Census preview takes resources from 863 municipalities and generates battle against IBGE data

The partial disclosure of Demographic Census data by the IBGE (Brazilian Institute of Geography and Statistics) and the consequent revision of the division coefficients of R$ 188 billion from the FPM (Municipalities Participation Fund) started a legal battle triggered by hundreds of mayors, given the risk of running out of money to pay budgeted expenses.

The sudden loss of resources affected 863 municipalities that saw their population statistics dwindle from one day to the next, according to a survey by the CNM (National Confederation of Municipalities). This Monday afternoon (23), Minister Ricardo Lewandowski, of the STF (Federal Supreme Court), granted an injunction restoring the previous division of resources.

The FPM is a fund supplied with 25.5% of income tax and IPI (Tax on Industrialized Products) collections and its resources help municipalities to finance policies. One of the criteria to determine how much the city hall will receive is precisely the number of inhabitants.

The impasse also increased the pressure on the IBGE. The change occurred after the agency delivered updated population data to the TCU (Tribunal de Contas da União), even though the Census was still incomplete.

Initially planned to last three months, data collection ran into a series of difficulties and now takes twice as long. The Census covered 85.1% of the locations to be censused, but another 14.1% are still in progress, and in 0.8% the survey has not even started.

To comply with the legal obligation, the IBGE adopted an unusual procedure: it consolidated population data from the available collection, which covered 83.9% of the sectors, and estimated the remaining 16.1%. Thus, he came to the conclusion that the Brazilian population is 207.8 million —below the 215 million expected by the agency itself.

The TCU received the information and, on December 28, 2022, issued a normative decision that fixed the new coefficients of the municipalities —which indicate what their share in the FPM will be. From there, confusion ensued.

Specialists began to question the IBGE data. The municipalities also criticized the agency’s decision to update population statistics before obtaining the final Census photograph.

The IBGE says in a note that “the challenges of municipalities that defend the use of outdated population data do not proceed”. According to the agency, the methodology for the estimate presented was approved by the Census advisory board, made up of economists, demographers and statisticians as representatives of civil society.

“The forwarded preview represents a joint effort —by the IBGE and the TCU— to deliver population data duly updated using the best statistical technique available with greater precision and reliability”, says the IBGE.

Even so, hundreds of prefectures filed lawsuits in the first instance to maintain the previous coefficients —many had already been successful.

In São Paulo, 97 municipalities had lower coefficients, and each subtracted quota means a loss of R$ 5.1 million. The problem affects larger cities, such as Poá and Mogi Mirim, and smaller ones, such as Lavínia and Porangaba.

Bahia is the state with the highest number of losing municipalities: 101. The Legislative Assembly filed a lawsuit with the STF on behalf of city halls to try to disregard the new division of the FPM. PC do B also filed a similar request with the Supreme Court. It was in the midst of this second action that Lewandowski granted the injunction favoring the municipalities.

Last Wednesday (18), the president of the TCU, Minister Bruno Dantas, dealt with the matter in a session with the other members of the court and gave a dimension of the political repercussions of the case.

“Since the 2nd of January I have received a flood of calls from parliamentarians, ministers of State, governors. I received here in the first days of the year the governor [Carlos] Brandão, from Maranhão, Senator Renan Calheiros, from Alagoas. I received contact from the Minister of the Civil House, Rui Costa, who was governor of Bahia and on January 2nd he had stopped being governor just one day ago”, he said.

“It turned into pandemonium”, summarizes the president of CNM, Paulo Ziulkoski. According to him, with each new judicial injunction, the fund’s values ​​need to be recalculated, affecting the other municipalities. For him, both IBGE and TCU ran over when changing the data in the 2022 lights out.

“It is logical that these municipalities lost population and will lose revenue, but there is a law saying that it is to maintain [o coeficiente] frozen,” says Ziulkoski.

The law mentioned by the president of the CNM was approved at the end of 2018, given the prospect of delay in the Census due to lack of federal resources. In practice, the measure froze the participation fund distribution coefficients until they were updated “based on a new demographic census”.

When delivering partial data, the IBGE provided information “based” on the Census, but the municipalities understand that this is not enough. The lawsuits ask for the maintenance of the previous coefficients until the Census is, in fact, concluded.

“There is a frenzy of deputies and mayors in search of a solution”, says Ziulkoski. According to him, the Supreme Court’s injunction gives a temporary exit to 702 municipalities that would be affected by the freeze provided for in the 2018 law. But the entity is also looking for a more perennial solution.

Due to the data lag, the prediction is that a large number of municipalities will lose resources. CNM’s suggestion is to dilute the effects of the change over ten years, creating a kind of transition between the highest and lowest coefficients. This would give municipalities time to adjust their expenditures to the new revenue forecast.

A bill to this effect is already being processed on an urgent basis in the Chamber of Deputies. The expectation is to vote on it in February, in the resumption of work in the Legislative. The biggest challenge is to convince the 331 municipalities that would benefit from the change and may want to see it implemented more quickly. “There has to be a principle of solidarity”, defends Ziulkoski.

The impasse surrounding the FPM is being monitored by the Federal Executive through the AGU (Advocacy-General of the Union), the Civil House and the Institutional Relations Secretariat —which has as one of its attributions the articulation with states and municipalities.

SRI informed that it received the demand from the entities that represent the municipalities and passed the matter on to the Ministry of Planning, to which the IBGE is linked, “for the taking of a technical decision”. Planning, which had been extinguished in the Jair Bolsonaro (PL) government and was recreated at the beginning of the year, did not manifest itself.

Members of the new government privately claim that the decisions that led to the controversy surrounding the FPM were taken at the end of 2022, still under the Bolsonaro administration. The new administration sees no problem in carrying out a sort of audit of the data to verify its solidity, since even a Census carried out within normal deadlines is subject to adjustments.

The Civil House said that the route suggested by the minister “is for the mayors to seek dialogue with the Federal Audit Court and other bodies involved”. TCU spoke on the subject during the speech by the president of the court last Wednesday. The AGU did not respond.

The confusion around the FPM has reignited the discussion around the quality of the Demographic Census amid budget cuts, operational difficulties and successive delays in data collection.

In some cases, municipalities appeared with population numbers below those recorded in the 2010 Census. This is the case of Porto Alegre (RS), which had 1.409 million inhabitants in 2010, 1.493 million in the 2021 estimate and had 1.404 million in the preview of the new search.

The crisis is such that the new government still does not have a name to preside over the IBGE, which is under the interim command of the research director, Cimar Azeredo. According to interlocutors, the Minister of Planning, Simone Tebet (MDB), understands that it is appropriate to maintain the current management at least until the conclusion of the research, to guarantee continuity in the work.