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The Federal Government Presents a Fiscal Package with Significant Changes to the Minimum Wage, Adjustments to Social Benefits Like Bolsa Família, and Cuts in Public Employees’ Excess Salaries. The Proposal Seeks Billion-Dollar Savings to Meet the Goals of the Fiscal Framework but Faces Political and Social Resistance That Raises Questions About the Impact on the Most Vulnerable Population.
The federal government is about to unveil one of the most controversial fiscal packages of the last decade. The proposal, which has been refined in intense meetings at the Palácio do Planalto, promises to bring deep changes to the public budget, with impacts that are expected to reverberate across various spheres of society.
Although final details are kept under wraps until Congressional leaders give their approval, it is speculated that controversial measures involving social programs, salaries, and labor benefits are at the core of the plan.
With an adjustment seeking to balance public accounts without compromising governability, President Luiz Inácio Lula da Silva and his team face a significant challenge: convincing Congress and society of the necessity for these cuts.
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After Paraguay, another South American country cuts corporate taxes, reduces the rate from 27% to 23%, and launches a package with over 40 measures to attract investments, generate jobs, and differentiate itself from Brazil in the dispute for competitiveness.
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The first installment of the 13th salary from INSS will be released starting this Friday, and over R$ 78 billion will enter the Brazilian economy in two phases, but not all beneficiaries are entitled to the payment.
The promise is that the measures will be sufficient to generate a savings between US$ 25 billion and US$ 30 billion by 2025, increasing to US$ 40 billion in 2026. But at what cost?
Package Details: What Is Being Proposed?
The heart of the fiscal package includes measures ranging from changes in the adjustment criteria for the minimum wage to adjustments in the Continuous Cash Benefit (BPC) and the salary bonus (PIS/Pasep).
One of the most controversial changes is the limitation of the real gain of the minimum wage, which could vary between 0.6% and 2.5% above inflation, depending on revenue growth.
In the case of the BPC, the idea is to restrict the benefit to people with severe disabilities or elderly individuals in extreme vulnerability, ensuring that only those who cannot support themselves, even with family support, receive the assistance.
To avoid lawsuits that increase access to the program, the government intends to propose changes to the Constitution.
Additionally, the tightening of Bolsa Família aims to prevent fraud and direct resources exclusively to those who truly meet the criteria.
Despite this, Minister Wellington Dias assured that the cuts will not affect current beneficiaries, reaffirming that the focus will be on management improvements.
Another central point is the fight against excess salaries in the public sector. A supplementary bill is being prepared to establish stricter limits on remuneration, but its approval depends on Congressional endorsement.
The Minister of Finance, Fernando Haddad, emphasized that the project is part of a collective effort to adjust public accounts without penalizing the most vulnerable.
Impacts on Unemployment Insurance and FGTS
While the government has ruled out changes to the FGTS and cuts to unemployment insurance, some adjustments have been discussed in meetings.
An initial proposal suggested using part of the 40% fine on FGTS in dismissals to fund unemployment insurance, but the idea was abandoned due to strong resistance from union leaders and Minister Luiz Marinho.
As for unemployment insurance, some changes were suggested, such as restricting the benefit to workers who earn up to two minimum wages.
However, labor unions pressured to avoid any changes that would jeopardize already acquired rights.
Resistance and Political Articulation
The presentation of the package to Congressional leaders — including José Guimarães (PT-CE), Randolfe Rodrigues (PT-AP), and Otto Alencar (PSD-BA) — marks the beginning of a political battle to ensure the approval of the measures.
Behind the scenes, the government’s strategy is to align the support of the presidents of the Chamber, Arthur Lira, and the Senate, Rodrigo Pacheco, before formalizing the public announcement.
Meanwhile, sectors of society and unions express concern about the impact of the changes, particularly in the areas of education and health.
Ministers from these ministries, such as Camilo Santana and Nísia Trindade, have already voiced opposition to cuts in constitutional floors that could undermine essential investments, such as Fundeb and transfers for SUS.
Economic Context: The Weight of the Fiscal Framework
According to the portal O GLOBO, the cuts package is a direct consequence of the new fiscal framework, which limits the growth of public spending to revenue performance.
According to Haddad, the proposal is a necessary alternative to avoid drastic cuts in discretionary investments, which could paralyze the government. He argues that, without adjustments, compliance with fiscal rules will be unfeasible starting in 2025.
Solution or Dilemma?
The promise of fiscal balance comes with political and social challenges. The government will need to convince Congress and society that the cuts are indispensable and do not compromise the rights of Brazilians.
With the economy recovering and growing demands for social investments, the fiscal package will be a litmus test for the Lula administration.
What do you think about the proposed measures? Are they the best solution for fiscal balance or do they weigh too much on the population? Share your opinion in the comments!
Esse governo é uma ****, o pior de toda a História do Brasil o povo nunca foi tão escravo do sistema como nos dias de hoje. Não temos nem saneamento básico que essa esquerda maligna foi 100%contra.