Lula meets Lira and announces changes at Caixa in a nod to Centrão

Amidst the struggle between the National Congress and the Executive over control of the Budget and parliamentary amendments, President Luiz Inácio Lula da Silva (PT) finally gave in to the advances of Arthur Lira (PP-AL) and negotiated with the president of the Chamber of Deputies. Deputies seven vice-presidencies of Caixa Econômica Federal. The exchanges, expected by Centrão since the approval of the tax reform in the Chamber in the middle of last year, were announced by the bank this Wednesday (24), in a statement to the market.

The invoice charged to the government for supporting the reform included the 12 vice-presidencies of Caixa, but until now Lula had only replaced the institution’s president, Rita Serrano, with Carlos Vieira, nominated by the PP, party of the president of the Chamber, who came to admit in an interview the appetite of the so-called Centrão for the positions.

The changes occur at a time of deepening tensions between the Executive and Legislative branches regarding the funds and rules of parliamentary amendments. This year, Lula vetoed the payment schedule for individual parliamentary amendments and state benches (mandatory), approved by Congress last year as a way to gain more control over the Budget in 2024. He also made a cut of R$5, 6 billion in committee amendments (that is, those approved by the permanent committees of the Senate and the Chamber, with non-obligatory payment) which especially harmed Centrão parliamentarians.

Who are the new vice-presidents of Caixa

Caixa’s statement informs that the Board of Directors approved the election of Adriano Assis Matias as vice-presidency of Retail. Adriano is nominated by President Carlos Vieira, who is linked to Progressistas de Lira. The new vice-presidents of Technology and Digital, Laércio Roberto Lemos de Souza; Logistics, Marcelo Campos Prata; Operating Agent, Pedro Ermírio de Almeida Freitas; and Wholesale, Tarso Duarte Tassis, would also be PP nominations, according to sources at Caixa and the Chamber who informed Gazeta do Povo.

The new vice-president of People, Francisco Egídio Pelúcio Martins, would be part of the PDT quota; while the vice-president of Sustainability, Paulo Rodrigo de Lemos Lopes, would have been appointed by the PL, which opposes the government. When questioned, the party president, Valdemar Costa Neto, denied it and told People’s Gazette that “the PL is not nominating anyone”.

Despite the Centrão’s appetite, the government managed to hold on to the position, at least for now, the vice-president of Housing, Inês Magalhães, who is linked to President Lula’s PT, and the vice-president of Government, Marco Bonfim, from the quota from the PSD.

The changes, according to interlocutors from Planalto, would be a sign of goodwill from the Executive after the “climate” caused by the vetoes on amendments and the sending of a provisional measure that re-encumbers 17 productive sectors of the economy, an issue that had been decided by parliamentarians in the last year, with the extension of incentives.

Although parliamentarians are still away from Brasília due to the recess, behind the scenes in Congress there are talks that Lira will call the party leaders in the Chamber for a meeting next week, before the start of the legislative year. On the agenda would be dissatisfaction with the government and the articulation of a possible overturn of vetoes, which the government still wants to negotiate.

Government pays debt with Centrão anticipating important battles in 2024, says analyst

For political analyst Cristiano Noronha, from Arko Advice, by paying off the debt with Centrão, and unlocking the desired positions at Caixa Econômica Federal, the Lula government, at the same time as paying off an old debt with the president of the Chamber, which he leads Centrão seeks to prepare for the battles that lie ahead in 2024.

The vetoes to the Budget, the regulation of tax reform points and the controversy surrounding the taxation of productive sectors should provoke a lot of debate between the Executive and Congress, assesses Noronha.

“The government has to alleviate Centrão’s dissatisfaction a little in order to have a calmer year”, warns the political analyst. Still, according to him, there are major battles expected ahead, and the government will have to make new concessions and negotiations to overcome parliamentarians’ resistance throughout 2024.