Government still seeks way of funding new cash-transfer program
In spite of the skepticism of economic officials about progress in the fiscal agenda this year, Planalto Palace officials have scheduled a meeting by Thursday with the rapporteur of the so-called federative pact and emergency constitutional amendment proposals, Senator Marcio Bittar (Brazilian Democratic Movement, MDB, of Acre). The idea is to try and reach a new consensus on the formula to fund a new cash-transfer program.
Mr. Bittar is also the rapporteur of the 2021 budget bill. Sources involved in the negotiations say he has already presented new options of austerity measures that could ensure funds for the cash-transfer program, called Renda Cidadã, to replace the current Bolsa Família. But nothing is defined. From now, it will depend on the government.
One source says Mr. Bittar already suggested he would only present the proposal if he has support from the executive branch. Because of this, he has been avoiding speaking on dates to present his report.
It is a discussion that is hard to have at this moment, with the municipal elections' runoff ahead, government officials reckon. In this situation, controversial issues will be set aside.
Although unfavorable results from the polls to President Jair Bolsonaro put more pressure on the government to design a strong successor for the emergency aid paid to informal workers during the pandemic, economic officials see that as improbable. Firstly because of the bad shape of federal public accounts in the medium term.
Secondly because the strategy to counter the probable halt of the fiscal agenda in Congress is not to announce any new expenditure this year. This will reinforce the message of resuming the fiscal consolidation in 2021.
Thus, the most probable outcome for the social program, according to comments among economic officials, is to begin the next year with Bolsa Família in the pre-pandemic format.
The bolstering of the program and the formation of Renda Cidadã is discussion for after the elections of the commands of the Chamber of Deputies and Senate, one source says.The government leader in the lower house, Deputy Ricardo Barros (Progressive Party, PP, of Paraná), believes any decision on changing Bolsa Família, the tax reform and the Emergency PEC (constitutional amendment...
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