The change to the Golden Rule was not detailed by the Treasury in a presentation to the PEC (Photo: Daniel Isaia/Agência Brasil)
The Treasury Department said Tuesday night that the Constitutional Amendment (PEC) proposal to provide for payment in installments for court orders is also leading to changes to the so-called Golden Rule, allowing the government to obtain prior authorization from Congress to cover current expenses, such as paying salaries and pensions with income from credit operations.
This measure, which makes the rule that has already been considered one of the main fiscal pillars of the country more flexible, has been adopted, according to the Treasury Department, “with the aim of achieving greater flexibility in the availability of resources for financing public policies, and contributing to better management of expenditures.”
Currently, the Constitution states that the Union’s credits cannot exceed capital expenditures in the same year unless the government obtains express authorization by Congress to do so, agreeing to the so-called supplemental appropriations, which require an absolute majority of the vote.
Since, over the past few years, the union has been running consecutive deficits in its primary accounts, the government has had to regularly turn to Congress for additional credits.
The new PEC decides that this legislative mandate can actually be granted in advance during a vote on the annual budget law. No additional credits will be required unless, throughout the year, there is an additional mismatch between income from credit operations and investment expenditures.
“The Presidential Election Commission aims to improve and simplify the current procedure, which causes delays by demonstrating the need for subsequent approval by the National Congress, by an absolute majority of votes, of additional credit for expenditures already approved by members of Congress,” the Treasury said in a note. During the budget bill procedures.
The agency explained that this year, with the vote on the budget delayed, the government was prevented from obtaining additional appropriations for several months, which puts expenses “at risk” such as salaries.
The change to the Golden Rule was not detailed by the Treasury in a presentation on the PEC given earlier to journalists and the explanatory note was only released after news about the measure was published in the press.
