Cities in SP do not report funds for Pix amendments – 10/25/2023 – Power

Cities in São Paulo hide the destination of special transfers known as “Pix amendments”, reveals an investigation by the TCE-SP (Court of Auditors of the State of São Paulo).

The Pix amendments make it possible to accelerate the transfer of funds to states and municipalities, without links to specific projects, which makes inspection by control bodies difficult.

The São Paulo court found that 565 of the 644 cities received R$760 million through this instrument, between the beginning of last year and until August 2023, via the federal and state government.

The amounts committed, which also include funds yet to be received, exceed the R$1 billion mark.

The court carried out an inspection in one hundred cities in the state, which is the one that receives the most this type of transfer.

In the case of federal transfers made last year, only 6% had financial statements disclosed. According to the court, there is no data on state amendments.

The president of the TCE, Sidney Beraldo, released a statement criticizing the lack of publicity regarding public spending.

“As things stand today, managers end up not clearly indicating the destination of the resources. Without adequate demonstration of the use of the transferred funds, external control and society cannot exercise their supervisory role”, he stated.

In 2022, federal amendments committed reached R$307 million, in amendments for 523 cities. This year, there were almost R$570 million for 428 municipalities.

State amendments reached R$74 million committed last year and almost R$110 million in 2023.

The court’s survey highlights another problem: city halls ignore the federal government’s rule on creating specific bank accounts for deposits. In the state case, there is no such rule.

The lack of an account for the transfer can cause it to be mixed with different funds, making any inspection even more difficult.

One of the concerns is precisely the lack of rules to regulate the use of this type of transfer.

The São Paulo court issued a warning to managers, for example, about the prohibition of using the funds for personnel expenses, social charges and debts.

In the evaluation of the São Paulo court of accounts, the problems detected may result in fines and communication to the Public Ministry.

The TCU (Federal Audit Court) established the understanding that control over the application of special transfers to city halls is the responsibility of the state and municipal courts of accounts.

In five months of government, President Lula witnessed the transfer of R$6.6 billion from the Union Budget directly to deputies and senators, through pix amendments. The value is almost double (94%) that of last year.

Data from the federal budget show that, between January and May, 8,327 amendments totaling R$6.6 billion were paid. In 2022, the number of operations was 8,191 and allocated R$3.4 billion to congressmen.

In 2021, it was R$2 billion and, in 2020, R$621.2 million.

This growth occurred because many of the pix amendments were previously part of the Budget rapporteur’s amendments, overturned by the Federal Supreme Court at the end of last year.

In other words: as they were not counted as transfers to states and municipalities, it is possible that the figure in previous years was much higher.

Rapporteur of the LDO (Budget Guidelines Law), federal deputy Danilo Forte (União Brasil-CE) has been dealing with the president of the Federal Court of Auditors, Bruno Dantas, on how to include control mechanisms over special transfers in the text.

The deputy’s negotiation takes place amidst a movement by Congress to try to expand the space reserved for special transfers in the Budget.

The rapporteur’s idea is to establish, as a counterpart to the expansion of resources, a way of identifying the destination of the funds after they reach the municipality. This way, in addition to increasing supervision over the money, the parliamentarian responsible for sending it would also have his stamp with the city hall.