Lula will not take office until the 1is January 2023 but he has already just obtained a major victory: the Chamber of Deputies of Brazil approved, on Wednesday, December 21, an amendment to the Constitution which authorizes the future Lula government to exceed the spending ceiling to finance social programs. The text was approved by a very large majority, by 331 votes to 163.
It allows the government of President-elect Luiz Inacio Lula da Silva to allocate 145 billion reais (about 26 billion euros) above the legal spending ceiling to social programs.
The authorization of these exceptional expenses aims above all to perpetuate the monthly allowance of 600 reais (110 euros) paid to the poorest families, an amount already in force since August, under the government of the outgoing President of extreme right Jair Bolsonaro. Lula also undertook to pay beneficiary families a monthly bonus of 150 reais for each child under 7 years of age.
Lula had a trump card up his sleeve during the negotiations with the deputies: a ruling by a Supreme Court judge who decided on Sunday that social minima could be financed by “extraordinary credits” regardless of the spending cap. It could therefore have financed them even if the constitutional amendment had been rejected by the parliamentarians.
Aid for the purchase of medicines
The constitutional amendment had already been approved two weeks ago by the Senate, which must now analyze it again after the modifications of certain articles. The senators had authorized these exceptional expenses for two years, a period reduced to one year by the deputies.
Beyond the social minima, the authorization to exceed the expenditure ceiling will make it possible to release funds for the program of popular pharmacies, with significant reductions for the purchase of drugs, and for the increase in the minimum wage.
More than 33 million Brazilians suffer from hunger, and the purchasing power of the poorest has been seriously affected by the Covid-19 crisis and by inflation.
“This constitutional amendment is an emergency for the country, after the damage caused by austerity under Bolsonaro”left-wing MP Fernanda Melchionna told the Chamber.
Adriana Ventura, of the right-wing Novo party, for her part castigated a text which “mislead the Brazilians”and estimated that “the poor will pay the bill with inflation” what she thinks the increase in public spending is likely to entail.
The left-wing president-elect’s team is trying to reassure the business community, which fears that the future government will neglect budgetary rigor to finance its social programs.