Sesc: Transfer of resources to Embratur becomes a target – 05/14/2023 – Market

A new rule that provides for the allocation of 5% of the funds raised by Sesc and Senac to Embratur (Brazilian Agency for the International Promotion of Tourism) entered the sights of the S System.

Business federations and confederations act to prevent the approval of the proposal in Congress, arguing that the transfer of funds compromises the maintenance of education and training programs throughout the country.

The rule is part of the provisional measure of Perse (Emergency Program for the Resumption of the Events Sector), which deals with benefits for airlines and companies related to entertainment. The text was approved at the end of April by the House and is awaiting consideration by the Senate.

During the analysis in the Chamber, deputy José Guimarães (PT-CE) inserted two articles establishing the transfer to Embratur of 5% of the resources that today go to Sesc (Social Service of Commerce) and Senac (National Service of Commercial Learning) .

According to the entities, which are administered by the CNC (National Confederation of Commerce in Goods, Services and Tourism), the measure could end units in more than 100 cities, causing the closure of 31,000 free places in vocational education and 7,700 in basic education.

In the case of Sesc, the calculation is that R$ 121 million would no longer be invested in free services. Senac already says that the transfer of resources would be responsible for the closure of 29 professional training centers, with a cut of R$ 140 million in assistance.

Together, the budget of the two entities is around R$ 8 billion per year, money that comes from the compulsory payment of 1.5% on the payroll of companies in the goods, services and tourism sector.

In recent weeks, Sesc and Senac began a mobilization to stop the measure, with a petition, sending SMS and videos with the participation of artists. As of the publication of this text, the online petition had received over 430,000 signatures.

Representatives of confederations that manage entities of the S System also sent a letter to the senators asking for the removal of the provision of the MP.

José Roberto Tadros, president of the CNC, says that the proposal is a “legal, social, economic and political outgrowth”.

According to him, the S System is private, and the amounts allocated to Sesc and Senac are not public resources. There would be, in the view of the confederation, understanding in the STF (Federal Supreme Court) that the amounts destined to the entities must be used exclusively for this purpose.

Marcelo Freixo, president of Embratur, disagrees. “The money from the S System is public money, derived from taxes and which has an effect on the price of products”, he says.

Embratur, whose mission is to promote Brazil in the world to attract more tourists, also opposes the argument that the measure will harm the activities of Sesc and Senac.

According to Freixo, the budget of both institutions has a surplus of R$ 2 billion per year. Considering that the total raised is around R$ 8 billion, the 5% allocated to Embratur would represent around R$ 400 million.

“It’s a quarter of what’s left of Sesc and Senac”, he says. “When they say they will have to stop activities, this does not correspond to the numbers that are on their own Transparency Portal”, she adds.

Freixo says that, internally, the S System’s fear is not with the impacts of this measure itself, but that it opens precedents for new requests coveting the institutions’ cash.

Tadros claims that it is fallacious to say that there is surplus in the budget. “This is sophistry, the grossest possible. What there is, in fact, is investment and resources stamped, provisioned”, he says.

According to him, Sesc has BRL 1.3 billion in cash, but a total of BRL 1.7 billion in committed works — a deficit of BRL 400 million, if the works were completed.

“Even if there were reserves, those reserves are ours. [transferência de recursos para a Embratur] It’s called expropriation. Brazil is not a communist country. It’s not a sin to have reservations, if it were true”, says the president of the CNC.

“Claiming to get our hands on private resources and coming up with fallacious arguments, based on a ridiculous spreadsheet, is something we are not going to accept”, he adds.

Embratur argues that the allocation of resources can work as a multiplying factor. By heating up tourism in Brazil, there would be an increase in demand for services and trade. As a result, companies would hire more workers and the payroll contribution —the main source of revenue for Sesc and Senac— would grow.

According to Freixo, in the first quarter of 2023 alone, tourists left BRL 8 billion in the local economy. “These R$ 8 billion went to restaurants, hotels, trade and went to Sesc and Senac, to the CNC. That is, they collect from it. So, in fact, the 5% should be understood as an investment”, he says .

According to him, the proposal was born from a study commissioned from FGV (Fundação Getúlio Vargas) to find sources of financing.

This is because, in 2019, Embratur ceased to be a federal agency and was removed from the Union Budget. By provisional measure, the government of Jair Bolsonaro changed the legal nature of the agency, but without a defined source of funding.

According to Freixo, the initial idea was to allocate 15% of Sebrae’s collection, but the device was removed from the text.

If the articles in Perse’s MP are not approved, the agency says it will have no budget to invest in attracting foreign tourists and will need to completely stop its promotion actions.

“We have a company that promotes all Brazilian tourism without any source of funding”, says Freixo. “We don’t want more money, we want a source [de receita] to have a promotion [do turismo]because today there isn’t.”

Tadros claims that Embratur has not fulfilled its objectives and has not yet shown its purpose. “What did it do? It receives 5 million tourists a year? Uruguay, which is a microcosm of the country, receives 8 million”, he says.

“On the day the Ministry of Tourism was created, there was no need for there to be Embratur. If it exists, the government should endow the Ministry of Tourism with resources and the portfolio allocate these resources to the agency”, he adds.

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What is System S?

Set of entities managed by business federations and confederations, segmented by type of economic sector. They are classified as private and have no administrative link with the government. They offer teaching, training, research and leisure services

Where does the money come from?
From the compulsory contribution of companies, which is collected from workers’ payroll. Charge rates vary depending on the sector

How is the money shared?
Contributions are collected by the Federal Revenue Service, which is passed on to the entities.

Entities that make up the system

• Sesi (Industry Social Service)
• Senai (National Service of Industrial Learning)
• Senac (National Trade Learning Service)
• Sesc (Social Service of Commerce)
• Senar (National Rural Learning Service)
• Sescoop (National Cooperative Learning Service)
• Senat (Transport Learning Social Service)
• Sest (Social Transport Service)
• Sebrae (Brazilian Micro and Small Business Support Service)