05/06/2024 – 17:35
President Luiz Inácio Lula da Silva announced this Monday, 6th, that he will issue a Draft Legislative Decree (PDL) providing resources to help with the recovery of Rio Grande do Sul amid the tragedies caused by the rains. The mechanism supports the subsequent release of extraordinary credits outside the primary result target. In other words, the PDL was the solution found by the Executive Branch to ensure that the fiscal target of zero deficit was not changed.
As Broadcast showed, the preliminary consensus among members of the Executive Branch heard by the report is that support for RS should not fit into this year’s ordinary resources, although the amount has not yet been defined. According to technicians, if there were only the issuance of a provisional measure (MP) providing for the release of extraordinary credit, without the PDL, the amounts would be outside the expense limit, but would impact the primary result target – which would not serve the economic team. , which maintains its zero deficit forecast for this year, and would likely have to change it to accommodate spending.
The government sought to quickly announce the PDL to prevent the proposal that has been defended by Congress to approve the so-called “PEC de Guerra” from gaining strength, which brings a series of flexibility in addition to the release of the resource, as the report showed. Lula said that the PDL is the first step for “things to start moving” and the first of many acts in favor of RS. “We will do everything in our power to contribute to the recovery of Rio Grande do Sul,” he said.
The War Budget PEC approved in 2020 allowed the separation of the budget and expenses incurred to combat the covid-19 pandemic from the general budget of the Union. The text was broader because, in addition to allowing the opening of extraordinary credits via MP or PLN, created an extraordinary regime to facilitate the budgetary execution of emergency measures, removing constitutional and legal provisions applied in normal situations.
The flexibilities provided for by the PEC allowed, for example, the temporary hiring of personnel without sufficient prior budget allocation to meet expenditure projections and the contracting of works, services and purchases without carrying out a bidding process. The text also made it possible to carry out expenses without estimating the budgetary impact and also exempted compliance with the “golden rule”, provided for in the Constitution. The golden rule aims to curb the State’s debt to cover current expenses.
Earlier, the president of the Senate, Rodrigo Pacheco (PSD-MG), suggested that Congress could approve a new PEC, along the lines of the War Budget PEC approved during the pandemic, to help Rio Grande do Sul in the midst of the tragedy caused by heavy rains in recent days. Behind the scenes, it is understood that the PEC will open space for parliamentarians to include proposals beneficial to their States, not necessarily related to the situation in Rio Grande do Sul.
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