Government evaluates bringing forward the 13th INSS for May and June – 03/08/2024 – Market

The government is evaluating bringing forward the 13th payment schedule for INSS (National Social Security Institute) retirees and pensioners. The measure is part of a set of alternatives being studied to stimulate the economy after growth stagnated in the second half of last year.

The idea is to make payments, normally scheduled for the second half of each year (in August and November), in May and June. The hammer has not yet been dropped, but the simple possibility of injecting resources has already excited retirees and commerce.

Anticipating INSS values ​​has been a recurring option of the Executive in recent years due to the popularity of the measure and its effect on activity. Then-president Jair Bolsonaro (PL) opted for the measure in the last three years of his administration.

Last year, President Luiz Inácio Lula da Silva (PT) also adopted the initiative. R$62 billion were advanced for 30 million people entitled to pensions, death pensions, temporary disability benefits, accident benefits or incarceration benefits.

São Paulo was the state that received the largest transfer (R$ 17.7 billion). Next, Minas Gerais (R$ 6.9 billion), Rio de Janeiro (R$ 6 billion), Rio Grande do Sul (R$ 5 billion), Paraná (R$ 3.67 billion) and Bahia (R$ 3.6 billion).

The initiative would be added to another recently taken by the government, the anticipation of court orders paid in 2024. The payment of R$30 billion owed to companies and individuals was made in February after a final court ruling – according to the schedule, the amounts would only be deposited in July.

In addition, R$93 billion in outstanding court orders were paid this year. The amounts had been postponed by then-president Bolsonaro, who had maneuvered to open up budget space on the eve of the elections for other expenses – such as greater Auxílio Brasil (Bolsa Família).

Another idea being considered is the release of a 5% portion of savings resources, currently held in compulsory deposits at the BC and which could inject around R$20 billion into Caixa’s ability to finance the purchase of its own home. The idea was presented by the bank’s vice-president of Housing, Inês Magalhães, in an interview with Sheet.

As shown by Sheetthe government is concerned about the risk of a slowdown in growth in 2024 and has been mapping out actions that could mitigate the problem.

Under the influence of a record high in agriculture, the Brazilian economy closed the year 2023 with accumulated growth of 2.9%. In the second half, however, there was no growth.

The warning points, according to experts, were the negative performance of GDP components such as the manufacturing industry, construction and productive investments in the economy (-3%).

In the list of concerns of Lula’s allies, the growth data adds to the demonstration organized by former president Bolsonaro in São Paulo last month. The fear is that the Ministry of Finance’s fiscal adjustment agenda will push a larger portion of the population towards Bolsonarism.