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Government assesses that decree shields Guedes from political agreements

The decree published this Thursday (13) that changes the decision-making process on budget administration should shield Minister Paulo Guedes from political agreements without support from the economic team, according to government sources and experts heard by the CNN.

The measure increases the power of the Civil House, of Minister Ciro Nogueira, who will have the final word on budgetary reallocation and opening of credits.

The concentration on decisions generates expectations that the so-called parallel budget, negotiated in a pulverized way between parliamentarians and ministers, will lose the autonomy it had until now.

The decree was established in a meeting between Ciro and Guedes. The objective was to formalize a procedure that was already being promoted informally through the Budget Execution Board, responsible for advising the president.

Behind the scenes, Guedes had been complaining about political agreements for the release of funds promoted between parliamentarians and ministers, which ended up running over the economic team.

With the rapporteur’s amendments, pressure increased and so did the dispersion of decisions, reducing control over the allocation of resources.

Now, say members of the economic team, the release of the money will be concentrated in the Civil House, which will share with the Economy the responsibility for any budget cuts. In addition to sharing the burden of “no” to some requests.

The change lessens Guedes’ exposure to dissatisfaction among the ministerial team. The most recent case exposed the problem when the Minister of Science and Technology, Marcos Pontes, criticized the economic team for reducing resources in his portfolio, and the decision was not exclusive to Guedes.

Among economists who have already occupied public sector management chairs, the decree only makes official a practice that was already adopted between the Ministry of Economy and the Civil House, through the Budget Execution Board. An executive who participated in the economic team in past governments said that he sees the change as a way to improve coordination in the Palácio do Planalto between the Civil House and the Secretariat of Government, and that for the Minister of Economy it does not change much. His assessment is that within the Planalto, it means that the Economy will necessarily have to listen to the Civil House.

An economist who has also held secretariats in the former Ministry of Finance said that the political character is stronger in this measure, and that he does not see any relevance from an economic perspective because it does not change anything in terms of defining the primary result target, managing the ceiling of spending. According to him, there is a feeling of lack of prestige and lack of trust in Guedes, but that this is more a noise than something relevant.

A former Secretary of the Treasury in Brazil, who for many years has followed and analyzed the management of public accounts, made a reservation, saying that budget allocation, which will or will not be prioritized by the government, is a political discussion, not a technical one.

Reference: CNN Brasil

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