Good morning! Today, we talk about the bill granting Lula a license to spend. A new direction for Petrobras? And how agricultural lobbies try to loosen pesticide regulations.
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License-to-spend proposal finally introduced
Senator Marcelo Castro of Piauí, the rapporteur of the 2023 budget, filed a constitutional amendment bill that would grant the next government authorization to exempt social programs from federal spending cap rules. It also allows the government to jack up investment in the event tax revenue exceeds expectations.
Why it matters. As presented by the outgoing administration, Brazil’s 2023 budget proposal is completely infeasible. Without permission to spend, many programs will be paralyzed, or the government will breach fiscal responsibility rules.
Tweak. Unlike the proposal put forward by President-elect Luiz Inácio Lula da Silva’s transition team, Mr. Castro’s bill sets boundaries as to how much the government will be able to “overspend” — and for how long the permission will last.
- Even so, Mr. Castro was generous with the next government, foreseeing BRL 198 billion (USD 37 billion)...