February 26th, 2018

Legislative Newsletter - Edition 080

An alternative plan going on in Brasilia

The government changed the strategy towards the Social Security Reform. The new plans have impacts in many social areas, including the economy. That’s because the agency Ficht Ratings lowered Brazil’s credit note.

Legislative Newsletter - Edition 080

The government changed the strategy towards the Social Security Reform. The new plans have impacts in many social areas, including the economy. That’s because the agency Ficht Ratings lowered Brazil’s credit note. On top of that, the relationship between Michel Temer and Rodrigo Maia (DEM/RJ) has been shaken after the president presented the Government legislative agenda. The Lower House president simply explained that the congress is the one who determine the agenda and not the Executive.

The Government’s agenda includes 15 projects pointed out as essentials to solve the fiscal crises, such as: Tax simplification through the PIS/CONFINS Reform; Bid and Contracts Law modification; New law on Public Finances; Government Agencies more autonomy; Government officials salary limit regulation; State Companies better corporate governance; Brazilian State Company of Eletricity (Eletrobrás) privatization; Update on Telecommunication General Law.

These alternatives are not considered enough to replace the Social Security Reform Bill. The Government also changed its opinion towards the Reform, saying it is no more an emergency. This switch in the political leading of the government weakens its influence on the Congress, especially now when it is close to next elections period.

The Decree that authorized the Federal Intervention in Rio de Janeiro State blocks any Constitutional Amendment Bill (PEC) to be discussed  either in the Lower or Higher Chambers.

Some matters included on  this Executive Legislative Agenda are consonant with some other projects already pointed out by Rodrigo Maia as priority. However,the publication of this list created a tension in Brasilia, since the government did not have a previous conversation with party leaders from Congress . Resulting from this lack of communication, House speaker Mr. Maia  declared that Congress is sovereign and will determine its own agenda – in contrast to what wished the Government.

For this week, the Provisional Measure that creates the Ministry of Public Security  is expected to be published. The new Ministry will coordinate public security measures for union and states. Raul Jungmann, the current Minister of Defense, will swap chairs and start off on the new Ministry. His successor will be Mr. Joaquim Silva e Luna. The creation of the new ministry depends on the Congress approval of the Provisional Measure.

For this week, the Chamber of Deputies will deliberate on the Provisional Measure that reduce conditionsfor  States and Municipalities to negotiate their debts with the Union (MP 801/2017); news rule on transport network companies using apps (PL5581/2016), which has been largely discussed throughout the country.

Also this week what will probably catch the attention is the meeting of the Ethics and Parliamentary Misconduct Council. The meeting will happen on 27th and will deliberate on starting proceedings against Congressmen Lúcio Vieira Lima (PMDB-BA), Paulo Maluf (PP-SP), Celso Jacob (PMDB-RJ) e João Rodrigues (PSD-SC). On this very same day the Rapporteurs will be chosen by random drawing.

 The  setup of the Permanents Commissions are still in standby. Mr. Maia intends to negotiate with the parties leaders and arrange all 25 Commissions on the next two weeks. However, the activities are expected to be delayed even further on as Congressmen intend to switch parties to run for next elections. The period for such switches ends on April the 7th. a Congressman may lose its chair in case of switching the party after this period.

On the higher house, the Commissions have already been arranged and have been working normally   Science, Technology, Innovation, Communication and Informatics Commission (CCT) has full attention due to the decision on the project that creates the National Scientific and Technological Development Fund – FNDCT (PLS 201/2015) that will occur tomorrow.

Issues on National Penitentiary Fund (PLS 25/2014) and on stop demanding tax debt certificates (PLS 285/2011) are to be decided in a plenary session in the Senate.

Finally, the meeting of the Special Joint Committee that analyzes the Provisional Measure Published: MP 806/2018, which increases taxes on investment funds.