New fiscal rule: rapporteur signals return to preventive blockades, but without punishment for managers

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Cláudio Cajado gave an interview to GloboNews. Rapporteur in the House will still talk to benches and intends to finalize the text of the proposal next Wednesday (10). Deputy Claudio Cajado (PP) will be the rapporteur of the fiscal framework project The fiscal framework rapporteur in the Chamber of Deputies, Cláudio Cajado (PP-BA), signaled this Sunday (7), in an interview to GloboNews, that he may include in the text the return of the mandatory blockades of government expenses, but without the provision of crime of responsibility in case the fiscal targets are not achieved. Analysts and politicians heard by g1 and TV Globo understand that the end of crimes of responsibility for authorities for not reaching fiscal targets and the end of the mandatory blocking of public spending to achieve predetermined objectives weaken the rules for controlling expenses. The changes are contained in the proposal for the new fiscal framework, sent by the government to the National Congress for analysis in April, and would alter the Fiscal Responsibility Law (LRF). To be valid, the rules still need to be approved by the House and Senate. Cajado, who has not yet finalized the text that he will present for analysis by the other deputies, defends the inclusion of triggers to contain government expenses in case of non-compliance with the goals. “What we would like is to add triggers that contingency some expenses. And in that sense, we are talking with the other benches, talking with the deputies and leaders to converge on a measure that does not, ultimately, have the issue of the crime of responsibility,” said Cajado. “We are building a middle ground that we can ensure that these goals are pursued and the managers actually have this feasibility of achieving this goal, but at the same time, we move away from this issue of the crime of responsibility that, in the final analysis, would be the impeachment of the president of the republic” According to the text, instead of the crimes of responsibility for non-compliance with goals, which are contained in the Fiscal Responsibility Law (LRF), it will be enough for the President of the Republic to send a message to the National Congress and explain the reasons for non-compliance with the goals of result of public accounts. The proposed new fiscal framework also made it optional for the government to limit (block) expenditures to meet fiscal targets. In recent years, to meet the spending ceiling and fiscal targets, different governments have had to authorize budget blocks to balance the budget. In the event of non-compliance with fiscal targets, the proposed framework determines that the increase in expenses is limited to 50% of the increase in revenue. Under the normal rule, this growth could be greater: up to 70% of the increase in revenue. Report Cajado stated that his ‘goal’ is to present the report on the new fiscal rule on Wednesday (10). Before, he will have meetings with the PL, PSDB, PSB and PSD benches. The deputy will also have new talks with representatives of President Luiz Inácio Lula da Silva’s economic team. “Having evaluated all these scenarios with the benches that make up the Chamber of Deputies, having heard the criticism of the suggestions that we presented to the Minister of Finance and the Minister of Planning, I hope to have the report completely equated to be able to make it available. If until Wednesday, great. That’s my goal,” he said. The framework is initially being discussed in the Chamber. If approved, it still needs to go through the Senate. The Minister of Finance, Fernando Haddad, asked the President of the Chamber, Arthur Lira (PP-AL) that the vote in the Chamber be held for the third week of May.

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