Brazil Senate approves more pandemic aid for poor families

RIO DE JANEIRO, BRAZIL – Brazil’s Senate passed on Thursday, March 4th, a constitutional amendment letting the government extend emergency pandemic aid to poor Brazilians, while keeping costs within its spending cap.

The government said it plans a monthly stipend of R$250 (US$45) for four months once the bill clears the lower house.

More generous cash transfers to millions of poor families from April through December last year totaled some R$322 billion US$57.3 billion) and boosted President Jair Bolsonaro’s popularity as he eyed re-election in 2022.

But the extension of the assistance raised fears the government would not comply with a mandatory spending ceiling, putting markets on edge about undermining fiscal discipline.

This bill allows the government to spend up to R$44 billion on stipends as an exception to certain fiscal constraints.

The original proposal by the Economy Ministry included a provision that would eliminate minimum investment in education and health, to compensate for the cost of the stipends.

But to get the bill approved, Senate leadership excluded that provision, which was opposed by many senators and likely to stall the legislation in the lower house.