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Lula's government is about to make profound changes to the minimum wages for health and education. With spending cuts, controversial measures could directly affect access to and quality of these essential services.
The measure could change the way the federal government deals with essential spending, impacting vital areas such as Health and Education.
Experts warn of the risks of this restructuring, which could affect millions of Brazilians.
The proposed amendment, which is still under debate, aims to drastically control the increase in expenses, restricting one of the country's largest budgets.
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The federal government is discussing significant changes to the way the Health and Education floors are calculated.
The proposal being analyzed by the Ministry of Finance, led by Fernando Haddad, suggests that the Health and Education floors cease to be linked to revenue and begin to be linked to the spending limits of the fiscal framework.
The change, if approved, will mean that growth in spending on health and education will be restricted to a limit of 2,5% above inflation, as stipulated by the new fiscal rules.
This review could have serious repercussions.
The government intends to cut costs, but at the same time preserve essential resources, such as those allocated to health and education., sectors that are fundamental to the well-being of the population.
In a meeting at the Planalto Palace, President Luiz Inácio Lula da Silva discussed the measure with the Ministers of Health, Nísia Trindade, and Education, Camilo Santana.
The proposed measure aims to guarantee fiscal sustainability, but, according to the president's own advisors, this change could generate significant friction with allies and even within the Workers' Party (PT) itself, which could complicate the implementation of the change.
Impact on the federal budget
According to the Constitution, spending on Health and Education must represent, respectively, 15% and 18% of the federal government's net revenue.
However, the new fiscal framework model has imposed stricter limits on government spending, which makes linking revenue to spending a challenge.
The measure of decoupling health and education floors from net current revenue and placing them under the fiscal ceiling may represent a risk of reducing investments in these areas.
Furthermore, if the measure is confirmed, health and education spending cannot grow more than 2,5% above inflation, a margin considered low given the growing needs for investment in infrastructure, salaries and resources for both sectors.
The restriction may compromise the quality of services provided to the population, especially at a time of post-pandemic economic recovery.
Political reaction and challenges for the government
The Ministry of Finance's proposal has generated controversy, especially in the political arena.
PT president Gleisi Hoffmann has already spoken out against the proposal, stating that decoupling the minimum wage from revenue would not be a fair option and could harm essential areas such as Health and Education.
. For the PT, the measure represents a setback and a way of seeking fiscal solutions that harm the most vulnerable population.
This division within the government and its political allies calls into question support for the proposed change. The debate continues heatedly, and the assessment of the measure’s impact will continue to be discussed in the coming weeks.
Alternatives under debate
An alternative that is also being discussed by the economic team is include parliamentary amendments within the Health and Education budgets, a measure that could help soften the impact of budget constraints.
However, this change also needs to be formalized through a Proposed Amendment to the Constitution (PEC), which requires a long process of processing in Congress.
The government has not yet released an official date for the announcement of the changes, but, according to information from the Ministry of Finance, the discussions are in the final stretch, and details are expected to be released soon.
Within Planalto, there is an expectation that the country's fiscal situation will improve, especially with the recent fall in the value of the dollar and future interest rates.
These changes, however, may not be enough to convince critics of the proposal.
The future of the Continuous Benefit Payment (BPC)
Another sensitive point in discussions about cutting costs is the Continuous Benefit Payment (BPC), which has seen a considerable increase in recent months.
The government is looking for ways to reform access and retention of people in the program, trying to block undue payments and adjust the rules to ensure that resources are directed to those who really need them.
However, a crucial measure has already been discarded: decoupling the BPC from the minimum wage, a proposal that would generate even more controversy and negative repercussions.
How will the federal government deal with the future of Health, Education and social programs in Brazil? Stay tuned for future updates to find out how these measures may impact your pocket and the quality of essential services.
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