The federal government created Auxílio Brasil, a new social program that replaces Bolsa Família, which ended after 18 years, and starts to be paid on the 17th. However, there are still several uncertainties about the financing of the program as of 2022.
Last Friday (12), President Jair Bolsonaro (no party) issued a decree in which he readjusts the definitions of extreme poverty (from R$89 monthly per capita in Bolsa Família to R$100) and poverty (from R$ 178 for BRL 200). As a result, Auxílio Brasil can reach over 17 million beneficiaries.
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The new decree also provides for a readjustment of benefits: the basic increased from R$90 to R$100, the variable from R$41 to R$49 (up to five people), for teenagers from R$48 to R$57 (up to two people).
To pay for the program by the end of this year, the government indicated resources from the increase in the Tax on Financial Operations (IOF). However, the problem is the financing of Auxílio Brasil in 2022.
PEC of Precatório
The Proposed Amendment to the Constitution (PEC) of the Precatório foresees that the Union’s expenses with judicial decisions can be divided in installments and postponed. Approved in the first round in the Chamber of Deputies, the bill still needs to be approved in the second round and also by the Senate, before presidential sanction.
The Precatório PEC allows changing the 2020 budget spending ceiling and would allow the government to spend an additional R$91.6 billion. With that, R$ 50 billion would be destined to the payment of the Auxílio Brasil. The budget set aside for Bolsa Família in 2022 is R$34.7 billion.
As Auxílio Brasil was created through a Provisional Measure (MP), it needs to be approved by Congress by December 7, when its validity expires. Without this approval, Auxílio Brasil will expire. The government promises to pay R$400 to beneficiaries by the end of 2022.
In opposition to the government, the Senate is discussing a basic income program that is permanent and that does not interfere with the 2022 spending ceiling.
There is still a Bill of Law (PL) sent to Congress that creates a tax on dividends, which would also be a source of funds for Auxílio Brasil – it has already been approved in Congress and is still in the Senate.
Thus, the government needs strong legislative support to consolidate Brazil’s Aid in 2022 and define its funding model in a constitutional manner, that is, one that respects the spending ceiling imposed by law.
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