CAE approves bill that expands oil revenue for health and education.
The Senate Economic Affairs Committee approved on Tuesday (3) a bill that guarantees new oil resources for the areas of health and education; according to the law, 50% of the total revenues of the Social Fund, supplied with resources from pre-salt exploration that belong to the Union, such as royalties and special participations, must go to education and health; the bill is final and should go to the Chamber of Deputies, unless there is an appeal for a vote in the Senate Plenary.
Senate Agency - The Economic Affairs Committee (CAE) approved on Tuesday (3) a bill (PLS 280/2013) that guarantees new oil resources for the areas of health and education. The two sectors can also start receiving part of the resources from signature bonuses, amounts that the winning company of a bidding process pays to the Union before starting to explore a deposit. The project is final and should go to the Chamber of Deputies, unless there is an appeal for a vote in the Senate Plenary.
The proposal was jointly presented by Senators Cristovam Buarque (PPS-DF) and Ricardo Ferraço (PSDB-ES). The text amends Law 12.351/2010, which creates the Social Fund, supplied with resources from pre-salt exploration that belong to the Union, such as royalties and special participations. According to the law, 50% of the fund's total revenue must go to education and health.
Current legislation already provides for the transfer of "a portion of the signature bonus value" to the Social Fund, but does not establish the size of this fraction. Originally, PLS 280/2013 mandated the full transfer of signature bonuses to the fund, a rule applicable to pre-salt exploration contracts signed under the production-sharing regime.
The rapporteur in the CAE, Senator Valdir Raupp (PMDB-RO), upheld the full transfer, but with one caveat: the amount destined for the company Pré-Sal Petróleo, created in 2013 to manage the production-sharing contracts, is excluded from the transfer.
Basic education
Even though Law 12.351/2010 already stipulates that half of the Social Fund's money be applied to education and public health, the bill also seeks to detail this point. In the case of education, which receives 75% of the funds allocated to both sectors, the text determines that the money should only be used for basic education.
"Brazil spends very little on basic education compared to higher education. There is no doubt that one of the major sources of inequality and low productivity of the Brazilian workforce is precisely the poor quality of the early years of education, which justifies the need to concentrate our efforts in this segment," Raupp argues in the report.
The original text of PLS 280/2013 also stipulated that the fund's money should only finance children's public health, but an amendment by the rapporteur removed this provision. According to Raupp, the measure contradicts the principles of the Unified Health System (SUS).
"The health of parents is important for children, considering that healthier parents are able to generate more income and take better care of their children. Furthermore, several epidemiological actions may require treatment of adults in the prevention of the spread of contagious diseases," the rapporteur explained.
Floor calculation
The project had already passed through three other Senate committees: Education (CE); Social Affairs (CAS); and Infrastructure Services (CI). An amendment from the CAS could, in practice, further increase resources for health and education, but the CAE accepted Raupp's vote against it. According to the amendment, the money from the Social Fund would not be included in the calculation of the minimum spending level stipulated in the Constitution for the two sectors.
"While acknowledging the importance of health for the country's development and the well-being of the population, we cannot forget that there are other important areas that also need attention, such as education itself. Since there is a spending cap, the more resources allocated to one area, the less will be left for others," argues the senator.
Bill 280/2013 also defines rules for when the government decides to spend the principal amount of the fund, formed by saving 50% of revenues not earmarked for health and education. This portion should serve as savings for the future, with permission to use only the income generated.
An amendment from the Infrastructure Committee stipulated that, if the principal amount were used, all the money from the signing bonuses should be transferred to the areas of health and education. Raupp rejected this amendment and opted for the original text: if the Union spends part of the principal amount, health and education receive only the portion of the expenditure related to the signing bonuses.