Brazil

Bad news about the PEC to guarantee the R$600 in 2023

Beneficiaries of the Auxílio Brasil Program are waiting for the Proposed Amendment to the Constitution (PEC) dubbed the Transition PEC to be approved in the National Congress to guarantee the continuity of payments of R$600 of the income transfer program next year, however, they received bad news last Wednesday night (24).

This is because the presentation of the text of the Transition PEC to the Senatewhere it should start to be processed, was postponed indefinitely, since the PEC should have been presented yesterday, however, the leaders of the parties and benches in the Senate did not agree on the amounts that will be released by the proposal and neither regarding the time that will be contemplated by the PEC.

The draft of the PEC, which is a suggested text, was delivered to the senators on Wednesday of last week, the 16th, by Vice President Geraldo Alckmin (PSB), suggesting that R$175 billion remain outside the spending cap rule indefinitely to guarantee payments of the R$600 of the Brazil Aid from january and another R$150 for families with children up to six years old.

However, according to the general rapporteur of the 2023 Budget, senator Marcelo Castro (MDB-PI), senators do not agree with the value of the PEC and mainly with keeping the social program off the ceiling indefinitely, and now, “ the idea is that by the end of November it will be approved in the Senate, but the most difficult thing is not to process it, it is to reach an understanding of what the ideal text is”, said Castro.

PEC of R$600 from the Brazil Aid

The preview of the text presented to senators last week foresaw the expenditure of BRL 157 billion to fund the BRL 600 and another BRL 18 billion to finance the BRL 150 more, in addition to forecasting the spending of another BRL 24 billion for other areas that the government believes they need resources, however, this is just a suggestion, and the final version of the text should have been officially presented to the National Congress yesterday, when it was postponed due to lack of consensus.

“Today will not be presented. No consensus was formed. I have been advocating from the beginning that we expend our energies towards consensus. […] The idea is that by the end of November it will be approved in the Senate, but the most difficult thing is not to process it, it is to reach an understanding of what the ideal text is”

Senator Marcelo Castro (MDB-PI), general rapporteur for the 2023 Budget

Transition PEC and Brazil Aid

The spending cap rule defines that the government of the moment can only spend the same amount spent in the current year corrected for inflation in the following year, thus, it has the objective of serving as a brake on the increase of public expenses, preventing the next government will simply spend what it deems necessary to maintain Bolsa Família in 2023, and therefore, it is necessary for Congress to approve a PEC to authorize this extra expenditure.

To become effective and open the way for payments of R$600 from the new Bolsa Família, the Transition PEC will need to be edited, discussed and voted on in two shifts, requiring the vote of at least 308 deputies, when the vote takes place in the Chamber, and the vote of at least 49 senators, when the vote takes place in the Senate, a situation that makes its approval risky, as it will depend on a lot of negotiation between the elected government and parliamentarians.

However, members of the transition team have already been negotiating with leaders of the Chamber of Deputies and the Senate since the beginning of the month to get the PEC approved, and despite the postponement, the budget’s general rapporteur expects it to start be processed by the Senate until the end of the month, being joined to another proposal already advanced to avoid lengthy discussions on the subject, and after being approved by the Senate, in early December, it is expected to go to the Chamber, where it should also be approved before the recess, which begins on December 23.

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