The first eight months of Luiz Inácio Lula da Silva's (PT) new mandate resulted in the largest deficit in public accounts ever recorded in that period for a first year of government. According to data from the National Treasury of Brazil, the deficit — arising from expenditure above revenue — amounts to R$104.6 billion [$ 21 billion].
The result contrasts with those obtained by Lula in the same period of his two previous administrations, which had surpluses of R$ 107.8 billion (2003) and R$ 129.2 billion (2007) from January to August, already factoring in inflation.
The country has been accumulating deficits since 2014, under the Dilma Rousseff (PT) administration. Since then, the only exception occurred in 2022, when oil royalties contributed to a surplus in the last year of Jair Bolsonaro's (PL) term. Before taking office, Lula negotiated with Congress the approval of a PEC ( Constitutional Amendment Bill) to increase spending by up to R$168 billion this year. The objective was to maintain social policies that Bolsonaro had boosted in the election year. Despite the negative balance, Finance Minister Fernando Haddad (Finance) promises zero deficit in 2024.
Translated by Cassy Dias