Bolsonaro's 'reform' cuts PIS/Pasep benefits for 23 million workers.

Current Brazil Network - The changes proposed by Jair Bolsonaro's (PSL) government to workers' pensions, gathered in Constitutional Amendment Proposal (PEC) 6/2019, bring further disadvantages to low-income workers. Presented to Congress last week, the pension "reform" project will restrict the payment of the salary bonus, a benefit intended for workers with formal employment contracts and low incomes.

Today, this benefit – originating from the PIS/Pasep program – is paid annually to workers who earn up to two minimum wages per month. But under the proposal, it will only be paid to those who earn up to one minimum wage. The result will be that 23,4 million workers are expected to lose the annual benefit, equivalent to the value of one minimum wage, currently R$ 998. In other words, by promoting this change, the government eliminates the bonus for 91,5% of the total number of people who are eligible to receive it.

This information was presented today by economist and public debt expert Maria Lúcia Fattorelli, during a debate on the topic at the Legislative Assembly of Minas Gerais.

The seminar also addressed administrative reform and the renegotiation of state debt. Maria Lúcia commented on the relationship between the changes the government intends to make to the pension system, without touching the country's debt system, which uses public money to fuel debt repayment mechanisms, and the highest real interest rates in the world.

In her presentation, Maria Lúcia also showed that the proposed constitutional amendment (PEC) foresees the accounting segregation of the social security budget into health, social security, and social assistance programs, while preserving the contributory nature of social security. "In other words, this could legalize the fabrication of a social security deficit by omitting social security revenues," she stated.