Haddad argues that discussions on a new fiscal anchor should take place after the government transition.

(Reuters) - Shortly after speaking at a Febraban event without addressing the issue of a new fiscal anchor for the country, former Education Minister Fernando Haddad argued to journalists that this discussion should be postponed until after the transition, so that a sustainable and credible rule can be created.

"The (spending) ceiling was exceeded by 800 billion (reais). So, there are many proposals, and even the elected government itself is suggesting that this discussion take place next year, the replacement of one regime with another," Haddad told reporters after the event, when asked about the ideal time for this debate.

Haddad, the leading candidate to be the future Minister of Finance, represented President-elect Luiz Inácio Lula da Silva at the year-end luncheon of the country's banking federation.

He reminded reporters that there are several proposals today for a new fiscal anchor, such as those already presented by the National Treasury itself.

"The fiscal target was exceeded by a huge margin, almost 800 billion reais. So, it's necessary to promote the transition so we can make this adjustment," he said, believing it would be more prudent to address this issue later.

According to him, it is necessary to have peace of mind to make this transition. Referring to the PEC of Benefits, approved during the election campaign, Haddad said that the current government promoted "a disorganization and a lack of education on how to manage the public budget."

For him, it is necessary to separate the immediate needs of the transition --hence the negotiations surrounding a Proposed Amendment to the Constitution that would allow spending on Bolsa Família to be excluded from the spending cap-- from a more permanent fiscal rule.

"It's one thing to acknowledge a budgetary dysfunction that was produced by the government itself... It's quite another to have a durable rule, one that will last 10, 20 years, but that needs some sustainability. It has to be credible. The worst thing is to have a rule that isn't credible, that people no longer trust."

At the event, Haddad dodged direct questions about the possibility of taking over the Ministry of Finance and argued that Lula should have time to appoint his cabinet.

"Look, you shouldn't constrain a president. You have to leave the president with as much freedom as possible to assemble his team and his lineup," Haddad said when asked if he would accept a possible invitation. "Let Lula pick his team."

When questioned about his relationship with Pérsio Arida, whose name has been circulating as a possible candidate for the Ministry of Planning, Haddad said that he is a friend of the economist and that they have known each other since he was a master's student in Economics at USP.

Arida, who worked in the economic administrations of the PSDB party and is considered a symbol of fiscal restraint by investors and fund managers in the financial market, is part of the government transition team.

Pressure for appointments to Lula's future cabinet has been growing at a time when the incoming government acknowledges difficulties in negotiating the Transition Amendment, which is expected to begin its legislative process in Congress next week. This Thursday, Senator-elect Jaques Wagner (BA), one of the Workers' Party negotiators, said that appointing a head for the economy would facilitate the negotiations.

(Reporting by André Romani.)

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