The 2023 federal investments managed to revert part of the moves seen since 2016 to dismantle social policies but did not show concrete efforts to solve structural problems. Furthermore, the expanded focus on the fiscal issue may represent risks to investments in crucial areas, such as health and education.
These are some of the conclusions of the State Budget Balance released on Monday (29) by the Institute of Socioeconomic Studies (Inesc, in Portuguese). The document presents the results of sectors such as energy, the environment, women’s rights, Indigenous peoples, the fight against racism and the protection of children and teenagers.
In an interview with Brasil de Fato, Inesc’s political advisor, Cleo Manhas, said that since 2016, the budget aimed at public policies has dwindled, which increased the challenges of retaking and building these actions. She highlights that the new federal administration managed to deal with part of this problem with the so-called Transition Proposed Constitutional Amendment, but warns of risks in insisting on austerity.
"Austerity still is an issue for the Ministry of Finance with which we must talk, not fight. There is a lot of contingency. Sometimes, resources are not released until the end of the year and it becomes very difficult to implement [public policies]. We also need to be careful that the new fiscal framework doesn't also become a spending ceiling so that a floor doesn't become a ceiling.”
According to Manhas, the rules controlling public spending cannot impact public policies.
“We see that several areas have improved, but we have repeated that the new fiscal framework cannot become a way of reducing resources for social policies. Education and health must continue to have their budgets bound by the Federal Constitution because there is great speculation that, because of this new framework, separation could end up happening. We know what the spending ceiling has done to the country in recent years. We have huge liabilities to resolve in these two areas in particular, which affect the whole population.”
Progress
The analysis points out that the policies adopted in the first year of the current administration of Luiz Inácio Lula da Silva (Workers’ Party) have managed to reduce poverty rates, increase employment and broaden popular participation and dialogue with society.
In the social area, the report highlights the rescue of essential programs such as Bolsa Família (“Family Grant”, in English), Minha Casa, Minha Vida (“My house, My life” in English), Mais Médicos (“More Doctors Program”, in English), Farmácia Popular do Brasil (“Brazil’s Popular Drugstores”, in a rough translation) and Brasil Sorridente (“Brazil Smiling”, in a rough translation). Also on the list is the strengthening of initiatives such as the National School Feeding Program (Pnae, in Portuguese) and the Food Acquisition Program (PAA, in Portuguese).
Also listed as considerable advances are the creation or re-creation of the Ministries of Cities; Women; Racial Equality; Indigenous Peoples; and Management and Innovation in Public Services.
Expectations and obstacles
According to the report, structural challenges persist and can be reinforced by fiscal limitations, resistance in Congress to tax changes, such as taxing the super-rich, and the low growth forecast for 2024, which is less than 2%.
The document also warns of the lack of resources for the energy transition and the damage caused by the shift from fossil fuels to a low-carbon economy.
“Structural change is a big challenge because we are competing with the financial market and big corporations. If we don't criticize from the progressive and left-wing side, criticism and lobbying from the right will continue,” says Cleo Manhas.
She says that the Multiannual Plan presented by the Lula government brings advances in this scenario, but it is still not ideal to address the losses of recent years. “We need bigger contributions, and that's what we're hoping for. There is some perspective for 2024, but in our opinion, it is still insufficient because of all that has been lost.”
