BRASILIA – The minister of Planning, Simone Tebetsaid this Tuesday, 2nd, that he still does not have the revenue projection numbers finalized to say whether or not the government will be able to maintain the goal of creating a surplus (positive balance) of 0.5% of GDP in 2025.
The expectation is that the data will be delivered by the Treasury to Planning between today and tomorrow, he commented. The fiscal target needs to be proposed in the draft law Budget Guidelines (PLDO)to be sent to Congress on April 15th.
“What can I say – which is what Haddad already said – is that the discussion of the 2024 and 2025 target is on the table, the re-discussion”, he said. When asked if, in addition to the target for 2025, this year’s zero deficit target could also be revised, Tebet corrected it. “No, it is not being re-discussed (the 2024 target); I just said that, in this year’s target, ‘A’ minus ‘B’ has to be zero, and we will evaluate it month by month”, said the minister to journalists, after participating in the closing of the International Seminar on Good Planning Practices Medium and Long Term, in Brasília.
“For now we have a (deficit) of 0.1% (of GDP) without a series of issues that we did not include, which we will have to include in the Budget in the second (bimonthly) report. By May we will have a real vision of what will happen in 2024,” he said.
“A (revenue) minus B (expense) for 2025 has to give a surplus of 0.5% (of GDP). If it doesn’t work, let’s very clearly take this to the Budget Execution Board (JEO) and say: the numbers don’t add up, either we’re going to revise the target or we’re not going to revise the target. What do we do? Are we going to face it like this? Shall we re-discuss the target of 2025 and 2026? That’s a decision that only the Board will make,” he said.
Still on the 2025 PLDO, Tebet said he hopes to hold a meeting with his team this Friday, the 5th, so that a JEO meeting can be scheduled for next week. “With the numbers closed, we will have the reality at our doorstep, whether we will be able to maintain a 0.5% surplus or not”, he declared, highlighting that, while the Ministry of Finance has the numbers relating to revenue, and its portfolio is responsible for the expense data.
“We’re going to hit the numbers. He [Haddad] There’s only one number, I only have another. This marriage needs to happen: he has the revenue side, we have the expense side,” she stated.
Spending Review
Tebet also confirmed that he will include in the Budget Guidelines Bill (PLDO) an annex with guidelines for reviewing spending, as shown by Estadão. Tebet reinforced that it is necessary to move forward in the budget discussion from an expenditure perspective and said that the alternatives to increase revenues are already “exhausting”.
“The increase in the Brazilian Budget from a revenue perspective is already running out, going beyond that would mean increasing taxes. (…) Is there another measure from a revenue perspective? Only the Minister (of Finance, Fernando) Haddad can say, I can’t say anything else, if there is a need. What we need to get rolling is the treadmill from an expense perspective. What to cut, how to cut,” said Tebet.
The minister reinforced that the annex on spending review will be a guideline for the execution of the Budget and may be revised later. “This list (of spending review) does not need to specifically include which or how many (policies); it needs to guide what we need to do and which expenses are compressing the space for discretionary (non-mandatory) expenses. It comes with a projection that if nothing is done, at a certain point we will not have resources for discretionary expenses,” she explained.
The discussion on the spending review agenda will be taken to the JEO meeting next week. According to the minister, the idea is that this annex contains a clear analysis of the impact of expenses on, for example, health and education floors, Social Security and public servants.
As Estadão showed, the government intends to include in the 2025 PLDO an estimate of savings with the review of benefit expenses linked to the National Social Security Institute (INSS) and the Agricultural Activity Guarantee Program (Proagro).
Tags: Tebet rule changing targets increase revenue exhausting
--
