Mercadante says the government will not ease fiscal adjustment measures.
The Chief of Staff denied that President Dilma would be willing to make changes to Provisional Measures 664 and 665, which restrict the granting of labor benefits, as reported by the newspaper O Estado de S. Paulo; "Fiscal adjustment is an indispensable sacrifice," he told reporters after a meeting with President Dilma Rousseff; he also said that the S&P rating agency recognized the government's effort to balance the accounts.
By Rodrigo Tolotti Umpieres
SÃO PAULO - The Minister of the Civil House, Aloizio Mercadante, stated in Brasília this Tuesday (24) that this will be a week full of meetings with the ministers in the Civil House.
According to him, all ministers are committed to fiscal adjustment and the measures announced so far are well-founded and indispensable. "Fiscal adjustment is an indispensable sacrifice," he told reporters after a meeting with President Dilma Rousseff.
Mercadante also stated that the government will not review the fiscal adjustment measures adopted since the beginning of President Dilma's second term. He also denied reports that Dilma had informed former President Lula and the PT (Workers' Party) that she was willing to make changes to Provisional Measures 664 and 665, which restrict the granting of labor benefits.
"The government has absolute priority and total commitment to fiscal adjustment. The information suggesting that the government is relaxing the adjustment measures in relation to President Lula or the Workers' Party is incorrect," he added.
Mercadante says the government will not ease fiscal adjustment measures.
Luana Lourenço – Reporter for Agência Brasil
The Minister of the Civil House, Aloizio Mercadante, said today (24) that the government is convinced of the importance of the fiscal adjustment measures and that the country depends on the approval of the cuts to resume growth. According to Mercadante, the National Congress is an independent power and will vote on the measures as it "seems necessary", but the government will not back down on the proposals.
Among the fiscal adjustment measures that depend on Congressional approval are Provisional Measures (MPs) 664 and 665, which restrict access to social security and labor benefits, and the bill that alters tax rates and reduces payroll tax exemptions.
"The government has absolute priority and total commitment to fiscal adjustment. The information that – whether in relation to President Lula [Luiz Inácio Lula da Silva] or the Workers' Party – the government is relaxing the adjustment is unfounded," Mercadante said in an interview after participating in a meeting with President Dilma Rousseff and ten other ministers.
"The adjustment is essential, it needs to be discussed in depth. And why does it need to be approved? Because the faster the adjustment is made, the faster we will resume growth," he assessed.
Mercadante said that the government, with the participation of the economic team, is negotiating the approval of the measures with parliamentary leaders and that it will use "all arguments" to ensure that the proposals pass in Congress.
"The National Congress is an independent power. It will vote as it sees fit. The government's conviction is that the measures were discussed in great depth, they have consistency, they have foundations that are very structural for the country, they are indispensable to the Brazilian economy. That is what we are defending," he argued.
According to him, with the adjustment in the accounts, the government intends to "spend less and spend better, with more austerity." The minister acknowledged that the government "excessively reduced taxes in the recent past" and now has to reduce subsidies to resume economic growth and maintain fiscal balance.
The minister repeated President Dilma Rousseff's statements that the fiscal adjustment measures are temporary and necessary in light of current difficulties. According to him, the cuts are an "indispensable and temporary sacrifice."
At today's meeting, Dilma also reiterated to the ministers that budget cuts will be defined after an analysis of each ministry's programs, so as not to restrict resources from priority government projects, according to Mercadante. "Each minister must present their priorities, establish what is essential, the important deliverables that are underway, and plan for essential projects, so that the budget cuts do not harm what is essential and fundamental to the government."