On Friday, 22nd, the Economy Ministry announced an additional R$6.739 billion block from this year’s budget to meet the spending ceiling, the rule that prevents expenditures from growing faster than inflation.
According to the government, in total, joining the three cuts made in 2022,
R$12.74 billion was blocked from the budget. In practice, this amount of funds allocated to ministries, which are already complaining of a lack of resources in daily operations, has been suspended.
According to a technician from the Ministry of Economy, since the last report, in May, the government has been using the blocked resources to meet the urgent needs of agencies. Therefore, in practice, a higher devaluation would be required now, amounting to R$6.7 billion. If this compensation was not needed, the additional block would be less, worth R$2.77 billion compared to what was already blocked in May, according to the ministry.
Details of the areas that will be affected must be announced on Monday, 25. The cuts (emergency in the technical range) are made in the so-called discretionary expenditures, that is, not mandatory. It does not exceed 5% of the budget and includes, for example, payment of energy, communications and water bills for public buildings, subject to a reduction in the event of default, as well as outsourcing of cleaning and security services, university maintenance, maintenance of federal highways and civil defense measures for prevention of disasters.
The Economy Ministry did not say whether the new blockade would also affect the secret budget, which was revealed by Estadão, or other parliamentary amendments.
Information about the new blockade is contained in the “Bi-monthly Report on the Assessment of Revenues and Expenditures”, published in an additional edition of the “Official Gazette of the Union”.
According to the ministry, the new block was necessary because there is an increase in the estimate of mandatory spending subject to the spending cap, even in the face of recent records of tax collection and contributions.
Among the new expenditures that the government has begun projecting, are R$3.86 billion for the cultural sector for losses related to the pandemic, with President Jair Bolsonaro’s veto being overthrown against the Paulo Gustavo Act and R$2.24 billion earmarked for states and municipalities. To adhere to the minimum wage for CHWs (minimum wages).
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