Device authorizes the Executive to pay the expenses if the budget laws are not approved this year
BRASILIA – In the middle risk of not approving the budget laws this yearwhich could lead to a “blackout” in the public sector in 2025, the presidential government Luiz Inácio Lula da Silva has included in the state debt renegotiation bill a provision that allows the Executive to pay expenses if the Annual Budget Law (LOA) is not approved and published by January 1 of each year. The project will be voted on today in plenary.
Congress has not yet voted on the Budget Guidelines Act (LDO) and the LOAwhich define the rules of public accounts and the destination of the Union’s money.
The text, reported by the leader of the PP in the Chamber, the deputy Luizinho (RJ), establishes that, if the LOA is not approved and published in time, the government will be able to implement the programming contained in the Annual Budget Law Project (PLOA) to ensure the continuity of essential expenditure, such as expenditure with constitutional or legal obligations, debt service and other expenditure foreseen in the LDO of that year.
It is not permitted to pay expenses for the creation of positions and bonuses, for the hiring of civilian or military personnel and for the increase in salaries of public employees before the approval of the Budget. According to the text, if there are negative balances between the provisional budget (PLOA) and the final approved budget (LOA), these differences will be adjusted based on the expenses already incurred.
Today, if the government does not approve the LOA in a given year, it must vote in 2025 on a decree establishing the so-called “provisional execution” of the LOA, with the financial planning for the year.
Each year, the LDO is responsible for regulating this provisional enforcement. Therefore, if it does not approve it, the Executive will run the risk of suffering a “shutdown” and of no longer being able to pay any type of resource from January onwards. In practice, by including provisional implementation in a companion law, the government does not depend on the approval of the LDO to execute the Budget.
As demonstrated by Estadaothe Lula government has nine working days before the parliamentary break to approve the proposals on the economic agendaled by the Minister of Finance, Fernando Haddad. In addition to the budget laws, the projects of expense containment package and the regulation of tax reform. The agenda was blocked mainly due to the impasse regarding parliamentary amendments.
Order for publication of amendments published by the government on Tuesday paves the way for the development of measures, but MPs expect an actual payment of resources to commit to voting on the proposals.
Source: Terra
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