Barring the state of Rio de Janeiro’s entry into the RRF (Tax Recovery Regime) is “evil”, said Governor Cláudio Castro (PL) this Monday (17th) in a statement to the press.
Castro denied inconsistencies in the Rio de Janeiro recovery plan. According to him, the project follows the guidelines of the RRF. The governor promised to trigger “any instance” that is necessary to overturn the setback suffered by the state.
“Taking Rio de Janeiro out of the regime at this moment, in addition to being evil, does not match what is being done here. It does not match all the recovery work that is being done”, said the governor at the Guanabara Palace.
The National Treasury, however, classified the plan presented by Rio as precarious and based on “fragile technical premises” to promote the rebalancing of the state’s accounts.
as revealed to leaf, Treasury and PGFN (Attorney General’s Office) expressed their rejection of the Rio de Janeiro government’s project, which in practice makes it impossible to adhere to federal aid.
“This secretariat believes it has found elements that indicate the precariousness of the plan presented for the rebalancing of the state’s finances, since it is based on fragile technical premises to promote the sustained financial balance that it aims to achieve with the Recovery Regime Fiscal”, points out the opinion of the Treasury.
The RRF is a program designed for states with cash difficulties, because it offers immediate relief in the payment of debt with the Union and other creditors. On the other hand, these federation units have to adhere to fiscal adjustment measures.
State governments need to commit, for example, to carrying out concessions, privatizations and other measures to improve collections and reduce expenditures. At the same time, they have to respect prohibitions on the creation of new positions, increases and increases in expenses.
The regime was created in 2017, and Rio was the only participant in the first phase of the initiative. The program underwent changes in Congress, sanctioned by President Jair Bolsonaro (PL). Now, the state is seeking new membership.
The Treasury criticized the Rio de Janeiro plan for providing for salary increases in all years of the recovery regime. This year alone, personnel expenses would rise 17.1%, with the application of retroactive payments.
Castro said the government is not allowing “adjustments” for the civil service, but only the “recomposition” of inflation after eight years without the measure.
“We have a state to recover. This fiscal effort cannot be the extermination of the public service and the public servant. Rio has to pay its debts”, said the governor, who said that the recomposition does not go against the fiscal recovery regime.
“Rio de Janeiro is returning to stand on its own two feet,” he added.
Castro, who took over the government after Wilson Witzel (PSC) resigned, intends to run for re-election in 2022. The governor said that Rio seeks, at the same time, the adjustment of state accounts and local development.
After Castro’s speech, Rio state finance secretary Nelson Rocha said he was surprised by the rejection of the plan.
According to Rocha, if the state is excluded from the regime, it will have to pay R$ 24 billion to the federal government in debt service in the first year.
“We are looking for a plan that is sustainable over time, not just concerned with the next two, three years, as most people do,” he mentioned.
Rocha also stated that the government will try to reverse the rejection. In this sense, he reported that the state will have a meeting with the Ministry of Economy on Wednesday (19).
The intention is to try to advance the negotiations, but the secretary did not rule out going to court to resolve the impasse.
as showed the leaf, there is an expectation that the government of Rio will end up resorting to the STF (Federal Supreme Court) to remain with debt payments suspended – a procedure that has already been adopted on other occasions.
“Let’s talk to see if there is an understanding. The Treasury’s conclusion is very interpretive,” said the secretary.
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