INSS arrears will be corrected by Selic

The arrears of the INSS (National Social Security Institute) paid in court will be corrected by the basic interest rate of the economy, the Selic, as determined by constitutional amendment 113, which took effect on December 9th.

Although the Selic rate is going up, the new rule should reduce the amount paid to retirees and pensioners who go to the Judiciary to have the INSS benefit granted or revised. For specialists in Social Security, the index is unconstitutional.

The monetary restatement appears in the part of the PEC (proposed amendment to the Constitution) of the Precatório which was a consensus in Congress and became valid after the promulgation and publication of the amendment. It will be applied in court orders, which are the government’s judicial debts above 60 minimum wages, and also applies to RPVs (Small Value Requisitions), of up to 60 minimum wages.

According to the rule, all debts of the Public Treasury must be updated by Selic. “In discussions and convictions involving the Public Treasury, regardless of their nature and for purposes of monetary restatement, remuneration of capital and compensation for arrears, including the precatory, there will be an incidence, only once, until the effective payment, of the reference rate index of the Special System for Settlement and Custody (Selic), accumulated monthly”, says article 3 of the law.

The lawyer Roberto de Carvalho Santos, president of Ieprev (Institute of Social Security Studies), explains that the change in the Constitution alters the rates that are being paid today, even replacing the default interest.

Until December 9, court orders and RPVs were being corrected for inflation measured by the IPCA-E (Special Extended National Consumer Price Index) plus interest of 0.5% per month. As of the amendment, Selic replaces the inflation index and interest.

“The correction and interest will be subject to the incidence of a single percentage index, removing the previous system of correction plus interest”, explains the lawyer, noting that the amount to be paid will be lower.

“In November 2021, the Selic corresponds to 0.59%. According to what is contained in constitutional amendment 113, this would be the index applied as correction and interest. Applying the previous system, the monetary correction would correspond to 0, 84% and interest of 0.4412%, totaling 1.2812%.”

Experts say correction is unconstitutional

For specialists in Social Security, the new correction of arrears is unconstitutional, as it is an interest rate that guides the economy, and not an index that restores the purchasing power of INSS retirees and pensioners and other citizens who have amounts receivable from the government.

Emerson Lemes, director of the IBDP (Brazilian Institute of Social Security Law), considers that the new constitutional rules challenge the right to property, as the Selic rate does not make up the loss of INSS policyholders. “It’s an interest rate, and interest is due as a penalty for late (or late) payments, not as compensation for inflation,” he says.

Attorney Adriane Bramante, president of the IBDP, reinforces the unconstitutionality of the measure, since the correction of INSS arrears was discussed by the STF (Supreme Federal Court). “It is at odds with what is defined by the STF in the 810 theme”, she says.

In this judgment, which ended in February 2020, the Supreme Court understood that using the TR (Referential Rate) as a correction for court orders and RPVs is unconstitutional. The correct thing, according to the agency, is the use of an inflation index to correct the purchasing power of retirees.

Attorney Carolina Centeno, a partner at Arraes e Centeno Advocacia, believes that it is necessary to closely monitor what is being debated with regard to court orders to avoid further losses, as the PEC dos Precatório initially was an alternative to achieve this amount to pay the Brazil Aid and ended up affecting the rate of correction of judicial debts.