Chamber Upholds Bolsonaro Veto Blocking Salary Increases, Reversing Senate Position

RIO DE JANEIRO, BRAZIL – The Chamber of Deputies on Thursday, August 20th, decided to uphold the veto of President Jair Bolsonaro, which prevented the granting of salary increases, new hires and career progression to the civil service at the federal, state and municipal levels until the end of 2021.

The result marks a federal government upturn after suffering a surprising defeat in the Federal Senate. On Wednesday, the upper house of Congress had decided to overturn the veto – which required it to be reviewed by the Chamber of Deputies.

Government political coordinators in the Chamber were taken by surprise by the Senate vote. They managed to defer the vote in the Chamber, originally scheduled for Wednesday, and worked on organizing a base against overruling the veto throughout the day.

The event marked the debut of the new government leader in the Chamber, Deputy Ricardo Barros, who ultimately had the help of other leaders, such as Arthur Lira, leader of the “blocão”, who has been moving closer to Bolsonaro in recent months, and the Chamber president himself, Rodrigo Maia.

There were 316 votes in favor of upholding the veto and 165 against. It took 257 deputies to overthrow the measure. In the Senate, the matter was overturned by a score of 42 to 30 votes. The votes refer to the National Congress sessions, which, due to the novel coronavirus pandemic are held separately at home, each with their own remote system.

The Ministry of Economy at one point estimated that the wage freeze would ensure a fiscal surplus between R$121 billion and R$132 billion.

The figures were contested by opponents, who say that overruling the veto would not necessarily imply salary raises for public servants. They also argued that the device would impact readjustments and also career programs, blocking progressions for more than a year.

A few hours after the Senate defeat, the Minister of Economy Paulo Guedes raised the tone against legislators. “To take healthcare money and allow it to become a salary raise for civil servants is a crime against the country,” he said. The Minister’s position has caused discomfort in the legislature and has even been criticized by those who have upheld the presidential veto.

The veto, which placed public safety, healthcare, and education professionals on a list of exceptions to which the restriction on readjustments would not apply, had been passed by legislators within the government’s R$125 billion financial aid package to states and municipalities, but was ultimately blocked by Bolsonaro after pressure from the economic team and in agreement with governors and mayors.

The freezing of public servants’ salaries is considered by financial market agents a guarantee of the government’s fiscal commitment, amid the increase in spending triggered by the health crisis.

They argue that its overthrow could undermine the country’s credibility and worsen the public accounts situation at a time when it is estimated that gross debt will exceed 95 percent of GDP (Gross Domestic Product) this year.

Source: InfoMoney

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