26/11/2023 – 21:03
Former Attorney General of the National Treasury (PGFN) during the Jair Bolsonaro administration, Ricardo Soriano assesses that the chances of the Federal Supreme Court (STF) declaring the PEC dos Precatório unconstitutional are high, as the current government wishes. The lawyer was a career employee of the PGFN and participated in discussions about the proposal as a member of the team of the then Minister of Economy, Paulo Guedes.
“I believe that the STF will declare them unconstitutional, I don’t know if in full or at least in part,” said Soriano in an interview with Estadão. “There are Supreme Court precedents understanding that acts tending to postpone the payment of court orders (the Union’s judicial debts) violate principles of the Constitution, such as res judicata, jurisdictional effectiveness and others.”
Enacted in 2021, the proposal became known as “PEC do Calote”, as it set a ceiling for the payment of court orders, “rolling” the amounts that exceeded the annual limit. This system generated a stock of R$95 billion in unpaid debts, which could reach R$250 billion in 2027.
This “rollover” is one of the main points questioned in the STF, which will judge the Direct Actions of Unconstitutionality (ADIs) this Monday. At that time, ministers will be able to pave the way for the payment of this stock outside the new spending ceiling, in addition to authorizing a change in the accounting of these expenses – which is in the interest of the current economic team (read more below).
Soriano, who is now a partner at Figueiredo & Velloso Advogados, claims that the PEC proposed by the Bolsonaro government was “very different” from the text that ended up being promulgated by Congress and that, at the time, “there were elements to defend constitutionality”.
“The issue is complex. At the time of the last judgment (on the subject), of Constitutional Amendment 62, the STF itself was divided on certain points,” he states. “In some of them, up to five ministers understood that part of the changes were constitutional, while another six understood that they were not in compliance with the Constitution”, he explains.
The lawyer also assesses that the PEC brought an important escape valve, which, if it had been regulated, would have the potential to reduce the effects of the precatório subceiling. This involves the possibility of using these debts as a bargaining chip, to “settle accounts”. Use them, for example, to settle taxpayer debts with the Union or pay for public service concessions.
The Federal Attorney General’s Office (AGU) was moving towards making this regulation now in 2023, but suspended the process after the Lula government’s decision to appeal to the Supreme Court to change the way court orders are paid. In the argument sent to the Court, the AGU even requests that this provision also be declared unconstitutional.
“I don’t consider paragraph 11 unconstitutional, which is the bargaining chip, but I don’t know how far the Supreme Court will go. You can, for example, understand that there was a formal failure in the vote on the PEC, and that would compromise the constitutionality of the entire text”, says Soriano.
Haddad’s strategy
This Monday’s judgment is of great interest to the Minister of Finance, Fernando Haddad, who seeks to pave the way for the current government to pay off the stock of court orders through extraordinary credits, that is, outside the new spending limit, in addition to changing the way these expenses are accounted for.
According to the proposed formula, the principal value of the debt will be treated as a primary expense – that is, recorded in the primary result (balance between income and expenses, not counting interest on the debt). Whatever relates to interest payments will be separated and treated as a financial expense, without being counted in the primary result and, consequently, in the spending limit.
Asked about the government’s strategy, Soriano assessed the decision to appeal to the STF to resolve the stock problem as interesting and positive, as the other option would be to take the issue back to Congress and this would require political construction. But he said he found the request for a change in accounting strange.
“When the Union receives interest payments, this comes as primary revenue and positively impacts the government’s results. It does not seem to make sense that when interest is received, this would have a positive impact, but when paying interest on court orders, this expense would be disregarded. It’s a pretty controversial line,” he says.
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