STF suspends judgment of actions that question points of the Social Security reform

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A request for a view from Minister Alexandre de Moraes interrupted the analysis. Rapporteur Luis Roberto Barroso voted for the validity of most of the changes made to pensions. The Federal Supreme Court (STF) suspended, this Friday (15), the judgment of actions that question the Social Security reform approved by Congress in 2019. The reform promoted changes in the retirement rules for public service workers and the initiative toilet. The set of processes returned to the agenda in the virtual plenary, in which ministers present their votes in an electronic system on the Court’s website. In this form of voting, there is no need for an in-person judging session. The issue had been under virtual trial since last Friday (8). The analysis was interrupted by a request for a review from Minister Alexandre de Moraes. There is still no date set for the return to the agenda. History The STF began analyzing the issue in September 2022. At the time, the rapporteur, minister Luís Roberto Barroso, voted for the validity of most of the changes made to the retirement system. The trial ended up suspended after a request for a review from Minister Ricardo Lewandowski, now retired. In June of this year, Minister Luiz Fux suspended the analysis and sent the case for in-person judgment, but Fux’s request for prominence was eventually canceled and the issue returned to the virtual plenary. Remember what changed with the Social Security reform In a solemn session, Congress enacts Social Security reform The twelve actions under analysis were presented by associations that represent sectors of the public service – public defenders, members of the MP, judges, tax auditors, PF delegates – – and by political parties. The minister voted to reject eight cases. In four actions, he understood that it is necessary to establish an interpretation for the section of the reform that deals with the collection of social security contributions from inactive employees and pensioners of the Union, states and municipalities. The minister concluded that, at this point, it is necessary to establish that the basis for calculating the social security contribution of this segment of civil servants can only be increased if an imbalance in the Social Security accounts persists, even after the adoption of the progressive rate regime for civil servants. When the trial resumed, last Friday (8), Barroso complemented the vote to consider situations in which first establishing the progressive rate regime could compromise public accounts. The minister made it clear that, if the government demonstrates, technically, that this can happen, this requirement will be met, which will allow us to move on to the second step – expanding the calculation base. Legislation Throughout the vote, the minister presented a set of social, legal and economic data, which point to the need for changes in legislation on pensions. In the social area, he highlighted the demographic changes that have occurred in the country in recent years; In the legal area, he cited a “favored” pension rules regime that has been in force for a long time in the country, especially for public servants.” In the economy, the rapporteur mentioned the relationship between Social Security revenues and expenses and the proportion of these expenses in relation to GDP, their position in the public budget and the impacts of the Social Security deficit. Rapporteur of the actions, Minister Luís Roberto Barroso presided over the plenary session of the STF this Thursday (14). Gustavo Moreno/SCO/STF Barroso highlighted the impact that the reform of the retirement system could have on economic activity. “Reforms in Social Security aimed at combating the deficit produce positive macroeconomic impacts that cannot be ignored. An effect attributed to the increase in the minimum age for retirement, for example, is that the worker, by having a prolonged working life, tends to to save less and consume more. This encourages companies to increase their production capacity, which heats up the economy and creates more jobs”, says the minister. Barroso also highlighted that an unbridled increase in the Social Security deficit affects government investment, compromises credibility and causes an increase in the basic interest rate — factors that harm the growth of economic activity. “Social Security in Brazil, over the years, has consolidated itself as a mechanism for transferring resources from poor to rich. It has established itself as a mandatory insurance model that aggravated existing social inequalities in the country, neglecting any promotional role of redistributive justice”, he added. The minister considered that there were no irregularities in the legislative process that led to the approval of the amendment in Congress. He also maintained that it is necessary to “accept the legitimate choices made by the legislator”. “When fundamental rights or democratic procedures are not at stake, judges and courts must respect the legitimate choices made by the legislator, as well as be deferential to the reasonable exercise of discretion by the administrator, refraining from overriding their own political valuation. “, he wrote. Divergence During the sessions, two more votes were presented. Minister Edson Fachin opened a disagreement, which was accompanied by Minister Rosa Weber, who brought forward the vote before retirement. Fachin partially accepted the requests in three actions. He concluded that the section that allows the expansion of the calculation basis for social security contributions for inactive employees and pensioners of the Union, states and municipalities is unconstitutional. According to legislation, this can occur if there is an imbalance in Social Security accounts. In two other points, he set parameters for applying the standard. One of them is the section that nullifies the granting of pensions under the specific regime (that of civil servants) based on the so-called reciprocal counting of fictitious contributions to the general regime (that of the private sector). Reciprocal counting occurs when contribution time in one regime is used in another. A fictitious contribution is one established by law, but without actual payment. This section of the reform prevents, in practice, a civil servant from using the time he worked in the private sector to retire, if this contribution period was only provided for by law, without actual payment. For the minister, this rule cannot affect length of service prior to the 1998 reform, to guarantee legal certainty. The other refers to additions to the calculation of women’s benefits. Fachin voted to equate these increases for women in both regimes – that of public servants and that of the private sector.

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