by Marcela Ayres
BRASÍLIA (Reuters) – The amount paid by the government in direct income transfer in 2022 will be 400 reais, said a source with direct knowledge of the matter. structured as a continuing expense, it will not need to be defined as a source of income.
According to the same source, Bolsa Família will be renamed Auxílio Brasil, as the government planned, and will maintain its budget of 34.7 billion reais planned for next year. The idea is for the program to reach 17 million families, compared to 14 million currently.
But, to strengthen the amount paid to beneficiaries, a temporary aid will be created, at a cost of around 50 billion reais. Part of the aid will be paid within the spending ceiling and part outside. As it has a limited duration, this expense does not need compensation under the Fiscal Responsibility Law (LRF).
With this design, the government will no longer need the taxation of dividends, proposed in the reform of the Income Tax, to make possible a greater social benefit next year.
The new formatting of the aid represents a victory for the political wing against the efforts of the team of Economy Minister Paulo Guedes to limit the benefit to 300 reais in 2022 and place it entirely under the roof.
The previous afternoon, a source from the Ministry of Economy had already signaled to Reuters that discussions were moving towards the adoption of the Bolsa Família formula with aid for 2022, but with the indication of 300 reais as the total amount.
Also on Monday night, the president of the Chamber of Deputies, Arthur Lira (PP-AL), indicated, in an interview on Veja magazine’s website, a social program outside the public spending ceiling, defending that it could not be prioritized fiscal responsibility and respect for the mechanism to the detriment of the needs of the most vulnerable population.
As Bolsa Família consists of a permanent expense, to make it bigger due to the idea originally proposed by the economic team, the government would need to indicate this compensation for its financing -which would be done by taxing dividends in the reform of the Income Tax-, in addition to find space, under the rule of the roof, to accommodate it, which would come with the PEC (Proposed Amendment to the Constitution) of the Precatório.
The assessment is that the reform of the IR should not, however, be appreciated by the Senate as desired by Guedes.
In the end, the value of 400 reais, although temporary, is also in line with the indication made by Bolsonaro in early August that the government was studying a way to promote an increase of up to 100% in Bolsa Família, which currently pays a benefit. average of about 190 reais.
In addition to serving the most vulnerable who were even more exposed to poverty in the face of the Covid-19 pandemic and the strong acceleration of inflation in the country, the increase in the program is seen as crucial, from a political point of view, to strengthen Bolsonaro in the race presidential term of 2022.
Although it represents a way out to avoid cheating the LRF, the implementation of a temporary aid leaves until 2023 –and for the winner of the elections– the real solving of the issue, since, apart from the extra benefit, Bolsa Família will not have had its budget structurally modified despite the reality left by the crisis, with 14 million Brazilians unemployed.
EXPENDITURE CEILING
Both last year and this year, the nearly 360 billion reais allocated, in total, to emergency aid were outside the spending ceiling, under the justification that they were directly linked to the need to face the coronavirus crisis – an admittedly extraordinary event.
Technicians from the economic team had been stating that the off-the-roof aid had been conceived within a framework of restricted mobility and amid alarming indicators of the pandemic. All that would have already changed, especially with the recent advance in vaccination in the country.
The secretary of the Treasury, Jeferson Bittencourt, even said that the conditions for issuing extraordinary credit – an alternative that left spending on aid out of the ceiling – were urgent, relevant and unpredictable, and that all three needed to be met.
“In summary, unemployment and poverty is urgent and is it relevant that we face it? Yes, it’s urgent, it’s relevant,” he said. “Is it unpredictable? No”, completed the secretary, signaling that there would be no technical support for the renewal of the work schedule.
Wanted, the Ministry of Economy did not immediately comment on the matter.
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