Bolsonaro signs MP that releases R$ 7.5 billion in extraordinary credit for social security

President Jair Bolsonaro (PL) edited a provisional measure this Thursday (15) to release an extraordinary credit of R$ 7.5 billion in order to pay social security benefits.

The release comes after the government consulted the TCU (Union Court of Auditors) on the extent to which it can resort to the mechanism to honor commitments in the midst of the budgetary blackout experienced by the Executive, a scenario that even affected the manufacture of passports and scholarships.

The court of accounts, however, was generic in responding and said only that it is appropriate to open extraordinary credit through MP “provided that the conditions of relevance, urgency and unpredictability of the expense are met”.

The measure signed by Bolsonaro and published in the Official Gazette this Thursday allocates funds for two types of expenses: around R$ 1.7 billion for social security compensation and the other R$ 5.7 billion for social security benefits.

Extraordinary credit is a resource outside the spending ceiling authorized by the Constitution only in restricted cases.

The acceleration of the granting of INSS (National Institute of Social Security) benefits in the second half of the year had already raised the alarm in the government about a possible lack of funds to pay for pensions.

The government ended up without enough resources within the spending ceiling (which prevents federal expenses from growing above inflation) and, therefore, asked the TCU for a kind of endorsement to activate the extraordinary credits.

There was a concern in the court to avoid a kind of triangulation of resources, removing part of the INSS expense from the ceiling and making room for unblocking expenses with the so-called rapporteur amendments — an instrument used as a bargaining chip in political negotiations with Congress. The maneuver would be punishable.