Group linked to Persio Arida calls for rejection of the Transition PEC

The liberal group Livres, which defended the vote for elected president Luiz Inácio Lula da Silva (PT) in the second round of the elections, released a note in which it asks for the rejection of the PEC project (proposed amendment to the Constitution) of the Transition, which opens the way to almost BRL 200 billion in spending outside the cap.

Economist Persio Arida, a member of Lula’s transition team, is an academic adviser to Livres, but had no participation in the document, which was drawn up by the entity’s board.

In the note, Livres defends that the new government should take advantage of the beginning of the mandate to discuss priorities within the Budget and the implementation of a new rule of expenditure control.

According to a study by Livres, opening this gap in the spending ceiling, without guaranteeing fiscal responsibility, even if it is to pay for social policies, “is giving with one hand and taking away with the other”.

“Livres is against the approval of the constitutional amendment project under discussion by the president-elect’s transition team”, says the note.

“It is the most socially worrying path, because it worsens Brazilians’ income and the country’s growth prospects. The implementation of social policies without fiscal responsibility has a perverse effect.”

Deborah Bizarria, coordinator of Public Policies at Livres and one of the authors of the document, says that the recalibration of Bolsa Família benefits, instead of maintaining the fixed amount of BRL 600 per family, would help to improve the effectiveness of the program.

If rejection is politically unfeasible, says the economist, Livres recommends action oriented towards harm reduction, as is the case with the proposal presented by senator Alessandro Vieira (PSDB-SE), which removes R$ 70 billion from the spending ceiling for the income program, he points out.

“We believe in the importance of social policy, but this has to be pursued in line with fiscal responsibility. Otherwise, we have an explosion in public debt, and this generates inflation and an incentive for there to be no discussion of priorities in the public budget. “, says the coordinator of Livres.

“If there is a change in the social programs, we would be able to do it without the extra expense.”

Livres emerged within the PSL in 2016, but left the party when Jair Bolsonaro (PL) joined the party in 2018.

The Transition PEC, filed on Monday (28), allows investments to be made beyond the expenditure limit, if the government has registered the inflow of extraordinary revenues. This mechanism would apply from 2023.