5% server adjustment could bring budget size to 16.2 billion reais, says secretary

The government is considering a written adjustment of 5% for federal public servants. A decision on the increases will be made at the end of June. Deadline in the Financial Accountability Act (LRF). President Jair Bolsonaro (PL) said on Thursday (19) that the government had made an effort to find room in the budget and think about civil servants.

So far, with Freeze announced on Friday (20), the total blockade imposed on the Executive’s budget will reach 9.9 billion Brazilian riyals until the end of this month. This block due to the overstatement of mandatory expenses. The aim is to respect the maximum expenditure rule, according to which the total expenditure subject to maximum inflation cannot exceed.

The overall 5% increase is estimated to cost the executive branch an estimated 6.3 billion reais, while the government will spend an additional 1.7 billion reais on job restructuring, money already saved in the budget.

Thus, if the government grants the readjustment and restructuring of jobs, the new expenditure will be 6.3 billion reais. If the decision only concerns a linear adjustment, without restructuring, the new block needed will be 4.6 billion reais.

According to Colnago, the blockade must be put in place by discretionary expenditure (financing of the public apparatus and investment by ministries) or by parliamentary amendments.

In response to a question about whether the blockade could cripple some basic activities, the minister said the economic team “will seek to preserve ministries that face many budgetary difficulties”, including himself. The Ministry of Economy.

Colnago also mentions that, historically, there are opportunities to free up resources in the second half of the year, as it turns out that there will not be enough time to implement some of the projects planned by the ministries.

Colnago also clarified on Friday that the server readjustment must be signed into law by the president by June, due to limitations in the Fiscal Responsibility Act.

The Minister also mentioned that once the amendment gavel is struck, a bill will have to be sent to Congress providing for the increase. This project must be approved and sanctioned by June.

Several categories of civil servants have lobbied the government to make adjustments after freezing category salaries for the past two years.

Eleanor C. William