necessary signatures in the Senate and start the proposal’s processing.
“The transition team brought us a proposal, a suggestion for a PEC. But I want everyone to understand that this PEC will be proposed by the Senate. We are going to take these suggestions that the transition team brought us, we are going to negotiate internally with the leaders here in the Senate, until we reach an understanding, a concertation of what would be the ideal text”, said the general rapporteur of the Budget to journalists after receiving the draft.
“When we are sure that this is an ideal text – the ideal, here, is what is possible and what is most likely to be voted on – then only at that moment will we begin to collect signatures”, he concluded.
The senator calculates that the PEC can be voted by the Senate before the end of November. Afterwards, he still goes to the Chamber of Deputies.
“The most difficult thing here in the Senate is not the procedure. It is up to us to come to an understanding of what would be the most appropriate text”, he said, adding that Alcolumbre is committed to speeding up the proposal at the CCJ.
(Reporting by Maria Carolina MarcelloEditing by Pedro Fonseca)
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