Government says it will not act to change zero deficit target in 2024

Highland

Information was initially released by the LDO rapporteur, who met with the government’s economic and political team this Thursday (16)

Brasilia DF) – The government of President Luiz Inácio Lula da Silva (PT) announced this Thursday (16) that it will maintain its target of zero fiscal deficit.

Palácio do Planalto therefore rules out the possibility of sponsoring any amendment to the LDO, presented by a parliamentarian, promoting a change in the goal.

The information was initially released by the rapporteur of the LDO (Budget Guidelines Law), deputy Danilo Forte (União Brasil-CE), who participated in a meeting with the economic team and the political articulation of the government in Planalto.

It was later confirmed by Minister Alexandre Padilha (Institutional Relations), adding that there is not and will not be any government initiative providing for the change.

“First objective [da reunião] was to make it clear and explicit that there is no government initiative to change the fiscal target established in the LDO that the government sent to the National Congress. We make this explicit. There is not and will not be any government initiative to change this fiscal target”,

said Padilha.

The parliamentarian participated in a meeting at Palácio do Planalto, with ministers Fernando Haddad (Finance), Alexandre Padilha (Institutional Relations), Simone Tebet (Planning) and government leaders in the National Congress.

The meeting takes place on the eve of the regulatory date for amendments to be presented to the LDO, a deadline that expires this Friday (17).

It also happens amid discussions involving the change in the fiscal target.

“[O governo] removed any possibility of amending the report, any modifying message in relation to what is being decided, and the preservation of the fiscal framework”,

said Danilo Forte.

“The possibility of a review may arise from some change in the future, but at present the government has maintained the zero fiscal target.” completed.

The issue of the target entered the center of discussions involving the federal government, after Lula said that the target of zero fiscal deficit would be “hardly” achieved.

At a breakfast with journalists covering the Presidency of the Republic, Lula also added that the fiscal target does not need to be zero and that he is not willing to make cuts in investments and social programs to achieve it.

“Let me tell you something. Everything we can do to meet the fiscal target, we will achieve. What I can tell you is that it doesn’t need to be zero. We don’t need that. I will not establish a fiscal target that forces me to start the year by cutting billions in works that are a priority in this country”, said the president, in response to a question from the Sheet, during breakfast with the press.

“If Brazil has a deficit of 0.5% [do PIB], what is it? From 0.25%, what is it? Nothing, absolutely nothing. So let’s make the right decision and let’s do what will be best for Brazil”, he added.

Lula also stated that he is not willing to make cuts in investments and social programs to pursue this goal. Contingency is seen by economists as an inevitable consequence of maintaining the zero target.

Alexandre Padilha later stated that there was no discussion about changing the government’s target. He stated that there was “speculation” in relation to President Lula’s speech, arguing that the president was referring to the band of 0.25% expected variation.

Lula, however, mentions 0.5%, which would be outside the expected band limits.

“Those who created the confusion are others. President Lula’s speech is explicit, first of all, reinforcing that he has always met fiscal targets, has always strived to achieve a primary surplus. The president talks about the band. The fiscal framework itself establishes a band of 0.25. Then, following the president’s speech, someone starts to speculate, either to make money or to make people lose money or to engage in political speculation,”

said Padilha.

*With information from Folha

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