Budget with zero target splits base and government supporters vote against Haddad

Eight deputies from the government base voted against Minister Fernando Haddad, of Finance, on Tuesday afternoon (19), when defending the change of the fiscal target for the 2024 Budget to 1% of the Gross Domestic Product (GDP). The vote in which the objective of eliminating the deficit in public accounts ended up prevailing, highlighted the split in the government between wings in favor of accounts in the red and others with balance.

Among those who voted against the zero target is President Luiz Inácio Lula da Silva (PT)’s own candidate for mayor of São Paulo, Guilherme Boulos (PSOL-SP), and deputies from PT and PCdoB. They defended changing the Budget Guidelines Law (LDO), but the majority of parliamentarians rejected the change.

In addition to Boulos, deputies Lindbergh Farias (PT-RJ), deputy government leader Jandira Feghali (PCdoB-RJ), Pastor Henrique Vieira (PSOL-RJ), Tarcísio Motta (PSOL-RJ), voted in favor of the change. Bohn Gass (PT-RS), Renildo Calheiros (PCdoB-PE) and Daniel Almeida (PCdoB-BA).

On the other hand, representatives from Centrão and the opposition voted in favor of Haddad to maintain the goal of eliminating the deficit in public accounts.

Minister Fernando Haddad’s goal to close the gap in public accounts has put government wings on a collision course, with President Lula, part of the PT and other left-wing parties on one side defending a deficit for next year. Lula went so far as to say, in October, that the target “does not need to be zero”, while Jandira classified it as a “tourniquet around the government’s own neck”.

Gleisi also adopted the same tone as Lula, stating that the zero result “will require a strong contingency […]
there is no need for us to do this in a framework where we need to stimulate economic growth.”

More recently, at the beginning of the month, she and Haddad once again disagreed on the fiscal target, in which the PT president defended a deficit of 1% to 2%. Haddad disagreed with her co-religionist’s position.

Once the LDO has passed, Congress votes on the Annual Budget Law (LOA) this Thursday (21), which will detail government spending for next year. The vote will take place after the Senate finishes voting on projects that promote an increase in revenue, including the ICMS subsidy in the states this Wednesday afternoon (20).