Haddad says 0.5% surplus depends on Congress – 03/26/2024 – Market

Despite having included the index in the fiscal framework proposal presented last year, the Minister of Finance, Fernando Haddad (PT), now recognizes that reaching a primary surplus of 0.5% of GDP (Gross Domestic Product) in 2025 will depend of the National Congress.

The goal was announced at the time with the approval of President Luiz Inácio Lula da Silva (PT).

“At the request of the President [do Senado, Rodrigo] Pacheco [PSD-MG] and the president [da Câmara, Arthur] Lira [PP-AL], bills were presented to arrive at an equation. This will define the future of the trajectory [do superávit]. What I’m trying to say is that, over the next few days, we will define with the National Congress the direction of the carriage, how we will define the trajectory from now on”, said Haddad in an interview with CNN Brasil.

The minister did not want to commit to any new number and pushed the responsibility to the Minister of Planning, Simone Tebet (MDB). She is the one who will prepare the proposed Budgetary Guidelines Law. The deadline for submission is April 15th.

The 0.5% surplus was originally part of Haddad’s plan to balance public accounts and reach the black in 2025, in the penultimate year of the Lula government.

“People imagine that the primary result depends solely on the Executive. This is a bigger mistake today than it was in the past,” said Haddad.

He attributes the change of route to the new reality of the relationship with the Legislature. According to the minister, the President of the Republic no longer has the same control over Congress as he had before.

Haddad cited the 16-year mandates of Fernando Henrique Cardoso (PSDB) and Lula as examples of a past that does not exist today.

“The overturning of a presidential veto, years ago, was an event that drew attention. Nobody discusses it anymore. It’s almost commonplace and it’s never been like this,” he said.

Haddad said he told Lula that it was necessary to face the debates and “publicize” what will happen as a way of negotiating with Congress, maintaining the economy’s course.

In the idea of ​​the fiscal framework, the economic team projected a deficit of 0.5% last year, zero this year, a surplus of 0.5% in 2025 and 1% in 2026. This year’s target is already questioned.

Among the topics that depend on Congress and that can influence public accounts, the minister cited Perse (program for the events sector) and payroll tax relief. He also recalled judgments in higher courts and tax compensations.