Failure to Get Pension Reform Bill Passed Means Government Will Extinguish 'Benefit Package'

12/18/2017 - 11h09

President Michel Temer's economic team is skeptical when it comes to getting the pension reform bill passed in 2018, and it ordered that the 'benefit package', which was announced - and approved - by Congress last week, be extinguished.

Folha has learned that aspects of the negotiation process will undergo alterations, such as funding for municipalities as well as legislation that extended to micro and small businesses the possibility of paying off debt in installments (Refis).

The assessment arrived at by members of the Ministry of Finance is that if the pension reform bill does not get passed, then the federal government will not have enough money to fulfill all its financial duties while also achieving next year's fiscal target, which has been set at R$ 159 billion (US$ 48.3 billion).

Mayors and congressmen will be among the first to be affected by such measures, especially when considering that president Temer had promised to give R$ 3 billion in funds (US$ 912 million) to municipalities in 2018 under the condition that the pension reform bill be approved and that half of funding go to projects tied to healthcare.

Last week, the president of the lower house of Congress, Rodrigo Maia (DEM-RJ), announced that the vote would be postponed until February of 2018.

Despite having come up with an alternative strategy to deal with the unfriendly political scenario, the Temer administration did decide to loosen provisions in the bill once again by including the possibility of a transition measure for those who began working in the public sector before 2003.

However, the measure goes against the administration's own argument, which includes a discourse of putting an end to privileges.

Translated by THOMAS MATHEWSON

Read the article in the original language